the rbnz coming up. rba story, day two coming up.is bloomberg. ♪ yvonne: it is about the antipodes. think about how the rba we are expected to hear the speech from phil lowe. the last hour has been about the rba z. the hawkish hike, 50 basis points, only one got it right, bank of america. david: like we planned it, bank of america joining us claudio p iron joining us, you guys nailed this one. what does this mean for the kiwi dollar? quarks i should give their -- >> i should give that credit to the consensus call. what's playing out with the kiwi's outperformance relative to the aussie, the markets are jockeying around relative interest rate expectations. i think it is difficult in the sense that you do 50 and you go back to zero. from that perspective, there is the momentum behind the rbnz with potentially raising rates further. upside risks related to inflation. by contrast it seems the rba may have opened the door to that pause, that is what is driving this relative outperformance of kiwi to aussie. david: claudio, just to broaden

the rbnz did not play ball. the open daca -- the opec story is in play for david: it might be the turn of the calendar, a first quarter and a reassessment after a few days. we haven't gotten to the point to what those few days means because as of now, we are extending the risk rally across the region. 4.4% of the catch up trade here in hong kong. the dollar, more downside as we speak. against the dm though, the dollar stable right now. we will get to opec in a moment. look at this. in terms of repricing, we have seen it, but the repricing has taken place over the aggregate expectation of how high the fed will actually go. so, there has been a little adjustment. but if you measured it all the way to next year, and a reminder from the rbnz and now the philippines central-bank that because of inflation, that they say they are ready to take further policy action. it might have just been the rba. yvonne: it might have been the rba bucking the trend, offering parameters that they have very high household and also vari

rbnz. hawkish move. aggressive move. one of the first among the central banks with a 50 basis point hike. how much more can they go? >> yeah, well, my colleagues will be delighted. they have been calling for this hike by the rbnz. how far? 2.25% by the beginning of next year. but see how the quarterly inflation numbers come out next week. that may give us more guidance in terms of justification, but we think we are on track. >> while. -- wow. do you think that in terms of the kiwi, the moves, are the rate differentials the biggest thing? is the dollar still going to be the most dominant in terms of market thinking now in the strengthen the greenback? >> yeah. it is tricky. it's like a photo finish. who is hiking 50? bank of canada potentially tonight as well doing another 50. it is a combination of commodities and informatics -- interest rate differentials. we have had basically the kiwi, the aussie, the canadian dollar outperform the u.s. dollar as a function of the commodity prices. i will be watching the aussie-kiwi c

of course, in new zealand, we have an rbnz governor saying he is confident the rbnz will get to its inflation target. we will get you the latest lines from that press conference. keep it here with us. this is bloomberg. ♪ haslinda: welcome back. singapore's transport ministry is investigating after a person was killed and dozens of others injured on a singapore airlines flight when it hit severe turbulence. what do we know? >> it's a really unfortunate incident. we heard how singapore's transport authorities are in touch with their thai counterparts, sending investigators to bangkok, which is where the flight made an emergency landing. the civil aviation authority of thailand is also investigating. singapore airlines says it is working with authorities. this was a flight that had more than 200 people on board, and it came from -- they came from multiple nationalities -- the u.k., australia, singapore, india -- and it was supposed to be a routine, uneventful flight. it was over the irrawaddy basin, singapore airlines says, where it hit severe turbulence. items were strewn, as you can see if yo

is the rbnz really done? >> yes, we think the rbnz is done.llar was because markets as we went into the meeting this morning was pricing in either one or two hikes. it was the liquidation of those that have priced in two hikes. if you take a step back and look at the global central bank landscape, in most of the economies, the inflation pressure is between five and 6%. when a central bank brings about 7%, i think it is only natural for them to consider a pause in take to an end because they reached a state where the rates are back to neutral or slightly positive. it is what we are seeing from the fed, they are calling a timeout for now. it is not a surprise and we think it is the last hike in the cycle for the rbnz. rishaad: we have a government saying the latest data she is seeing this pleasing after a long battle. this is the language, we had yvonne say this, mission accomplished. surely that is a bit premature. you also have another player on this which is the aussie dollar is outperforming its kiwi cousin. >> i think it is a little bit pol

the rbnz one day said 75% rate cut. then in october of 2021 they were the first to start hiking rates again. they have done two 50 basis point hikes already. this is their third in a row and you can see that investors are expecting them to get nearly to 4% by the end of the year. and their inflation rate, 6.9% year-over-year, their forecast had been 5.9%. it will be interesting to see if -- as we get more information from their policy statement that what that will show. do they change their forecast? what is their expectation? how soon do they say inflation coming down? the rbnz has been very clear. we are going to be aggressive when monetary policy. that is what they have done. of course the bank of korea doing its first rate hike of 50 basis points since 1999 when i first started using interest rates as a monetary policy tool, talking about inflation will behind for a while. their target is 1% to 3%. so clearly the new b.o.k. governor, who already endorsed a 50 basis point rate hike, he was barely sworn in and saying

