shery: welcome to daybreak: asia. >> a mixed picture after a volatile wall street session.

investors are awaiting key u.s. inflation data. the economists have to take over the bank of japan. alibaba posts its first growth since 2020. the future remains uncertain. we are just getting breaking news. we are awaiting numbers when it comes to fourth-quarter net income coming in at a miss on expectations. we are also looking at nonperforming assets. the net income at 5.7 5 billion. we see some allowances there at 314 million.

the ratio staying at 15.2. we were expecting somewhat higher profit and that we were expending -- expecting lending to cushion. looking to see if the markets will still see the prospect of robust market growth going from here. shery: we are staying at downside after big swings in the new york session. we did manage to and in positive territory. the pressure continues and after our session despite the fact that tech also managed to gain ground ahead of the pce index number coming out on friday. the expectation is for -- inflation to accelerate again. the 10 year yield was below the 3.90 level. expectations continued that the

fed will tighten higher for longer that seems to be the narrative despite the fact we are getting growth warnings coming from the lakes -- likes of jamie dimon and larry summers. we continue to see a little bit of upside in oil prices. we gain ground for the first time in seven sessions in new york after oil near oversold territory. haidi: a volatile start to the trading session in asia. this is the picture when it comes to the first couple of minutes of the staggered open in australia. pretty flat but we did manage to see futures snapping three days of losses. asia-pacific stocks are in line for a fourth straight week of losses. take a look at chicago nikkei futures we are seeing a little bit of downside there as well as

volatility that was seen going into the trading overnight head of the parliamentary hearing with the bank of japan head nominee. we're looking at dollar-yen posting the new high of 13536. shery: the fed continues to signal rate hikes ahead. kathleen hays is here with the latest. what are we expecting? >> we are expecting to get a read on the inflation number and a very special part of that. we know that jay powell is very focused on the pce deflator. when you look at the core take out food and energy than services. this is an impressive report in a way that is not going to

impress the fed favorably because if you just look at the may numbers on a monthly basis, the headline pce deflator it's best to go from 0.1 20.5 on the month than on the year stay steady at 5.0 so that's not so bad but still too high and it's not going down on the court. -- on the core. a story on the bloomberg terminal today talking about services restaurants those kinds of things, those are the numbers that continue to keep rising in fact they have an example of a restaurant in memphis where the owner had to boost the hourly wage for dishwashers from $12 per hour to $17 per hour. that doesn't sound like much but that's a lot more in memphis then it would be in big cities. wages keep rising and inflation keeps rising so people say i

need to make more money, i need a bigger paycheck, that's when you get away price spiral. that's why there is so much focus on this number. the weekly jobless claims, they went from 195,000 to 192,000. in normal times, pre-pandemic the average is about 200,000 or 225,000. that is signaling a tighter labor market, potential higher wages and that gets us back to higher inflation. >> we saw implied volatility overnight in the yen. what are markets bracing for? >> they want to know what he thinks about policy and where it might be heading. he was boj board member but it was a long time ago.

stan, while he is widely respected academic while he knows everybody at the bank of japan and he is involved in their conferences and more, he has not in the public eye for the last decade or so, he is not written about military policy -- monetary policy. we want to know about urgency to start normalizing policy. when he was put in this office, he had this mandate to hit it hard and that's where we got a benomics. why cc do you want to tweak it or eliminate it? his views on the yen, the bond market, does he support the accord made 10 years ago between the government and bank of japan. how does he perform under fire? does he think sustainable 2% inflation is upon us?

also higher wages. we are seeing big companies raise wages but it's tougher for small companies to do that. these are the kinds of things that will be on the table that markets will be listening to word by word. haidi: much more ahead when it comes to the boj. we will be debating the policy path with economists that hold contrasting views on when tightening should begin. we will also be speaking with the be ok governor to go over there hawkish hold and what comes next after this week's rate discussion. vonnie: washing the says beijing may have given companies the greenline -- green light. antony blinken says the dual use award has been nonlethal and almost certainly approved by the state. sources say the u.s. is planning

a new package of what it calls security assistance for kyiv. the indonesian finance minister says they must make progress on debt restructuring costs. debt was topped the agenda. >> this is the area in which the creditor whether it's the traditional as well as a new one like china, they should really step in and discuss because it definitely needs a space in their fiscal to serve the debt. vonnie: china is reportedly considering appointing a veteran banker as its next central bank governors. the wall street journal says it would be a change from the previous governors who were academic economists. the current governor is widely expected to step down after

approaching the usual retirement age for senior officials. global news 24 hours a day powered by more than 2700 journalists and analysts in over 120 countries. shery: alibaba has reported its first profit growth since 2020. tell us about the earnings given the numbers were better-than-expected. >> coming in with growth of 69% in the three months ending in december. net income well ahead of projections. a huge jump there. revenue also better than the median projection. these numbers are partly a reflection of alibaba's efforts to reining costs and that came through in the job cuts as well because we saw 4000 positions

eliminated in the fourth quarter of last year. that takes the total number of reduction to around 20,000 over the course of 2022. you need to be looking at one of the longer term growth drivers. haidi: what are they when it comes to these big drivers of future growth? >> we know that cloud computing has traditionally been the one they look to. the number's for the last reporting time were a little bit disappointing anemic growth around 3% but still the customer was asked about a development strategy for and where it says a lot of demand could come from is artificial intelligence. as this area to develop, alibaba says it's going to require massive computing powder -- power. so and analyst team points out that alibaba could be facing

competition for more local giants in china that are more affiliated with the state backed giants like huawei. shery: what is happening with the fintech arm? >> not great numbers. we sought losses accelerating, profit down 80%. the amt numbers due lack alibaba by one quarter. small in comparison to the overall earnings of the company. it has been under huge scrutiny from beijing. we still saw it under pressure so after two more years authorities asked the listing. there still waiting the green light, the application to become a financial holding company. if that were approved, it would allow them to restart the preparations to list.

haidi: the latest on the alibaba numbers. take a look at the movers we are watching. tell brett metals -- pilbra minerals are up. we will be watching that and also speaking to the ceo a little bit later. watching brambles in terms of the earnings story. very much on the earnings beat but we will be speaking to the ceo of pilbara minerals.

shery: still ahead, we hear from a lawmaker on the push for an equality bill to battle sexual and tender discrimination. up next, bull tech tells us why they don't buy the theory of immaculate disinflation. this is bloomberg. ♪

thanks to avalara, we can calculate sales tax automatically. avalarahhhhhh what if tax rates change? ahhhhhh filing sales tax returns? ahhhhhh business license guidance? ahhhhhh -cross-border sales? -ahhhhhh -item classification? -ahhhhhh does it connect with acc...? ahhhhhh ahhhhhh ahhhhhh

