good morning, everybody. happy friday. welcome. you're watching "street signs." i'm louisa bojesen. >> i'm carolin roth. >> more questions than answers. the pound recovering from hitting its lowest level in more than three decades. the cause for the know dive remains unknown. >> a selloff in sterling, but the ftse 100 boosted by the falling pound. deutsche bank declines to comment on a report that it's mulling an asset management spinoff. shares are trading higher. u.s. authorities warn of

life-threatening weather conditions as hurricane matthew strengthens to a category four storm due to make landfall on florida's atlantic coast. good morning. welcome, everybody. just when you think you'll end the week kind of, you know, a slow note. looking at the markets this morning, down lower b a half percent. starting on the slight back foot. our main european equity markets reflecting precisely this, flat to lower for most, the ftse just bucking the trend up by a half percent. then the sectors out there, just seeing the sector positioning. just one sector in positive territory, basic resources up by 1.5%. gold hitting a 3 1/2 month low here over night.

down about around 5% on the week. silver at a four-month low. seeing buying back into the resources. a lot related to currency moves. >> let's look at sterling. >> sterling taking a nosedive early in the session falling by 6% in only two minutes. also hitting the lowest level since may of 1985. the currency has somewhat recovered but reasons for the sharp move remain unclear. some traders citing a fat finger move saying the pound plunged because of wrongly entered trade, or some saying an algorithm exacerbated by light liquidity. also media reports have been warning of a hard brexit for the uk. >> unicredit says no matter what the reason, sterling will remain under severe pressure as the uk's role on the global stage is questioned. we heard from numora, they say

the more likely reason is that there is a large barrier op sun that traded and that thcaused t selloff. and barkleys saying there were real traders done at some of these weak points, so people were clearly prepared to believe in sterling's new weaker levels. >> i have a feeling it's the stop loss triggering. once you go through the psychological levels, it sets off a bunch of stuff in today's trade. very different than 40 years ago, 20 years ago. >> many people say it was down to the comments from hollande.

>> precisely, hollande calling for this hard brexit speaking at a dinner in paris. the french president said that britain would have to pay the price for leaving the eu. he called on the european union to respond with firmness to avoid jeopardizing the principles of the bloc. but even if he said that you would still have to have somebody starting the selling process, which then triggers other big processes, especially looking at liquidity. >> it can't just be down to his comments alone. we've known so many european politicians have been lobbying for a hard brexit. philip hammond was on wall street on charm offensive yesterday visiting top u.s. banks to tell them that london will remain a financial hub despite the brexit vote. take a listen. >> our economy is fundamentally strong, but we're going into a period of uncertainty because of

the brexit vote. our employment figures have been revised upwards. we'll probably be the highest growing g-7 economy this year, next year will be a slightly more turbulent period. the markets will set the exchange rate right for the economy, but we're confident once people look at the fundamentals and process things will settle down. >> james bardy at bank of america and merrill lynch just joined us. james what did you think when you woke up to the news? you want to take a guess on what's behind the plunge in sterling? >> these things often happen in asian trading hours, all you need is a comment like the one that came out from hollande, then you get some automated trades on the become of it, you get a gap lower. it's not that unusual in fx markets and asian trading. we're getting lots of questions,

is this the start of a sterling crisis? does the uk look like an eamericemerg emerging market country? it's not as bad as that, but news has made people think this is a harder brexit, and angela merkel saying yesterday actually that conditions will be very tough for the uk. against the back drop where we are still on a fundamentally strong uk economy, it's running an account current deficit of 6.5% gdp. if you don't have the portfolio flows into the uk to upset that, that puts downward pressure on sterling. >> if you look at the ftse in isolation, we've seen the ftse nearing record highs once again, up by almost a half of 1% this morning on the result of the sterling strengths. the ftse 50 has been rallying, which is surprising since it has high exposure to the domestic