we had the rbnz this week with j.p. morgan on what to expect. yvonne: don't forget to turn to bloomberg for more on that rbnz decision with governor for -- governor mark -- governor orr said to speak next hour. year end, rates could be at 3.20 5%. the peak, 3.90 5%. in new zealand, this is bloomberg. ♪ re efficie you become. such amazingly perfect shapes run throughout the natural world. and can now be found in the automotive one. the world's most aerodynamic production vehicle. the eqs sedan. david: 100 25 more basis points in terms of rate hikes. that is what the rbnz just told us minutes ago. have a look at the market reaction. as far as the currency is concerned, it is on it rocket here. yields actually lower here. rishaad: seen as being ahead of the curve, we did have them saying a short while ago that they would rather have too much too soon, which is better than too little too late. anyway, is that the case elsewhere? thanks for joining us. the reserve bank of new zealand is seen as being ahead of things, generally speaking, but is the na

so rbnz staying pat for a second time in a row at 5.5%.remember, this is the central bank that has done 525 basis point hike. it has been pretty aggressive ahead of the curve, way ahead of the fed. and now it is keeping its rate standing pat at 5.5% for a second time in a row. dave. yep. yeah. so we're looking at, to your point there where there is some commentary on inflation and how restrictive rates are and they're saying already restrictive and that should be enough to return inflation to target. we're just going through some of the phrasing here on the statement because that i guess in some ways, short of hearing from the governor himself, which rule, by the way, here from is perhaps the best indication of tone right now. a couple of more lines coming through. the activity slowing is more in rate sensitive sectors. suffice to say it does look like it's working in terms of the currency markets right now. there's a bid coming through ever so slightly on the kiwi dollar. some forecasts are now showing a small chance of another rate hike.

the rbnz keeping its rates unchanged. of course this coming on the back of inflation expectations which have soared and growth momentum has eased. cutting property prices would be another factor. the kiwi right now losing a bit of ground, currently at 70.54 on the back of the rbnz decision, pretty much expected on hold. rishaad: yep. also at the moment equity markets moving to the upside. also against this backdrop in hong kong of the record antitrust penalty handed down to alibaba. this may not be a one-off. china continuing to scrutinize its most powerful technology companies, ordering 34 to drop anti-competitive practices over the next month. let's get over to senior analyst with eurasia group. why are they doing this, first of all? guest: i think there is the obvious message why a regulator is pursuing this route, and then there is the implicit message as well. on the obvious side, the antitrust crackdowns have intensified is the message irregular wants to send to the company. the record fine is not a one-off event. f

yvonne: yvonne: the rbnz yvonne: continues to be hawkish.u think there's a void entering into a recession next year? grant: a lot of commentators still see resilience and strength in the economy. exports are holding out particularly well. people want our tourism to come back here. it's going to be a challenging year with a global slowdown, no doubt. a lot of economists can still see resilience. inflation well outside of the target of one to 3%. i think we can keep a balance going through into next year and avoid that. what happens in the rest of the world has a big impact on an open trading nation like new zealand. david: it is that same resilience that the reserve bank has pointed to for the need for higher rates. let me ask you directly. do you think the economy needs a recession, even a mild one? grant: obviously, we've seen a significant amount of stimulus in the economy. demand has hold up. that's what causes those inflationary pressures. most economists recognize that there will be some effect from that. we will see that demand and slo

in its policy statement, the rbnz said it expects to get up to 5.7% at its peak. now we've got that other rate hike in place so you can see when you look at that inflation rate, even though they expect it to come back down into the 2% range over the next several months, for now it's a big gap. that's one of the reasons they are moving now and why they expect to move more into 2022. unemployment down to a record low in new zealand at 3.2%. their partition rate is 71.2 percent. it's interesting that in this statement, they note that there -- they are somewhat concerned about the impact on business sentiment, getting a little bit weaker. vaccination coverage is going very well. the lockdowns are ending. they will reopen in january. we spoke to achieve economist at rbd capital markets. she said not only do they expect that rate to get up to 2%, she said it could go higher. let's listen. >> but we've seen in the policy statement is an upward revision to the rbnz's cash rate projections. up about .5%. it's probably closer to 2.5 percent. that does seem appropriate for a

hawkish stance out of the rbnz. reporter bloomberg learning the united states: has given an advisory for traveling. sources say that could impede beijing's ability to gain data. we are told the -- democrats have reached an agreement on a $3.5 trillion spending and tax plan. president biden's jobs and families initiative without republican support. senator schumer says it is part of a two track process by which they will consider a 579 million -- billion dollar intern -- infrastructure bill. an economic rebound in singapore. this is weeks of viruses. gdp for the 3 month at the end of june contracting from 2%, a jump of 3%. it means year on year, gdp was up more than 14%. no bases during strict lockdown at the start of the pandemic. the covid lockdown has been extended until the end of july in australia. australia is a good city -- australia's biggest city is performing more -- reporting more covid cases. australia is the second vaccine rollout among countries on the oecd. vonnie: lack of legal protections left asia's