>> it is fair to say that the globally economy is in a better place today than many predicted just a few months ago.

in the fall, many were worried about the sharp economic slowdown across the world. the challenges we face are real and the future is always uncertain. but the outlook has improved since we gathered in the fall. >> i won't be courageous enough to make a prediction, but i will say there is a risk, it may not be disastrous for the world for the average person, but there is a risk that the macroeconomy delivers results that markets are still woefully unprepared for. >> that was janet yellen and others on their diversion views of the economy. our next guest is refusing to subscribe to what she calls immaculate disinflation. she is a chief investment strategist at bulltech. you think this is wishful

thinking that a soft landing is still on the table or we could get inflation down but not have a hit to demand? >> when i first heard that, i left out loud. it's going around. immaculate disinflation is a real term. of course it is attempting to describe the current phenomenon where we have near record low unemployment rates in the u.s., 3.4%. we have job openings rising rather than falling in the midst of a falling labor market participation ratio. and we still have some sort of this inflation. the idea is that the labor market perhaps no longer matters in terms of relevance to inflation. while i do agree with some components of that view, i think that things haven't changed right now to such a degree that

we can discard the forces of the very overheated labor market with regard to inflation. my point is i do think that soft landing which should be defined as the fed able to curb inflation which topped out at above 9% last year, go to 2% it's a dream. it's wishful thinking, it's very nice but i think that to get to 2%, we do have to see wage pressures abate. my suspicion is that we will have to see domestic demand curbed and by that i mean the next phase of this economic cycle is recession. >> that's talking about developed markets. when it comes to emerging markets, if you take a longer-term work medium-term outlook are there places where you can see meaningful

allocations that are worth the risk right now? >> yes. i think that the markets specially the equity markets once they have fully priced in what think is forthcoming which is economic contraction and a junk in on a planet rate, then i think yields are going to be high enough for risk assets in equity and fixed income long-duration. i think the time is coming. think emerging markets will be very attractive but i wouldn't jump in right now. i think the rally we have seen year to date, in general this trade is premature which means that inflation is not over, the fed has to go higher for longer and one thing i will put out there is a market is certainly not discounting the possibility and a very real possibility that the fed pauses at about 5.5% and if inflation does not continue

this immaculate trend to 2%, the fed doesn't cut but it resumes its hiking trend. that is something that the equity markets and risk assets in general are certainly not prepared for. shery: what can we learn from emerging markets like brazil that hiked aggressively and could those be opportunities? >> absolutely and i think brazil is one of the names we should most look at. we should look at countries that either have diversified sources in terms of commodity exports such as brazil but also has done its homework. in the past year, the brazilian central bank increased its benchmark rate more than 1000 basis points. that was before the fed had started. that's good for the currency, good for the carry. they can actually start to cut sooner rather than later. so yes, long brazil at a point.

for now, i would say short duration investment grade bonds. short duration treasury bills. you can get very attractive yields at these three month, six month. we are talking 5% commercial paper and the like. i don't think it's a bad place to hide especially if you think the markets have gone too far too fast year-to-date. shery: will the u.s. dollar act as a safe haven? would that be a place to hide and what would the implications of that be for the markets? >> right now i think it would be an attractive that to go long to some degree on the u.s. dollar given the impact it would have some conflagration of geopolitical forces or the fed that resumes a more aggressive tightening cycle van the market has currently indicated. yes in the near term the dollar could get an additional boost.

emerging markets to fantastic once we are past all talking about inflation and fed hikes and talking about recession. emerging markets get lower, the fed starts to cut rates, that's a great space for emerging markets. one more point is that china and india are really going to move the entire globe in terms of their growth. the growth in em is far going to outperform developed markets this year. shery: great to have you with us. coming up next, a bloomberg scoop on how deutsche bank looked at credit suisse. this is bloomberg. ♪

bloomberg has learned that deutsche bank has looked at

buying parts of credit suisse before last year. >> the source is also saying that if some of these assets that credit suisse has come up on the market that could change. sources are telling us the german bank was looking at specific credit suisse assets that might have been sold as early as last fall then in the fall in october credit suisse announced a dramatic restructuring. that was in the wake of losses and scandals. we are told that deutsche bank had done a serious analysis of individual business asset management and wealth management units. they say these are to areas within deutsche bank that deutsche bank is planning on growing. the plan also we are told inside

deutsche bank was to move quickly if attractive parts of the bank credit suisse were to come on the market last year. if you will recall the revamp, credit suisse initially improved its business but it did stop short of further significant sales. >> what is the latest when it comes to the revamp of credit suisse? >> there is a view that it has done little to stave off the crisis of confidence that has hung over the bank for a few years now. analysts are concerned about several things including the dramatic drop -- the dramatic deposit outflows. the departure of key staff. the swiss bank shares are down about 75% over the past two years and in contrast, deutsche bank recently reported the highest profit in over a decade.

haidi: you can get around up of the stories of the day. terminal subscribers can go to dayb . this is bloomberg. ♪ as a business owner, your bottom line is always top of mind. so start saving by switching to the mobile service designed for small business: comcast business mobile. flexible data plans mean you can get unlimited data or pay by the gig. all on the most reliable 5g network. with no line activation fees or term contracts. saving you up to 60% a year. and it's only available to comcast business internet customers. so boost your bottom line by switching today. comcast business. powering possibilities.

>> this is what we are seeing when it comes to japan cpi. bang on expectations. expectations accelerated from the previous 4% excluding fresh

food, that number is a little bit shy of expectations. still having said that the national core cpi is just outside of the range to have any kind of significant impact we can see ongoing when it comes to the moves in the yen, we had high volatility in fact the strongest dollar-yen year-to-date but that is variable on account of the fact that we are seeing, we had confirmation hearing later today. we're getting the february tokyo cpi next week and that is expected to show perhaps a bigger move given the government energy subsidies. >> i had the perfect chart for you because you mentioned yen volatility.

