dani: good morning.

i am dani burger along sign jeb bush -- alongside jennifer zabasajja. fresh data shows the services sector in china was as low as rates this year is in august. bloomberg economics says china may never overtake the u.s. as the world's biggest economy. lying low. philip lowe the governor of the rba these interest rates unchanged in his final meeting to warns that some further tightening your choir. -- may be required. country garden avoids a default with last-minute payments on dollar bonds. happy tuesday. it is great to be back on the show with you, jen. jennifer: it is great and thank you for having me. dani: you are a pro. you had the rains yesterday and everything was great but it should be a morning of relief. we have the u.s. dollar bond payment from country garden and goldman seeing a lower chance of recession.

someone should tell the markets that though. jennifer: we should see whether or not the u.s. will reflect that when they are back from labor day holiday. let's look at s&p futures at this point. we mentioned yesterday with the labor day holiday and we did not see a lot of activity but what we did see overnight was a dip from the s&p. just over 0.1%, and a sea of red at this point in time after relatively flat session. the markets were closed for the labor day holiday on monday, but after the boost that the markets got on friday from the jobs report, we will see whether or not the resumption of trading today after the long holiday weekend potentially gets things back in the green. at this point in time, not seeing next. dani: not surprising that we are giving back gains that we had from friday but i feel like there should be more optimism that is not reflected. maybe the bond market makes more sense in that regard.

treasuries, first daytrading of the week open lower, to losses. we are looking at yields barely higher on the front end. more movement further out in duration but we are up 1.5 basis points. maybe some of that is finally pricing out the cuts that are priced in. goldman's says it is less likely we will get cuts that the market is pricing in a given what the economy is doing. jennifer: let's get over to a wrong in singapore -- avril hong in singapore. you have been taking a look at this all day. talk to us about the equity picture for you are. avril: taking a look at this all day, and it looks like the negative picture that we started off with in asia has remained for much of the morning. the asia stocks are lower. a lot of the losses are coming in from the hang seng and that is because of the unexpected

decline in the caixin services pmi despite its remaining in expansion territory. that is raising concerns about the chinese economic recovery. chinese property stocks are lower today as well and that is despite hundred garden managing to avert a default and telling bondholders that has made payments on a dollar bond interest and that is a bit of relief, but not quite solving the issues in the chinese property sector. we also have the aussie stocks as well as the currency that are flat on the back of philip lowe keeping things unchanged at his last policy meeting. it is not just the titan services numbers that we are watching closely in asia. we also got hotter than expected inflation print out of south korea and the philippines and thailand. that is raising concerns that economists have underestimated the impact of higher energy prices and what that might mean for the global picture.

is this a scenario that will play out around the world? we are headed for a down day in asia stocks. dani: thank you so much for that. bloomberg's avril hong in singapore. let's get to our morning roundtable. we are joined by jill disis, lizzy burden and valerie tytel. we have to start with where she left off. country garden has told creditors that it paid coupons on two dollar bonds within the grace period which avoids the first default. jill, let me bring this to you. i may look -- i'm looking at a market that looks pessimistic and country garden shares are down 2%. as a crisis not over yet? jill: i think you are right. it is too soon to call the crisis over but it is good news country garden. they have paid back interest by 22.5 million dollars with bonds coming under the wire there.

i believe the grace period ended overnight tonight. they are really avoiding the potential default for now but remember country garden literally just last week reported a major loss for the first half of the year. they also still have several other repayments do before the end of the year and if you look at the pricing services pmi that avril just pointed out, a contributor to that sector is the property sector. it indicates to us that there is still pretty big concerns for the property sector here even if we had a reprieve right now. jennifer: what is it you are paying attention to her what is happening next? you mentioned another payment before the end of the year. what do you have dry on? -- your eye on? jill: can country garden continue to weather the storm they are in and what to do their look like next time?

