that first time you take a step back. i made that. with your very own online store. i sold that. and you can manage it all in one place. i built this. and it was easy, with a partner that puts you first. godaddy.

shery: welcome to daybreak: asia. we are counting down to asia's major market opens. haidi: asian markets are set for a cautious open ahead of the fed, with bets piling up on higher for longer rates. treasury yields are getting some of their highest levels since 2007. oil prices giving u.s. housing makers a headache before wednesday's fed meeting adding to inflationary pressures while curbing growth. indonesia pushing it critical deal with the u.s. as the green transition accelerates. we hear exclusively from their president. shery: the newest futures muted as we saw stocks and bonds falling in new york. the s&p 500 down to a three week low. it is the eve of the fed rate decision and the bets are that central-bank policy makers will deliver. a hawkish hold. . of course we have higher oil prices and you can cwt i at the moment above $91 a barrel. brent just touched $95 a barrel

at one point. every time we have had surging energy costs we have seen the u.s. tip into a recession in the mid-1970's, in the 1980's and 1990's as well. you can see how we are setting up broadly with what we can expect from the fed with traders also thinking about the hot canadian inflation data we got when trying to figure out where the fed goes from here. we had treasury yields rising across the board. five year and 10 year yields hitting highest since 2007. oil prices still high, but well below their 2020 highs. this latest search as posing risks of the fed's efforts to engineer a soft landing. our reporters join us here in the new york studio. let me start with you stuart. we are expecting a hold wednesday from the fed but what happens if oil prices continue to move higher? >> if oil prices continue to

move higher we are going to see another surge in headline inflation. we saw the same thing in the headline -- at that time we were looking primarily in the quarter and what was most notable to us is new car prices continued rising. something that is interest-rate sensitive continued rising. you can expect the fed will keep its foot on the brakes if it sees any surge in inflation but particularly any consequences of oil prices trickling in in an inflationary sense. higher energy prices will be the headline, but most important to the fed will be the quarter. shery: so what are we expecting from oil prices from here on out? su: it seems productions for $100 oil are coming in left and right. even from some of the more bearish analysts over at citigroup and we heard from the chevron cdl yesterday that $100

oil seems around the corner. you look at the year-to-date gains which have been significant for both west texas intermediate and brent, and the ignition in this run-up had a lot to do with the saudis and russia, the two key members of the opec-plus oil cartel, extending voluntary curbs through the end of the year. the latest upswing has been marked in major moves in what is called time spreads. some of the market's most widely tracked gauges. for both brent in west texas intermediate, we are trading in backward is asian. that is a very bullish pattern. the front end is a lot more expensive than the backend. there is about one dollar difference. traders and burgers say this happens as premiums for real-world barrels soar higher and that is what we are seeing in the u.s. oil's relentless surge also went even higher after on monday.

we heard from the saudi oil minister in a conference in canada they are working to keep markets stable. many translating that is they are doing everything they can to keep prices high. they say the output -- their output plans will be reviewed every month. so again, the near-term direction looks like we are going right at $100 once again. haidi: bloomberg has learned a single firm is behind the recent price run-up when it comes to physical barrels? su: yesterday we reported the most recent run-up has a lot to do with the fact that the physical price is -- prices being paid for crude is off the hook. sources are telling us that tested with one firm in particular called atlantic trading and marketing. it is the trading arm of the french firm, total energies. and they have been bidding up u.s. physical crude markets, according to people close to the matter. many say this is a sign of the

fact the refining margins at are an enormous premium, and that is what is driving competition. but you have the physical market moving higher, complicating the futures market also moving higher. the trading on oil futures is relatively paper trading, but the physical receipt of the oil is something many countries, for instance, u.s., asia and europe, depend on. they tend to look at the u.s. as an oil market of last resort but they are now being priced out of the market if they want to use u.s. oil. these charts are as bullish as they come, and that exacerbates the pressure on president biden who had promised he would keep gas prices down. you can see we are looking at some of the highest gasoline prices seasonably in a decade, and that tends to proceed a recession. again, a lot of concern about this runaway rally. back to you. haidi: stuart, how much to be

expect energy prices to show up in headline inflation when we get the september cpi print? stuart: one thing we need to keep in mind is it is the rate of change of prices that will matter the most for inflation, not the levels themselves. so while gasoline prices are basically decade highs on a seasonably adjusted basis, the price level has not changed that much month over month. the average gasoline price in august was not that different from the average price in september. it is the seasonal adjustment factor that makes all the difference. we are expecting to see about five basis points of tailwinds being contributed by gasoline prices in the september cpi print. that pales in comparison to the august print, which was about 40 basis points if you include not just gasoline but diesel as well. shery: so the oec, we had them come out with global growth prospects and they are telling central banks that they should remain restrictive. so what can we expect went at

the same time we continue to see perhaps global growth taking a hit because of higher rates? stuart: so, it sounds as though there are mixed messages coming from the oecd. on the one hand they are saying growth is started to crack up a little bit and higher energy prices play into that. lower energy prices supported real spending on other things. high energy prices are going to start taking away from consumer's ability to spend on real goods and services. we see growth headed in one direction, risks are skewed. at the same time, we have higher prices, particularly energy prices, and to suppressed demand overall. and to continue weighing on inflation, the oec recommends to central bankers they keep their foot on the brakes and keep monetary policy type. -- tight. haidi: on the impact of higher

energy prices. in addition to the fed we are also looking ahead to the bank of japan, where we are expecting governor ueda to sound hawkish to rein in the moves we have seen in the end. we are hearing from japan's currency chief speaking about the prospect of intervention, saying that the excessive yen moves are not desirable, that they are keeping in contact with overseas authorities, especially when it comes to u.s. treasury. these comments coming as janet yellen said any intervention by japan to prop up the currency would be understandable if it was aimed at smoothing out volatility and not affecting the level of the exchange rate. we're hearing from japan that they are not ruling out any options and will take appropriate steps on fx. and they are watching the situation with a high level of urgency. say they are communicating with their u.s. counterparts every day and the two countries share views. so that statement from janet

yellen, according to our colleagues, imply the secretary will not stand in the way of any kind of japanese intervention in the yen. so we are on alert. but heading into that boj decision, bloomberg economics certainly expects that suddenly hawkish tone to reign in the yen depreciation that has made it harder to sustain the current settings that the boj has in place. getting to another one of our top market stories, instacart has racked up a 12% trading debut gain after one of the year's biggest ipo's, taking the value of the company to over $11 billion. katie roof joins us now. so how would you assess this debut? katie: sure. it popped at first. it had a pretty big pop of maybe 40% and closed the day just over

10%. a lot more muted of a pop, but it priced at the top of the range of $30 a share after they had raised the range. in other words, it went better than what they were initially hoping several days ago. but it's lower than the valuation they had in 2021, a lot lower than that. but around the $13 billion where they were valued last year. they had a $13 billion internal valuation. shery: we are seeing more ipo activity recently, right? whether it is arm or clay video, which just priced its ipo. katie: they are another tech ipo based out of boston that will be debuting when the market opens. arm is a really high-profile one that went public last week. all of these are profitable. there has been a perception that public tech and vectors -- investors care more about profitability than before.