it is been spiking versus its peers. the pound and the euro over the past few days. were going to get the first hint of the new leader when he speaks before parliament just over one hour from now. the question is how dovish how hawkish she will be but traders are anticipating movement in the yen either way. we just saw the cpi coming in, it is hotter than expected. it raises the question will the boj be forced to pivot on its rates? in terms of the options market, or bets that the boj will be forced to change tact on its policy settings. we are already seeing swaps nearing the 1% level, the official cap is .5%. the big question is when the settings will be changed. >> let's turn to geopolitics

because washington says beijing may have given chinese companies to greenlight to help russia with nonlethal assistance in its war in ukraine. these concerns about beijing getting more involved in ukraine war are really growing right now. >> that's right. this is the second time in the last week we have heard from secretary blinken talking about the possibility of china providing more assistance to russia and essentially underlining american opposition to china doing that. obviously with us approaching the one-year anniversary, the war in ukraine is on the top of many minds. we are expecting waiting for beijing to unveil the peace plan of its own. there's also talk that xi jinping is planning a visit to moscow in the spring. president putin in russia would potentially ask for more

assistance from xi jinping if that were to happen. it is feasible why there would be so much concern from the american side. >> beijing relay finds itself in a difficult position at the moment because you can't really overtly be seen to be supporting moscow but at the same time, it does need the alternative market, the alternative high tech that it's not necessarily going to get from the u.s.. >> secretary blinken talked about this. he says as china is reopening after the covid restrictions, the country is trying to go on a charm offensive. secretary blinken made the blunt point that providing support to russia is going to undermine that charm offensive. there will be countries in europe, the u.s. definitely but other countries around the world who oppose the war in ukraine who are going to find any

support lethal especially military provided by china to russia very objectionable and it will make it harder for china to build its relationship with other countries. >> bloomberg tv has special coverage marking one year of the war in ukraine coming up at 5 p.m. on friday. 8 p.m. if you are watching out of sydney. vonnie: defense officials say the u.s. is increasing its small contingent of troops that train local forces in taiwan. the wall street journal is reporting the u.s. presence would grow on the island to more than 200 people. it is likely to further strain tensions with china. the white house is narrowing it search for the next vice chair of the federal reserve.

the process is underway to replace one who became joe biden stuck economic advisor this year -- top economic advisor this week. this reopening should be a liquidity boost for market that is struggling to recover after last year's crisis. new criminal charges against sam bankman-fried have been revealed. prosecutors allege he and two co-conspirators illegally sought to influence cryptocurrency regulation by donating millions of dollars to democrats and republicans. he pleaded not guilty to earlier fraud charges and faces trial in october. a los angeles judge has

sentenced harvey weinstein to an additional 16 years in prison for rape and sexual assault. he was ordered to serve the sentence after finishing the 23 year term he is serving now in new york for sex crimes. it means he will spend the rest of his life behind bars. global news 24 hours a day powered by more than 2700 journalists and analysts in over 120 countries. i'm vonnie quinn. this is bloomberg. >> a latin american e-commerce giant has reported a surge in profits. the company's chief financial officer joins us. always good to have you on the show. you really had that record quarter handily beating wall street consensus. what drove the gains? >> thank you for having me on. a combination of sustained strength in volume of sales,

verily rapidly growing fintech business with increasing revenues and profits coming in from credit and a new profit engine for us which is our advertising business. that despite being small in terms of its future potential, is a very high-margin revenue stream that is growing very nicely. >> the company is looking to increase investments in latin america this year. does that mean it will be larger than $10 billion for lester and how much of that will go to brazil? >> brazil is our largest market. it represents over 50% of our revenues. investments tend to come in line with that proportion more than half of our investments. we see significant potential both in e-commerce and fintech in the region going forward and we continue to invest aggressively behind those

opportunities. absolutely, we expect our investments in 2023 to surpass those last year and the consequence of that, we expect to continue to see the kind of high-growth that we have been seeing so far. if you look at our 2022 results, we grew note -- north of 50% while expanding margins. we did hundred billion dollars of payment profit, $10 billion of revenue and $1 billion of ebit. >> how has this event impacted your company? >> our strategy remains unchanged. the strategy is not impacted by what's happening to competitors but it impacts in a level when there's potential change in market structure, there will be

gained. tactically we are looking at opportunities to lean into that whether it's re-accelerating our first party business, trying to understand product categories where they were strong and how can we offer to the consumers that potentially will not be buying their will be buying less there, the ability to buy mercadolibre and gain that share. >> there's been a lot of downsizing and layoffs in tech companies. is that something you envision? >> we feel we are -- we were cautious through the pandemic and we invested accordingly so we don't find ourselves currently with over staffing more overcapacity in terms of most of our logistics operations. there have been no layoffs for us and we have signaled we will

continue to grow our engineering based. we think it's a competitive advantage and an area or we could accelerate a little bit while others are pulling back. we will continue to hire obviously at a more cautious pace. that is even more so when you look at nonengineering headcount in terms of staff or businesses. we do have the fortune of not having found ourselves with excess headcount or investments in areas so we have not been pulling back which is countercurrent what we are seeing in most of tech right now. >> i think the last time we spoke to you, you said you had narrow the targets the list to about 30. has that been narrowed further? >> we narrow the targets on? >> the last time we spoke to you you said you had narrow the list

of targets for the spac to 30. >> absolutely. it has and as the clock ticks on this, we are down to a few interesting targets not much i can comment there. at the end of the day, this is part of a larger orbit develop portfolio. -- larger corporate element portfolio. otherwise at the end of the date we need to be good custodians of our investors funds and if nothing comes up, there is always the chance to return the money. >> great to have you with us. coming up, and independent lawmaker joins us from sydney world pride. this is bloomberg. ♪

go scientist. go software. go cure. go production. go faster and safer. emerson automation software helps breakthrough medicines get to market at warp speed. go human go. go boldly. emerson. is an elegant ev. yeah, with 389 horsepower. ♪♪ it's electric. with an edge. ♪♪

♪ old school wisdom, with a passion for what's possible. that's what you get from the morgan stanley client experience. you get listening more than talking, and a personalized plan built on insights and innovative technology. you get grit, vision, and the creativity to guide you through a changing world. ♪ we are in the second week of sydney's world pride festival. while australia is largely a welcoming place for lgbtq place for people -- to visit. joining us is a lawmaker alex

greenwich. thank you for joining us especially ahead of a week like this. i speak to a lot of people and they say australia is very aggressive, you have gay marriage. is very open. and you think of what the debate was like going into that. is that still a lot of residual trauma for people? >> absolutely and happy sydney world pride to you. the -- was a tough time. the result was very affirming. we learned the majority of australians support fairness and equality. what we think people want now is for governments to take action. yes marriage equality is important but there places of law and form -- chloroform that need action.