let's look at kiwi assets on the back of very hawkish rbnz.imating the cash rates rising 3.25% at the end of next year. this is 67.63 -- .6763. rishaad: let's bring in mark with regards to all of this. how are people really viewing ukraine? how are they weighing that up? what are they weighing that up against? >> over the past couple of decades, traders have been really reluctant to praise into much geopolitical risk because it has usually ended without affecting markets too deeply. the amount of volatility we have seen in the past couple of weeks is probably the most we have seen since north korea first started launching missiles at the beginning of the 2000's. that quickly faded away. people are getting used to the fact that this is a little bit more extreme. you can see that we had the central bank and new zealand getting -- going ahead with a rate hike. this will deviate from his path just because of the geopolitical risks in the short term. the bigger issue is in terms of inflation and other factors, wage hikes, real things that are affec

the rbnz delivered as expected.: they did but it still quite a dovish statement from the rbnz. i guess there are key elements that have caused a reaction in markets. the first is, there is size of their the asset purchase program to 60 billion for the year. there was speculation this would happen, but i think it goes beyond that when they signal that there is still a range of monetary policy options they can add other assets to the purchase program, and they will think about other ways to support the economy. fairly dovish in that regard. they have also left the cash rate unchanged but haven't ruled out a negative cash rate in the future, signaling it is an option. aren't prepared yet but there is discussion and consultation, so very much signaling it is prepared to move into negative territory if needed, that it could do more beyond even the step up in the asset purchase it signaled today, including suggesting it will do whatever it takes and is prepared to do more. we have seen interesting reactions from markets.

a couple of headlines, rbnz in a statement, one governor saying that the rbnz is prepared to navigate economic financial challenges. he also says the economic recovery will continue, they will continue monetary support, and eventually settings can normalize. no details on when that can be. rbnz also saying that recovery needs continued monetary fiscal support, and they have planned to embed new risk appetite and capital framework. remember we have reports suggesting the rbnz may see bond purchases resume in a couple of months. all those headlines from the rbnz governor adrian orr. now let's get the first word news with vonnie quinn in new york. vonnie: this nation has defended its decision to launch airstrikes on iraq. speaking on a visit to rome, secretary of state antony blinken says it sends a deterrent message that the u.s. will not hesitate to protect its interest in the middle east. >> regarding the strike last night at the president's direction, u.s. military forces struck iranian-backed militia groups. they targeted facilities used by groups responsible for recent attacks on u

we are right at about 50 basis points on the rbnz. they will still deliver, not today, but the risk market says it's probably going to be one, maybe two. yvonne: and there's a statement from the rbnz talking about renewed restrictions, highlighting the ability of the virus, that they remain alert of the display supply disruptions covid can create and they are talking about the unemployment rate as well, at or above maximum sustainable levels. and prices are both sustainable levels. they are very much part of the economy that they have to talk about in terms of overheating. and as our james mcintyre said, they have other tools in their toolbox to handle these issues right now, but for now hold is bably the bestition. the taliban say they will allow women to work in government roles, the latest next. tencent expected to report its first profit decline in almost two years after china's crackdo wn on the tech sector. this is bloomberg. ♪ david: the internet stocks this year, we have retraced about 42%. recently we were ok, about a week an

the rbnz has kicked off for the rest of the world. now that we have seen it, we have seen the spike in with the kiwi here, at 63, 60's sense. all economists, rbnz remains appropriate to continue tightening at pace. is want to watch. we have been looking at any signs they could slow this tiny path. core consumer price remains too high. let's bring in kathleen hays, for any sort of reaction. your take away so far. >> hawkish. inflation remains too high. the rate is peaking at 4.1 versus 3.9, which they said -- with a projected at the last meeting. they are talking about inflation slowing to 3% by the second quarter. that might be a little helpful. remember, this is only the third quarter of 2022. they're holding out some hope for the future. so, saying it piques that 4.1 is also bad. for now, would you not agree this underscores the market sense, economists forecasted to more 50 basis point rate hikes are coming. look what they did at the beginning of next year, but more could be coming as well. clearly, any sense that they are ready to

here is what he said in a policy statement where the rbnz cap there record low one .3%.etary policy will remain accommodative. numerous uncertainties remain, particularly in respect of the international outlook, and policy may need to adjust accordingly." he has also said that it is just likely that the rbnz could raise its key rate as cut it. the fact that he said that bank would also like to seek a weaker new zealand dollar because that would help their gdp get stronger, you might think he would be ready to cut, but economists don't link so. far away from that 3.5% he would like to see in the second half of the year. no cuts, even though that could help boost new zealand's exports. chance of a move from the philippine central bank today? well, there are two economists who follow this in our recent bloomberg news survey who are looking for a rate increase, but 19 others say no way, and that is the majority few when it comes to the philippines. bank is keeping the therate at 3%, but it is first time it has not been ironclad unanimous since 2014. let's look at a chart, th

the rbnz hiking a record signaling a higher peak great next year. new covid curves in shanghai and shenzhen, as cases surge short of a daily record. rishaad: we do have asian equities, some good earnings supporting the s&p, the likes of best buy, other companies as well, abercrombie & fitch helping to lift the town. new zealand is on the way down. we still have a little bit of underperformance by chinese equities as we get these fresh numbers. shanghai asking new arrivals to stay away from public venues, including restaurants, for five days. the city trying to insulate itself from a nationwide surgeon the coronavirus. it is really forcing authorities to resort to tougher restrictions. the market on the way down. yvonne: i mean, it is the hawkish comments we heard from the central bank. we expect to hear more in the press conference happening any minute now. when the rest of the world is talking about slowing down the pace of fed tightening soon, yes, they will continue on this inflation fight, but the rbnz and is saying their work is not done yet. t

