>> you are watching "daybreak asia," coming to you from new york, sydney, and hong kong. >> we are counting down to the market opens in tokyo and seoul. >> the nominee for the top job to the boj to be announced shortly with traders betting as central -- will quickly abolish yield curve control. risk appetite set to return after the survey suggested the u.s. inflation data may not be as bad as feared. top diplomats could meet face-to-face this week, seeking to diffuse tensions over a spate of mysterious flying objects. >> we have the open of the asx 200 and at the start of the day, we are keeping an eye on what is happening in u.s. futures because those are trading fairly flat. we did have the new york fed survey and focus given it did

show inflation expectations edging down. we did see strong momentum throughout the wall street session and that is looking to carry into trading in asia at the start of the day because the asx 200, the first major market to come online and this is what we are seeing here, snapping a three-day loss at the start of trading. one sector we are focusing on closely will be the energy given it was the only industry or sector that was in the red in the u.s. session. we are keeping an eye on what is happening in the bond space and seeing the big repricing around said expectations starting to ease and the aussie dollar fairly flat. we have seen the greenback wavering ahead of that data later on tuesday but let's change now because the big focus in asia today is what happens with the bank of japan. we are expecting the nomination for the next governor within the next few hours. in terms of what we are watching in particular, there are a few factors. the japanese 10 year yield still close to that .5% threshold and

then also keeping an eye on what is happening in the japanese yen because we have seen the weakness to the tune of around 1.2% earlier. lots of activity happening in the lunar yen and the aussie dollar. it is testing its 100 day moving average. shery: we are watching the dollar as well because it was flat in trading, given we are headed towards the u.s. cpi numbers ahead of that data. we saw u.s. stocks rising again in u.s. futures not doing much at the open in asia right now but we had a lot of positivity on the wall street session. every sector was in the green, led by tech stocks. the 10 year yield holding at the 370 level with treasuries rebounding. the two year yield also was up and it did give up gains earlier in the session. energy was the only sector down today and you can see the pressure continuing to the asian session below that $80 a barrel level. we heard the report that the

biden administration plan to sell more crude from the strategic reserve. really, the focus today is on what is happening in japan with the government expected to formally nominate him in a couple of hours as the next governor of the boj. kurumi mori joins us now from tokyo. what will this process look like? kurumi: today marks the first day of a long process. it will take several weeks for us to actually appoint the next governor of japan. today at 10: 30 a.m., prime minister kishida will be at the building behind me where he will officially nominate the next boj governor along with the two deputies and we are going to see around 11:00 a.m. is what the media is supposed to get, pieces of paper, physical pieces of paper where there will be a list of names including our own bloomberg reporters along with two japanese and that will happen this morning.

he may face some questions over his surprise decision because he was not necessarily even on the shortlist of potential candidates so we will see how that plays out tonight. >> what are the next steps given how much focus there is on the procedural side of things today? >> like i said, this is a weeks long process. it just starts today and the next date after this official nomination takes place here at the building will be february 24, the date to mark on your calendars. that is when the parliamentary hearings will begin for the upper and lower have to go through february 27 or so. this is when he will be speaking , possibly getting grilled on his monetary policy as well as any of his insight into what he thinks about the exit strategy for monetary easing so the 24th is a really big date that we are looking forward to next to mark on your calendars. the weeks following include more

items such as the final candidate decisions. we will have the deputies starting earlier than the boj governor on march 20. he will officially start on april 9. those start dates will be followed by press conferences including the outgoing governor, kuroda, as well as the incoming governor and the two deputies and a q&a session. so way more events to come after today. >> there was speculation that perhaps we could see a female governor at the boj but given the lineup, including the deputy governors, perhaps diversity will not be seeing any boost from the candidates in the nominations. kurumi: yes, as you say, this is probably one of the most negative points that we are seeing in terms of diversity for this nomination. the two incoming deputy governors are both men. the front runner for the deputy

was a female. she is a former boj official and the economists we named -- they had named her the front runner so there was some hype around potentially japan finally breaking through. we have janet yellen at the fed and christine lagarde of ecb but boj lagging far behind in terms of any sort of representation for women and it comes to show that japan continues to face hurdles when it comes to representation in terms of women. >> kurumi mori keeping track of things for the bank of japan in tokyo. let's get more on how the markets are positioning ahead of this. garfield reynolds, we are seeing traders increasingly convinced that we will see yield curve control this year? garfield: traders are being a

little bit cautious. the initial immediate reaction when the name was sprung on us on friday was yen strength and bond futures sold off. that was seen as hawkish. his comments on friday put a bit of cold water on that and people are passing what sort of decisions he was involved in back when he was at the bank of japan in the early tooth -- early to thousands. it's difficult to get a read on it. there will be a lot of interest in how the government frames it and if there are any signs anywhere about what policy will go on. either way, the tension is going to be there because markets are very convinced that yield curve control needs to be scrapped as soon as possible. it is no longer appropriate. it is buckling under the strain.

we have swaps well above the 0.5% when you look at the space. the market thinks it has to go in the longer it takes before it goes, the more disruptive it is likely to be when it does happen. how that squares with that long and involved process carew may just mentioned, you know, japanese bond traders will be patient because they understand their own market. foreign bond traders might be a little bit less patient. they are still looking for the opportunity to get some gains from the bets they have been putting on that the boj will have to bow to global and local inflationary pressures. shery: this is all coming at a time when we are closely watching the u.s. cpi numbers and how disruptive that could be to the markets as well. garfield: we have seen a pretty severe selloff in the last week or so or longer for government

bonds. that has been partly because of central-bank pushback against the pivot narrative and the very strong u.s. labor report. cpi, yes, inflation is seen decelerating but not by a lot. it would be the smallest decrease in annual inflation since september if it hits the expectation and we are expecting to see an acceleration in monthly inflation. there is a whole range of volatility from the re-weightings going on in the consciousness that the fed is very, very, very sensitive to anything that hints that the past down from inflation has hit a few speed bumps. that would be the sign for them that we are in danger of repeating the mistakes only if we don't stay the course so anything other than a fairly strong downside surprise will

put the bond market on notice that the fed is likely to continue to stick to a more hawkish path than many investors in bonds and stocks have been expecting. shery: garfield reynolds with our top economic stories of the day. we are also watching geopolitics. antony blinken is said to be considering a meeting with china's top diplomat later this week at a secure -- security conference in munich. it would be his first face-to-face meeting since the upper over a chinese balloon and other unidentified flying objects. let's bring in senior executive editor john. if this meeting does happen, it seems a pretty quick recovery from the very publicized balloon saga we have been seeing recently. what do you make of it? john: the two gentlemen will be at the same place at the same