it's time for my colleagues at the state and federal level to step up. >> it's extraordinary i think because you are obviously pushing for the removal of the ability for any form of so-called gay conversion practices. it was quite -- news to make that it still happening. is there any room for debate given the other side is saying you need to have the ability to religiously or otherwise council people that want to talk about this. >> the tension with a lot of these can be protecting religious freedom but making sure we are not impeding on the rights or welfare of lgbt people. people want to see -- these are happening in places where people are still being counseled. some really cruel practices which can be done through

counselors, medical practitioners or church environments. what we are not talking about his prior. what where -- is prayer. what we are not talking about is communicating a religious ideology or statement of faith. that will always be protected. what we're talking about is practices that cause harm to individuals and i'm grateful that the leader of the opposition and the premier have both back to my call for this. >> what lessons do you take from your work leading for marriage equality when it comes to this new push and do expect pushback from wider society? you mentioned churches as well. >> we learned through the marriage equality campaign that you can trust australians to do the right thing. that they love and value their lgbtq brothers and sisters, colleagues and neighbors. they want to see all discrimination removed. when it comes to a ban on

conversion practices, i have not seen any large-scale opposition to this. this is an important reform sends a clear message that if you are lgbtq, there is nothing wrong with you, you don't need to be fixed and indeed we will put laws in place to prevent anyone causing you harm. >> it's a time for celebration when you have big events going on in australia, but at the same time we have heard about pink washing as well. are you seeing that? what progress commit made on that front when you have the usual deluge of corporate logos jumping in? >> i welcome all of the corporate logos and sponsors and supporters of our community. corporate australia was one of the first parts of australians society to back the marriage equality campaign. they showed great leadership throughout the campaign for marriage equality. whether it is small business flying the rainbow flag or selling cupcakes or supporting local charity through two we

have some amazing out gate ceos in australia. two of whom get back to the community in so many ways and provide important leadership role models. i'm really grateful to the support of the business community for our community and they do it for the right reasons. to be good corporate citizens, to support their staff and also to support their customers. i don't see this as pink washing, i see it as important leadership. >> the corporate world has been ahead from government when it comes to making progress and we are looking at the 2022 australian workplace equality index, a stocking -- shocking statistic that respondents said they felt the need to hide their sexuality or their identification in the workplace in 2022 and australia. is that something you felt

across the political landscape which here has been more known for toxic headlines rather than ones that are embracing of diversity? >> it is something we need to keep on acting on. we need to have this visible role models within the corporate environments. there are many other great leaders who are openly gay. it's important that we give them a platform, we celebrate their work and their contribution but we also make sure that in all workplaces, people can bring their whole self, their authentic self for work and share that there colleagues. some of my parliamentary colleagues seek to attack members of the community and we have seen the latest election make cruel attacks on the community. they have some of the highest rates of mental illness, harm, and suicide and it is important

we work to protect them and support them and i'm grateful that in the new south wales government, we have seen record funding for the diverse communities and their health and well-being. we have a long way to go, but important work is being done. >> great to have you with us. ahead of a big weekend when it comes to world pride being celebrated here in sydney. you can get all the latest on bloomberg radio, you can hear from the day's big newsmakers from our team broadcasting live in hong kong. lots more ahead, this is bloomberg. ♪ the first time you connected your website and your store was also the first time you realized... we can do anything. cheesecake cookies? [together] the chookie! manage all your sales from one place with a partner that always puts you first. godaddy. tools and support for every small business first.

introducing the new sleep number climate360 smart bed. only smart bed in the world that actively cools, warms, that always puts you first. and effortlessly responds to both of you. our smart sleepers get 28 minutes more restful sleep per night. proven quality sleep. only from sleep number.

hkex has reported an 11% profit as investors review their china investments. we are told investors are bullish on china's reopening despite the mask mandate. a key variable we are watching is what's happening with the china reopening trade in the sense that we've seen that that has been much faster than expected. we look at volumes for example in january, the average volumes were around 140 billion hong kong dollars per day average trading volume.

that compares with 125 that we had throughout the year last year. that slow down a little bit in february, but we are probably expecting it will be moving up and down but the natural trend is that investors are quite bullish on the fact that this reopening is going to generate a lot of growth from this part of the world and many investors that have trimmed their position in the past, they are looking at perhaps catching up with a slightly shorter position. >> how quickly do you expect the reopening to accelerate? i just heard a report this morning that the mask mandate has been extended in hong kong. i think i heard through march. nonetheless, that doesn't seem to bode well. if you are extending these kind of requirements, how does it look from your vantage point? >> hong kong is fully open at

this point. there's a lot of visitors coming from all over the world. in some cases, it's hard to get hotels and restaurants are full. what we are seeing is that hong kong is very active. clearly a lot of what is happening in hong kong is people are participating in a lot of what's going on in overall china . that's what's generating a lot of interest. there also seeing a lot of people from china and also within hong kong going internationally to the middle east. i've been there a couple of times. throughout the u.s., europe, there's a lot more conductivity. we think that it's really really good for the role that we play which is creating that conductivity between east and west. where the bridge and hong kong has historically been known for its conductivity, liquidity, and opportunities that we provide.

>> these are some of the stocks that we will be watching today. asian semiconductor related stocks are in focus after tsmc is planning to build its second chipmaking plant in japan it would cost over $7 billion. japan's financial firms could be moving as a surprise pick for the central bank governors starts a series of hearings on friday. the market opens in seoul and tokyo are next. this is bloomberg. ♪ avalarahhh ahhh ahhh ahhh

>> this is "daybreak asia." we are counting down to asia market opens. it is boj day not necessarily because we have a decision but

we have the governor speaking in parliament today. after trying to hunt for that out-of-print book of his, "finding zero interest rates," this is quite the treat for markets trying to understand where he's coming from. >> i was thinking of the reporter that went to speak to his father. a potentially has even more implications than an actual boj decision. >> this is really the key focus for us this hour, the first time we will have heard from waiter -- from ueda since he was nominated. this will be what frames trading for japan and other assets in asia. we do have a lot of anticipation again at what kind of leader he will be, what sort of tone he will set on communication, how soon we will be likely to see policy changes and also that outside chance that corroded delivers some sort of surprise

to markets before his term ends. in terms of direction of trading, we are looking very range-bound, which you can expect even we are still 30 minutes out from the session, but young volatility continuing to rise, a lot higher than we see for its peers, the euro, the pound, but not quite what we had in anticipation of further tweaks back in january. the other market we are watching at the opening today is korea. we did see that session moving higher given that we saw the boj striking a more optimistic tone around inflation and that rates prospects perhaps we could see a rate cut later in the year. that will be the key question we put to the be ok governor when we speak to him later today. that interview is exclusive to bloomberg. in terms of what we are also seeing, the korean won still trading around the key psychological 1300 level.