is there turning of the tie-dye? i am looking out for a bunch of support measures that were announced china particularly for the property sector so you are looking at lowering down payments for mortgage rates and we are looking to see how much of that translate to a change in sentiment for the property sector. we saw good news over the weekend with home sales picking up in the wake of some of that mortgage rate using measures. at this -- mortgage rate using easing measures. there's a shift in the property sector and how much that helps developers and ultimately whether we see any further easing on the part of the government. several positive signs here and there but there is a long way to go. jennifer: definitely down to the wire. bloomberg's jill disis. thank you for your time and for joining us. bloomberg economics leaves china

is no longer set to eclipse the u.s. as the world's biggest economy soon. this is of course a difference from what we heard before. let's bring in lizzy burden who has more. what can you tell us? lizzy: we have had that reminder of chinese economic woes this morning and the shape of the caixin services pmi data weaker than expected even if it is still in growth territory. it is the weakest growth of the year. that has weighed on asian equities this morning but if you take a step back, as bloomberg economics has, this narrative that china inevitably is going to overtake the u.s. comes into question. actually, they say that is not going to happen until the 20 40's and even then, it is only by a marginal amount because you've got the structural issues in china, exports tumbling, the property was spreading across the economy and last year you saw the population in china dropped for the first time the

years. what was once deemed inevitable is in question. if you are an economist you can only work with policy measures on the table at the moment so you are betting that there is not going to be a bazooka which is a pretty big bets. dani: it is worrisome and is not like the u.s. is going gangbusters. what will pick up the mantle global growth? stick with asia. rba has kept rates unchanged at governor philip lowe's last meeting with the central bank warns that further tightening is to be needed. valerie, was is a snoozer of a last decision from governor philip lowe? valerie: it went as expected. most of us are wondering what kind of optionality will keep on the table for the new governor because he does step down in two weeks. he kept all the optionality on the table and said the rate because give them time to assess the impacts of rate hikes and that more tightening depends on how the economy does evolve. let of optionality there the new

governor and the rba. they held the cash rate at 4.1% and kept the threat of further tightening still on the table. there are economists that do see a risk of economic acceleration in austria's later half of the year tempting one more hike from the rba but it is looking like there on pause from here to the new governor takes over. dani: i feel like we have been ignoring the u.s., which is fine because they were off yesterday and they don't is a retention because it had a holiday. i want to point out the comment at goldman sachs because goldman has been more optimistic about the economy than most. they have cut their odds of the u.s. recession the next 12 months to 15%. previously it was 20% saying the change reflects continued encouraging inflation news, favorable real income outlook and decline in the jobs worker gap to just above pre-pandemic level. the fed and peers are set to cut

rates by less than what the market expects because a neutral rate should settle about the post gse norm and because activity remains resilient. the bloomberg poll is much meyer -- much higher than 50%. that is for recession odds. jill: the consensus for the year had ability as it stands on bloomberg is 60% so goldman is very much more bullish than the consensus on the u.s. economy. it comes at a time where many are expecting a slowdown in the consumer to really start to hit u.s. economic growth and that is because from september 1 we had the student loan forgiveness that start to roll off as consumer start to repay their student loans and they will be buying less goods and being less active spending money. a lot of us are expecting some sort of turn in the economy as we enter the fall because of those headwinds. goldman noting that the labor

market reports we got last friday was a good one for the fed and noting the progress disinflation without any true labor market pain opens the door to avoid a recession and that was emphasis on their call. jennifer: students are not looking forward to those repayments, myself included. let's look at events we are following today. we will have the ecb's inflation expectations survey. at 10:00 a.m. u.k. time, euro area ppi. dani: i'm looking forward to it later this afternoon we will get comments from the ecb executive board member isabel schnabel who will be chairing a panel at a legal conference. i'm interested in this because it was her comments last week that shook things up. people interpreted them as more dovish as we are worrying about stagflation. valerie: the one thing about her speech she drew attention to the ecb inflation asportation survey that we get today.

the market will be focused on that at 9:00 a.m.. it is almost the last day to print before the ecb convenes next week. we are not pricing in too much of an ecb hike next week, only 20% but if we get hotter than expected inflation asportation print in the survey, because she drove so much attention to it attempt the market to price and more for the meeting next week. dani: there is room to do that. that is valerie tytel and you can get a roundup of all the stories you need to know to get your day going in today's edition of daybreak. terminal subscribers can go to dayb on the terminal. jennifer: we will dive into markets including what austria's rate decision means for policy in the world's other big central banks. that is next. this is bloomberg. ♪

dani: welcome back to "daybreak europe." the rba has held its cash rate target .1% in the central bank did however warn of further tightening that may be needed to hit its inflation goal. joining us now is mliv strategist mark mandel. this was expected and is governor philip lowe's last meeting. can you tell me why we should care about an rba meeting where they did nothing as expected? mark: well, you should care because it is a lovely template for other central banks who may want to do a pause of their own.