previously they were more focused on the rate of growth. these tech stocks went down a lot. and so the companies coming to market right now have different finances and also they have a lot of anchor investors. so they are taking a different approach this time to try and open the window. shery: katie roof there. heidi. haidi: take a look at all of this playing into the set up when it comes to the start of trading in asia. we saw u.s. markets struggling as we get into this fed decision. of course that extra volatility element of what energy prices staying at this level, even climbing further into $100 a barrel, what that will do to headline inflation and feedthrough to perhaps the higher risks of more moves, more timing from the fed, and rates staying higher for longer. that is the risk we are dealing with an australian, even as we see don -- we still see the potential for some gains when it comes to

those energy majors, the oil producers listed in sydney. some of those heavyweights would likely benefit from this continue to climb in crude prices. new zealand seeing downside of about .2%. when it comes to the broader economy, maybe some good news when it comes to the gdp numbers. looking to increase by about .4% for the three months through june. so emerging from that recession, but still a second recession is being forecast by the rbnz as we get into the start of the third quarter. so, in terms of japan, we just went through some of the remarks from the currency chief. so on intervention watch following on the back of what we heard from janet yellen overnight. nikkei futures looking pretty weak at this point. china futures, we saw that fall when it came to u.s. to chinese stocks overnight. we are seeing quite a bit of depressive sentiment there still prevailing. we are also watching the chinese banks looking to publicly lower that rate on the one year opr

after resolve the divergence between what the pboc's rate was, as well is what the chinese backs were doing. that is likely to be a catch up move in that fixing later on today. in terms of that broader theme though, really is waiting for the fed, and really looking at this implication of higher energy prices. shery: high energy prices. a very tight labor market as well. which is really leading to these stoppages in work when it comes to those strikes we continue to see, whether it is in the auto sector or writers and actors as well. but of course this is as we continue to see a very challenging global market. we will discuss with gilbert houngbo who joins us later this hour. first, stonex says a soft landing scenario remains challenging for the fed, with inflation set to remain sticky. their chief market strategist

joins us next. this is bloomberg. ♪

>> europe is slowing down. >> we are at the beginning of the biggest ever recalibration of the economy that we have had in history. and an unprecedented rate of speed. >> the increase is for sure. that is why there is such an attraction around private debt. >> for private debt, the levels of the fault will be very low. unless your assumption is that we go through a very three severe recession, there is not -- >> it's a reasonable expectation for europe over the next year to have pretty muted performance. >> the fact we have seen a few reactions compared to two years ago is plausible. with this recalibration we

talked about, you expect people to pause a bit. i do not think we will see record level transactions again in a few quarters time or exceeding that. >> there is no doubt inflation is impacting our portfolio. recession is coming. the question is when and what magnitude. haidi: some of the executives we spoke to at the private equity conference in paris. our next guest says week could easily see a reseller ration of inflation. joining us now is kathryn rooney vera, chief market strategist at stonex. great to have you with us. the energy piece really kind of throws a spunner in the works. should we be assuming the possibility of a soft landing or a no landing whilst achieving the fed goal is looking more challenged? kathryn: it certainly is, with the resurgence we have seen in the price of oil. i think you can also see that

expectation being unwound of the fed cutting pretty aggressively and soft landing, and kind of this whole wonderful, beautiful, rosy picture all panning out for 2024. you can see that in the appreciation of the dollar, none of which of course is good for the emerging market space. going forward to 2024 to get inflation back to the 2% target, the fed will have to pause for an extended period rather than cut, which means the dollar probably has a bit more broadside. returning to the e.m. space, which i think is what you focus on in your show, is the worst scenario for the emerging markets is with a high fed rate, a strong dollar, and potentially the u.s. sliding into recession. so 2024 i think will bring a lot of difficulty, and investors would be wise to engage in what i call countercyclical portfolio policy at this juncture. haidi: how are you positioning then at this point?

kathryn: for people that have not had defensive equity positions, i like them. staples, health care, energy have been my topix this year. -- been my top picks this year. utilities as well. i like cash. in the short-term, tips are attractive. i think the market is buying into this idea wholesale for some period of time for a no landing scenario. which, reality bites. if you look at historical probabilities, the probability of landing this no landing or soft landing scenario is historically low. so i think that it would behoove investors to buy protection on their technology holdings, when volatility is very low, hold some cash and gold, get into the defensive sectors, and look at the tip option.

because the fact is if you look at real yields versus nominal, the markets continue to price this non-inflation scenario going into 2025. shery: we saw also this year consumer discretionary stocks returned the broader s&p. does this mean we should be turning away from consumer facing stocks? kathryn: yes, if you get a downdraft in consumer demand and you get this story play out, which i think has a higher than discounted probability, which is that the fed stays on hold for a much longer period of time than is currently discounted. that will be bad for the consumer, especially if you are get what we are already seeing, a rollover in the labor market. what keeps consumer confidence high? people have jobs, and they are earning wages that finally, finally in a couple recent data points, are above inflation. wage is positive, 401(k)s are

looking good, people have jobs. once those things change, you get a drop in consumer confidence. and i think those interest rate sensitive sectors such as consumer discretionary, such as tech, could see a retracing going into next year. shery: we continue to see nasdaq futures attracting bearish flows. what about the ipo market? could we see more activity after the healthy debut of arm? today we had instacart also jumping 12%. kathryn: yeah, i mean, right now everything is still looking pretty rosy. i think going into next year though, the tables will turn. i think there is going to be a lot more risk aversion, as i say the fed holds for an extended period of time. so if we get 5.50 in terms of the terminal rate and a soft landing, that means the fed is probably going to have to increase rates rather than decrease rates.

because my view is that going into the next 24 months, the fed is going to have to face a decision between 2% or breaking something, specifically consumption. shery: are you concerned that factoring in a potential government shutdown later this year? kathryn: that is certainly going to play into risk off appetite. i think the other thing that very few are talking about is of course the fiscal situation. an election is coming up next year with fiscal deficit at about 8% of gdp. that in and of itself is inflationary. when you combine that with the prospects of the markets retracing its more bullish view with the prospect of fed hikes, the impending government shutdown, which i think is going to happen. but i do think it makes sense to protect those long risk positions and make your portfolio more defensively positioned. shery: kathryn rooney vera, great to have you with us, chief

market strategist at stonex. you can get a roundup of the stories you need to know in today's edition of daybreak. terminal subscribers go to dayb , also available on mobile in the bloomberg anywhere app. you can customize your settings so you only get the news on the industries and assets that you care about. this is bloomberg. ♪

♪ is it possible to fall in love with your home... ♪ discover the magnolia home james hardie collection. available now in siding colors, styles and textures. curated by joanna gaines.

shery: let's check in on some of the top corporate stories this morning. amazon is planning to hire 250,000 logistics workers ahead of the holiday shopping season, a jump from last year's quota. these will span a variety of roles including part-time and seasonal. amazon will also boost pay. the announcement comes even as some analysts expect overall

holiday hiring to stay muted. the managers of bankrupt crypto exchange ftx are suing the parents of cofounder and former ceo sam bankman-fried. the company accuses them of receiving millions of dollars at the expense of its victims. ftx fell apart last november with $8 million in debt in what prosecutors allege was one of the largest financial frauds in u.s. history. consumers accidentally caught a glimpse of microsoft's future videogame plans after the tech giant mistakenly provided confidential information to federal court websites. the details were part of the ftc's antitrust suit against its takeover of activision blizzard, including unannounced games in a refreshed xbox console. the information has since been removed. take a look at how treasuries traded in the new york session. we saw the selloff resuming today and extending following canadian bonds lower after we got that very hot canadian inflation data and traders

trying to figure out what the fed will do, as we see global prices continuing to accelerate. we saw five-year and 10 year yields hitting the highest since 2007. and we're watching the bond space across asia as well to see if we follow treasuries in the asian session. coming up next, the u.s. commerce secretary says there is no evidence china can make advanced chips at scale after huawei's latest phone shakes up washington. we will get the latest on this, next. this is bloomberg. ♪ so... i know you and george were struggling with the possibility of having to move. how's that going? we found a way to make bathing safer with a kohler walk-in bath. a kohler walk-in bath provides a secure, spa-like bathing experience in the comfort of your own home. a kohler walk-in bath has one of the lowest step-ins of any walk-in bath for easy entry and exit.