it actually was one of the best performers in asia in the day prior, but it has been lagging given that we did see the be ok rates on hold and there's still the prospect the fed -- somehow they are saying the terminal rate could reach 7%. the asx 200 one-hour into the session, we are seeing those gains fairly range-bound, still very much earnings focus. the lithium producer eyeing massive growth in the sector. we will also be speaking with the ceo, dale henderson, later this morning on bloomberg television in his first interview since taking the helm at the company. we are continuing to keep and i on wti. it is fractionally higher this morning but heading for its second weekly loss. a lot of concerns around that recessionary outlook, and again, it comes down to fed inflation. shery: staying in large-cap equities and inflation-proof

small caps, with as now is richard harris -- with us now. you also say in your notes, you cannot run, you cannot hide. is this the only way to stay invested in this inflationary environment clearly did do not know if it is a fact that prices will fall? richard: this is the wonder of being an investor, isn't it? you have to take the rough with this move. if assets go down in general, as we saw last year, investors have to be invested. that is your job. you are supposed to be there and you also have to be careful of the whiplash, as we saw in the last quarter of last year. you cannot run, you cannot hide. you just have to design portfolios in a way you think will be robust and in a way you think they are likely to survive some of the things coming down the pipeline. i actually think that the moment you have to think outside the box because there's so much consensus thinking in the market at the moment that you are not

going to get anywhere by following that particular line. haidi: --shery: if we are worried about inflation continuing to stay elevated, that could mean higher yields, higher u.s. dollar as well? richard: i think so. the thing about inflation as we are starting to say maybe it is a bit stubborn. there's no way it's going to go down to 2%. we are so europe but close to something like 7% in the u.s. of course it may go down to 5%, but if you look at that over the last few years, 5% compared to the 2% we have had over the last few years, there's an awful lot of space under that curve, so that has to be built into markets sooner or later, so, yes, that's why i'm bearish.

haidi: argue bearish for geopolitical reasons as well? we saw that even if we do get guardrails on u.s.-china political elation's on sensitive issues like data security, does that way on the ability to have the visuals to be able to invest into china? richard: i think in general terms, if you are looking at the guard rails, i think that is likely to happen. i do not think we are in such a serious situation. yes, it is a lot of discussion between the u.s. and china, but i don't think you're in the kind of situation that they are just going to turn their backs on each other. there are huge economic links. they won't go away, so i think guardrails will come into play. i think both parties are treading around each other. it will be more difficult to

invest in chinese assets. the chinese themselves have close control over the economy. it is about us difficult to get into china as i can remember. when i was a young lad in the 1980's, for instance, when it was still quite difficult to get into china. that is going to be quite restrictive. having said that, i think the chinese economy domestically will do well. there's plenty of covid rivage -- covid revenge to come through and technically, -- technically, china is the place to be -- tactically, china is the place to be. haidi: are you seeing that we are entering a new type of volatility potentially with more of these short seller attacks? richard: i think short seller attacks have always been around. they are likely to be more intense if the market is fragile. of course, if you go for a company that maybe does have relatively weak fundamentals,

you will probably have quite a bit of luck because the market is looking on a-on basis. i think tactically, if you look at what happened -- it was right for a fall and people were looking at these opportunities -- looking for these opportunities all over the world in order to take advantage of them and is it's easier to take advantage in an uncertain market. i think yes, we are likely to see more of those but only because the environment is more, it like, applicable, more adaptable to that sort of thing happening. >> always great to chat with you. let's get to vonnie quinn with first word headlines. vonnie: the indonesian finance minister says creditor nations must make progress on debt restructuring talks. she says poor and developing countries need some breathing room after the pandemic.

>> this is the area in which the creditor, traditional or a new creditor, they should step in and start to discuss because countries definitely need space in order for them to serve the debt which is not at the cost of their own survival. vonnie: china is considering appointing its neck central bank governor. "the wall street journal" says the considered appointment would be a change from the previous appointees, who were academic economists. defense officials say the u.s. is increasing small contingent of troops that train local forces in taiwan. "the wall street journal" is reporting the u.s. military presence on the island will go to as many as 200 people from 30 a year ago and is likely to further strain relations with

china, already tense over the war in ukraine and the recent u.s. downing of an alleged chinese spy balloon. president biden has nominated former mastercard ceo rj conger -- ij banca as a surprise pick to head the world bank -- ajay banca. global news powered by more than 2700 journalists and analysts in more than 120 countries. i'm vonnie quinn. haidi: japanese financials and banks of interest today. annabelle: we are not seeing much movement at this stage, but unsurprising given investors are in that wait-and-see mode. where about 20 minutes away from the start of that hearing to get

the first insights into the type of leader, the type of strategies that he will bring to the bank of japan. not exactly if but when we can expect to see some sort of policy changes, particularly around yield curve control, forward guidance, other issues like negative rates. this has been one of the biggest beneficiaries out of the anticipation that the boj would be forced to tweak its policy settings. we are seeing the bank index up around 10% this year. you compare that to the broader gains, around 5%. shery: still ahead, we bring in economists to hear their opposite takes on bank of japan policy. up next, the u.s. says china is probably helping russia nonsense war against ukraine, but beijing has not crossed a redlined get. this is bloomberg -- beijing has not crossed a red line yet.

♪ get help reaching your goals with j.p. morgan wealth plan, a new tool in the chase mobile® app. use it to set and track your goals, big and small... and see how changes you make today... could help put them within reach. from your first big move to retiring poolside and the other goals along the way wealth plan can help get you there. j.p. morgan wealth management.

shery: the japanese government's pick for central bank governor starts a series of hearings friday as lawmakers continue -- consider the nomination amid strong policy changes to come. kathleen hays is here with more. it is a treat for markets to hear directly from because will -- from kazuo ueda. kathleen: it certainly is because we will find out what his views are because we don't know his views. he was on the boj board from

1998 to 2005, but that was a long time ago. back then, he was in favor of quantitative easing. he opposed a rate hike by the boj that proved to be a misstep and was one of only two on the board that did. but that was a long time ago. he has been an academic, highly respected and well-known for his work in academia, but what does he think now? that is what we don't know. in a recent survey, 70% of the economists we talked to said they will start the normalization policy even at the april meeting. they are going to do it quickly, so what do we want to hear him say? first of all, yield curve control -- that's the big one because that's the one that governor kuroda who is outgoing had to tweak. what do we say about widening the band? maybe even getting rid of it altogether. a week young versus a strong yen. how does he come in their? meanwhile you have a volatile japanese government bond market and they are having to buy a lot

of bonds to keep it inside the band. the prime minister would like to have a look at the policy accord that was made 10 years ago when kuroda first took office. what would he say about the need for that? what would he say about the need for watching inflation, finding out if it is sustainable or not. and credibility -- how does he sound? is he confident? how does he stand up to some of the questioning? we could get tough questions from members of the ldp ruling party suggesting they are not so eager to see monetary easing the eliminated vertebrae. how does he respond to that? finally, because the ruling democratic party is the majority party by far and he is the nominee of their leader, the prime minister, there's almost no doubt he is going to get the job. recently, governor kuroda has said monetary easing must