time. they will be in munich later this week. them being in the same place offers the opportunity will they actually meet? that has yet to be confirmed. both sides are discussing the possibility but it has not yet been agreed upon. the two gentlemen have meant as recently as july last year in indonesia and they will obviously have lots to talk about. the balloon, the unidentified flying objects that have been shot down over north america i'm sure will be top of that list but obviously, all the tensions will be over taiwan, over trade, over technology, so there is a lot to look forward to. haidi: at the same time, we are seeing beijing leveling these new accusations, looking at trading down what is flying over but they are saying it is not unusual for u.s. balloons to float into chinese airspace multiple times since last year. john: china really shooting back

yesterday. the foreign ministry spokesman saying the united states has flown balloons more than 10 times into chinese airspace since the start of 2022. that coming after obviously the u.s. shooting over the weekend down four objects flying over north america. we do not know if those are chinese balloons or if they were some other origin of objects flying in the air but obviously, tensions are high and china wants to show it is steady. near the naval base in china, we have not had confirmation whether or not china has shot it down. haidi: john liu with the latest. let's get you to vonnie quinn with the first word headlines. vonnie: turkey is considering whether to extend the closure of the estoppel stock exchange as it grapples with fallout. market regulators could delay wednesday's planned return to

trading. the board has suspended trading but not before tens of billions of dollars in market value were lost in the 48 hours after the quakes. in national state of emergency has been declared in new zealand. a cyclone brings flooding, landslides, and power outages. the move enables the central government to give additional support to regions across the north island. flights are expected to begin later on tuesday. the cyclone comes to weeks after auckland was hit by a storm that killed four people. adani electricity mumbai has paid more than 50 million dollars worth of coupons on their debt this month. a spokesperson said all payments are being made on schedule as a group tries to rescue its shares and bonds battered by the fraud accusation made by hindenburg research. china's regulators are checking on how banks are coping with the pressure from a wave of mortgage

prepayments. some homeowners are taking advantage of falling interest rates to reduce--. they have solutions to cope with the pressure. global news, 24 hours a day, on air and on bloomberg quicktake, powered by more than 2700 journalists and analysts in more than 120 countries. this is bloomberg. shery: j.p. morgan securities joins is later at this hour to preview the leadership change. up next, affinity investment management shares their analysis on the earnings season so far and why they are cautious on big tech. this is bloomberg. ♪

>> we are still far from achieving price stability and i expect it will be necessary to further tightened monetary policy to bring down -- bring inflation down toward our goal. doing so will likely lead to some growth in economic activity and some softening in labor market conditions. >> michelle bowman speaking,

federal reserve governor, and of course, we are looking ahead to u.s. inflation and how that informs that narrative in terms of what the fed is doing next but our next guest is looking up earnings so far. for the u.s., a bit better than feared but still disappointing in terms of negative growth across a lot of key industries as well as setting expectations for 2020 three. joining us in the studio is a global portfolio manager. always great to have you. it has been such a long time. it is wonderful to have you back in the studio with us. we are managing expectations going into this earnings season. how worrisome is the outlook and forecasting for you? >> thank you very much for having me back. it is great to be here. there was some very big misses among companies like amazon and google and some of these stocks missed earnings significantly and then they fell 25% so expectations were muted going into this earnings season and people were crossing their fingers and hoping it was not going to be as bad as the third

quarter and actually, you have not seen the massive misses where you have met cap companies going down 25% after but as you mentioned in the introduction, the overall outcome from earnings so far has been quite disappointing in terms of there's not a lot of stocks that have very high growth and a lot of the commentary and the calls are that if there's not a lot of visibility for 2023. our strategy right now is to stay in companies that are in an earnings of rates cycle because a long cycle doesn't generally change one quarter or the other. high-quality companies with high-quality management because they will be able to manage through these difficult times better than low quality companies with questionable management. haidi: you are looking at tech and thinking that's still not appealing. encouraging measures from big tech in terms of the cost side. mary: you need to differentiate between big tech and the rest of tech. a lot of those companies have changed their names so we cannot call them that.

you did see a lot of deceleration continuing in clouds so whether it was aws or azure and microsoft, those are big drivers of those businesses and they were decelerating quite significantly so we are not invested in those companies. apple still has a lot of headwinds in terms of the consumer side and the supply side is not 100% normalized so we have a very small position in apple. one company where there was bright spots was in let's, a stop -- in meta. we don't own it but their results were very specific in terms of cost cutting and that is why the stock went up so much because all the analysts can easily go back to their desk, stick in the headcount reduction numbers, and you can get good earnings upgrades and the tone out of mark zuckerberg was quite different than what we have heard for years actually in terms of changing the strategy and focusing on costs and profitability. i think that was a big surprise for everybody from meta. haidi: are you looking for

exposure to ai? mary: we are looking at exposure to ai and microsoft that i mentioned before and chat gpt is the phrase of the day. there is exuberance and i just got back from san francisco last weekend. some of the feedback i heard is that chat gpt is probably overhyped for what it is but it's under hype for what it could be and what generative ai could be in the longer term so we are doing a lot of work on ai and we have a sustainable fund and very strong esg criteria for all of our investments. we are doing a lot of work on what that means in the context of ai because it's a very unexplored space and it is something where people are going to have to come to conclusions pretty quickly because it's moving quickly. shery: can you find any of those tech bets, high quality, supported by emerging markets world? mary: yes. right now, our tech exposure from early in the u.s., so in

tact, we own companies which, despite what is going on overall, has done very well because of this exposure. we own companies in the securities space p at fortune net reported very strong results and had a very strong share price reaction so we are sort of looking at that area of tech, not so much the big tech companies and not so much in emerging markets tech. for the big chinese tech companies, there has been a very significant turnaround in the last few months and a very significant bounce off the bottom and that has to do with china reopening and also coming to the end of that very draconian crackdown from a regulatory perspective but right now, our exposure to china is not necessarily in tech, it's more in the consumer side because we think that is a better place that will benefit more in the near term. shery: aside from china, we also thought other emerging markets would lead in the rate cutting cycle given they have started to tighten even faster than the developed world. do you still see that when

inflation seems to be surprising to the upside now just across the world? mary: absolutely. one of our top picks in consume overall is the largest e-commerce stock in latin america and part of the thesis for investing in mikado libre -- mercado libre is certain markets are ahead of developed markets in terms of the cycle and inflation so if you look at what happened in brazil, they had 12, 13 rate rises, and inflation peaked maybe six month ago so now, you are starting to see economists talk about rate cutting in brazil and some of the other that american companies outside of chile. it also has a very big simtech business. if rates have plateaued and they start to come down, that is positive for those stocks so that is one of our big holdings and it is done very well so far this year. haidi: so great to have you back

in person. global portfolio manager here in sydney. you can get around up of the stories you need to go in today's edition of daybreak. terminal subscribers can find that at dayb and you can play with those settings as well to get the news on the industries and assets that matter to you. this is bloomberg. ♪

>> here's a quick check of the latest business flash headlines. net profit sell their loot to -- failed due to currency fluctuations. it also said that he saw strong performance at its units.

qatari investors look set to make an offer for english premier league football club at manchester united in the coming days. the sovereign wealth fund is helping the consortium with preparations for a bid. the club has been the subject of takeover speculations and its u.s. owners were reported to be open to selling a stake. of course we are counting down to the start of trade in tokyo and seoul. the government will officially present nominees for the next boj governor and we are also watching the fourth quarter preliminary gdp numbers due later this hour and we will also get a read on the final industrial production numbers for december. we have j.p. morgan securities chief japan s hi, i'm jason and i've lost 202 pounds on golo. being a veteran, the transition from the military into civilian life causes a lot of stress. i ate a lot for stress. golo and release has helped me with managing that stress and allowing me to focus on losing weight.