it features textured surfaces, convenient handrails for more stability, and a wide door for easier mobility. kohler® walk-in baths include two hydrotherapies— whirlpool jets and our patented bubblemassage™ to help soothe sore muscles in your feet, legs, and back. a kohler-certified installer will install everything quickly and conveniently in as little as a day. they made us feel completely comfortable in our home. and, yes, it's affordable. i wish we would have looked into it sooner. think i might look into one myself. stay in the home and life you've built for years to come. call... to receive $1,000 off your kohler® walk-in bath. and take advantage of our low monthly payment financing.

haidi: the threat of a first

default continues to loom over country garden. the chinese developer past initial deadlines to pay dollar bond interest. the builder had to pay $15.4 million by monday. by tuesday, they said they had not received the payments. there's a 30 day grace time before a default can be called. gina raimondo's casting doubt on the country's ability to build advanced chipset scale after huawei's latest was found to have an of -- and advanced seven millimeter chipset made. stephen engle is in hong kong. the u.s. has launched its own investigation into the chinese chip. we've heard from a number of analysts that there's quite a bit of doubt over whether they can do this at scale. that's an entirely different challenge. stephen: absolutely.

this is something that gina raimondo brought up overnight. she said she was upset when that new huawei mate 60 pro with the new chip inside of it, the seven nanometer technology, she was upset when it was launched coinciding with her trip to beijing. whether that was a coincidence or intended, i will let the viewer decide that. essentially, this raises questions about the efficacy of a u.s. led global campaign to prevent china's access to cutting-edge technology. because the united states alleges that they could potentially get into the hands of the chinese military. this chipset is the latest smic chip to use this latest technology. gina raimondo telling that congressional hearing that she has doubts whether huawei can

build these kind of chipsets at scale. we are -- this is her quote. we are trying to use every single tool at our disposal to deny the chinese the ability to advance their technologies in ways that can hurt the united states. you are seeing this tear down of the mate 60 pro by tech insights that was conducted for bloomberg news. that set off a lot of speculation as to what the united states might do to potentially tighten its export restrictions. last week, a group of republican lawmakers demanded the commerce department to fully cut off huawei and smic from u.s. suppliers. they say u.s. sanctions are not effective and are urging even tighter restrictions. shery: the chinese foreign minister wrapping up his visit to moscow today.

what do we know about what was accomplished? stephen: the readout from the chinese side. in his meetings with his counterparts and other officials within the kremlin in moscow, essentially that beijing and moscow are going to increase their strategic cooperation. defense and you could say security cooperation. that is ahead of vladimir putin very likely heading to beijing next month for the 10th anniversary celebrations of the belt and road initiative. putin expected to be there in beijing in a very rare overseas trip. the trip comes as the u.n. general assembly is gathering in new york. a meeting that they in the past have attended. this year they are not.

that lays the ground look -- groundwork for a potential summit with joe biden in november in san francisco. a lot of backroom bargaining and preparations. one for putin to go to beijing and then xi to go to san francisco. shery: the indonesian president says southeast asia's largest economy can enjoy growth as high as 7% on policies already laid down by his administration. he steps down next year after two terms in office. he spoke exclusively with haslinda on ahead of the launch next month of a new high-speed rail line. >> i am very happy and also the indonesian people are happy because our high-speed train is the only one in southeast asia. it's with this infrastructure

that we can build the foundation of progress. most importantly, this will also increase indonesia's competitiveness. last year's imd survey showed our competitiveness index rose from 34 to 44, up by 10 ranks. this is the highest increase in the world. we need this. it's very important for our country to be able to compete with other countries, for live justice to be more efficient as it will have an impact on the welfare of the people. >> it came at a high cost. $7 billion, more than $1 billion. is it worth it. some people say it will take 40 years before you break even. >> mrt lrt high-speed trains should not be calculated by profit and loss. don't come profit. what should be calculated as the benefit. because of congestion in jakarta

, the country loses more than idr 100 trillion. therefore, mass transportation much be built to overcome projection, pollution, and provide services to the community picket if we calculate the loss per year and compare with high-speed trains, lrt mrt, these items provide net benefits for the people. >> i want to touch on the economy. when we spoke in our first interview when you became president, you talked about an economy that will bro at 7%. right now, the gdp is still far away from 7% and we are in the final year of your presidency. why have you failed to get to 7%? >> the target must be low. it would be too easy for our team.

the target must be given as high as possible so that there's a strong desire to achieve it. the global economic situation is not favorable. third, the readiness of domestic infrastructure in order to compete and attract investment is also not yet supportive. i think it must be resolved one by one. infrastructure is resolved. investment licensing services are improved. if we can consistently do this, there will be hope in investment. many industries will build in indonesia. i think reaching 7% is not difficult. i estimate it will happen in 2027 to 2028. >> so you've laid the foundation of infrastructure for the country to get 7%. >> yeah. it's because we just built the foundation. we've built 16 new airports. 18 new ports. 2040 kilometers of toll roads. 36 out of 61 dams have been completed.

if the infrastructure is completed, our competitiveness is strong. that's where our economic growth will jump up. >> it's been nine years of your presidency. we are on the cusp of a leadership transition. are you confident that your successor will continue with the plans and policies that you've adopted? [laughter] >> well it has been prepared. it has been prepared. so that it sustains. don't let every leader have their own vision. change the vision, change the orientation. every change of leader changes the orientation so we end up starting from the beginning again. we already have a medium and long-term development plan. this is very important. it includes the development of a new capital city, industry down straining, and optimization of infrastructure. if the plans are in place, i think this is indonesia's vision

towards indonesia 2045. >> you are meeting president biden in november. what will be your priorities in your conversation with the president? >> first, with regard to the j ept, i will bring this up again so that the commitment can be implemented immediately. second, indonesia wants to obtain a special tax credit for ev batteries so that we can enter the u.s. market. indonesia is pushing for the critical minerals agreement with the u.s. to be signed soon. if this is granted as we want, of course this is good for indonesia's products that will be able to enter the very large u.s. market. haidi: the indonesian president speaking exclusively with haslinda amin. coming up, the international labor organization joins us to discuss the latest global trends of worker unrest.

this is bloomberg. ♪ ♪ explore endless design possibilities. to find your personal style. endless hardie® siding colors. textures and styles. it's possible. with james hardie™.