continue. it will certainly continue under him, and the question is -- how quickly does it change? these are the kinds of things we are waiting to hear, and i can only imagine, parliament rehearing today, more parliamentary hearings next week. we will have plenty of time to learn what is on his mind. haidi: the focus when it comes to u.s. inflation is just as intense as ever. just ahead, the fed's key inflation gauge. what are we looking for on expectations? kathleen: the personal consumption expenditures report has spending. it has income, and importantly, it has the inflation gauge which the fed considers its printable gauge. on that front, we are not expected to see any improvement. actually, spending is supposed to pick up. remember the strong retail sales we saw just a couple of weeks ago for the u.s.? we will see that reflected in this report, but in terms of what we expect on the numbers, we can look at our chart to get

a sense of how this is stacking up, but the headline number is supposed to come in on the month at 0.6%, up .1 from the previous month, and is it supposed to remain around .5% year-over-year and way stronger than the ones. you can see blue bars showing that consumption was weak week for a couple of months and is expected to rebound. the pce deflator is at i've percent year-over-year. when you look at the core, the number is supposed to go up on the month to 0.1. services, remember jay powell's core services number, when you take the services number, take out food and energy and take out housing, what do you get? bloomberg economics says what we will get is a number that does not improve. in fact, it accelerates. that will be problematic for the fed and presume a plea something the market is watching closely as well. we could see some reaction to that. haidi: global economics and policy editor kathleen hays. we will be speaking with the be

ok governor to go over that hawkish hold and go over what is next. that is a 2:40 p.m. hong kong time only on bloomberg. we did see the previous session closing steady if in a subdued session. we have perhaps seen the bulk of the hawkish bits priced into this market. we are seeing a bit of an uptick . we did really kind of see that investors perhaps were satisfied that harder eurozone inflation and a more hawkish start by central banks may be already baked into the cake in terms of these markets and this string of declines we had earlier. shery: let's turn to geopolitics. washington saying beijing may have given chinese companies the green light to help russia with nonlethal assistance in its war in ukraine. what do we know about this?

>> well, what we heard from u.s. secretary of state antony blinken overnight is that the united states believes chinese companies have provided nonlethal, dual use, so things that can be used for both civilian and military purposes, to russia, and that that support came with the approval of the chinese government. secretary blinken did not provide more detail or evidence, but he went on to say that he sent lee in the last couple of months, the united states has picked up intelligence that china is seriously considering providing lethal support to russia in its war effort in ukraine. that would obviously be a tremendous additional strain on the u.s.-china relationship. that has been underlined by the fact that secretary blinken has brought up the issue twice in the last week, speaking with china's top diplomat over the weekend in germany and no bringing it up again overnight in the united states.

so, secretary blinken said if china were to do this, to provide lethal assistance, it would undermine china's attempt to strengthen its relationship with the rest of the world, especially europe. haidi: this certainly is why we have seen quite a bit of cynicism over the idea that beijing is trying to position itself as a neutral party, wanting to broker a resolution between the two sides. >> we are expecting beijing to release the details of a peace proposal for the war in ukraine. we have not gotten the details. we do not have a time before that release, either. if china were to provide lethal assistance or even greater levels of assistance to russia, it would be hard to imagine how countries in europe, the united states, and other parts of the world, would be able to view china's peace proposal with rate seriousness if china were seen

backing russia even more than it is right now. haidi: bloomberg tv has special coverage marking one year of war in ukraine coming up at 5:00 p.m. on friday in hong kong, 8:00 p.m. if you are watching here. shery: we take our viewers live to the launch of the sawyers 23 that we'll head to the international space station. pictures are coming from because extend. we know three astronauts are on what the international space station. we have been talking about the u.s.-russia tensions. this is one space where nasa astronauts and russia cosmonauts are working together. they flew to the station in september and were slated to come back this spring before the return ship was damaged, so the incoming russian sawyers craft will bring them back to earth possibly in september of this

year -- the incoming russia soyuz craft will bring them back to earth possibly in september of this year. this is bloomberg. ♪

shery: alibaba reported its first profit growth since 2020 after reining in spending and narrowing losses abroad. the reaction from the stock was not that positive. where are we expecting future growth to come from? charlotte: that is actually the question esters -- investors want to ask. if we look at the numbers, like you said, alibaba did well in boosting profit, but topline revenue barely grew from last year, which was just 2%, and its core chinese e-commerce unit as

well as the cloud business, which was usually the fastest-growing business unit, also had very narrow growth. if we look at the share price perspective, i think investors were not that impressed, where is the -- not that impressed with the lack of a clear growth story going ahead, but it improve its bottom line by over 60%, which is quite impressive, and also, given that, we have to be reminded that this is the first quarter that china reopened, so it was a chaotic situation for the first months with the first wave, so it will actually take a while for the growth recovery to happen. haidi: there's no worries about cash burn and the press war as being the next issue for big internet tech giants, particularly on the e-commerce side. did we get any commentary on that? charlotte: yes, they actually gave pretty positive commentary

on that in the sense that they say subsidies are nothing new and that the ones able to sustain market share, it does not come from giving subsidies. it has to come from technological innovation, so i think that is music to investors' ears because they were concerned about if you engage in price wars again, that could erode margins, and as we see, whereas with jv, shares plunged after that which investors saw as a pivot point to its improving mortgage and -- improving margin trend. haidi: let's get a check of the latest business flash headlines. axa has unveiled plans to buy back as many as $1.2 billion of its own shares as the insurer has reported higher underlying earnings. the firm intends to complete purchases by the end of the year. the insurer is refocusing on its

under margin business while shifting its exposure to natural disasters. >> buybacks for us are part of the capital management strategy. we always have a look, is it better to invest into the business in particular and organically or is it better to buy back shares. it is always a decision that comes every year. the board of directors has taken the decision to go for a buyback, and this is a true sign of confidence of where we are today. haidi: sources say deutsche bank looked to buy parts of credit suisse group last year including asset and wealth management units. we're told the plan was to be able to move should attractive parts of the bank come onto the market the project has been on hold since credit suisse announced the overhaul in october. coming up, as investors await kazuo su: -- kazuo ueda's

nomination hearings. this is bloomberg. ♪

shery: the boj governor nominee will be questioned by lawmakers today at the lower house. this coming at a time when governor kuroda is expected to leave his office very soon, and

what a treat for investors because we have been trying very hard to gauge his policy stance. haidi: we have. we talk about the out-of-print book that has been selling for multiple times its original price, even to the extent of trying to interview his father to try to get a gauge on what kind of policymaking -- policymaker he's going to be. we did get a gauge on the inflation going into the start of trading today, and of course, that key parliament rehearing really highlighting the strength of price hikes before we get, of course, the first major public appearance from the boj nominee since he was picked by the government. really highlighting just one of the aspects of the challenges when it comes to what he will be taking on if confirmed. ahead of that, we have seen quite a bit up young volatility. let's get to the markets. >> that's right.