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areas that will produce a spillover that will exceed the forecasts so we will have more fish to eat, food security. we know that for every dollar that we invest in a protected area in a marine reserve, that produces $10 in unique -- in economic output and creates more jobs so it is a triple win for marine life, food security, and for climate and of course for the economy so that is the goal, the mission. haidi: breaking news and at a

.5, a fall of almost 7% month on month and that is actually a pretty terrible rating. we have only seen a seven handle four times in the last 20 years. two of those instances were during the pandemic in april and august of 2020. july 2008, the global financial crisis, and once in 2020 two. given we have seen this falling to 78.5 and that decline of 7% month on month, really calling into question as to whether we are starting to see that sentiment transition given that we have seen the consecutive rate hikes, the cost of living crisis, the impact on mortgagees in australia and how mortgages are part of that broader picture when it comes to consumer confidence. we have seen relatively resilient retail sales numbers leading into the holiday season but this could suggest a turning

point, particularly with how the rba starts to look at these data series as well. let's you to vonnie quinn with the first word headlines. vonnie: thank you. the u.s. secretary of state, antony blinken, is considering sitting down with his chinese counterpart. sources say the diplomats would meet at the munich security conference later this week provided both sides agree. keep put out his trip to beijing after washington identified an alleged chinese spy balloon. the white house says there is no indication that alien activity is behind the downing of objects over the u.s. and canada. the three uso's had stoked speculation they could be related to extraterrestrial life forms. the press secretary dismissed any such concern. >> there is no indication of aliens or extraterrestrial activity with these recent takedowns. again, there is no indication of aliens or terrestrial activity with these recent takedowns.

>> consumer prices in india rose more than expected last month, reinforcing predictions the central bank will keep raising rates. inflation hit 6.52% in january, higher than forecast and topping the reserve bank of india is present target. the central bank raise rates six times since may and meets again in global news, 24 hours a day, april. on air and on bloomberg quicktake, powered by more than 2700 journalists and analysts in more than 120 countries. i vonnie quinn. this is bloomberg. -- i am vonnie quinn. this is bloomberg. shery: we are closely watching the nomination of the new bank of japan governor by a prime minister fumio kishida, widely expected to name ueda as his pick. nobody sure what kind of policy path he will pursue. kathleen hays is here and really, investors scrambling to get an idea of what he will do with the out-of-print book selling for almost $300 right now. kathleen: yes, that's true.

he has written so little recently and that is why everyone -- excuse me, share a. everyone is saying he's taking over from haruhiko kuroda. this is significant. 10 years of the most stimulative policy they have ever seen. is he going to be able to march away from that? how much will he have to start and follow it? we don't know and this is the big question. too bad those books are selling for $200 a copy but we do know that back in 2000, he voted against the rate hike that year. this is very significant because there were only two members of the board that did not vote for it. everyone else did. it turned out to be a bad vote, the economy was getting weaker, and he was dovish. in that time when he was on the board, he backed zero interest rates. he was in favor of quantitative easing, bringing that into existence as well sounds of this. as recently as july of last year, he talked about don't rush to raise rates. it's not necessary.

don't know what is going to happen with inflation in japan. he said yield curve control is problematic and subject to attacks from the bond market but he was in no rush to get rid of that either and just this past friday when it was announced or leaked from the press that he would be the next bank of japan governor was totally not expected. he said it was good to continue monitoring -- monetary easing now. the question of is he going to become a hawk or dove is very important. japanese investors with overseas bond holdings have started to sell them like crazy. $181 billion was sold out or in bonds and 231 billion of jgb's, japanese government bonds, were purchased due to this expectation that he will back away from yield per control. he may be more hawkish than kuroda and move in that hawkish direction. if past performance is any indication, maybe he will be less dovish than kuroda was.

most everybody is more dovish than how he go kuroda so maybe that is not saying much. very interesting question. it will be so interesting to hear him later in the month when he has to testify to parliament. haidi: kathleen hays there. joining us now is the chief strategist at j.p. morgan securities, japan. good to have you with us. kathleen was running us through perhaps some speculation of what the policy stance could be from mr. ueda. we saw the yen reacts when there were reports that perhaps he was more hawkish than the expected deputy governor. what are you making of where he could stand on this altria dovish policy from haruhiko kuroda zero? -- kuroda's era? rie: thank you. that is the most frequently asked question in the past couple of days whether mr. ueda would be hawkish or dovish.

i would say that he is neutral. he is academia. his decision is always based on theory in his framework. and also, he sees data so his decision for the boj's with him as a governor, the boj's decision is more data dependent and based on theory, theoretical framework going forward, so i would say that professor ueda is, you know, hawkish or dovish. i would not say that. he would be neutral, more data dependent, based on the theory. of course, i know what you are asking. the market is now looking whether the professor ueda will be taken more, you know, -- normalization. so we need to look at that

inflation or development in the recent times. we saw that talk of cpi hit 4%, 3%, and also the monthly wages, the recent one is 4.8%, up. it's really clearly different from the past decade so even for him, he will think about the normalization for monetary policy. haidi: does that mean we are going to see more pressure for the equities space and for surge the japanese yen? even if his policy stance is neutral, the data shows they need to be tilting more hawkish. rie: yes, so i think the boj's december decisions, earlier than expected from the market.

bank of japan has already considered that normalization steps. of course, the most important thing would be inflation, wage inflation, and inflation certain ability and in addition to that, i would say domestic political situations because monetary policy is a part of all total economic policy. and global economic developments that when the u.s. recession would start, if any. so those things together i think kazuo ueda will make best effort decisions going forward. >> how are you investing around this? caution matched with opportunity strategy when it comes to building a portfolio that potentially reflects that risk in policy. rie: sorry, sorry?