economy. at what point will this logic turn around? at some point this will drive up inflation. >> the way we think about brexit, we avoided a plane crash, we now have a slow motion car crash. the lower sterling goes, the more upward pressure we put on prices, the more downward pressure we put on incomes. the more it will hit the domestic part of the uk economy. the point we made about the mcx is that yes it contains more cyclical components than the ftse. if you want to be concerned and bearishly positioned on the uk economy, pick your stocks more carefully. pick the ones exposed to the domestic economy. we have a basket of stocks. if you look at a basket of domestically exposed stocks, they will still struggle. you think about retailers, travel companies, travel and

leisure is one of the bottom sectors in the stoxx 600. those are the areas where will you see the weakness and pain. if you're a big pharmaceutical company, big mining company, uk economy is not important to your business. >> what does a hard brexit mean at this stage? if we were to see a soft and mushy brexit that was drawn out, couldn't that end up being detrimental for the uk economy and the pound if there is this uncertainty with regards to timelines and what will happen? maybe this cut is a better option in the longer term. >> but you still have to negotiate your way out. you have to trigger -- it's not easy to do the straight cut. there are too many parts of the uk economy that the government will want to protect. philip hammond was saying to the big bosses that we want to protect your positions. i think it's dangerous for the uk to turn around and say that's

it, we're out. forget everything else. there are too many parts of the uk economy which are too dependent. i think article 50 will get triggered. we're then into difficult negotiations, not forgetting we have french elections next year, german elections next year. the uncertainty will be there for a long period of time. what uk economists have been saying is that uncertainty will weigh on investments. while the uk economy has been holding up okay, in the lkt it will long-term it will be hurt. >> how much further do you think sterling can drop? >> it's always difficult to pin exactly where you will go on this. the way we think about it, positioning is quite short now in sterling. would you want to necessarily put a short position on today? no. into every bounce in sterling you will find sellers. people will look at that current account position and say it's

going lower. our official forecast is 125. there or thereabouts in cable. but rfx strategies say the risk is to the down side. i don't think we'll hit the more extreme numbers, going back to the 1985 lows of 105, but, you know, could we be another 5% or so weaker? yes, we could. a lot of it depends on how the negotiations go. it's very difficult other than the fact that people are short of sterling to find a concrete reason to buy it. >> just want to jump in and bring you another forecast from hsbc, they're forecasting that sterling will fall to 110 against the dollar by 2017. they also forecast for the pound to fall to parody with the euro again by the end of 2017. that is a drastic cut. that's a lot more extreme than what you're actually forecasting

at this point. if we see that continued slump in sterling, isn't that positive for deal making in the uk? >> yes. you've seen a rebound in manufacturing because the exporters have been fitted from the falling sterling. you're right. people will come in and start to do m&a. so you do get investment flows. the one thing cutting the forecast on sterling, you're not fall off the low. >> james, you will stick around a bit longer, james barty. e-mail the show. we're miltulti-tasking. if you want to get in touch, you can find us on twitter. >> @louisabojesen. >> or @carolincnbc. one viewer says the cable flash crash is like a mini snb moment for fx brokers, also pointing out that the bahamas fx desk is under hurricane threat. coming up on the show, as

deutsche bank takes steps to cut costs, we hear from global financial leaders on how to deal with europe's banking troubles. we'll be back in two. guess what guys, i switched to sprint. sprint? i'm hearing good things abouthe network. all the networks are great now. in relion mt current other. and,national carrier rates. save money on your phone bill, invest iin your small business. woul't yove more customers i would definitely love so new customers. sprint will help you add customers and cut your costs switch your buness to sprint and save 50% on most current verizon, at&t and t-mobile rates. don't let a 1% differencecost . whoooo! for people with hearg loss, visit sprirelay.com.