claudio, i was going to ask you about the rbnz, but let's start with the renminbi.he pboc stand out of the way or are they engendering weakness in the currency? i think they are blessing weakness in the currency. we saw in the monday open, holding below the seven level, 6.99 level and it was the fixing on monday that gave the blessing that we can go higher and it was followed by a statement by the pboc that this was in response to growing protectionism and the rise in tariffs. it was sanctioned as an offset with the potential of tariffs going higher. rishaad: how can the u.s. response to this? can they respond to it? what do they have in their armory? claudio: there are a number of things. there is the september 1 deadline in escalation. a further 300 billion. last weekend, wilbur ross was in latin america saying as soon as this week, we could have the rulings with regard to u.s. applications to trade with huawei being announced this week. we will have to see what happens to those rulings, which shows china has taken a gamble and lost some degree of confidence that

benjamin from jp morgan wasn't really expecting much nuance from the rbnz.have a preference to be silent, then strike hard and fast. it has historically been a bit of a roller coaster ride. even by that standard, what's going on now does stand out. haslinda: say what you want, new zealand has become a gold standard for other central banks as well. yes it's a small country but when it comes to policy, it does punch above its weight and size. dan: there's a lot of history here. the 90's into thousands were characterized by a shift in many economies toward central-bank independence and buttressing that independence was a formal inflation policy, generally with a two minute somewhere. new zealand was the first. they liked to remind people of that. they are very proud of that. all through the 90's, you couldn't go to any conference or listen to any speech by a central banker without some reference to inflation targeting which drew in a comparison with new zealand. when that trend was in place, it was the gold standard. it's become a little bit squishy or. chris l

after the pause from the rba and the rbnz hiking, it is touching go what the rbi will do.re that they will hike 25 basis points, but they could pause moving forward. that will be the key question. that is what we are watching today. markets are not sitting on the sidelines today as well. haslinda: that's right. as you said what we are coming down to the market open in india in two minutes. rbi front and center. we are watching adani shares that have recovered some losses as of late. if you look at the flagship shares, down 46% since january. taking a look at premarket, positive territory. adani power up 0.60%. adani transmission higher by almost 3%. this is pre-market. big day for india, especially on the back of the rbnz and rba, it does seem like we are some diversions. and it comes to the rba, ed has the property sector front and center, so -- it has the property sector front and center. central banks around the world party much between a rock and a hard place. yvonne: yep, and getting harder. we had the oil shock earlier this week and now we have the central bank diver

after the rbnz cut rates by 75 basis points.re likely to maintain the pressure to the downside as more countries go into coronavirus lockdown. nick, we are getting to this point in the markets where we don't really understand what each volatile move to the upside or downside means. we are trying to interpret moves into gold, for example. for an sx,u watching particular the u.s. dollar? raining --tainty is reigning. certainly the dollar, with an unprecedented cut from the fed like we saw today, you would normally expect the dollar to be a lot lower than it is. as you said, the clean shirt in the dirty basket is still relevant. we are expecting the dollar to retain is strength over the next week or so. is cut aturrency, it the moment. i think short-term, the reaction we've seen since the fed cut seems to be that the markets are not taking it particularly well. i think we probably got in the short-term, the downside for risk currencies and were probably looking at dollar-yen, and something like the a ussie-yen under pressure in the

one of the precursors to what were seeing is the rbnz. david: taking the dollar down and then dropping it. live pictures from the press briefing, they kept their rates unchanged but it's really the guidance and no cuts in price. rishaad: they are wary of ongoing inflation pressures, well, i should hope so. yvonne: i was impressed with how they've come back the last few months. that's something we are watching very closely. that briefing just started a few minutes ago. david: on top of all that, this movement seen in the rates market, now price for 100 basis points. the term premium is completely gone, we thought it was back. some of these futures for example at record highs, and i actually suspect markets have swung too much the other way on this. kiwi style qe. rishaad: let's get back to what we are really talking about, mood music coming out of the federal reserve and the federal reserve governor speaking, bill ackman all weighing in with their views. >> i am increasingly confident that policy is currently well-positioned to slow the ec

we also had the rate cut from the rbnz. it was not completely unexpected, but we are getting this line from the governors saying they considered cutting 50 basis points today, but the consensus was for 25 percent. we have new zealand making an abrupt pivot to easing. to what degree do you think the country might be a canary in the rates coal mine? >> normally, they are not considered the canary in the coal mine. i think there are a couple of central banks who are, but i think what the rbnz has done is really underscoring the situation you see in the developed markets, which had an expansionary economy, and you definitely are looking at a slowdown which will more it rate cuts. you have seen how the expectations of a 50 basis point cut by the fed have risen from a very low level two weeks ago to know about 15%. i think we are in a monetary easing cycle, but i would not necessarily say that new zealand is going to drive that or that they will be the canary in the coal mine, so to speak. avril: what are you expecting from the f