could you say it again? haidi: how are you investing around this? rie: ok, yes. so we need -- looking at the upcoming boj events, the most important timing will be april 28. a new deputy governor. and the briefing after the policy decisions is very critical to think about the pace of normalization under the new boj governors. so based on that, you know, if we see that, let's say, our view is if the yc meet this year, we see that, depending on the governance briefing, if the monetary policy normalization is

likely in the first half of this year or in the foreseeable near futures, then i think, you know, faang stocks would be overweight and i think the nikkei, if it could lead to yen appreciation, will have our headwinds. >> rie nishihara, chief strategist at j.p. morgan securities japan. coming up next, a closer look at australia's energy transition and why it is falling short of amendments to reduce carbon emissions. this is bloomberg. ♪

shery: the world's largest zinc smelter has acquired operations. they spoke to stephen engle about their plans as well as regulatory hurdles they have had to overcome. >> the reason we have found that is because we have the metals corporation in queensland. which is a zinc refinery. as a zinc refinery, it consumes a lot of energy, especially electricity. what i am talking about is energy prices.

it was significantly increased in 2022 and it's probably going to be a little bit better this year. >> is the solar energy intensity enough? no, it's not. >> out of the electricity we need first on metals, solar farm -- for sun metals, solar farm uses 33%. because we have expanded, we will continue to expand. after that expansion, the solar farm, you know, pie, will be up 25%. the rest of it -- after solar farm, we said this is a great investment and we should continue. the next target was let's find wind. if we put solar and wind together, especially in queensland, it creates a bit of a baseline looking generation profile so i think we have done that successfully. we have identified a very robust project which is in construction

right now. we are partnering up with a spanish firm and they own 70%. we own 30% of this project. >> the analyst community say there's perhaps some hiccups with the regulatory process. is there anything different or abnormal? >> there are always hiccups, especially in australia and especially in renewable energy space. a lot of times, it has to do with connection which, you know, because australia is such a huge country, you know, with relatively fewer population, the challenges on the grid are amplified so connection to the grid can be a challenge but then mcintyre sits -- you know, project -- it sits on the grid which is robust and stable. we have been delays and

challenges in terms of regulatory permitting and collection -- connection into the grid but i think none of that is extraordinary. i think a lot of that has been resolved. >> what about in the united states? i did see a partnership that was announced with another big korean conglomerate for onshore wind in the united states, also something -- i don't know what it is. blue ammonia. >> fundamentally, our business model is such that we believe in australian -- especially australian renewable energy markets. i think it will continue to go up. electricity prices will i think overall escalate constantly in the foreseeable future. and need to transition from fossil fuel to renewable energy. we will -- the people accelerate. those tooth -- the need will accelerate. investing in the

renewable energy market in australia is a sound bet. hydrogen and ammonia amplifies the strength of that market because it now allows australia and countries like australia with abundant resources in renewable energy to not only consume the energy within its borders but to actually export to places like korea and japan and other, you know, asian countries, for example. >> that was the korea zinc chairman speaking with stephen engle in seoul. australia's energy sector will need every dollar investment it can get as it falls behind in its commitments to reduce harmful emissions. let's bring in the head of australian research at bloomberg nef. investment in renewables more than doubled in 2022 so you get the big jump in investment. there is clearly appetite for

it. is there a mismatch? >> great to be with you and always a pleasure. there is a bit of a mismatch. last year, we saw a significant increase in large-scale renewable energy across the country. about $5.8 billion by our figures. this is almost but not quite a record year for investment in this asset class across the country that since back in 2018, just over $6 billion but this does represent significant growth. about 2.5 times more than was invested in 2021. there's been a number of drivers . government policy, the desire for australia to reduce its omissions does play an important part of that. in recent years, we have seen various state and territory governments across australia committing to ambitious renewable energy targets and last year, the newly minted labor -- by the year 2030.

the challenge being many of the mechanisms that underpin these target do not exist just yet and many will require a few more years to ramp up for they can materially impact investment overall. but what has been a major driver of growth is the global energy crisis and how it landed in australia last year. record high wholesale market prices put significant upwards pressure on power bills and as a result, many of the consumers of power across australia, its industrial base, its manufacturers, look to sign new contracts which drove and supported the investment we saw. shery: are we seeing those prices come down and what would that mean for renewable investments if in fact we ceasing of this crisis? -- we see easing of this process? leonard: australia faced a perfect storm. incredibly high fuel prices, a lack of available dispatch about

capacity and unseasonably high demand led to these record prices and ultimately the suspension of the market which is an historic event. a lot of times, many of these factors have softened or faded almost entirely. fuel prices have come down. a lot more supply has come online from renewable energy and governments across australia have put in place many additional policies and regulations designed to cap fuel prices, to put downward pressure on the electricity system. this has had an enormous impact to the extent that in q4 of last year in victoria, and south australia, wholesale prices were below zero, negative, more than 20% of the time. it's a pretty incredible turnaround for where the market was just six months earlier. i'm sure this is welcome news to energy consumers across the country but it does mean 2023 will be a more challenging investment market as the value of their power has fallen so dramatically. haidi: great conversation.

leonard quong at bloomberg n ef in sydney. driving the transition to a low carbon economy. that is on energy transmission every tuesday. shery: breaking news out of japan. fourth quarter gdp numbers. these are the preliminary numbers. they are disappointing to the downside. we are talking about annualized quarter on quarter growth. the expectation was for growth of 2%. the previous quarter has been revised down of a contraction of 1%. it is growth from a contraction but much slower growth than analysts and economists had expected. when it comes to business spending, a contraction of .5% quarter on quarter. we are talking about inventory trims of .5% from the quarter on quarter gdp. private consumption rising, meeting expectations, rising .5%, but the annualized number

of only .6% disappointing to the downside although it is expansion from the previous month. we have seen higher costs for materials, for workers really leading to the downside pressure. we will of course be watching the japanese yen as we are also awaiting the nomination of the new boj governor. this is bloomberg. ♪

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>> we did just get those gdp numbers despite the myths when it comes to japan gdp numbers. we are seeing some strength in the yen and a lot of this tied up with of course the uncertainty and the outlook for the future boj policy path. yen traders certainly on edge. that spring in our senior reporter for fx and rates, carson. if you take a look at options, what is this telling us about what yen traders are doing, what they are expecting, how they are trying to plot out those expectations? >> options traders have a right to be nervous at one month volatility on japan's currency skyrocketed this month alone. we saw a rapid jump in the yen.

just as quickly, we saw those gains vanish. stimulus was here to stay at the bank of japan. if you look at the chart, it looks like it is trading like an emerging market currency. we are just hours away now from the confirmation of ueda as the next bank of japan governor so may be volatility will pipe down after that. >> with so much volatility, what are some of the market stock trades? >> if we look at what hedge funds are doing, they are also -- almost muted from the end. big money managers like jp morgan, citibank, goldman, they are all penciling in more yen strength. going short dollar-yen is one of the big trades of 2023.

for many investors, japan's currency is looking incredibly cheap right now so buying the yen is the way to go and that is the word on the street. haidi: our senior reporter for fx and rates, ruth carson. looking ahead to that nomination. japanese bank stocks of course, where are japanese yields going to go? it's a big question with the new government. america's -- have really pressured energy stocks. keep an eye on crypto related shares as well because new york regulators are taking aim at the cryptocurrency. the market opens in seoul and tokyo are next. this is bloomberg. ♪