. hi, everybody. welcome back. you're still watching "street signs." deutsche bank once again in focus after a report from the ft that germany's largest lending is mulling an ipo of its asset management business. cnbc reached out to deutsche bank who declined to comment on the report. the ceo's of several german corporations are ready to help the lender. the companies have discussed an emergency plan to purchase deutsche bank shares amounting to billions of euros in a bid to sure up the lender. >> deutsche bank struck a deal with works council on

restructuring measures to slash another 1,000 jobs, bringing the total number of job cuts in the country to 4,000. the restructuring plan is part of a deep overhaul announced in 2015 which involves the elimination of 9,000 roles worldwide. and christine lagarde said deutsche bank needed to reform its business model and reach a deal with the department of justice over its proposed $14 billion fine. the imf identified the bank a greater risk to the global financial system than any other major lender. the ubs ceo is saying that european banks are suffering from the ultra low rate environment. speaking to cnbc, he warned that bubbles could be forming in certain asset classes. >> european banks are suffering because of the macro economic conditions of europe, the lack of growth, low rates, negative rates are clearly putting a lot of pressure. the results are a huge

overcapacity in the european system. that's the problem. i wouldn't call it a -- something that people should be concerned about in terms of stability of the financial system. >> so that was the ubs ceo chief. kuroda on thursday said monetary policy has not reached its limits signaling val banks can do more to spur economic growth. >> reporter: he talked to reporters before attending a group of 20 minutes leaders gathering and said the economy as a whole is headed towards a favorable region but action is needed. concerns are growing that central banks have exhausted their policy ammunitions to spur growth. but kuroda said i don't think monetary policy has reached its

limits. reiterating his view that there's more the boj can do to boost economic growth. when asked about europe's financial situation including worries over deutsche bank facing a massive fine from the u.s. department of justice, kuroda said it is necessary to identify the problem quickly and deal with it as soon as possible. he also added that each country's financial system and banking sector is different and needs unique solutions. that's all from the nikkei. back to you. speaking to cnbc, julius bear also weighed in on europe's banking worry. >> i think 2016 we're seeing, again, the different parts of the world have done their homework when it comes to balance sheet repair, this in a macro environment that is now very difficult. we're looking now at the european banking sector under

pressure. a pressure of profitability and margin in the negative interest rate environment at a time when the sector is not capitalized enough to withstand some shocks we're experiencing. we're seeing valuation that may not reflect what maybe the asset -- net asset value should be or could be or the book value. on the other side we're anticipating more restructuring and conciliation in the sector. so i think we'll be seeing more volatility in the european banking sector. the ecb has reaffirmed its plans to stick with its aggressive stimulus policy of negative interest rates and bond buying until inflation rises to 2%. a target the central bank does not expect to reach until two years. removing stimulus too early, it is said, would stall europe's economic recovery. the managing director of the

european stability mechanism says the future of the eurozone is not in question. in an interview, he challenged the claims of please-winning economists who predicted the death of the europe. >> we are used to that. there have been predictions like that around for a while. they have been proven wrong before. the euro is there with all its member states. we worked hard in europe to make this possible. quite a number of significant measures were taken the last five years to make this possible. we are convinced that the euro is a success, there's a good reason why we have it. it's very strange sometimes to read that the euro was created only for political reasons. >> this is what mr. stiglich said. >> he is one of them. he predicts the end of the euro again. i think markets don't share that

view, otherwise we could see some reaction to markets. i think markets are right not to share that view. we had these predictions before in the past. they were wrong. >> the likes of mr. krugman? >> that's another example, yes. we have taken many steps to make the euro function better, like creating the institutions i managed. we have dispersed a lot of monies to countries that have had problems. we dispersed money to five countries, four of them exited their programs, they're in fairly good shapes. some are success stories. greece is special. you may want to talk about that. it's important to have the esm. we created other institutions. we have the banking union now. so, european supervisor for the most important systemically important european banks.