that is what we are seeing in terms of market reaction so far. that's fight does tell us investors are expecting moves in either direction, but still so much unsaid as far as exactly what kind of leader ueda will be. because of that, we are looking at range bound in other asset classes. take a look at this terminal chart. we had seen a lot of that's building, at least in the options on swaps market, that we will have to see some kind of change coming through on the yield curve control setting policy because that has been spiking even though the benchmark 10-year yield is cap at that 4.5%. we have been hitting that operant a number of times of the past couple of days. the boj has been forced to spend trillions of yen defending this policy-setting, but when we do see changes because it does seem

like a when question not and if, key economists there say it certainly will have big ramifications for the financial sector and we have seen bank stocks rising in anticipation of changes at the boj. shery: not surprising given that we also had the jgb 10-year yield topping that .5% ceiling twice already this week. let's bring in our global economics and policy editor kathleen hays and our guest from capital economics. really huge debate right now on if we will see that shift in boj policy. kathleen: absolutely. there has been so much pushback. let's start with governor kuroda, who is on his way out of office, and a big debate in marcus among -- in markets among economists. a recent bloomberg economic survey showed 7% of the people

we spoke to say they could start the normalization even by a tiny step as early as the april meeting when mr. ueda is going to take over, but what about the concern that inflation is not going to stay high? what about pushback from some of the political forces in mr. kishida's team? why do you think it will start as soon as april? >> there's eight range of reasons. the first is that control has always been marginal policy. the impact of barney gilts on japan's economy is pretty small, and the cost is reasonably large, so you have big distortions, and the bank improving the margin of the bond market but widening the bank has not been met. the policy is looking

increasingly unsustainable. the other factor is that the government seems to be pushing quite hard for a change. if you read the background of ueda's nomination, it is clear that a prayer is nominee rejected the job because -- a previous nominee rejected the job because he was not willing to reverse a decade of policy. the government wants a reversal because the yen is very weak and that is weighing on the government's approval rating. kathleen: those are some pretty powerful arguments, certainly the fact that why cici does seem unsustainable. you are in the minority. you don't think they will start tightening until next year. why? >> we do not expect any monetary tightening measures from bank of japan. bank of japan is under two kinds of pressures.

japan still has structural deflationary pressure. and second, government pressure. the government is under pressure to maintain abe-nomics, including aggressive monetary policy. we think the government will keep this policy, so we do not think the boj will change its monetary policy to tightening this year. shery: we hear from kazuo ueda, saying that underlying inflation is expected to rise gradually. could you really address some of the issues that marcel was

talking about, especially when we saw that attack on jgb? does that concern you that we might not see markets waiting for the boj to turn hawkish? >> the government and boj thinks this inflation level is not sustainable, so inflation could come back to the level below 2% which is bank of japan's cpi target. domestic demand recovery is very, very weak. the government, boj, and we think cpi will be well below 2% next year, so the cpi is not sustainable. also, the long-term yield at 5%. in the second half of this year,

we expect tightening and also global rising and inflationary pressure will weaken. we think rising pressure on the boj will weaken, too, and we think the boj will be able to maintain the 0.5% operating margin. haidi: we are getting more lines from the nominee speaking with parliament, they will be closely coordinating with the government to receive approval aiming to achieve sustainable inflation if approved. the current easing measures are approved. it will take time to achieve sustainable inflation. we've been talking a lot about this idea of -- what is the phrase? immaculate disinflation, the idea you can bring down inflation and still manage to avoid a hit to demand. do you think that is possible in

japan's case, given how extra complicated the settings are? >> inflation will definitely come down later this year simply because a lot of the process has been driven by the weaker yen and the search in energy prices. on the domestic front, there is much price pressure, but we are seeing now some signs that wage growth is accelerating, and our analysis suggests this is increasingly driven by -- it is kind of like a wage price barrel in its infancy. you can see the strongest growth in wages is happening at the lower end of the income spectrum, so those households are least able to cope with rising prices and are no pushing very hard for stronger pay hikes , and employers in a tight labor market are willing to grant them. increasingly, this domestic inflation is starting to gain momentum.

it is not clear if it will force a reversal of policy. the other argument i would like to make is that the bank of japan has been arguing that the week yen -- the wiki and -- the weak yen is bad for japan's economy. it is not clear they view this as tightening. it is possible they will review this as an easing of policy because the yen would strengthen and the sharp search on import cost has been weighing on the profits of households and weighing on household incomes would reverse. >> want to ask you kind of a follow up on something that has been here implicitly, and that is the politics of this. the very large abe coalition is thought to be against a lot of moving away from monetary easing, and it is partly because they have already got a big adjective as it.

defense spending is going to double. there is a -- because they already have got a big budget deficit. defense spending is going to double. >> you are right. in june, the government will revise, and still they are saying they have to keep abe-nomics, including aggressive monetary pricing -- pricing. we do not think the prime minister will change the approach. under this political pressure, it is difficult for boj. >> marcel, you jump in here now, please. [crosstalk]

>> i think toshiba -- kishida is facing opposing policies. there's a number of lawmakers that would like to keep current policies in place. i think they are increasingly unpopular because they are resulting in high inflation, and that's why his approval rating has plunged. i think he is fighting for political survival, and i think he has to walk a tight line between securing support but also pushing up his approval rating. we think at the moment he has more of an eye on the approval rating rather than securing ldp support. >> in terms of the question of inflation and wages, this is a very important issue as well. governor kuroda has said the increase this year has to be at least 3% on average. it is looking pretty good so far. if wages are strong in the

spring wage negotiations, is this another reason to support the view that normalization could come much sooner rather than later? >> yes, wage is very important. one problem -- smaller companies are still struggling with business. even though large companies could increase wages a lot, smaller companies cannot raise wages. we think this year's spring negotiation will increase only 1% level with a 2% inflation target, so real wages are still negative. also this year, smaller companies have to pay back debt. until last year, the government supported small companies to hold the debt so they did not have to pay back debt, but from

this year, they have to start to pay back, so i think if the boj makes monetary tightening, we think the cycle could be very weak. and that will stop japanese inflation at next year's wage increase. >> we continue to hear from kazuo ueda speaking in parliament. he said he was very surprised by media reports of his nomination on february 10, that he was asked by the bank to be governor nominee on february 13. does this give credibility to the reports that he was not really the first choice for governor of the boj? if that is the case, does that mean the government was not necessarily seeking a shift away from its current policy? >> what i've read is that the

bank asked, mia first, and he rejected it because he was not keen on reversing policies, so that's why they had to look for an outsider. also, the other options were seen as to dovish -- to hawkish by the ldp. that's my understanding that is why they chose ueda. the shift is that the people first ask to do that were not willing to do that. >> does that then potentially pretend -- portend a more complicated dynamic between ueda if he does become the next bank of japan governor, and that relationship with the government in terms of how this precarious, narrow path is potentially followed? >> yes, i guess so.