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shery: this is "daybreak asia". we are counting down to the major market opens and watching, of course, the nomination of the new bank of japan governor as he faces a herculean task of normalizing policy in a country that has been mired in the ultra dovish setting for years. it time when we are also seeing economic pressures. fourth-quarter gdp gdp to the downside. haidi: the yen still holding onto some strength as we see traders with the effects currency and equity markets shery: fx currency and equity markets really scrambling. let's look at the market open. annabelle: we are just a few seconds away from the open in tokyo and seoul. and as he said, the big story revolves around the bank of japan because we could get the official nomination for governor within the next hour. because lolita is widely tapped

to replace kuroda. major ramifications across asset classes. he may not be as hawkish as he was, but the fed could see some changes to the yield curve control settings within 2023. heading into negative rates perhaps mid-year perhaps as well. we are seeing the risk of future repatriation of japanese fans. and what we had with elevated yen for literally the policy uncertainty. we saw the huge moves in the yen after the boj tweaked policy of yield curve control settings back in december. . but the big move could be in japanese bank stocks, one of the big beneficiaries from the tensioning environment. we have seen the topix index climbed 8% this year. one thing that could put one issue in front of the bank of japan is the deteriorating economic outlook. still when we have the gross domestic product numbers

out earlier, an analyst basis, coming in at 6.3%. the estimate was two point percent -- 2.3 percent. the other major story we are following today is what happens with the u.s. inflation data that is due, this will be a real litmus test of the fed's ability to tame inflation. ahead of that, we had the new york survey coming in that showed expectations for wage growth starting to moderate. something that investors are taking as a sigh of relief here. . we can see that reflected in the open for the kospi today. even the tech-heavy kosdaq, we saw the nasdaq adding 1.6% in the session following its first weekly loss in 2023. likewise the korean won is looking stronger this morning, coming off its longest run of losses since 2019. let's change now to what we have for australia, one hour into the

open for the asx 200. we are snapping a three-day drop. energy is one of the big gains, even though it was the only sector in the red on wall street. we are still seeing wti looking weaker, the u.s. possibly planning to sell more oil out of its strategic reserves. keeping an eye on new zealand, given that it has declared a national state of emergency from cycle gabrielle gabriella that is moving across the north island. shery: and we continue to watch more potential volatility and uncertainty given all of these stories we are following right now. our next guest is underweight equity and bonds and overweight cash. joining us is our guest head of multi-asset solutions aipac at t. rowe price. you seem cautious and defensive, but at the same time, i am seeing in your notes that you are overweight the yen. how do you balance two?

guest: we have had a difference for quite a while. but recently we added back some risk in selectively contrarian exposures. emerging market is one of them where we see the china reopening and the starting point of valuations and earnings pricing being favorable. japan also is something we need to talk about because we are mildly optimistic there. but the u.s., the largest market in the developed world, still has some high valuation and also earnings that need to be revised downwards. it is not all clear, we are awaiting further guidance from central banks, depending on inflation to be more constructive later this year. shery: it's interesting that you are adding to japan when we still are not sure who the boj governor will be. will that make any difference

when it comes to your market bets? thomas: not really. we always thought that the key candidates would be quite mutual, in terms of what has already been done and what is likely to come. we are expecting that at the next meeting, or the following one, there could be further changes to the yield curve controls. what we are not expecting is any change on the negative interest rate policy. what i mean is that the main moves that we saw in december, after the first tweaked in the yield curve control was a major move. now there is an adjustment to that policy. that is why we are not expecting a big change, depending on who is appointed the new governor. haidi: you say that is not a story for 2023. are you looking beyond that for one we could potentially see more meaningful hawkish policy

from the boj? how do you invest around a reflation trade that does not go so far as to make significant policy changes? thomas: our investment horizon is 6-18 months. about a year. so the negative interest rate policy would be a story for 2024 and beyond. for now, we think, as you mentioned before, the japanese banks needed to gauge how the market is pricing in terms of where yields will be. there is opportunity there. but we know that they tend to peek when the changes are announced, so it is not really a time to add massively, but more to be tactically positioned and changes from the -- and waiting for the changes to happen and, without a mean the yield curve control change to happen in the second quarter. haidi: the china rally, which

has in part driven that exuberance in em's, seems to be taking a pause and waiting for a new catalyst. do you have a preferred way of gaining exposure to that story? thomas: look, you are right. there is a bit of a pause because the initial beneficiary -- beneficiaries were identified and they definitely rebounded hard since october last year. i would say the rally in chinese stocks is not over, given valuations are still in demand and earnings growth is likely to accelerate comparative other markets where it is likely to decelerate. there is a different profit cycle there. what i would say is that there are also some beneficiaries which are perhaps -- right now. and although the property market is not something that we see in massive rebound in, because the policy direction is quite clear there, it is stopping to get

worse. when it stops getting worse, we see that markets can rebound on their aixa mental -- very incremental and positive news. that is something we could expect as the next leg of the rally in chinese markets could be coming from unloved sectors, like property, in the second half of this year. haidi: it is inflation day in the u.s. on tuesday. we have seen the volatility that has brought in the last few months. shery: how careful are you about these moves on a monthly basis? is it more about the longer-term picture for the fed? thomas: for me, the -- first on inflation, inflation peaked already, but it is likely to stay sticky, more sticky than perhaps what the market is pricing in, that is why the market is always likely disappointed, but was getting disappointed when you see more hawkish tone from central

bankers. but volatility came off quite a lot compared to what 2022 was, in terms of how hard it was in terms of volatility for both equity and bonds. we are expecting the volatility environment to be a bit more subdued. that is why i said here looking to add to equity, because of a more subdued volatility environment, and the fact that the main action from central banks was the story from last year. this year we are likely to see big moves from central banks. of course, they are not done, but it will not be as drastic as it was last year. there will be also a turning point in terms of, from hawkish to potentially dovish central banks. haidi: always great to have you with us, thomas pulley -- thomas poullaouec . let's get you to new york with vonnie quinn and our first

word headlines. vonnie: turkey is trying to determine whether to close the stock exchange as it grapples with the fallout from last week's earthquakes. a return to trading could be delayed. warsaw suspended trading last week, but not before trillions of market value were lost. a national state of emergency has been declared in new zealand as a cyclone rings landslides and power outages. this enables the central government to give support to the regions across the worst affected north island. flights are inserted to resume tuesday. the cyclone comes two weeks after auckland was hit by a storm that killed four people. adani electricity mumbai made an interest payment. they have paid $50 million worth of coupons under dollar debt this month. a spokesperson for the company says all payments are being made on schedule, as the group tries to rescue its shares and bonds,