and very important, the countries that went into trouble, some of them lost market access, they have done their homework. >> just intrigued as to why you think there continues to be this narrative, particularly in north america, that talks down europe, talks down the euro. >> yeah. i don't know why it happens. i think some of the people who do it have not really looked at the facts. we have really taken important measures to get out of the crisis. basically the crisis is behind us. greece is a special case. we know why it is special. otherwise the crisis is behind us. europe is doing well. the eu is a success. the euro is a success. looking at gross numbers, often people think gross in europe is very low. they forget we have certain demographic trends that's didn't from the u.s. if i take out differences in population growth, gdp per

capita growth on average in europe is the same as in the united states. it was like that for 25 years before the crisis. it is again now looking at the forecast. actually this year gdp per capita in europe will be a lot higher than in the u.s. th but that's normal. some years we're higher, some years lower. on average it's the same. gdp per capita is the relevant indicator when you want to measure how standard of living is developing. so our standard of living is going up at the same speed on average. on top of that we have a better income distribution in europe. very strong point for europe. the last 15 years, 80% of european households have seen a real income gain. in the u.s. it's only 10%, 20%. >> i've been interviewing you for years, all the way through the crisis. this is about the most angry i've seen you on this issue.

>> maybe i'm getting tired of reading again and again these negative views on europe which have nothing to do with the facts. i think we have demonstrated the last six years what we are able to do in a crisis. would it have been better to do it earlier and not get into such a crisis, but we did what needed to be done at the time. and now the euro area is much stronger than before. >> james is still with us. james barty, head of global cross asset and european equity strategy from merrill lynch. there will not be the death of the eurozone, we're together. the euro won't disappear. >> you would expect him to say that where he does have a good point is that a lot of american academics have been calling for the end to the euro almost since it started. i remember getting phone calls from american investors saying when do we short the euro back in the year 2000. the fact that the euro together

is still together after the global financial crisis underlines the determination of all the senior policymakers to keep it going. if you look at draghi at the ecb, the most successful thing he's done through qe is tighten the bond spreads. italy issued a 50-year government bond with 2.5% yield that tells you what the ecb has done is effective in holding the you'eurozone together. >> is there a simple equation now, i look at all of this and say it's a long dollar story for the next two years? >> i think the dollar looks very well underpinned. you have a u.s. central bank that is almost certain going to tighten in december. probably another couple tightenings next year, at a time where notwithstanding all the concern about ecb tapering, qe continues into next year, dodge talking about pinning ten-years

at zero. we are long the u.s. dollar. i don't think it's going to go on a tear like it did in 2014 and 2015. but a modest appreciation in the u.s. dollar is the most likely scenario over the next 12 months or so. >> in an environment where growth and yield is so hard to come by, where do you want to invest? where do you want to be positioned? >> this is the point we make within strategy. you have to be long what the world is short of. the world is short of growth and yield. we go and look for our growth, particularly in meeremerging markets. this year we're forecasting just under 5% gdp growth in emerging markets. so, we're overweight emerging market equities, within my european portfolio, we're overweight emerging market proxies, miners and oils, beneficiaries of stronger market growth. on the yield side, even if the

fed does tighten next year, it's difficult to mimagine the ten-year treasury above 10%, bond yields above 20, 25 basis points. so if you're looking for yield, you can't go and find it in the government bond market, you have to find it elsewhere. we're long 81s. long basket dividend yielding in european equities. that's one thing european markets got. >> james, thank you very much for that. james barty. e.on shares are trading higher on reports that activist investor cevian capital is looking to buy stake. in the last year, e.on shares have come under pressure from the rize of renewabilities energy shedding almost half of their value since 2015.

>> innogy shares are trading roughly in line in frankfurt today. they are made up of retail and renewability units, and is germany's largest ipo since 2000. >> do you need a cup of water? >> i needed to suddenly cough, as one does. >> head to world markets live, we're taking a short break. keep your e-mail questions coming through. @carolincnbc or @louisabojesen, or on e-mail as well. "street signs" will be right back.