when you automate sales tax with avalara, you don't have to worry about things like changing tax rates or filing returns. avalarahhh ahhh haidi: -- is planning to make electric vehicle battery systems and components at a detroit factory. their latest move to diversify

into green energy. the ceo says the company will work at an existing 400,000 square-foot plant to supply its fleet of electric or mining trucks. the united auto workers are ranked -- weighing an expansion of strikes. the union president has warned more plants face walkouts if carmakers don't sweeten their offers. striking workers are expected to discuss this on friday. representatives say bargaining is still ongoing. shery: the strikes against detroit's big three come amid a scandal year for work stoppages in the u.s.. the international label organization is focused on worker rights. that's also pushing for gender pay equality. the director general joins us now here in the new york studio. thank you so much for your time today on a busy u.n. general assembly week. >> thank you. shery: so we are seeing the strikes. threats in canada as well.

we are seeing strikes in hollywood with writers and actors. are we seeing a shift in bargaining power to the workers now? >> actually, we don't believe, since covid and the current crisis we have is a combination of many classes that's definitely pushing the global situation a little bit more toward the workers really looking for justice. looking for a fair deal. we really want to encourage social dialogue and bargaining to really be -- of course, the unique situation with the filmmakers in hollywood with the whole challenge that ai is is important. shery: i want to talk more about

this crisis we are facing in the labor market. can workers capitalize that to an extent, where we can help reduce the gender pay gap, gender discrimination in the workplace? how much progress is being made on that front? gilbert: there has been progress but not sufficient enough. globally, we are talking about a gender pay gap of 20%. that's huge. so there's a lot of work that we still have to do on different levels to make sure that hopefully before 2030 -- the sustainable goal is 8.5. hopefully we can reach that goal before 2030 on that. of course, there is a lot happening on the policy side. also encouraging the bargaining

and collective bargaining to make sure that justice, fairness is in place. shery: ilo is part of the it will pay international coalition. explain to us, what is the importance of equal pay for work of equal value? how women have been undervalued in terms of some of the work they've done. gilbert: quite frankly, it's unexplainable. it's really unacceptable that in the 21st century, women are paid much less for work they can do. we see that in different sectors . it varies from one country to another country. it started in the so-called scientific sector. a sector that traditionally was

considered underpaid, a sector where you see a lot of women that carry the economy. the domestic world. that's in addition to a lot of unpaid work. so we know brazil -- today, the president reinforced the law that they just passed to make it mandatory for every company to ensure that women have an equivalent salary for the equivalent value of work. shery: -- haidi: we spoke about the impact that covid-19 had on lower income earners. we know that climate change will be having that outsized effect on those parts of the demographic as well as ai. we were just reading a report from the university of north

carolina saying that up to 80% of women's jobs could be affected by ai. is it possible to get ahead of these challenges, given that we are coming off the back foot anyway? given a lot of the technology is unknown in its application. gilbert: i'm very optimistic that there is still time for us to get ahead on that, simply because yes it is true that technology is advancing at a pace that sometimes takes all of us about -- by surprise. if the right policies are put in place, it's possible. the department has done a lot of study on that. it's very clear to us that the jobs, a minimum is going to be lost because of ai and technology in general. that's given. on the same token, ai will create millions of new jobs.

so the challenge in fact for us is to ensure that we put a policy in place that allows reskilling, retooling, upscaling that will allow women and all workers that are at risk to be retooled or be able to upscale their competencies in their sectors. sometimes, to be retrained so they can move from one sector to another sector so that they can find jobs in the new digital economy. it goes with our economy. we need to make it easier for workers but have to move from the current carbonized economy to a d carbonized and greener economy. the skills are key.

haidi: we know there's been an increasing issue when it comes to youth unemployment. the demographics of that population are changing. what insights do you have into the next 5, 10, 20 years for china? gilbert: look at the population. it's an asset. at the same time, it's a challenge. we know that our estimates indicate that every single year, we have 16 million youngsters that are graduating from university and they get into the labor market. the unemployment rate for the youth is higher than average. we talk about 21% unemployment rate compared to the national average where you look at the 54 years old. the average is 4.1%.

so this is quite a challenge. at the same time, we know that they are very conscious and focused in on creating opportunities for the youth to be able to engage, even to get jobs, all to be able to create their own companies and opportunities. clearly, this is one of the challenges. shery: what are the biggest trends that you foresee when it comes to the labor market? especially demographic challenges that china faces. we know that india continues to grow. gilbert: yes. if you look at the trend of india in the past years, compared to china, we see that it's different. china was ahead in the past years. that caused a problem like we see today. the growth rate.

global growth is very low compared to the growth rate in the emerging economy. when i talk about china or india, the youth. shery: thank you very much for joining us today in the new york city -- studio. we do have breaking news out of japan. we are getting the latest trade numbers with the august export numbers, a contraction of 0.8% year on year. the estimate of a contraction was more than 2%. imports as well, still a contraction of 17.8% but it's not a 20% contraction that economists had expected. that means a trade deficit that is coming in at ¥555.7 billion. adjusted for the month of august.

we have more to come on daybreak: asia. this is bloomberg. ♪ website and your store was also the first time you realized... well, we can do anything. cheesecake cookies? the chookie! manage all your sales from one place with a partner that always puts you first. (we did it) start today at godaddy.com

haidi: justin trudeau has vowed to hold accountable whoever was response will for the murder of man. joining us now from ottawa is our canadian economy and government reporter. what's the latest that we know?

randy: what we've seen so far is a tit-for-tat action between the two countries. trudeau accused modi's government of masterminding this assassination. he said that was absurd. what's really going to matter now is how canada's allies react to this. so far, responses from the u.s., u.k., and australia has been somewhat muted. they are saying that they are concerned but aren't doing anything beyond that. that's largely because all of this is happening at the same time the u.s. and its allies are trying to bolster their relationship with india as a counterweight to china. so responses that we've seen so far have been very measured. these nations are trying to balance between not upsetting india and not leaving canada, one of their closest allies, to stand on their own. shery: coming up in the next

hour, we discussed china's recovery in the latest potential trade flashpoint over ev subsidies with the eu chamber of commerce president, exclusively later. up next, the market opens in sydney, seoul, and tokyo. this is bloomberg. ♪

¡se fue la luz! pero todavía tenemos wifi para hacer las tareas. ¿y eso es algo bueno? wifi y estudiar. buenísimo. wifi y pedir una pizza online sería buenísimo. presentamos storm ready wifi. solo de xfinity. ahora puedes mantener una conexión confiable durante apagones, con datos celulares ilimitados y batería de respaldo de hasta 4 horas para mantenerte conectado. obténlo solo con xfinity. el hogar del 10g network. entérate más hoy.

every business that's why comcast business de is launching theal. mobile made free event. with our business internet, new and existing customers can get one year of unlimited mobile for free. it's our best internet. powered by the next generation 10g network and with 99.9% reliability. plus one line of free mobile for an entire year. it's the mobile made free event-happening now. get started for just $39 a month. plus, ask how to get one free line of unlimited mobile. comcast business, powering possibilities. ¡se fue la luz! pero todavía tenemos wifi para hacer las tareas. ¿y eso es algo bueno? wifi y estudiar. buenísimo. wifi y pedir una pizza online sería buenísimo. presentamos storm ready wifi. solo de xfinity. ahora puedes mantener una conexión confiable durante apagones, con datos celulares ilimitados y batería de respaldo de hasta 4 horas para mantenerte conectado. obténlo solo con xfinity. el hogar del 10g network. entérate más hoy.