battered by the fraud accusations made by hindenburg research. a new york regular has ordered this company to stop issuing new tokens of binance-branded stablecoin busc. it is the return of issues related to the company's relationship with binance, including a spinoff on a binance-peg busc. the company will end its relationship with binance and stop issuing the stablecoin on the 21st of this month. hong kong brokerages are suspending accounts held by mainland chinese customers, to comply with a ban issue last year to halt outflows that run afoul of strict capital controls. one is suspending accounts held by mainland clients until further guidance. global news, 24 hours a day, on air and on bloomberg quicktake, powered by more than 2700 journalists and analysts in more than 120 countries. i am vonnie quinn, and this is bloomberg. haidi: all right, we are talking

about the upside for japan bank stocks, given the trajectory of boj policy. what are you watching? annabelle: this would be one of the big sectors that would benefit from any policy normalization from the central bank. we had seen the trend higher for japanese stocks in 2023m that gauge up 8%. now at a 20 a team-high. in terms of what we are watching -- now at a 2018 high. we are awaiting the nomination for the best boj governor. could come in the next hour. we are keeping an i also on the energy sector. . still seeing the wti trading below $100 level. bloomberg reporting that the u.s. could release more oil from its strategic reserves, putting more supply into an already fraught market. in asia today we are seeing shares mostly moving to the

upside. vonnie just mentioned in the first word headlines, the story about the company that will stop minting a new tokens of binance-branded stablecoin's. a lot of concerns in the crypto market about staking products and stablecoins. these are some of the crypto plays in asia, roughly shrugging off those concerns. shery: still ahead, we will ask the chief japan economist at ubs what boj policy changes they expect. but first, we dig deeper into the process of nominating the new boj governor and his immediate challenges after taking the top job. this is bloomberg. ♪

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haidi: we are looking ahead at the formal nomination today for the boj's next governor, with sources telling us that economist kazuo ueda is the chosen one. we bring in our next guest from tokyo, and also a global economics and policy editor, kathleen hays. kurumi, you are on the ground. what are we expecting today? kurumi: good morning. tokyo is expecting 10:30 a.m.

for prime minister kishida to announce the nomination for boj governor. this is the first step in a weeks long process, just the first of many steps we will get to the appointment of the leader. 10:30 a.m. local time is when we will get the kishida submission to parliament, followed by at 11:00 a.m., in a couple of hours, we will see the media get pieces of paper with a list of names and they will be parsing through some of that, including our own bloomberg reporters, to make sure that we get those names and whether where data is confirmed to be the next boj governor. shery: if we do in fact see kazuo ueda nominated as the next boj head, what are we expecting in policies? su: it's interesting to me is the reaction. kathleen: why not the deputy governor, amamiya?

seems like the perfect guy. looking at our colleague who is on the boj team in tokyo, he is being worked as a boj favorite outsider. outsider is maybe what you need right now. he was an academic who came in and tied to previous policies and was able to take big, dramatic steps. cannot act of -- and he is not a part of kuroda-nomics. he has not followed that stimulus and stuck with it through and he is seen as the guy to start the path of normalization. our guest in the last hour, a former boj official saying that when they did the september 30 two week to widen the ban on yield curve control, that was the first step toward realization, which ueda will be taking now.

a lot of people have been studying with him in universities in tokyo, and he is not seen rushing policy changes. yes, he is on that road, but as bloomberg economics point out, he is maybe slightly more hawkish than the previous team, certainly than governor kuroda. but he is going to go slowly. bloomberg economics is not expecting any steps led by ueda until at least 2024. to me it is really interesting that the narrative seems to have changed. now he is looking more like the right guy. on friday people were wondering where the deputy governor amamiya, did not get the job. now we are awaiting the nomination. haidi: have we heard much public reaction or debate at this point? kurumi: it's interesting. ueda was a surprise nomination that we found out last friday

night. we saw him come out outside of his house in the rain with reporters just asking, trying to get every little detail they could possibly get about him. in terms of the public, we are not sure. but we are seeing a 2005 out-of-print book by himself many times over sticker price. people are looking for any kind of information they can get on ueda. a japanese broadcaster went to visit with his father in the town where he is from. he asked his father what he is like and he said, even as a child, he was very studious and had a brilliant mind. he had sent his son, ueda a congratulatory message and he replied to his father saying, "if i fail, i am coming home." [laughter] so of its lead not too overconfident. we will see. shery: bloombergs kurumi mori with an update on the ground in

tokyo. and kathleen hays with analysis of what to expect from the boj. u.s. secretary of state anthony blinken is said to be considering a meeting with china's top diplomat later this week in munich. it would be his first face-to-face with wang yi since the uproar over a chinese balloon and other unidentified flying objects. let's bring in rebecca choong wilkins. what meaning can we expect when both sides are still accusing the other of spying? rebecca: it shows and suggests that there is some appetite, to a certain extent, as biden frames it, of guardrails on the relationship. there has been talk of the need to find a flaw in the relationship and this could potentially provide an opening. secretary of state anthony blinken, the day after the first chinese balloon was shut down, had canceled the plan of going

to visit beijing. that was said to be a very significant meeting where china and the u.s. would be provided an opportunity to not necessarily improve relations, but at least normalize the act of speaking, particularly at these high levels. we also had the claim from the pentagon that china itself confirmed, that china's defense secretary had declined to speak to the u.s. about the balloon during the height of the incident. so it looks like communication certainly had been afraid, and there is some repair to be done if the two can sit down on the sidelines of this security conference in munich, which falls between february 17-19. haidi: we are getting a line from the u.s. saying that they express support for the philippines in the south china sea, saying that china's behavior threatens original peace and stability.

this regarding the incident where a chinese shape directed a laser light at a philippines coast guard vessel in that area, which is contested by both nations in the south china sea. this is one of myriad examples of the way in which we see this continued rivalry play out between the u.s., its allies, and china in this part of the world. do we need to manage expectations on what could be achieved even if the conversations in the meetings are restarted between the u.s. and china? rebecca: yes indeed. the most optimistic view many will take from this is that things do not get worse, that open communication is better than none. that at least this will mean that china's top diplomat and u.s. secretary of state anthony blinken are having frequent communications. it's important to remember that alongside the backdrop of this balloon incident, to some

extent, the u.s. has been pressing its advantage. the u.s. did in some ways use this incident to highlight china's global surveillance program, as it sees it, soliciting and briefing its partners, and other countries and allies that it believes have been targeted by this program. that has prompted an international response, in some places publicly, but certainly privately. that, in addition to the expanded literary cooperation with the philippines. so reducing the u.s. going out and being very proactive now about seeking international support -- so we do see the u.s. going out and being very proactive now about seeking international support. shery: rebecca choong wilkins, thank you. you can get a roundup of the stories you need to go to get your day going on today's edition of daybreak. bloomberg subscribers, go to dayb on your terminals. it is also available in the bloomberg anywhere app. you can customize your settings so you only get the news on the industries and assets that

matter to you. this is bloomberg. ♪

haidi: a quick check of the latest business flash headlines. an australian biotech giant says its profit fell due to currency fluctuations. however, the company said it saw strong growth in immunoglobulin sales and plasma collection. it saw a strong performance also when it comes to its flu vaccine unit. it expects strong growth in plasma collections to continue this year. this company is set to make an offer for english premier league football club manchester united. qatar's sovereign wealth fund is helping the consortium with preparations for a bid.