. welcome. you're watching "street signs." i'm carolin roth. >> i'm louisa bojesen. your headlines this morning. >> more questions than answers. the pond rund recovers from hit the lowest levels in three decades. european stocks opening a bit lower riled by a selloff in

sterling. the ftse 100 boosted by the falling pound. deutsche bank declines to comment on a report its mulling an asset management spinoff. shares trade higher amid positive prints across the sector. u.s. authorities warn of life-threatening weather conditions as hurricane matthew strengthens to a category 4 storm due to make landfall on florida's atlantic coast. we have a lot of data to get through on the uk. i don't think the pound will react that much. i will bring you the data nevertheless. uk august industrial output falling 0.4%. also the uk goods trade deficit was wider than expected in the month of august. oil and gas output showing the biggest drop since september of 2015. the ons adding they see limited

evidence that the weak sterling boosted manufacturing exports in august. three-month manufacturing output down 0.4%. three-month industrial production plus 0.2%. look at sterling/dollar 1.2434 still down 1.5% on the day. we saw that precipitous fall to the tune of 6% in asian trading session, that spooked investors. we have been speaking with experts from around the financial industry this morning to hear their thoughts on the sterling drop earlier today. >> notwithstanding this 6%, 7% two-second move, the downward pressure i don't think should come as any great surprise. i think the reaction function of the bank of england is that the heart of brexit looks the more accommodative they will be. >> if you trade the british pound during asian trading hours around midnight that will always

be an issue for currencies. we have looked at liquidity through various trading sessions, and certainly if you are getting a move like this at the midnight hour, then you will face up to potential liquidity strength particularly ahead of a key event day or data given the u.s. non-farm payroll numbers. >> you have so much uncertainty around the brexit process. i think the market had been complacent ahead of the conservative party conference and all the indications we've got. following the weekend and the date for article 50, indications that the uk golf. is seeking something closer to a hard brexit than soft brexit, the markets had to face up to the reality. that has to be bad news for sterling. >> has to do with liquidity as well. midnight uk time, asian hours, but it is about market

structure. things have become too political. people are always saying how they will carry out the brexit plan they mentioned. peoples opinions differ on that. >> jeremy stretch is with us from cibc. take a breath. i know getting here can be real difficult when you're popular because of what's happening in sterling. >> it's been a busy morning. >> let me read you out a viewer e-mail from raj. writing in from london. he says in physics there's a method called protobation theory. he says you blast with a disturb balance and watch the results, it's like shaking a tree and seeing watches. the test on sterling is exactly that as i'm sure trader the and hedge funds want to know the market strengths, they may call it a fat finger, but test and see. it is a long equation of that

i'll take a picture of and tweet. do you think he has a point? we're seeing how much can sterling withstand? >> it's an interesting way of looking at it. a perspective from financial market participants, which you had a range of in those clips. there's reasons to see why we saw that dramatic move. the underlying message is that sterling looks to be heading lower. i'm focused more on the fx perspective but also fixed income, where gilt is under pressure. a fiscal environment that is more significant or troublesome into 2017. it's going to be interesting, as philip hammond puts together his autumn statement in six weeks or so time. the fiscal environment doesn't look particularly attractive. and investors are deciding sterling or uk paper doesn't look as attractive. >> the policymakers must be looking at these moves with

great interest following on raj's theory. bernie says the bank of england must act independently of the uk fall and defend sterling a quarter percent or a half percent. >> defending sterling, that's an interesting parabola. we know that doesn't always end terrifically well. i thought it was interesting going back to philip hammond yesterda yesterday. sterling is drowning in current environments, and i think that'n terms of negativity. in terms of the bank of england, clearly issues or have been issues, politics have felt the bank of england has been too politicized. it will be interesting to see

how carney's decision whether to remain in the medium run or consider the exit. >> how much lower can it go? do you have any technical indications of how low it can fall? it's trying to find any range now. where is that range? 120 to 125? >> it's interesting. i was writing a draft piece due to go out today suggesting that sterling could fall to under 118 or 119. sort of layers we were trading -- >> you would have looked so smart. >> i should have written faster yesterday. >> looking in the upper 118s. that's a support line that comes back. you have to go back to march to may of 1985. we have consistently traded f h fresh lows in cable. that's the line where we will see support.