shery: this is daybreak asia. we are counting down to major market opens as we are about to get started on the 36 hour sequence of special bank decisions. we are waiting for the fed to actually hold rates steady, but at the same time, a hawkish hold. two days later, we have the boj and in between, everything from the boe, philippines, indonesia, plenty for investors to watch out for. haidi: plenty for investors to watch out for, even before the steady ascent of energy prices which threatens to upend the broader picture for the fed, and also the breadth of economies you were referring to. of course, we end the week with the bank of japan. we are expecting some hawkish

overture when it comes to governor wade. no change or pivot expected in policy but certainly they could be looking for, entry. we heard when it comes to the yen from the forex chief, talking about being on high alert and steady and regular conversations with the u.s. treasury after we heard from janet yellen saying she could understand the reasons when it comes to smoothing volatility and intervention being used. looking at the start of cash trading in the nikkei 225, flat at the moment. it does look like we are on intervention watch but does not seem to be a great deal of volatility or moves in dollar-yen at this point. the other story has been treasuries when we see given the element of this potential inflationary picture, we saw the

big moves when it comes to the five and 10 year treasuries, hitting the highest yields since 2007. shery:shery: looking at the kospi coming online, we are seeing not a lot of movement. this after we have three sessions of losses for korean stocks. we did get a little more strength in the korean won, that 1327 level against the u.s. dollar. the focus is on the fed and the rest of the central bank decisions we are waiting for. but we have some positive news that could give some more upside to the very tech appended to economy -- dependent economy, at a time when we had japanese numbers, export numbers, imports numbers, contraction still in japan but not as big as economists had expected. haidi: taking a look at the start of cash trading here in

australia, those futures were indicated a little lower but we could see gains when it comes to the big energy players given that we see a one-way street when it comes to trading in crude prices at the moment. a little downside at the start of trading. a staggered start meaning we will check back later. also, correlated moves when it comes to the 10 year yield given what we saw in u.s. treasuries overnight. the aussie dollar holding steady. brent crude as we continue to monitor that, under $95 a barrel. of course we've had commentary from various analysts including the head of chevron saying we could see $100 oil as well. to that point, we are seeing energy trading pretty flat at the beginning of the session here. shery: our next guest is watching the dot plot to see if the narrative shifts from how

high rates can go to just how long high rates are here to stay. peter kinsella is the global head of fx strategy at ubp. great to have you with us. what are you expecting when it comes to the fed communication on wednesday and what will that tell us on where yields go at a time when the five year yield and 10 year yield has already touched a 2007 high? >> thank you and good morning from hong kong. i'm expecting a hawkish hold from the fed this evening. i think the dot plot, we will see a potential shift from expecting 100 basis points of cuts next year, towards 75. a hawkish hold. that reflects decent growth in the u.s., but also a bump higher in contemporaneous inflation in the u.s.

really altogether, this means we are likely to see the dollar stay relatively firm, certainly over the coming weeks and months. in addition, this will be augmented by the ongoing steepening we are seeing across various curves in the u.s. i think the front end of the u.s. yield curve should remain pretty steep and well above levels of 5%. the back end of the curve, we've seen it at its highest level since 2007 and i think the steepening will continue. likewise, the return of turn premia to the bond market suggests we might move toward a range of four .5% and 5% on the u.s. 10. it is an environment in which rates will continue to steepen but also as a result will do pretty well. it's a question of not necessarily how high rates will go but how long they stay at

high levels and that's what the fed will dictate to us this evening. shery: what does it mean on the other side of the trade for the japanese yen? we have rate differentiation but at the same time, we are watching for any intervention coming from japan. >> i think if we look at it, there are two or three things really affecting the yen in a negative manner. the first is steepening at the long end of the u.s. yield curve. the second point vis-a-vis the boj, they are talking about normalizing the negative rate policy. they are not really talking about raising the front end of the yield curve in any meaningful respect. it is normalization, not in any way a real tightening of policy. the third thing we are seeing is japan's trade balance continuing to worsen and deteriorate.

if the oil price continues to rise as we've seen in recent weeks and months, that will put further pressure on the japanese trade balance. overall, i'm still minded to think we will see upside risk in dollar-yen. the boj will continue to talk quite hawkish lee vis-a-vis a potential intervention but i think this is a leaning against the wind strategy from the boj. the fundamental backdrop is not from aggressive yen appreciation at this point in time. haidi: are there are many paths forward when it comes to the yuan? it's hard to see a meaningful economic recovery. it's also hard to see growth diversions and policy diversions to change much. >> i think there are three or four things going on. the first is certainly the move we've seen to date has been the dollar story.

if we look at the r&b basket, it is not that weak against other currencies so it's primarily a dollar move. what we've seen is consistent with currency weakness. we've seen the boc cutting rates. we've seen very very low inflation in china. that's consistent with weaker currency. and the final thread of one weakness is what's happening with net fdi flows toward china which have moved toward a negative profile. that is kind of a seminal change that we've not seen for the last 30 years. if that continues to manifest itself, it will be kind of a drag on the currency and the wider balance of payment set up. we are seeing the pboc setting up fixings lower and we've seen the state banks perhaps intervening in forward markets. overall it suggests a similar

profile for the boj leaning against the wind, trying to stop aggressive depreciation and slowing the pace of that at this point in time. haidi: does that mean it also weakens the role which has come back recently of the yuan, broader chinese assets, in terms of an em anchor? >> if we look at what's happening vis-a-vis investor flows, it is clear there is limited external demand for chinese assets. if we look at the bond connect flows and equity outflows, they have been quite significant in the last two or three months. i am not suggesting from a flow perspective, it's a pretty negative backdrop and negative sentiment towards cm why assets. . for hold, it is a bigger picture. we are likely to see a pronounced em rate cutting cycle. leasing that beginning in both

brazil and poland in recent weeks. as that follows through, for local currency bonds, i would say less constructive for local currency em. particularly in the context of the ongoing yield steepening of the u.s. curve. overall, i would say it is time to take stock in what's happening with various em assets. some will do well, but overall the context of ongoing steepening at the long end of u.s. curve will be a speed bump for em at this point in time. haidi: great to chat with you, global head of fx strategy at ubp with us. still ahead, china's recovery and take the temperature when it comes to trade relations. the president of the eu chamber of commerce joins us, with that exclusive conversation. a threat of default looming as dollar bond. we get an update next.

this is bloomberg. ♪

when you automate sales tax with avalara, you don't have to worry about things like changing tax rates or filing returns. avalarahhh ahhh

haidi: we are waiting for

china's rate fixing do in about an hour's time. most economists surveyed by bloomberg say they are holding steady after the pboc kept the rates unchanged last week. however, some colleagues see the five basis point cut on the short-term rate, but not a bold move. just a catch up to the august cut. we saw those rates in a rare situation diverge. analysts credit today by the shanghai securities news say there's room to see if further cuts to bank reserve requirements as well as interest rate reductions to help shore up the recovery. continuing to watch chinese developers as well. country garden has passed an initial deadline to pay a dollar bond interest payment with at least two creditors yet to receive their money. let's bring in our credit editor kevin kingsbury. is it a surprise that they have entered into the grace. period for this interest rate?