shares of fidelity national information services tumbled after it hooked on almost 17 point $6 billion -- after it booked an almost $17 billion write-down. the fintech company says it will pursue a tax-free spinoff of that unit next year. it also released guidance on revenue and profit that fell short of analyst estimates. plenty more to come here on "daybreak: asia." this is bloomberg. ♪

haidi: we are getting business

confidence. the index crossing the bloomberg. confidence in australia rising from six to 18. this is a contrast to what we saw earlier in terms of the consumer confidence reading which actually file to eight 7 handled for only the fifth time ever. potentially we are seeing a diversions between what we see for business conditions, as well as commercial sentiment, versus what we see on the pressure for households. households are suggesting that the economy remains resilient and demand supported by strong demographic growth. and global prospects for recession fears appear to have eased somewhat. we are seeing business conditions picking up in january after three months of easing in late 2022. returning to a high level on the index reading. so we are watching profitability

and employment gauges also above average. so, belle, what are you watching in terms of the markets? annabelle: we are all about the positive surveys in the market session today. we did have the fed survey of which expectations in the u.s. and saw the biggest drop in more than a decade. that tells us, at least from the u.s. consumer perspective, that the fed rate are starting to take hold. that is what is driving the positive sentiment in the session. take a look at where we are 30 minutes into the day's trading for japan and korea and it is green across the screen. the kospi climbing 0.8% after we had the positive lead-in from wall street. do of course still have u.s. inflation data due out in late tuesday. waiting to see traders taking a lot of big bets. take a look at where volumes are sitting. we are still off the 20-day

moving average for the broader index, down 5% from where we would be on the 20 day moving average. the other thing investors are waiting for is what happens with the bank of japan. we are expecting nominations for the next bank of japan governor within the next 60 minutes or so , that could come as soon as 10:30 a.m. local time. kazuo ueda is widely tipped to take the helm. he is someone who, even though not quite as hawkish as had been expected by markets, he is still likely to change, at least from a traders perspective, yield curve controls that is important for any investor in global bonds, given that it could lead to a repatriation of funds back into japan. this chart looks at when japanese 10-year yields are lower. the u.s. 10-year yield, when you account for currency hedging costs, it is still a very attractive that.

huge ramifications will be coming out of this change in leadership at the boj. shery: we will be watching that closely. let's get to vonnie quinn with the first word headlines. vonnie: bloomberg has learned that u.s. secretary of state anthony blinken is considering sitting down with his chinese counterpart. the diplomats would meet at the munich security conference this week. blinken had called off his trip to beijing last month after washington identified can alleged chinese spy balloon. japan's economy returned to growth in the fourth quarter, but the weak momentum will compound challenges for the bank central bank -- for the new central bank governor. they fell short of the 2% growth estimate by analysts. the results come out just as parliament prepares to nominate a new boj governor. the fed governor michelle bowman says the u.s. central bank will probably keep raising

interest rates and she is warning that that could slow economic expansion and affect the jobs market. core cpi is expected to show a 0.4% rise in january. >> we are still far from achieving price stability, and i suspect it will be necessary to further tighten auditory policy, to bring inflation down toward her goal. doing so will likely lead to subdued growth and economic activity, and some softening in labor market conditions. vonnie: consumer prices in india rose more than unexpected last month. data shows inflation hits 6.52 percent in january, higher than forecast and topping the central bank's 6% target. they will meet again in april to decide on borrowing costs. global news, 24 hours a day, on air and on bloomberg quicktake,

powered by more than 2700 journalists and analysts in more than 120 countries. i am vonnie quinn. this is bloomberg. haidi: the adani group finances's remain under intense scrutiny following fraud and market 20 thracian allegations by hindenburg research. the group has denied any wrongdoing, saying it is on firm footing and continues to make bond payments on schedule. let's bring in our next guest. we continue to watch this keenly as to whether the consistent messaging from the group their efforts to restore market confidence, can ultimately drive out the part of the market there is still feeling the jitters about that report. guest: that's right. they are making a very concerted and deliberate approach to meet their obligations. you mentioned the bond repayment yesterday on dollar debt, they have a couple more payments looming, one for adani green in

march, $17 million. so they are making a very concerted effort to make those payments and tell the world that they are making those payments, to really portray an image of both legally and visits as usual , but also that they are rule-abiders and willing to play the game when it comes to global finance, which has been a big criticism in the hindenburg report. shery: we know that adani stocks are spread across many esg fonts. what has been the impact? emma: we did an investigation that found that some 500 funds held either directly or indirectly, adani holdings, which is of victory raising questions for investors in esg fonts, given the questions being raised about the adani empire,

particularly when it comes to governance. a lot of those holdings were related to adani green, the renewable energy arm of the group. they had pledged to put billions of dollars into that fund, even though it is mostly future commitments. this look that we did into some of these investments, it shows that the adani group filings eased a lot of esg verbiage. they knew how to play the esg game, and they reflect a bit of a moment of reckoning, i think, for the esg world. you saw recently that esg funds are being found to have russian holdings, for example, even russian oil and gas holdings. it is just another moment that really shows that there needs to be greater scrutiny on what is included in some of these funds that take that name, because it is not matching with what investors expect from these

investments. shery: emma o'brien, bloomberg's asia managing editor. coming up next, we will ask white ubs still doesn't buy reports that kazuo ueda will be formally nominated as governor of the bank of japan. this is bloomberg. ♪ get help reaching your goals with j.p. morgan wealth plan, a new tool in the chase mobile® app.