you can argue about the lows of the overnight session, but on a definitive tradable basis we can see that upper 118 threshold hit before we see support. >> one viewer wrote in saying this was a mini snb moment? do you agree with that that investors are losing trust in trading the pound/sterling given it may be involved in precipitous falls? >> clearly the news flow is interesting, it's beyond the financial press. it's making mainstream news because of the extent of the move. yes, you can argue about the importance of that. there are lots of cross currents in that context, but it doesn't imply we're losing trust in terms of trades the market. it underlines the fact that investors are still looking for opportunities for a cheaper value of sterling and/or underperformance on uk government or bonds. >> more of you writing in. get your questions in. do it early.tend the to be a de.

dr. sean says it is all about that article 50 now. does march really myanmar much? >> of course we are all relying on politiciapoliticians, and thy one thing and mean another. it is almost a period of megaphone diplomacy. we have may and the other brexit ministers on this side of the channel shouting their demands of wanting to have access of single markets or not concerned about access of single markets, the europeans setting out that templates. we have a period between now and march to say how is this diplomatic environment going to play out and will march myanmar much? we have a number of political variations in europe to play out through 2017. the fact that prime minister may said march caused a degree of consternation. i think there were some still hoping in the market that the uk would delay triggering article 50 until after that political

environment had become more clarified after the german elections and after the french and dutch ones. >> what also caused consternation was her criticizing the boe. do you think mr. carney will take this to heart and lower the extent to which the uk will do qe? do you think he'll be completely independent? >> i think he wo like uld like completely independent. that's the way he likes to operate. he was seen as a political appointee in relation to the previous chancellor, john osbourne. he was close to the previous administration and the campaign. that does put a bit of a question mark over his tenure. of course, as i say, he has been debating whether to remain on the five or eight-year schedule depending on his decision on ten-year. you mentioned carney. linda has a good point that the

british economy should pick up with low sterling, bank of england is helping theresa may by buying u.s. ten-years. carney will be the first to raise rates. >> i think that's unlikely. there's a lot of debate as to how quickly or how beneficial cheaper value the currency will be to uk plc. it should benefit exporters, but a lot of exports have components which are imported. it's very much not a definitive one-way benefit and the uk export sector is comparatively small. we rely on services and are they always quite so reflective of the exchange rate? there you're talking about other, more soft elements rather than pure competitiveness on price. >> you got a smart down winter jacket ready to go as soon as it starts snowing? >> i think quite probably it will be needed. >> good. we'll come back to winter jackets. >> not so much in the uk. i haven't seen snow here in

years. >> don't jinx it. we'll be talking more later. the u.s. non-farm payrolls report is expect todd show 170,000 jobs were added to the economy stateside in september. this is according to dow jones forecast and compares to 151,000 last month. the unemployment rate is expected to remain unchanged at 4.9%. fed watchers will keep a close eye on the data as for clues on the typing of the next hike. alan greenspan says monetary policy has done as much as it can. the former fed chairman told cnbc fiscal measures were needed to boost an economy. alan greenspan did not say whether it was time to raise rat rates. >> people are aware that there's an election out there. they would prefer not to do something during an election, by if it is called for, it is done.

so the real question centsly is will the federal reserve hold back when it should be moving? i would say no. >> now, jeff spoke to the brazilian minutes minister in washington and asked him when the fed should raise rates. >> it's about the time for the normalization of the american monetary policy. that is not a surprise. that's not coming too fast. no, it's a measure expected. the signals are very clear. the best solution for everyone is that the fed takes the right decision. >> all right. well, jeremy stretch is still with us. it's been super busy for you. listen, the fed and what the fed

decides to do. we're continuously seeing this change in market perception with regards to whether or not we'll get the december hike. there is a 65% chance we'll get a hike. 50% chance last month. are we going to get it? what's the deciding factor for the fed? >> this year is reminiscent of 201 in the context of the fed passed in september and comes back in december and hikes then. the dollar rallies into the event. that's the scenario we're anticipating. that probability of 65% will edge up to 70%, 75%. even today f we're right and looking for an above trend consensus forecast of 190,000 jobs being gained. then that probability of a fed hike in december will get to that 75% number, and that will provide a bit further impetus