i'm looking at the federal reserve and european central bank. he put all the arguments in place for a very neutral outlook and we were concerned about the data but have done a good job on inflation and we may need to hike again if the data tells us to do so. all those kind of things fits neatly into a package of somebody who thinks have done a lots of good work they would like to stay on hold for quite some time and let the economy catch up with rate hikes they have done. doesn't that sound like the fed and ecb? it is a pretty good message for the rest of the g10 that's maybe we will get a halt this month. it looks pretty exciting on the surface and may be the time september is over, all we've got is major central banks staying on hold. jennifer: let's talk about country garden because we were talking to jill earlier and she was saying they waited until the last minute and yet it was still big news for us this morning. give us a sense of how markets are reacting to this. is there excitement and is as

potential a change in the outlook and sentiment of country garden? mark: there is a certain amount of relief because it is better that they paid. the amount itself is relatively small in the context of the size of their outstanding, $22 million when you've got $15 billion of debt is not an enormous amounts. it is the beginning of the process but at least advise him sometime. obviously -- it buys them some time. if they missed it there will be threats default they may have to go into liquidation and it would be very messy and ugly. there's a lot resting on the fact that country garden stays intact and gradually works through its problems. it is good from that point of view but there is a lot of work still to be done. they are huge company, very important for the whole structure the property market in china. they are already asking for delays on their yuan on shore bonds. some have been delayed already and they're looking to extend evermore -- several more as well.

they may ask for something similar on dollar payments as well. it will be a long process but at least this is a positive step we may see more relief in equity markets in asia this afternoon but don't be mistaken, this is a very big problem and it is not just country garden. there are other property developers in similar struggles and there is a long way to go. dani: again, the market not reflecting any of that hope at this moment. hopefully we see that come through and we could use the news. i want to ask about the bond auctions that we will get from japan this week. i was reading the credit agricole note saying the boj likely will not exit yield curve control until 2025. who is still buying this market? who was present at these auctions when already, the government owns it so much of the japanese jgb market? mark: like any major economy, you have a domestic base does

not have a whole lot of choice particularly if you are a life insurance company in japan, you need to have long duration. you have a sudden flow of money, you need to reinvested somewhere. if 10 year jgb's for all you have, that is where you put your money. what makes a difference to the market course is the new money that's people that can choose between equities and bonds going overseas or staying at home, those are the guys that make a difference. certainly, although this auction went through without any big problems, if you look deeply at what happened, a lot of the bonds are issued at the lowest price. that is not a great sign for the auction. there's another 30 year coming up later this week that will be more difficult, the tail end of the steepest part of the curve is not always easy. there is less demand. it will be tough week you had the bank of japan meeting coming up later this month which most people consider to be a light meeting in the sense that they may tweak policy again. at the same time, we have a good

macro view out today from our colleague in tokyo saying even the unpopularity relative unpopularity of the japanese government, even that may weigh on bank of japan policy as well. there's a lot in the mix and japanese bonds will have a turbulent week. jennifer: thanks to bloomberg and why strategist mark cranfield for that update. coming up, it could be a $1.3 trillion problem. 3.5 years after covid sent office workers home, the commercial real estate market is counting the cost. we will take into that story next. this is bloomberg. ♪

>> india, home to a now record 1.4 billion people, more than half under the age of 30.

but that also includes a large number of jobless youth anywhere in the world. the fastest growing large economy in the world, india has the third highest number of billionaires but on per capita income, it ranks at the bottom. the widening gap between the richest 10% in the bottom 50% makes india one of the most unequal company -- countries in the world. democratic english speaking india with an army of software engineers has started to become a major economy since its economic liberalization in the 90's. authoritarian china has made boulder moves to become five times bigger. so why might this be india's moment? one big reason, it is not china. policymaking in beijing nowadays remains hard to predict. western countries are wary of china's growing economic and technological clout.