we know they managed to get the extension for the nine yuan bonds. reporter: right. like you mentioned, we got those extensions. because country garden last month did not pay to dollar bond coupons worth $22.5 million before and went into a grace period, it is not a surprise they would do that again this month. some of the recent builders, evergrande among them, went into grace periods before deciding to stop offshore debt. it seems to be a playbook where once they start to enter grace periods, they do that again and again. one thing to watch regarding country garden is the september sales in two weeks. august sales down 72% year-over-year. if there's anything close to that decline for september, it will raise questions as to how much cash country garden has in

the ability to pay debt and fund construction. shery: what other key deadlines are we watching at this point? reporter: for country garden, with the yuan bonds extended, really kind of off the hook as far as the onshore -- offshore payments. even onshore, they have minor coupons. late in the year, there's a 3 billion-dollar hong kong bond which will be something. we are still months away from that. in january, there will be a u.s. dollar dollar bond coupon principal due in january. shery: our china credit editor kevin kingsbury. we are following the prices for oil, brent, and new york traded oil futures, appearing steady for now after reaching the highest in 10 months. su joins us with the latest. the drumbeat of conditions for $100 oil only getting louder. reporter: yesterday, the chevron ceo saying $100 oil is imminent.

if you take a look at where oil has come, year to date, it has taken off in the past couple of weeks. a lot of this due to the fact that opec skiing members, russia and saudi arabia -- opec's key members, russia and saudi arabia, extended cuts to the end of the year. given a flurry of predictions about $100 oil, it's clear the volatility is not going away. check out these time spreads. this is a gauge that many oil traders and analysts as well as investors take a look at. brent and west texas intermediate trading in backwardation. the front end of the curve a lot more expensive than the back. right now for west texas intermediate, there's about a dollar difference. traders and brokers say this is happening as premiums from real-world barrels are soaring

higher as we see here in the u.s. the relentless pace higher in oil has been a real concern. monday, the saudi oil minister told a conference in canada they are working to keep markets stable. in other words, they want to keep the price of oil elevated, so it makes sense for opec-plus producers, but there are concerns the higher prices are going to keep leading to $100 oil. saudi oil ministers saying the output plans by opec-plus we reviewed every month, but it doesn't ease concerns of those who have been watching this and concerned about its inflationary pressure. haidi: the physical market for crude is always interesting. bloomberg has learned it's actually just one single company, one firm behind the run-up? reporter: sources close to the matter are telling bloomberg it is one firm pushing the physical market higher and, the treating

arm of the french firm tou thao energies is bidding the u.s. firm higher has a lot to do with the fact that the refining margins are at historic highs, so there is competitive pressure to do so. the physical market meaning you will take receipt of the barrels of oil rather than treating futures contracts, where you just keep swapping contracts and never take physical receipt of the oil. that only compounds the pressure we are seeing on oil prices going higher. meanwhile, it is translating into gas prices at a seasonal decade high. according to this bloomberg, chart we are looking at, that has historically preceded a recession. the fact that we've got energy prices at these high levels is certainly compounding issues for the biden administration, which promised to keep gas prices low. the white house looking toward

reelection and the upcoming campaign. this is an issue. inflation is an issue. if you look at nymex crude oil, what we are looking at wednesday is the latest inventory data in the u.s., and the api is estimating there will be a significant drop of more than 5.2 5 million barrels. not just around various hubs around the country, but the central hub in oklahoma, and that tends to move prices higher. haidi: su keenan with the latest. you can get a roundup of the stories you need to know to get your day going in today's edition of daybreak. bloomberg subscribers can get that at dayb on your terminals. it's also available on the mobile in the bloomberg anywhere app. customize your settings for the news on the industries and assets you care about. this is bloomberg. ♪

welcome to ameriprise. i'm sam morrison. my brother max recommended you. so my best friend sophie says you've been a huge help. at ameriprise financial, more than 9 out of 10 of our clients are likely to recommend us. our neighbors, the garcias, love working with you. because the advice we give is personalized, hey, john reese, jr. how's your father doing? to help reach your goals with confidence. my sister has told me so much about you. that's why it's more than advice worth listening to. it's advice worth talking about. ameriprise financial.

haidi: we are watching currency given the outsized impact from the dollar and potential for more currency volatility, once we get that announcement from the fed of its policy decision. we are watching dollar-yen, not huge moves in the session, just shy of 148, after we heard from japan's top currency official saying he's keeping an extremely close contact with his u.s. counterparts and watching any excessive moves in the currency. coming really after we heard from u.s. treasury secretary janet yellen earlier that any intervention to prop up the yen would be understandable, should it be aimed at smoothing out volatility. we saw the yen weakening to

levels near the lowest since november. the dollar hitting just shy of 148. to the. yen. watching the aussie dollar, a little upside potentially to do with more of the gain in crude prices and broader commodities overall. japan is due to announce the latest inflation. the country has seen pockets of growth even as core consumer inflation soared in july. they could have information by the year end to judge if inflation continues to rise. the 2023 event in tokyo, the jp morgan chief japan equity strategist says she is confident tokyo is committed. >> every 12 years going forward, the government will increase in among wages, and we have to remember that 20% of employee rate -- wages are directly linked to minimum wages.

this government is very strong so i do not worry much about this. whether it's a cycle between wage inflation will continue or not, with the government's long time commitment, i'm optimistic of the shift from deflation to inflation. haidi: shery: taking a look at how futures are trading at the moment, we are seeing european futures coming online, pretty muted but perhaps more to the upside as stocks finish. little change in the tuesday session. investors trying to stay on the sidelines given that we do have the fed central-bank decision, not to mention the boe as well, as a number of european banks are deciding on rates. we have seen of course the stoxx 600 in a narrow range. taking a look at u.s. futures,

not doing much, on the sidelines. u.s. stocks and bonds fell on the session. we have canadian inflation data putting traders a bit on edge about what might happen with the fed and thinking of the hawkish hold. ukrainian president volodymyr zelenskyy has urged u.n. leaders to show a united front against russia. speaking of the gathering, he condemned moscow's latest moves to escalate the war. >> russia is launching food prices as weapons. the impact spans from the atlantic coast of africa to southeast asia and this is the threat scale. i would like to think those leaders who supported our black seed rain initiative and program -- and grain from ukraine. shery: some leaders have used

the general assembly to double down on support from you -- for ukraine. annmarie hordern has more. reporter: here at the un's general assembly, president biden urged world leaders to continue supporting ukraine. he said what what that mean for other independent countries if the world order allows ukraine to be carved up? at the same time, president biden was speaking in new york city. speaker mccarthy and washington, d.c. talked about accountability for ukraine aid going to kyiv. i spoke to the nato secretary-general and he said the u.s. continues to expect support from ukraine. >> i'm confident that you the united states as well as nato allies will continue to support ukraine. it will be a strategy for ukrainians -- a challenge for ukrainians but also dangerous for us, because the message for him and china, when they use

military force, when they invade another country, the russians get what they want. that would make us more vulnerable. it is in our security interest to support ukraine, and therefore i'm confident the united states will continue to support ukraine. reporter: president biden and president zelenskyy will meet in washington, d.c. later this week and he will also meet with u.s. lawmakers on capitol hill. and reorder, bloomberg news -- annmarie hordern, bloomberg news. haidi: coming up, we take the temperature of european trade relations.the eu chamber of commerce president joins us, jens eskelund-hansen, in just a moment. this is bloomberg. ♪ hi, i'm jason and i've lost 202 pounds on golo. so the first time i ever seen a golo advertisement, i said, "yeah, whatever. there's no way this works like this." and threw it to the side. a couple weeks later, i seen it again after getting not so pleasant news from my physician. i was 424 pounds,

and my doctor was recommending weight loss surgery. to avoid the surgery, i had to make a change. so i decided to go with golo and it's changed my life. when i first started golo and taking release, my cravings, they went away. and i was so surprised. you feel that your body is working and functioning the way it should be and you feel energized. golo has improved my life in so many ways. i'm able to stand and actually make dinner. i'm able to clean my house. i'm able to do just simple tasks that a lot of people call simple, but when you're extremely heavy they're not so simple. golo is real and when you take release and follow the plan, it works.