for the dollar. >> would the fed be afraid of starting a massive divide scenario? we can't start to see hikes here in europe. the housing market for one would go off a cliff. >> we are a long way from hikes in europe. obviously this week, as far as europe is concerned and ecb is concerned, we are talking about is tapering considered? once you enter, it's difficult to go out. they are considering at least providing market color for the market to consider is. we're a long way away from the ecb considering that. but in terms of the labor market, the labor market is tight in the u.s. you look at continuing claims yesterday at 25-year lows. it is implicit that the federal reserve move. but they will move very, very

slowly in terms of tightening rates over the course of this december and through 2017. >> what do you like in the currency space no? >> i think it's very easy to be -- easy to find currencies to short. still you want to be short of sterling as we discussed. the canadian dollar. the currency close to our bank's heart has further downside risks because rate spreads are continuing to move wider. i think the australian and new zealand dollars will also edge back lower, particularly in new zealand where there is still that consideration of a monetary ease coming as early as next month. >> you'euro dollar has been ran bound over the last couple months, do you see a breakout? >> i don't think we're seeing a capitulation trade. we have seen some of those comments about tapering being pushed back. that is the short-term story. if we add fed probability into the mix, then i think that does suggest the you're euro dollar

lower. >> jeremy, appreciate it thank you very much for that. i wish you would have brought that forecast for sterling yesterday. we would have been smarter. jeremy stretch from cibc. for more clues on the next condition, stay tuned for an exclusive interview with loretta mester at 14::30 cte. >> now come the jackets. >> are you ready for skiing? winter is approaching, is your kit adequate? do you just look the part? will you be warm enough? we'll speak to the ceo of montclair, all of that happening after the break.

. welcome back to the show. delta lloyd rejected nn group's 2.4 billion euro takeovered by.

the board said the proposal undervalues delta lloyd. amundi reportedly raised the bar in the race to buy pioneer investments. the french asset manager has made a higher than expected $4 billion euro bid for pioneer whose value was previously estimated at 3 billion euros. there are also three other bidders. the post office is now looking for an additional partner to sweeten the offer or good join forces with aberdeen. binding officers are due on november 3rd. and a final decision will be made after it leaves referendum on the 4th of december. >> time to get ready for winter and focus on posh winter outfits as we focus on moncler. it initially produced quilted sleeping bags, but is now popular for its signature down

jackets. remo ruffini took the brand over in 2003 and moved the headquarters to milan where it listed back in 2013. it's not all about trendy down jackets. they are focusing on growing sales of accessories including sunglasses. moncler announced it is bringing in two foreign investors to bring in growth. we are joined by the ceo, remo ruffini. pleasure having you around the desk. we've been talking about the big decline in the pound/sterling in yesterday's trading session, overnight trading in asia. it's been at very low levels since the brexit vote. so many luxury outfits have benefited from the low level of the sterling. you have one store in london already. you have seen similar demand for your luxury goods? >> it's a very good moment for us in england. since the brexit, you know, we've increased a lot of customer and tourists that come

to london. the reaction was very, very good. we have one store on bond street, we have department stores, very successful at the moment. >> let's talk about your sales in asia. they count for one-third of total sales vn. in the first half of the year sale there's increased 30%. is it still going strong despite the crackdown in luxury buying and gift buying and the slowdown of the consumer there? so many other luxury companies are struggling there. >> at the moment, for us, the business in asia is strong. talking about china, i think if you make a good distribution, exclusivity is important. i think we did in the last two, three years good strategy. at the moment the business is strong. you know, let's wait. all the other luxury companies are struggling. >> you have not seen signs of that yet. >> at the moment, no. china is strong.