this is as we are seeing the rbnz unleash qe.will see $17 billion upon buying for new zealand to short the economy, the kiwi dollar the longest streak of losses against the u.s. dollar since 1971. let's check in on how the kiwi 10-year yield is faring. we are seeing moves for the yield that are quite extreme. we have the 10 year off as much as 53 basis points, the biggest drop on record. i want to highlight stocks to watch in sydney as we go to the open. keeping an eye on virgin australia as the carrier has flagged more capacity cuts and the australian government whitens the shutdown. santos also in view after slashing its target by 38%. also looking at this one, as it estimates jet fuel demand reductions could be as much as 80% to 90% for the timeframe. a lot of pressure on jet fuel shortage -- jet fuel storage. >> i want to get more on what we should be watching. bloomberg's global markets editor adam haigh. what is the latest we have heard from federal reserve officials on the current state? the latest comments have been those

we think the risks are balanced. >> the governor from rbnz talking about patience.ng to india's elections, parties are accusing each other of illegal spending as authorities seize ballistic goods in a crackdown. let's bring in our reporter from delhi. why is the amount of money spent , legal or illegal, on an indian election so very high? >> is basically the size of the electorate. you have hundreds of millions of people you are trying to where you -- trying to woo to get the votes. more than 950 million people and political parties have to get the voters to come to rallies and spend -- and they have to spend money on ad campaigns and every other kind of publicity campaign and in india a lot of the money that is spent is not accounted for. a very small percentage, less than 5% of the actual money spent, is declared. so it is actually about trying to get out the word and paying all of it with cash, liquor, gold, drugs, whatever works. >> what does it mean for a party to use unaccounted money to fund a campaign? >> india is still a significant cash-based economy so a

we are looking to adrian, the head of the rbnz speaking on what this means.ld be more support for the kiwi dollar. plenty more to come. this is bloomberg. ♪ >> from the heart of where innovation, money, and power collide, in silicon valley and beyond, this is "bloomberg technology" with emily chang. ♪ emily: i'm emily chang in san francisco, this is "bloomberg technology." coming up, the washington dc attorney general slaps amazon with an antitrust suit, accusing

we expect a 20 -- 25 basis point cut in august, and -- august from the rbnz.sis point cut from the rba. rate cutsluding to complicates matters for the central banks. we saw the ecb move last week and now the rbnz indicating that rates would need to go lower before they go higher again. the rbnz have highlighted global risks, and it is key that these currencies can lean in to some u.s. dollar weakness, and the reason for that is because domestically, investment was highlighted by the rbnz and it is concerning to us that business confidence has been week for some time. we have a forecast for the kiwi dollar of around 65, and a forecast for the aussie dollar around 68. but we still have a euro-dollar -- euro strengthening against the u.s. dollar over the next 12 months. we think the antipoverty and deanencies -- antipo currencies will stay relatively weak themselves. with regard to positioning, it is very short for the new zealand dollar as well as the aussie dollar. you have to remember, when you think about why is it short, the traders are picking up carry here

rbnz did decide to hold their rate at 1.75%.he of the rbnz would like to see a weaker currency but he's not going to do anything to make that happen. but the philippines, it's a different story. out of a survey of 21 economists, 2 are predicting that they will, the bnp will raise that key rate today. it's the first time it has been not unanimous that they are going to hold the rate since 2014. it is significant. it's not because the fed raised rates last week. it's because of inflation. let's look at a bloomberg chart, 7034. what you are seeing now is the white line that is the key rate. the blue line, that pretty turquoise, inflation is down to 3.3%. that means it is above the key rate. we have a negative real rate at the short end. that is something people are pointing to as a suggestion, combined with that yellow line, that is the gdp rate growing pretty quick. in 2016, 6.8% in the philippines. that is among the best going economies in the world. at any rate, people say maybe they are starting to fall behind the curve. econom

what are you expecting to hear from the rbnz governor? i want to start with something tracy withers nor burlington bureau picked out as the key phrase because they did make the 50-basis point hike, they point out that while there are early signs of demand easy, it continues to outpace supply. the committee agreed monetary conditions need to tighten further. how much further, mr. orr? you say the rates will peak at 5.5%? does that mean another 50-25? what would make you slow down? the fact that they say implement remains beyond the maximum level, how much does it have to slow down? that unemployment rate is still very low. and remember, they will update their forecast, very important as well. they see in terms of the more dovish part of this, the recession starting in the second quarter of this year. although adrian orr says they expect him be a mild recession. they see the policy as contractionary no, that is another cautionary sides. these are some of the things that we want to learn more about, and we want to hear them pushed on by our

as i mentioned, the rbnz is the clear line to cut.u play the policy divergence, i would go for going long aussie kiwi because while it is marginally less hawkish, it is out hawking the rbnz. that's a very clear policy divergence in my view. haslinda: it wasn't long ago that you on played a part. it has been pretty stable. the pboc has supported it in a huge way. does it play any part it all? what are the guiding factors for asian currencies? >> as you mention, the volatility has been dampened so much. the traders get excited to go from 721 to 722. in reality, that's very little volatility. so the asian currencies are not able to take their cue from the yuan. that's why any changes from the dollar leads to an outsized reaction in the asian currencies as we have seen just today. we have seen again in the dollar. we've seen outsized reaction from the juan and the tieback even though the yuan is still historically stable. haslinda: we have to talk about the yen. 151. closed to 152 which is on the cusp of the 1990 levels that we saw. and y