international companies are seeking supply chain diversification, china plus one. to speed that along, india's government is spending record amounts on the structure and offering production incentives to key industries. other reforms range from a unified national sales tax to a world leading digital payments system. bullish investors and stockmarkets highs have burnished english story and that g20 presidency. i mr. narenda modi holds that will set the stage for his reelection next year. it will also test whether the most indians are buying the india shining story or not. dani: bloomberg's menaka doshi there in mumbai. let's get a check in the commodity action because i have been banging on about this all day. if you like it should be positive but has not been. look at commodities.

iron ore singapore is on a five day winning streak, the biggest five-day gain, almost 10% since december. that is where you are seeing china optimism come through but the mliv blog has a great piece saying this is just a downturn delayed. jennifer: we are taking a look at oil because it is holding for the most part. still trading at the highest level since mid-november. what we saw this morning is just about $89 a barrel after a five day surge. we have wti crude just about $85 right there. we have seen oil rally since june since we heard those potential cuts from saudi arabia and potentially russia and the coming days, there is that patient we might see more of that spirit we could -- more of that. dani: one other thing before we go to break, i want to cover the big take.

it is the return of the work from home. everyone wants their employees to come back to the office. it makes americans sound antisocial. americans are more productive at home and in asia everyone was to come back to the office for socializing. survey after survey says americans don't care. jennifer: it is interesting because you don't inc. about how different it is depending on which region you are in. i live in south africa and i am american so seeing the different variations of what people are doing but what is interesting is what people actually do after labor day. this is a time when people get back to a normalcy after the summer holiday. i wonder whether or not that will work to get more people back into the office. dani: there is a lot at stake. $1.3 trillion according to mckenzie could be the loss and real estate value by 2030. in london, jp morgan says office buildings could lose 1/5 of

their value of the year through march. jennifer: that is not something people want to see what the fact that there is a lot of variations to the kind of workers and some don't have the option of working from home. it depends on who you are looking at and -- dani: we don't have the option. jennifer: you have people who have to be in the office have to do hard labor and things like that. there are different variations. coming up, the rba keeps rates unchanged at governor philip lowe's last meeting. we will have headlines driving the market this morning next. this is bloomberg. ♪

>> this is bloomberg daybreak: europe." these are the stories that set your agenda. indented chinese developer country garden avoids what would be its first default with last-minute payments on to dollar bonds. fragile china. fresh data shows the services sector expanded at the slowest rate this year in august. bloomberg economics says china may never overtake the u.s. as the world's biggest economy. and lying low. governor philip lowe leaves australia's interest rates unchanged but warns some further tightening may be required. good morning to you. dani: good morning. still waiting for any optimism to show up in this market. i just want an optimistic day. the americans are back. the stock market is not even rallying. the futures, usually we get that. even bonds are selling off. let me take you straight to what the 10 year yield is doing or

the front end. of the curve. . i'm not sure which one we have. there we go. the tv screen has decided the two year yield is looking at gains or rather the price is looking at losses. higher by 1.5%. we saw a selloff in the european session yesterday. it is the will they won't they of the ecb next week. inflation is bad but the economy is also bad. we have priced out rate hikes from the ecb and the fed. perhaps a little bit of hedging because it is not a sure thing at this moment. dani: -- jennifer: i don't know if this is going to make you happy. s&p futures still a little bit flat from monday. but down at this point in time after we saw the flatness yesterday. we did see asian equities retreat for the first time in seven sessions. the americans are back after a long holiday so markets were closed but we did see last week the jobs report really give a boost to the market over there. the question now is whether or not there's going to be a

turnaround in the markets ahead of. this week. we get fed speak so maybe we will see some green this week. right now not looking like that. >> we are about to enter a fed blackout period. it's check on how the asian markets are doing. get over to avril hung in singapore. what do you have for us? >> a lot of negative sentiment in asia-pacific stock markets. stocks are falling to the msci asia-pacific for its first day of losses in seven sessions. a lot of these losses are being led by the hang seng on the back of tyson services pmi data which disappointed despite remaining in expansion territory. this is raising concerns about the chinese economic recovery. but we don't just have our eyes on the numbers of china. we also had inflation data out of south korea. the philippines. and thailand. all hotter than expected,

raising concerns that economists have underestimated rising energy prices and the impact that might have on inflation in these respective economies. more globally as well as the scenario that's going to play out around the world. case in point we had the rba governor philip lowe saying more tightening may be needed despite keeping things unchanged for now. so down day in asia-pacific stocks. jennifer: we also have our eye on country garden. is that the outlier that changes things for the markets? >> it does not look like it. despite it managing to avert a default, it has made payment on a dollar bond within the grace period, the sense is that this is just delaying the inevitable potentially as mark pointed out earlier. we have 22 lien dollars but that is a drop in the bucket compared