i think initially, ueda will follow instructions. i think it's pretty clear the government wants to appoint him with an agenda, and the agenda is better yield curve control. i think we saw the same thing when kuroda was appointed. it was clear abe sought someone who would listen policy, and corroded did that. the longer he is in power, the less he will make his own decisions. at some point, yes, there may be tensions, especially when it comes to, as you previously said, raising interest rates. i think there may be tensions further down the line. >> always great to have you with us. we are continuing to see more commentary from this hearing. of course, su: -- of course ueda

saying he would be well aware of the chief if he were nominated. we will continue to watch that and you can also turn to york bloomberg for more on this story. you can get that commentary and analysis from bloomberg's team of expert editors. let's take a look at how markets are reacting. >> it has been pretty interesting so far in the last 20 minutes or so since this confirmation started. in terms of reaction, we are seeing the yen, for instance -- it had been looking a little bit weaker. it is strengthening fractionally, and likewise, we have seen reaction going on in the bond space with that 10-year future taking around 24 points, but the overall market perception, it still seems there is a lot more to be defined about the kind of leader ueda would be at the boj.

basically, we are looking a little bit range-bound. the other sector we are watching, though, and this is where we are starting to see losses started to build a little bit in the financial space because we have seen bank stocks rise over the course of 2023 with the expectation that there would be some sort of changes to policy. it does seem like we will keep those policy settings in place for now, and financials one of the laggards in the session so far. that could be a functional little bit of that weaker yen as well. shery: we will have plenty more analysis of ueda's testimony next. this is bloomberg. ♪ ♪ a beach house, a treehouse, ♪ ♪ honestly i don't care ♪ find the perfect vacation rental for you booking.com, booking. yeah. get help reaching your goals with j.p. morgan wealth plan, a new tool in the chase mobile® app.

use it to set and track your goals, big and small... and see how changes you make today... could help put them within reach. from your first big move to retiring poolside and the other goals along the way wealth plan can help get you there. j.p. morgan wealth management.

bonnie: washington says beijing may have given chinese companies the green light to help russia in its war with ukraine. secretary of state antony blinken says the so-called dual use support has been nonlethal and almost certainly approved by the state. meanwhile, bloomberg sources say the u.s. is planning a new package of it calls security assistance for kyiv with about $2 billion. the white house is narrowing its search for the next fed vice chair. sources say contenders include austan goolsbee daily as well as morgan stanley's seth carpenter as well as others -- sources say

contenders include austan goolsbee and mary daly. asia trading has been suspended since march of 2022 when the lme canceled billion-dollar transactions as it was hit by a short squeeze. the reopening should be an important liquidity boost or a market that has trouble to recover after last year's crisis. new criminal charges against sam bankman-fried have been unsealed in new york city. the counts include commodities and securities fraud. prosecutors allege the ftx cofounder and two unidentified co-conspirators illegally sought to influence cryptocurrency regulations by donating millions of dollars to democrats and republicans. the 30-year-old pleaded not guilty to earlier fraud charges and asus trial in october. global news powered by more than 2700 journalists and analysts in more than 120 countries. i'm vonnie quinn. shery: we continue to watch the

testimony of kazuo ueda. we are seeing the japanese yen weakening and bank stocks under pressure. does this hearing so far give the impression that he is not moving away from what the boj has been doing so far? >> so far, we have mostly just had the prepared remarks. they were what you might call compromise remarks. they did not indicate a lot of the potential for radical changes and certainly did not give much of a not to those expecting that the yield curve would be widened. we've had jgb futures jumping. we had the yen dropping, but now it is fluctuating a bit. it is about 0.3% stronger, although there does not seem to be anything in particular that ueda has said that could justify

that move. you might best characterize it as being -- it is trending in something of a range. as i said, i cannot see anything that ueda has been saying that would have really been yen supportive, and the move is not breaking any fresh ground as yet, so we will keep a close eye on that. of course, we do see that it is breaking away, and we see there might be a reason for that, either that he is refraining from taking the opportunity to sound, you know, determined to keep these settings, something like that, then we will let everybody know, but yeah, we have a slight lead -- a slightly odd set about the moment. bond futures are slightly higher, but so is the yen. that is not a set up we

necessarily expected to see. haidi: yeah, a lot of talk that investors still seem to think they are hearing from corroded, not -- hearing from corroded -- hearing from kuroda, not ueda. perhaps he is being extra cautious. >> the read through should be yen-positive, dollar-negative because it is another sign that the current policy mix is not really sustainable, so if you want to say that we need this policy mix until we get sustainable inflation because we are sure we will get inflation about target, inflation is picking up speed after going above target, so it is becoming harder to justify, especially as far as investors are concerned, the current settings. that being the case, that adds to the pressure.

it will be interesting to see what happens with bonds. jgb is getting a bit of a break because treasury yields came down overnight, but we will be watching to see if at 10-year yield hops above 0.5% again. we just got the comment coming out from ueda that is it's important to see wage growth in order to secure inflation. that would also seem to be coming from the corona -- the kuroda playbook. he is seen as being a bit more open to change than kuroda was. >> you contender your bloomberg for a lot more on this -- you can turn to your bloomberg for a lot more on this. let's get a quick look at the markets. annabelle: it is interesting.

garfield was just noting if we would excite to see the 10-year yield hit the upper limit again. we saw japanese firms offloading these bonds at a record pace over the course of 2022, and that was down to the expectation we would see some level of normalization coming through on the market, but what is interesting is we are actually seeing foreign bond purchases rising to their second-highest on record. investors favoring this asset class again are not going to see any policy normalization it seems for some time to come. shery: we will continue to watch the testimony from kazuo ueda, but that is it for "louvered asia." "bloomberg china markets" is next. this is bloomberg. ♪

♪

at morgan stanley, we see the world with the wonder of new eyes, ♪ helping you discover untapped possibilities and relentlessly working with you to make them real. ♪ because grit and vision working in lockstep ♪ puts you on the path to your full potential. ♪ these days, our households depend on the internet more and more. families grow, houses get smarter, and our demands on the internet increase. that's why we just boosted speeds for over 20 million xfinity customers, on us. so you get more of the speed you need for day and night streaming. more speed you need when you're work from homeing. and more speed you need as your family keeps growing. check in on your current speed through the xfinity app or upgrade to the speed that's right for you today.