hong kong is okay. macau is strong and china is strong. >> where are your goods produced? >> my production? >> yes. >> basically all the production is made by us. both with raw material, we make production all in europe. and mostly in romania and bult g bulgaria? >> are you finding production costs high right now? >> no, production is stable. we follow quality, try to have the best. at the moment the price is stable. >> how much of a drop did you see during the financial crisis, at height of the financial crisis? did you feel an equivalent drop in your goods? >> i mean, you know, this is really depending on the market now. volatility is very high. the business changed from the day to the night. paris is not strong anymore. it was very strong. for us, it's a very good market.

it was a bit of crisis after the terrorism attack. europe was so-so last year, now it's increased a lot, including the uk. japan, in case of the exchange rate, is quite soft at the moment. there is not more chinese customer in japan. in general we are quite happy. >> want to talk about the two new investors who have come in and bought a stake. do you foresee a change in overall strategy or an acceleration extension of the current one? >> not at the moment. they just kind a couple months ago. very good partners. torres has good experience in travel retail. that's why i like him with the company, and timasec is the biggest in asia. i think they can help us a lot to develop the business in these

markets. we've quite happy to have these new partners. >> how do you feel about the upcoming winter season? the last couple years we have not seen much snow across europe. that can't be good for sales. will there be a bumper winter this year? >> it was not good weather, but for us good weather means good weather. in europe and united states, in japan as well, i hope this winter will be better. >> who do you think drives fashion at the moment? do you think it's the consumer or the bloggers? do you look to the vogue people? >> again, the world has changed a lot. i think digital is very important. the strategy is important. exclusivity is important. you have to stay with your customer, learn what they say, understand what they say every day they come to your store. you have to really stay tuned with your market. this is very important. >> thank you very much for being with us. remo ruffini, ceo of moncler. now in other news, hurricane

matthew, which has already left hundreds dead and caused devastation across the caribbean is headed towards the u.s. east coast. jay gray is in daytona beach in florida. jay? >> reporter: good morning to you. want to give you a realtime look at the situation here. the wind continuing to gust here, and it has been for the last couple of hours. rain coming down in sheets. that surf out there continues to grow pushing up over the beach at this point. there's concern about the surge. it could reach over ten feet, which is really unheard of in any storm in this area for a very long time. now, look, these conditions have been deteriorating over the last several hours, considering we're still on the front edge of this storm, so it will get worse. we have not seen the worst of this storm. it will happen over the next several hours here as it continues to pass through this area and up the east coast. there's a growing concern that as it does that, it could

actually get to the top by this weekend, loop back around a bit weaker but be back here and causing problems early next week. so the next 24, 48 hours definitely going to be a struggle here. it's going to be rough. and then we could see more at the bow beginning of next week. it's going to be a tough go for quite some time here. >> jay, thank you very much. jay gray joining us there from nbc news. quick look at european equity markets in the wake of the precipitous fall of the pond in the asian trading session. ftse 100 rallying to the tune of 6.3%. nearing record territory hire. xetra dax off by a quarter percent. all eyes on the pound sterling. should be just above the 124 handle, falling as low as 118 in the overnight trading session.

down by 6% within just two minutes. 124.24, down by 1.5%. it is on track for 4.2% fall this yeweek. that would be the worst week for the pound sterling since the post-brexit week. guys, your e-mails are too late. w we tell you at the top of the show, you can't get them in late. again, i'll tweet what this theory is, it's called perturbation. one viewer explaining that. that's it for today's show. >> i'm carolin roth. >> i'm @louisabojesen. have have a fantastic weekend. li of . d, sprint saves you % on most currennational . ve mon on your phone bill, invest it in your small business. wouldn't you love more customers?

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good morning. global market alert. a flash crash sending the british pound to a new 31-year low. a 6% drop in two minutes. florida authorities sounding alarms not heard in years as an extremely dangerous hurricane matthew approaches. and it's jobs friday. waiting on the september jobs report. likely to set the tone for today's trading session, a busy friday. october 7, 2016, "worldwide exchange" begins right now. ♪ good morning. welcome to "worldwide exchange"