to the billion dollars in liabilities this distressed property developer out of china has. even our colleagues at bloomberg intelligence believe the making of the payment for now averts a default but that is not going to help it avoid the downward spiral overall in country garden because also it has a huge number of projects and there is a looming risk of construction holds on these projects. we are seeing losses in property stocks out of china as well. jennifer: let's stick with country garden. we mentioned this, once china's largest developer by sales has avoided what would be its first default telling creditors it's paid coupons on to dollar bonds within the grace period. joining us for more his bloomberg opinion's surely rehn in hong kong.

people are wondering whether or not country garden actually has enough leeway. we've talked about how this was at the last minute, and potentially not enough to assuage concerns. can country garden based on your opinion crawl out of its debt crisis? what does it need to do? >> at this point, no one really knows. what country garden is doing is buying itself time. hoping for the best. what happened was there was a very drastic shift in the chinese attitude toward the housing sector. for that the government said one city, one policy. all the easing measures were minute. last week the government said nationwide it is lowering the minimum payment ratios. that is very significant. it is the first national policy

change in almost a decade as far as i see. maybe country garden is just hoping the physical market will turn around and we will have a few months to recover. dani: is that the only hope? that the physical market recovers? is there any hope if it does not? >> it really has no other options unfortunately. the chinese government does not want to reopen the refinancing windows or pick up country garden's 200 billion liability bill. no. i think country garden's only hope is a pickup in the physical market. dani: thank you for joining us. shuli has a great bloomberg opinion piece out on this. shuli ren. let's turn now to natural gas. chevron lng workers have threatened two weeks of 24 hour rolling strikes at two major

export plants, that would start next week. chevron's president spoke from the gas tech conference in singapore today. >> we are committed to find a solution. we want to find a win for chevron, a win for our employees, and a win for the gas market. >> let me follow up on that. to give our global audience perspective on how heated the rhetoric is. this is a quote from the offshore alliance when they made a statement. claims chevron will ultimately agreed to, but not before they lose a few billion dollars judging by the -- which is ok as chevron have plenty of loose change in the piggy bank. do you have any timeline as to how quickly you are willing to resolve the standoff? >> if i go back and really just

repeat what i said before, there are active conversations, there is active dialogue. i'm not going to comment on things on the edge. but to say that we are really committed to find a solution here. we want to find a solution and we understand you have to get a space that is a win for various parties. it has to be good for our employees and for us. all of that will be good in the energy market. that is what we are committed to doing. jennifer: chevron's president for midstream speaking there. let's turn to the ukraine situation. vladimir putin said he would not revive a deal to safeguard the passage of ukrainian grain through the black sea. wheat rose. joining us is maria tadeo who has been all over this. no deal came out of this meeting but did anything actually come out of this? there was a lot of hype around a potential breakthrough in the standoff. maria: there was a lot of hype

because president erdogan is one of the few international leaders that still gets face time with vladimir putin. we have seen isolation from the west of the russian leader. president erdogan with a face-to-face meeting, becoming unusual for vladimir putin. not to say that erdogan can influence vladimir putin but certainly maintains a level of clout. this meeting, the expectation, the hope is that erdogan would convince vladimir putin to reinstate the green deal, the black sea initiative. it has been credited for exporting more than 30 million metric tons of grain. the reality is there was not a lot of content out of this meeting in terms of the specific of how to revive and reinstate the deal. vladimir putin said he's willing to talk and he is willing to listen to solutions. president erdogan conceded that the united nations will have to listen to some of russia's demands but not a lot has changed. the bottom line here is russia

believes the sanctions that have been implemented on some of its food products but also fertilizers would have to be removed for the time being. it's not clear whether that would happen. the russians said they would give turkey one million tons of grain. they said qatar could get involved in this. it is nowhere near the deal in terms of total tons out of the black sea. there was a lot of hope and hype into this meeting. the specifics, not a lot. dani: there's also been attacks on ukraine sports. -- ukraine's ports. where do we stand on the counteroffensive? maria: you see pressure still on ukraine. clearly we have seen the big changes that took place in the defense minister, a new minister coming in now. we have seen those changes. this counteroffensive, also, some major breakthroughs going on in the country but not to the