david: the assistant governor their of the rbnz.ick check of that latest business flash headlines. >> macron and united microelectronics have settled a lawsuit over intellectual properties. that will make a one-time payment of an undisclosed amount to settle all competing claims. it was -- micron says it will continue to seek full restitution in a separate civil lawsuit. amazon is trying to delay the plan takeover of india's future retail company with a fresh legal challenge. amazon alleges $1.5 billion was diverted away from future retail including to a company owned by one of its founders. it is demanding an investigation. it says the allegations are baseless. kkr and cbc are said to be considering a joint did for telecom italia. kkr is already pursuing a solo offer that has been described as too low by shareholders. now we're hearing kkr could team up to share the burden of what would be europe's biggest ever leveraged buyout. the ceo rc company board to take action on the kkr bed, offering to resign to help get across the line.

the key we could face more selling pressure, even if the rbnz holds. we are down 1% for the kiwi at the moment. take a look at the bonds. look.d: let's have a they said a rate cut was necessary to support jobs and their target for cpi, which they project to rise slowly. this is what you wanted here. the new zealand dollar on the slide. you can see when that rate decision came through, a fall of 1% plus at one stage. yvonne: people say there was a lot of people pricing in this cut already. we will not see too much reaction when it comes to the bond market. when it comes to your new zealand to year yield unchanged. the 10 year yield down one basis point. it is the kiwi we are watching, the aussie kiwi also bid up. 1.1% tookhis fall of the new zealand dollar to the lowest level since november 2018. they are forecasting at the moment a chance of one further rate cut in the offing for new zealand. there we have it. yvonne: we have the rba hold, the rbnz cut. malaysia cut yesterday. we have thailand and the philippines, so plenty more to digest, but it has b

rba, rba and z -- rbnz. now we have some signs governor lowe is starting to price in the pivot, or a leastt hint this is where they are going. opec meeting in vienna, that will be a crucial one. we have inflation numbers out of korea, thailand, taiwan, philippines. and in the u.s. jobs report. rishaad: aussie dollar, 63, now 64. but nevertheless. always great to see you. is there anything which can possibly right now halt this, i am not going to say king dollar, but i have said it now. anyway, the strength of the dollar. >> in terms of the framework on the dollar outlook, what are fx team highlights is there are two key things they are watching. they want the fed rate hike ex petitions to peak and they want the rest of the world's growth to bottom out. on the fed rate hike expectations, as far as our forecasts are concerned it is pretty much there. but when do we see the rest of the world growth bottoming out? in terms of our team's forecast, we have that happening in the first quarter of next year. that wil

as soon it can almost, rbnz is going to move to negative rates.this auckland outbreak somehow remind you as policymakers, remind investors that may be it is still an issue that is alive and well, an issue that is on the table for rbnz? >> i do not think the reserve banks ever forgot it. we have gone to pains to explain to people we are crowding scenarios and not projections of certainty. markets to be thinking forward. they know what we have to achieve. they know the instruments we use. i really do hope they are watching the same information. growe economy continues to and do what it is doing, today's news around the coven just puts -- the covid just puts it back into perspective. be prepared. do not run around on predictions. >> how much are you depending on the new funding for lending program to give the economy the additional stimulus it will need to keep the recovery going and maybe again there will not be a need for negative rates if it does its job. >> one would hope it is a beautiful world and the sun comes up and covid goes away. we could

the rbnz has been against the move which was except -- suggested in september. the government says the rbnz overall mandate for financial stability and full employment remains the same. in italy, mount etna continues to suppress -- surpass its record of directions. it's the most vibrant this for years. it shot lava and rock more than 6000 meters into the sky. it closed a nearby airport. there are no reports from injuries -- of injuries. global news 24 hours a day on air and at bloomberg quicktake, powered by 2700 journalists and analysts in 120 countries. this is bloomberg. haslinda: korean stocks up right now after the bop left rates unchanged. the governor saying that today's decision was unanimous and that the economic path depends on the vaccine rollout. the csx 200 index rebalancing after three days. the hung saying up by 1.5% after plunging on wednesday, led by the hong kong exchange. oil hitting a one-year high. some forecasting $100 crude in the next year or two. the global economy recovers. copper at a nine-year high with investors betting on more gains

the rbnz staying packed as expected. they are ready for negative rates.nt and business closures. the nifty pointing to a higher open, currently up .4%. the dollar continues to rise along with real yields. the dollar index hitting a one month high. dollar trade is beginning to price in risk. we have the yuan heading for the best quarter since 2009. currently lower by .2%. we have the pboc fixing rates lower for a second day. headlinesust a few coming through. one is from huawei. it's the deputy chairman. seem huawei is still willing to buy from u.s. suppliers paid we need chips for it a lot of the networking equipment. fujifilm will be applying for radio tory approval as early as october -- regulatory approval as early as october. trialsactually suspended on this particular medication, if you will. beganed its delay and clinical tests as of yesterday. move to commodities and have a look at iron ore futures on the way down. supplies weigh rising against the recovery taking place in china. concerns over demand are being compounded by the prospect of rising a