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>> based on the previous comments, i think his persistence is neutral relative to the more hawkish candidates. >> he is a dove, i don't think there's much doubt. is he as devilish as kuroda? maybe not. >> the key thing is that he is completely objective. he is a scientist, he is an economist. he is not dogmatic. >> i don't expect a lot of major surprises. >> clearly, the fundamental story is suggesting that the bank of japan is more likely to consider normalization for its monetary policy, regardless of the boj governor nomination. >> if you are in a hurry, he is not your guy. he is the guy who will steer japan into a more predictable and pragmatic future. haidi: some of our guests sharing their views on the

likely nominee to lead the bank of japan, kazuo ueda. we are awaiting the formal nomination process to begin today. let's get more with my some ratio -- let's get more with our next guest, masamichi adachi. you are expecting amamiya to become the next boj of governor. you had said, meier was the only person you could imagine taking this job and steering japan in a successful way from the current policy setting. tell us about your views now that you've had a couple of days to process this. guest: definitely i've made a mistake. i just could not imagine that amamiya refused to take the job. but as we know, he did not accept, but he also recommended professor ueda to become the next governor.

as you know, professor ueda is quite well known academic, he is 71. not a relatively high age, but still, compared to biden in the u.s., he is young and he can do the job. he is more neutral. not very hawkish, not to devilish, but very neutral and very soft-spoken guy. very good at communicating to the public and the markets. that also with the governors, deputy governors. they are very good technocrats in monetary policy and backing regulations. so actually, the new team is probably going to be well regarded. haidi: your confidence about policy this year, does that have to be revised now? masamichi: i think so. compared to what i expected, i

need to think more on -- more comprehensive understanding of what the new leaders will do in the transition from corridors policy to the next policy paradigm. i think it is a balancing of hustling for the 2% inflation target, and the stability of the financial system and market function. so i think the next leadership will try to start policy normalization earlier. at the same time, it is very difficult for me to say that they will tighten policy rapidly. because inflation is not their problem, for japan. many people misunderstand from overseas. yes, it is true that japan's cpi

inflation was 4% in december of last year. but many people including myself expected to go down below 2% by the end of this year. it is still uncertain whether japan can sustain 2% inflation for the next five or 10 years. so, even professor ueda agrees on that. as you know, last friday he said that the current accommodative policy is still appropriate, because he probably believes inflation will slow down in japan, as well. shery: but this is coming on the back of market distortions given this really unprecedented qe, ultra loose policy coming from the boj. you were talking about this academic taking the helm, mr. ueda, and technocrats as deputy governors. is that the leadership we need at the boj, after the political leadership that we saw from haruhiko kuroda with his engagement with abenomics?

now that you need to get out of this situation, what would you like to see coming from the boj now? masamichi: so, it is like a swing of the pendulum. before kuroda joined the boj, i called it the paradigm of white, which focused on the financial system much more than reflation. because people did not like the idea, due to the consequence of that policy stance was a sharp deflation, from there, kuroda took the other end of the spectrum to the more focusing on reflation. so there next leadership will probably be in the middle of these two. i think what we want to see is more communication. more, how do you say, more comprehensive assessment of what

has been done, and also a communication of what they think the boj should do for the next five years and then, i hope they will adjust the policies to pursue their 2% inflation, without any radical side effect in the bond markets, and so on. shery: of course, a lot depends on wage growth and the trend of inflation in japan. what are you seeing during the spring, during the shinto negotiations? masamichi: we are expecting that negotiations will deliver 3%, 100 basis points higher than last year. good numbers. but at the same time, this 3% is not that base up, not that 3% that the government and the boj are claiming a victory over 2% inflation target. therefore, it is still low than

desired. but it is still better than last year, better than the last 10 years. so it means that probably the boj can argue that we are heading towards the inflation target, but it is still not achieved, and they have to handle the side effects first before pricing in the 2% target. shery: it is really good to have you on an important day like today, we need to have you back more often. chief japan economist at ubs. investors are already reacting when it comes to betting on companies lenders, this as we are expecting the new central bank leadership to perhaps boost the sector, battered by several years of negative interest rates . our senior asia stocks reporter joins us. stocks are reacting to that potential ueda nomination. hideyuki: good morning. part of this is the reaction

after the market learned earlier last week that amamiya has been approached by the government for the top job at the bank of japan , and so obviously, many investors were expecting amamiya to be nominated, and suddenly they named ueda, so there was a knee-jerk reaction. but if you look at the outlook, no matter who will be at the top of the boj, it seems almost inevitable that the boj has to normalize some part of its policy. people are expecting interest rates to go higher down the road, even though they are not really sure of the pace, or the extent of policy normalization. another thing that seems to be getting some attention is the regulatory policy. when we talk of japan, people

talk about interest rate policy. that is not the only thing they do, regulation is a very important part of their job. ueda wrote many years ago that the banks' risk-taking capacity has been crippled by the banking crisis in japan, and that is weighing on japan's growth. so if that is the case, he could do something to shore up japan's growth by easing regulation. but that is not the widespread expectation. but it is something that investors may have to pay attention to in the future. haidi: our asian stocks reporter, he dup sano -- hideyuki sano there. plenty more to come on "daybreak: asia." this is bloomberg. ♪

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haidi: this energy company is among the indian companies advancing renewables projects in africa and the middle east. its ceo told us they are studying prospects to make green hydrogen and methanol in countries including oman, morocco, and saudi arabia. >> we are seeing ourselves not just as a utility, but we're

looking at ourselves much more as a broader decarbonization-oriented company. we are expanding our customer base. we offer discounts also to corporate customers. on both those sectors, we are expanding our business footprint, in a sense. as you look at the corporate side, we have shipping companies, steel companies, we have refineries. the requirements for them is not the same as it is for utilities, which -- for example, these companies want green hydrogen and derivatives for green hydrogen like methanol for shipping companies, or sustainable aviation fuel for aviation companies those require green hydrogen as the base. then they are blended with other carbon dioxide-based derivatives. so i think those kinds of opportunities are not really opening -- they are now really

opening up dramatically. for a company like us, it makes sense to progress into that area. >> any information you can share with us about any partnerships or investments? >> when you are a public company, -- what we have announced so far is a joint venture with another company for addressing the domestic indian market. and also opportunities outside of india. that is for green hydrogen. >> beyond that, methanol? >> beyond that, not really, we have not announced anything yet. but certainly we are working with a number of companies on those opportunities as well. we are looking at international markets, as well, because obviously india is a leader in using green hydrogen, but there are other countries as well where natural resources are cheap. >> are you in egypt? >> we are looking at other markets in the middle east.

we have not signed anything definitive yet. as soon as that happens, then of course -- >> what is the timeline for that? >> hard to say because every government moves at a different pace. india moves the fastest so they were working towards that timeframe, they wanted to get something tangible done before then. that helped progress things faster. but there are other countries in the middle east, whether it is oman, or saudi arabia or in africa, morocco and namibia. where there is good solar, good wind, a lot of land available. they are well-situated geographically. those markets could be of interest. >> so you are moving to these countries? >> we are talking to those countries. whether something works out or not, is hard to say. >> let me go into green hydrogen. you are not the egypt project and set potential -- on that. can you give us any progress,

any news on that front? >> actually, no. we signed a framework with the government of egypt that gives us 12-18 months of feasibility studies. the government of egypt also has to do things from their standpoint on infrastructure and so on. . all of that hopefully comes together over the next 12 to 18 months, and when that happens, we will then look at signing something more concrete in terms of an actual investment decision. haidi: the revenue power ceo, speaking to bloomberg. that is it for "daybreak: asia." but our markets coverage continues. standby for "bloomberg markets: china open." this is bloomberg. ♪

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