speed or the extent western allies would hope to see for the time being. . nonetheless yesterday when we spoke to an advisor to president zelenskyy, he did say it takes time. it's not a hollywood movie but the results would be there. let's take a look. >> we have another very important counteroffensive, which is going on. this is not a hollywood movie. we would not completed in one day. the president is making his decision. we are hoping that the tempo of the counteroffensive will be increasing. ukraine needs significant resources soon. maria: that was an advisor to president zelenskyy yesterday talking to bloomberg. he says the country hopes they will increase the tempo of the counteroffensive. a lot of that has to do purely because of the weather. we know in a few months that

winter effect will begin. it is difficult to move the front line especially when you have difficult weather conditions. ukraine does feel this pressure to be able to shift that frontline before the winter weather arrives. jennifer: thank you for joining us. let's turn to get bond -- gabon. the new military leader has called for an overhaul of opec after being sworn in as transitional president less than a week after soldiers overthrew the former president. he pledged to restore civilian rule after an unspecified transition period and said he had the goal of giving, quote, everyone a reason to hope for a better life. dani: coming up we are going to dive into the world of private markets. bloomberg reveals cbc is nearing a deal to buy -- capital

partners. we will discuss the outlook for the industry. this is bloomberg. ♪

dani: bloomberg has learned that cbc is nearing a deal to buy infrastructure investor fif -- dif capital partners. we are expecting the private equity firm could announce a deal as soon as today. is this the long-awaited return of private capital deal flows? or just cvc, a giant, getting a deal? here to discuss the industry is the global head of private capital advisory of raymond james. so great to see you, great to have you in the studio. i feel like so many people -- you and i were both at the super

return earlier this year. everyone said post-summer the deal flow comes back. is there any chance? >> there is the deal you announced. private equity owners of companies that would want to go out and buy assets through m&a, somewhere between half and two thirds of the entire volume globally, have been on hold or on hiatus for quite some time. almost a year. they cannot go off deployment for so long. at some point they have to go back and start buying companies and selling companies. private equity runs on a plot. four years to buy and invest in companies. sometimes five. four or five years to sell them on. you can take a pause but you cannot go on hold. >> we are trying to see what the fed is going to do next. talking about rate cuts potentially coming next year, what is it that companies need to sustain where the market is at?

>> for the longest while the market needed stability. the debt underwriters, steals required debt underwriting whether it is any kind of business that wants to get sold, needs to be able to show the debt markets are functioning for the new buyer to finance the acquisition. those markets needed some kind of interest rate stability to underwrite debt. we had news flow coming out of banks saying i cannot underwrite if i do not know what terminal rate is. we know where terminal rate is. it is close to where we are today, may be higher, but not double. that is not where the signals are for the market today. so we are seeing debt being underwritten in europe and the u.s.. it's expensive. buy an asset that is outpacing the cost of your debt. but it is available and that matters. dani: but in this world where the cycle is not perhaps picking up where it should be, investors want money back. is anyone in this world willing

to commit new capital if already what they invested is not coming back to them? >> there are lots of people willing to invest capital. there is three point $7 trillion in private equity commitments. -- 3.7 trillion dollars in private equity commitments. we are nearly at $800 billion raised. if you look at the capital coming into all kinds of private markets, it is still high. not its high watermark, but high. if i had to pick three or four areas were investors are continuing to invest, it is private wealth. private wealth as we can all agree over the last decade has come into its own. platforms have been burgeoning around the world and they are looking for diversification away from equities and fixed income and commodities and doing private markets that way. we are also seeing that for middle eastern investors, insurance companies, all of them remain big investors. jennifer: the goldman chief

economist was saying 15% change the u.s. will slide into a recession down from 20%. do you agree? or do you think it is premature to make that call? >> probability is going down i guess. a member in march when we were talking about crash landing scenarios? to think of the journey the markets have been on, it is quite something. we are thinking about soft landings, potentially no landings. i think the picture looks a little bit stable or -- stabler today for the short term than it did any other point this year. if we said s&p would be up 17% earlier this year we would not be very happy and take that and run. on the economy we have to wait and see with the long-term picture holds. services based inflation and goods inflation, it's hard to write that off. that we are fully in disinflation especially when it comes to services driven by wages and labor. labor has bargaining power. it is hard to think about if you break down the components of