rbnz greek prime minister alexis tsipras winning a fourth vote of confidence. backing of lawmakers in a vote triggered by his landmark accord with the neighbor to the north. the government's coalition partner had pulled out in to allowin agreement the country to call itself the republic of northern macedonia. global news 24 hours a day, on air and at tictoc on twitter, powered by more than 2700 journalists and analysts in more than 120 countries. i am rosalind chin. this is bloomberg. come, one ofl to apple's biggest advisors to report earnings and what to expect from the taiwan semiconductor. yvonne: the pboc has been quietly trying to ease lending rates without cutting official rates. how big cash injections will help. this is bloomberg. ♪ this is bloomberg. ♪ ,ishaad: talk about the pboc could quietly make borrowing costs lower while changing official interest rates. billion input $83 cash and to the market. yvonne: providing cheaper funding of banks to allow them to lend to companies that lower rates. let's bring in mayank mishra. he joins us from singapore

adrian for not going to let virus outbreaks stop the rbnz from hiking rates as soon as october. kathleen, what is the governor's reasoning? kathleen: his reasoning is that a central bank has to learn to deal with the virus, deal with outbreaks. he says the economy is still surging ahead. there's key concerns that inflation expectations could get out of control, and he said yes, very definitely, the door is open to a rate hike in october. >> we have to focus very much on our purpose, which is, of course, the inflation and employment mandate that we had, and absolutely, this week was not the best of timing to be looking to reduce interest rates -- reduce monetary stimulus, i should say, given the health situation, but we can observe what is going on, and the underlying economics remains the same. we have severe capacity constraints. we have supply disruption creating the costs. we have above maximum sustainable employment, so the underlying situation remains the same, but we thought best let's just observe over the next few days at low cost to us. kathleen: you brought up an inter

we expected 25 basis point rate cut from the rbnz.ill depend on what transpires over the next few weeks, the meeting at the end of the month. they have the advantage of waiting to see more information, seeing what other central banks do. it is quite possible the fed has cut 100 basis points the time vr begins at meeting rolls around -- the rbnz meeting rolls around. paul: jp morgan security chief economist, thank you so much for joining us. still to come, we do have another major event canceled. google is calling off its conference. we will have the details next. this is bloomberg. ♪ emily: quick check of the latest business flash headlines. ford motors is betting all air travel for business trips after two of its employees in china tested positive for the coronavirus. they have been quarantined and ford says they are recovering. the company says it is serving domestic and international business air travel until at least march 27. while also asking some staff to work from home. india's struggling yes bank facing more difficulty with p

the rbnz holding its first q. week auction.quidity rules to boost dollar funding. bloomberg intelligence cautions ongoing demand of dollars may suffocate asian currencies with the worst of the regions macro data yet to surface. haidi: sophie kamaruddin in hong kong. let's get more on what we should be watching with the markets. assetshe rally in risk continuing to a second day but it is really hard to see how sustainable this is before we get more assertive data on the health containment front. we can see the market a little bit confused or disappointed that the tariffs, which were deferred and not removed entirely. adam: people very reticent to take any real long-term view on the markets, even though we have had such a huge decline across across rateand -- assets. it is difficult to take that one view without seeing it peaking some of the most serious places like the u.s., in places like europe, but of course, we are continuing to see the lockdown. the lockdown in india is only just starting and that will become more and more

we saw the rbnz on hold at record low levels, showing the discrepancy between the u.s. zealand. anchored,remains still no prospects in terms of market pricing. the rate rise potentially next year. that still holds its way. clearly, the tariffs on steel and aluminum have an impact. we know there has been a carveout on exception when it comes to australia. as long as china continues to remain robust in data, does not decelerate to sharply in terms of growth, it is almost a goldilocks scenario with those periphery countries. haidi: with the jay powell pushing up the hawkishness into 2019, when are we going to 3% for the u.s. 10 year, and what happens when we do? andre: i am sure you are familiar with our hsbc call. our minds, if it does occur, it will be temporary in nature. last night,the fomc it was not a surprise when it comes to the fed hike. to me, the one thing that stood out was the 2020 projections. %, to be exact. that is well above the long-term projections they had for 2.8% or 2.9%. i think that is less likely. they do break through percent, will be very tempora

has been and that painful unwinding now with more dovish than expected sentiment coming from the rbnzth the hold, they were looking traders that is in that positioning for vigilance from the governor and it was a softer take than expected and compounds concerns about how much the economy has slowed. looking at treasuries, processing some nuanced comments from chair powell, the first day of testimony to congress flagging rising risk of the jobs market and that was the key element, the shift when it comes to messaging on the labor market and the rate cuts still being held for the rest of the year. that is it for us. middle east and africa is next. ♪ (♪♪) (♪♪) (♪♪) (♪♪) sandals rhythm and blues caribbean sale is now on. visit sandals.com or call 1-800-sandals. >> the following is a paid program. the opinions and views expressed do not reflect those of bloomberg lp, its affiliates, or its employees.