haidi: we have breaking news

when it comes to the australia westpac leading index for the month of august. actually seeing a full 4.0 percent there a slightly steeper fall than we saw in the previous month this is the leading economic index released by westpac bank in the melbourne institute looking at expectations of growth. six-month annualized growth falling half a percent, that leading index level coming in at 97.09. some of these components looking at stock market performance, industrial production, commodity prices as well as drilling's prices. seeing that broadly fall across the board as we have seen these signals of some elements of weakness when it comes to the australian economy. at the moment we are seeing aussie bonds holding onto those gains. especially as we have seen the big reaction when it comes to treasury yields overnight. but some concerns that this recent spike in energy prices,

perhaps potentially means we could see the rba raising rates again in the meetings to come. shery: turning to china u.s. commerce secretary's casting doubt on the country's ability to build advanced tips at scale. that is after while ways latest film was found to have an advanced seven nanometer set made by china's -- our chief north asia correspondent stephen engle is in hong kong. the u.s. has launched an investigation into the chinese chip, what is the latest? stephen: we do know that while way is targeting 15 million sales of the handset of this mate 60 pro, the new smart that has the smic chipset. the care and 9000 s chip which is the advanced seven nanometers technology. they have 15 million handsets targeted this year for that phone. that could go up according to

annulus to 70 million by next year, 2024. but gina raimondo in congressional testimony in a hearing on capitol hill casts some doubt on whether china has the scale to make a lot of these chips. at scale essentially. this is raising questions, the mate 60 silicon it raises a lot of questions in particular in washington about the efficacy of u.s. led global campaign to prevent china's access to cutting edge technology. last week a group of republican lawmakers demanded congress to fully cut off while way and smic semiconductor manufacturing international corporation as it is formally known, from u.s. suppliers. they say that u.s. sanctions are not effective and are urging even tighter restrictions. of course while way and smic are blacklisted by the united states. gina raimondo, while admittedly

saying she was upset with the new phone when the new chip was released last month, while coincidentally she was in china. but she says the u.s. has no evidence china because make these at scale. this is a direct quote from gina raimondo. we are trying to use every single tool at our disposal to deny the chinese the ability to advance the technology in ways that can hurt us. that is essentially the goal of u.s. lawmakers and of course the white house to prevent china using american proprietary advanced technology in their military capabilities. he saw that video and those photos of the tear down of the meat 60 pro. that was done by tech insights recently for bloomberg news and again this has sparked a lot of concern and dialogue and an investigation. over the efficacy of the export curbs right now. haidi: chinese foreign minister

von yi is wrapping up his three-day visit to moscow today what was accomplished? stephen: it is interesting because he is wrapping up today a three day visit where he has met with his counterpart in moscow the foreign minister, as well as other senior kremlin officials. the readout at least from the chinese side is they are going to advance their security cooperation between beijing and moscow. it is interesting because of the timing. as other world leaders are meeting in new york for the united nations general assembly, wong yi and his boss sheeting pay are not attending. and wong the top diplomat from beijing heads to moscow instead. what is happening likely as they are laying the groundwork for a potential visit, highly likely we are hearing of vladimir putin going to beijing next month for the 10 year anniversary celebrations of the belt and road initiative. we do know that xi jinping

skipped out on the g20 in india, he is skipping out on the u.n. general assembly, again perhaps leading up to what the chinese side in the u.s. side are working for in that is xi jinping going to aipac in san francisco in november. a lot of backroom geopolitics and diplomacy going on for two big high-level visits. have putin going to beijing next month and then you have potentially xi jinping going to san francisco in november. haidi: our chief north asia correspondent with the latest they are with the eu chamber of commerce in china says confidence in the country's growth prospects have fallen but even -- perceptions may be changing. they have a shared mutual interest and continued success. the chamber president joining us exclusively from beijing. it is great to have you with us. it is twofold isn't it at a time when you are seeing less predictability, more volatility

when it comes to the broader business and the investing environment in china. you are also seeing these as you say, the demographic dividends fading. is the risk premier for investing in china as european business really starting to pull back now? jens: i think there are a number of things at play right now, i think a lot of the things are within the capabilities of the chinese government should they desire to address them, our main concern for european business right now is what we see is it increase in the level of ambiguity and unpredictability in the regulatory environment. what we are seeing it really seems to be two stories. we have one story coming out where the government is talking about self-reliance, about security and things that you not resonate well with global trade and european participation in the chinese economy. on the other hand we saw at the

national people's conference in march other talked with the continued commitment to reform and opening up. we saw they announced 24, opinions that would seem to address a lot of the concerns we have. and that is where european businesses are struggling a little right now. is it a focus on self-reliance and security or is it to engage with the global business community. on top of that of course, we have the economic uncertainties right now in china it is very much also felt by european business. haidi: that economic vulnerability, because we had spoken to some business leaders in china who have said there has been an increased willingness to engage and may be more of a willingness to compromise. we saw the pboc meeting with some of these foreign companies this week. to think that foreign investors and businesses may have more leverage in this new dynamic? jens: i think i would certainly

hope so we are beginning to see the decreasing fbi levels coming into china are beginning to figure more prominently in discussions with the government. actually the chinese government has announced 2023 as the year of fdi into china. what we hope to see is we begin to see concrete and specific measures that would really move the needle for european businesses in china. we have seen a lot of positive noises, we appreciate that. the 24 opinions were on paper very positive but what we need to see is implementation of some of these things. for example in regards to public procurement where right now european businesses are in a very weak position and generally not allowed to participate in public procurement. we have seen this new draconian change with regulations and their are opinions that may be you can establish channels and

address some of the benchmarking there. these are the kinds of things we would like to see. so far we have seen headlines, now we need to move to specifics. if that happens i think that could be something that would be somewhat of a confidence booster for european consumers. shery: you mentioned earlier about chinese self-reliance and security stance but i wonder how that actually compares to the european union or the u.s. is own de-risking strategies? jens: this is the funny thing about it because when you look at it over history, china has been going through a de-risking process for the past 20 years. i think in many ways you can say that china is the original the risk her. you have seen it made in china 2024. circulation and so on and so forth and even before that there were initiatives to build and protect national emerging industries that were considered strategically important.

i think europe in some ways is beginning to wake up to the fact that the country has some vulnerabilities. we saw in connection with covid certain commodities were not available. we saw strongly in connection with russia's war in ukraine where the effects of the european dependency on russian energy became very evident. i think it is common sense, companies are doing it themselves. what does europe need to do in order to protect itself? i think at the end of the day it is probably a fairly low percentage of commodities so not something that will materially, also the trading relationship between europe and china -- what concerns us a little bit china is that it seems to be a much higher focus on self-reliance. europe says that in many cases it does not want to be 100% reliant on a single country whether it is brazil or china.