inflation how services inflation goes the other way. it is not going to come down from here. dani: it is a good point and it would be so of the past few years for everyone to get comfortable with inflation coming down just to see it react seller. does that mean -- to see it re-accelerate. does that mean you see continued appetite for risk assets and question that and say we have not hedged enough? >> yes, there's a lot of wanting to -- creating your own reality is what you would say. let's hope that is the case and leg into it. that is what the summer has been about. the jackson hole speech was supposed to put a damper on the markets. there was nothing new. the markets took that is good news so the party continues. that is fine but the caution to the wind is what does the long-term picture look like in terms of supply chain but also services pressure, which is a huge component into inflation in the you can the u.s.. jennifer: thank you for joining

us. plenty more ahead. this is bloomberg. ♪

jennifer: welcome back to "bloomberg daybreak europe." valerie, what is on the mind of the markets? >> you have mentioned the fact we have this country garden dollar bond payment has failed to lift risk sentiment. given there was so much optimism about the chinese property market, lifted u.s. equity markets until around the close. i find it surprising we are not getting any reversal of this weakness we have seen so far this morning. maybe markets are already looking ahead to what else we are expecting. for europe the key data printing is going to be this ecb inflation's expectation survey.

normally it is not a huge print for the markets but the fact that there was a specific hawkish member on the ecb governing council who drew attention to this survey, many are seeing this as the last big data print before the ecb convenes next week. perhaps erasing the six basis points priced in for next week. or it may be adding to it if we get some higher-than-expected inflation expectations. dani: i have talked to a lot of economists who do not by a pause. 5% to 6% range inflation, how can they afford to wait? today is the first day we have everybody online. the u.s. is back. treasury cash markets will be trading. what fresh horrors await this market? >> the beginning of september is one of the busiest months for corporate bond supply. not just in the u.s. but also here in europe. the tuesday after labor day is one of the busiest days. last year they sold $35 billion

worth of investment-grade bond issuance. might be a headwind for the treasury market this week. you can see a reason why the u.s. corporate's might want to frontload this supply in august for the beginning of the month. we had a fed meeting later in september and then in mid-september we have an inflation print. there is going to be a lot of corporate's trying to jump the gun, issuing debt this week, this early week in september to try to get ahead of the volatility events. we have been seeing steepening in the long end of the curve. the weakness in long and treasuries. perhaps this could be another kicker to take the weakness lower. keep an eye out when the u.s. does open for those big bond issuance announcements from u.s. corporate. dani: we are already getting bear steepening coming into the market. it feels very of the moment. jennifer: go ahead, what were you going to say? >> we did see a lot of that after friday's payroll print.

a lot of head scratching over why we saw such a weakness in the bond market after such a goldilocks print for the fed. maybe a lot of that was traders making room for this heavy bond supply. but again expectations could be beaten today when we hear these issuance announcements at the u.s. open. dani: it seems like a market from the report. i don't know -- a market friendly report. i don't know. jennifer: we are going to speak to the bank of israel governor after the central bank kept its benchmark rate unchanged for the second time in a row. do not miss that interview. dani: we will do it again tomorrow. up next is markets today. this is bloomberg. ♪

(jennifer) the reason why golo customers have such long term success is because we focus on real foods in the right balance so you get the results you want. when i tell people how easy it was for me to lose weight on golo, they don't believe me. they don't believe i can eat real food and lose this much weight. the release supplement makes losing weight easy. release sets you up for successful weight loss because it supports your blood sugar levels between meals so you aren't hungry or fatigued. after i started taking release, the weight just started falling off. since starting golo and taking release, i've gone from a size 12 to a 4.

before golo, i was hungry all the time and constantly thinking about food. after taking release, that stopped. with release, i didn't feel that hunger that comes with dieting. which made the golo plan really easy to stick to. since starting golo and release, i have dropped seven pant sizes and i've kept it off. golo is real, our customers are real, and our success stories are real. why not give it a try? it's an amazing thing when you show generosity

of spirit to someone. and you want people to be saved and to have a better life, then you don't stop. the idea that we have saved five million people's lives, it's overwhelming. it's everything.