we also wanted to focus on what we see in the rbnz. we are still seeing quite steep declines on the kiwi dollar, and this is coming after some comments from the rbnz suggesting it sees financial conditions currently still restrictive, and this suggests it could see more easing to come in the days ahead. we are also seeing bonds in new zealand climbing. let's flip the board because yesterday was a really wild one for chinese stocks. just to give you a sense of how extreme it was in terms of turnover on the mainland as well as in hong kong, we saw it at a record ever biggest trading frenzy. we are hearing about people rushing to open new accounts. that is the state of play at the moment. haslinda: trepidation, frenzy, you name it. let's get to the global strategist at j.p. morgan asset management to discuss more on the markets. good to have you with us. lots of questioning about whether that sell we are seeing in china is consolidation or capitulation. >> thanks for having me. firstly, let's go back and think about the chinese equity ral

the kiwi higher as the rbnz held as expected. current level for the foreseeable future. in india surging food prices are pushing up india's cpi. we are reaffirming expectation of a hawkish hold from the singapore bank. temasek warning of an uncertain road ahead after its worst returns in seven years. we hear from haslinda's conversation with the cio. haslinda: today asian stocks up for a second day as we await crucial cpi data out of the u.s. expectations that cpi will ease, and that is propping optimism, seeing rice's the last two days. taking a look at benchmarks in asia, almost all sectors are in the positive. tech, in particular alibaba among the biggest gainers. the nikkei to 25 8%, it is about the strong yen story. passing 140 which is a crucial level. expectations that boj may remove ycc when it meets at the end of the month. the 28th of july. let's wait and see if that really happens. in terms of other fx currencies in asia we're seeing gains. he talked about the dollar at a two-month low. the peso is up, as well as the t

here was a look at jay powell's comments to congress, and also the rbnz releasing commentary. kathleen: there's no doubt jay powell made his message perfectly clear. he has been singing the same dovish tune for a while. recent speeches at the end of the fed's last policy meeting, maybe there's inflation concerns in the market, maybe bond yields -- no doubt about it, they have risen a lot since the fed's past meeting. jay powell says nothing is going to change. >> the economy is a long way from our employment and inflation goals, and it's likely to take some time for substantial progress to be achieved. the economic recovery remains uneven and far from complete. kathleen: that was his prepared testimony. that contains the fed's new mantra -- it's going to be some time before substantial further progress on its goal is enough, in other words, getting to inflation at 2% and higher and seeing it stick there, seeing unemployment falling toward the full appointment level, jay powell says 4.3% or below is where he starts seeing that. he also is more optimistic about vaccines rolling

more than one priced in at markets right now before year end for the rbnz. the qe, the spike at 722. take a look at sterling and raymond b. it was gains that helped alleviate some strength in the greenback overnight. 11404 for the dollar-yen. still hovering around the for your highs. haslinda: that is right. when you take a look at markets, it is about inflation should inflation fears and the prospects of subtle bank targeting weighing on market sentiment paired discuss emerging market opportunities with our next guest oversees more than $35 billion with franklin templeton said we are joined by the cio. good to have you with us. inflation front and center. it is a quagmire. there is no consensus whether it is transitory or not. >> we have been trying to grapple with this issue about inflation for the last year. the pandemic has had a lot to do with it. we are seeing economies recover. supply chain issues around the world and that is causing a lot of issues with inflation. the question is, is this for a set time? is it contained or is it more widespread? for

the finance minister praised the rbnz effort to ease the economic impact of the virus. they down plied the idea of monetizing government debt to pay for the qe program. the country's bond market is continuing to function and operate well, he says. bank --ly the reserve debt is continuing to operate. liquidity levels are good within the banking sector. for now, the approach we're taking is right. karina: human the u.s., the house of representatives has passed a $484 billion coronavirus aid package even with lawmakers at odds over the next rescue bill. the debate from members wearing masks and entering the chamber under strict precautions. president trump is expected to sign the legislation which is the fourth virus related package since early last month. global news, 24 hours a day, on air and on quicktake by bloomberg, powered by more than 2700 journalists and analysts in more than 120 countries. i'm karina mitchell. this is bloomberg. rishaad: thanks. still to come, many exclusive directors from the nec and ask goldman president. and the credit suisse ceo. this is bloo

tune into daybreak australia for an exclusive interview with the rbnz governor.es burn across new south wales and queensland. at breaks in northern sydney are under control. firefighters managed to contain 20laze in the neighborhood cobblers north of the center of the city. three people have been killed so far. parts of eastern australia have been left vulnerable to fire by a two-year drought. to india, where new delhi s are experiencing severe pollution. the air quality rating rose above 400 on tuesday. that's about eight times the internationally accepted level. northwesting from the brought smoke to burning fields in punjab. world health organization data last year showed india at the 10th most polluted cities in the world. u.s. is putting pressure on the wto by raising the possibility of blocking approval for its budget, which would effectively stop it from working. the tradepproached body, which president trump has threatened to withdraw from entirely. the u.s. contributes more money to the wto's annual budget. global news 24 hours a day on air and on @ticto