maybe take 30% of that and move outside to another country but europe is not saying that we need to move inside europe and in principle that is a big difference. anyways i don't think that europe will go nearly as far in de-risking as china has done over the past 20 years. shery: in terms of protecting itself the european union has called on chinese support for electric vehicles with those massive subsidies. is that one way to do about it? jens: i think in general in the chamber we are not big fans of tariffs or other restrictive measures. we do promote, we do support free trade. we do believe in it and we have seen the benefits of mobilization. that being said we of course also need to be sure that when trade is taking place it is on a truly level playing field and sometimes we need regulations. the experience with solar panels in europe where the european solar industry was pretty much

liberated 10 or 15 years ago, that experience is still prominent in european mines. and maybe that is one of the things that informs the decision but i can say clearly we do not support tariffs for these kinds of measures. let's work together to see what we can do in order to create a more level playing field and ensuring that european companies have the same chances of success in china as chinese companies would have in europe. shery: there is a reason that global business -- businesses flocked to china. the massive middle-class growing, youth. what is happening now in terms of these demographic dividends from china especially when you are looking at record numbers of youth unemployment? jens: i think that narrative gets it upside down because when you look at last year europe was exporting 200 billion euros

worth of goods to china and china was exporting 600 billion euros worth of goods so as a market there three times larger for european business when you look at it from an export perspective. i think you need to look at it as europe really being a big market in china being not so big a market. europe exporter 23% more to china than in 2020 one then europe exported to switzerland, just to put it into perspective. that being said we do expect that the chinese economy will continue to grow at a somewhat lower clip that has been done and we also hope that even though perhaps there has been more wishful thinking that consumption growth will grow somewhat faster than growth in gdp. i think again we need to keep some of the propulsion in mind that europe really is the bigger market right now. shery: good to have you with us

and keep your time president of the european union chamber of commerce in china. coming up byd is about to announce the pricing of its compact model for the japanese market, where buyers have been reluctant to embrace chinese cvs. a preview next. this is bloomberg. ♪

shery: take a look at how markets are trading at the moment we are seeing a little bit of a mixed picture with the nikkei losing about a quarter of 1% and we are talking about energy, materials, communication services leading the declines. only utilities are gaining in the japanese market and take a look at the kospi because we are seeing a little bit of upside. really reversing those two sessions of losses we saw this week. as we continue to see a little bit of pressure on the korean won which is reversing those gains we saw in previous sessions as well. a lot to do with investors sitting on the sidelines given that we are expecting the fed to come out with a policy decision not to mention the boe, s&p and other central banks around the world. we will be capping the week with the boj. the asx 200 at the moment losing ground for third consecutive session as we are seeing kiwi stocks holding steady. haidi: we are talking about

chinese ev makers earlier and chinese carmaker byd is about to announce the price of its compact model for the japanese market. it is trying to crack a market that has been resistant to embracing chinese made ev's. bloomberg senior editor joining us from tokyo, how are they going to tackle this market? reed: essentially it looks like they're going to try to compete on price. but this has been byd's strategy across the world. they enter into challenging new markets with a very affordable ev market model and then see how far they can get. obviously the biggest success they have had so far has been in their home market of china but they are down in australia, they are looking at europe. and ultimately i think their goal is to lay the groundwork to enter the north american market. haidi: we have seen byd selling

about 100 cars a month since january, what sort of indication does that give us about how the dolphin could perform? reed: let me give you some numbers for context. here in japan japanese auto sales last year in 2022 totaled about 2.2 million vehicles. of that about 300,000 imports. when you look at byd their current model, it is called the auto three it is a small crossover, that sold about five or 600 units in the first half of this year. as far as the scale of the market here, even though yes the japanese automakers and car buyers have been reluctant to really embrace cvs, -- evs even within that larger context they have not been selling a whole lot. it has been more of a test market for them more than

something that will be a promising huge moneymaker down the road. haidi: right because they are more partial to locally recognized brands and i do wonder whether a jv would have been a way to overcome this. is there a different plan that byd has in mind? reed: there are sort of two issues here. one is the loyalty to the local brands and the other of course is the slow adoption of ev's. that is due to a variety of factors, the lack of charging infrastructure. at least an extensive one. as well as just a general feeling that the era of ev's, at least as far as this archipelago is concerned, has not arrived yet great shery: we have more to come on daybreak asia, this is bloomberg

. ♪ ♪ is it possible to fall in love with your home... ...before you even step inside? ♪ discover the magnolia home james hardie collection.

available now in siding colors, styles and textures. curated by joanna gaines. haidi: a look at some of the top corporate stories we are following, amazon is planning to hire 250 thousand logistics workers ahead of the holiday shopping season. it is a jump from last year's

quarter, these will span a variety of two roles including part-time and seasonal and will post the average pay for logistic's workers amid a shortage of workers. some analysts expect overall holiday hiring to stay muted. the managers of the bankrupt crypto exchange ftx are suing the parents of sam bankman-fried. the company is accusing them of saving millions of dollars at the expense of its victims. ftx fell apart last november with $8 billion in debt and what prosecutors allege it was one of the largest financial frauds in u.s. history. -- accidentally caught a glimpse of microsoft's future video plans after the tech giant mistakenly provided confidential information to a federal court website. the details are part of the ftc antitrust lawsuit of their takeover of blizzard. including unannounced gains and a refreshed xbox console. that information has since been removed. thanks including city, and

others are set to be looking into financing a $15 billion program to protect indian ocean habitats. one of the environmental groups behind the push say the banks have discussed bonds and circled nature spots. it would feed into the great blue wall initiative which is also backed by the united nations. shery: take a look at how some of the stocks we are watching ahead of the market opens in hong kong and mainland, country garden before passing a initial debt deadline, some we have spoke with said they have not been paid. -- also reporting -- could raise at least 140 $6 million by pressing its ipo at the bottom of its intended range. freighters also snapping up neo-options after shares slid on tuesday. will also be watching for any movement in hobe after hong kong accused another crypto platform j pex cheating investors through

social media influencers. the scandal has cast a cloud over the city's goal of creating a crypto hub. take a look at how currencies are trading at the moment. really not a lot of movement given that investors are staying on the sidelines ahead of key central-bank decisions around the world starting with the fed. take a look at the japanese yen holding very close to the 148 level it is steady against the dollar in the narrow range. we have heard from the chief currency -- the currency chief, the head of the currencies in the government speaking in tokyo today saying that the price of yen moves on are not necessarily desirable in their watching the foreign exchange with high levels of urgency. we are on intervention watch in a way. haidi: fx continuing to be in focus whether the fed, watching for what kind of guidance we get from the boj as well. take a look at u.s. futures.

a lot of investors are sidelined by the caution going into the fed decision. we are seeing a little downside, not much move in either direction. taiwan futures off by about a 10th of 1%, we are looking at chinese futures looking weaker. we saw tuesday at stock turnover to a fresh loaf or 2023. it just about $87 billion worth of onshore equities changing hands and really another indicator of the continued cooling we have seen in sentiment despite ongoing measures to try and support the economy. to that end we are counting down to the one year prime rate, bloomberg economics is an outlier expecting that rate to fall in today's fixing. it much more to come, this is bloomberg. ♪ i was able to create my website on my own. to have it be exactly what i want it to be. be able to integrate my appointment app.

godaddy was able to provide everything that i needed. the whole image of who i am and what empire is is presented through my godaddy website. ♪ fabulous surroundings... but everyone's looking at their phones

for financial insights from merrill. is he hailing a ride to the concert hall? no. he's making sure his portfolio and retirement plans work in harmony. they want to adopt a child and build a new home. so they're talking numbers with their merrill adviser. she's not researching her next role. she's learning how to handle market ups and downs without the drama. personalized advice so impressive your money never stops working for you with merrill. a bank of america company.