in what happened with the boj for the 10 year.t will be a good balance with fresh eyes and also the knowledge about what the boj is all about. francine: do you think if he does become actually the bank of japan governor, he will be much more dovish so we are going to see market swings the other way as markets get over their initial knee-jerk reaction? >> well, i mean, the situation in the boj is really difficult right now. first of all, the boj right now is observing the first sign of the possibility that--it seems very challenging for the boj to complete its job but i think there's good communication going forward, and the markets will understand how good communication -- how good a communicator he is. i think has communication will provide some kind of stability in the market going forward. tom: the importance of the bill to commit a case about some of these potential -- mia kate about some of these potential changes. the time during your looking at is april the eighth when mr. kuroda will be replaced. what is expectation and yo

and also, he sees data so his decision for the boj's with him as a governor, the boj's decision is morea dependent and based on theory, theoretical framework going forward, so i would say that professor ueda is, you know, hawkish or dovish. i would not say that. he would be neutral, more data dependent, based on the theory. of course, i know what you are asking. the market is now looking whether the professor ueda will be taken more, you know, -- normalization. so we need to look at that inflation or development in the recent times. we saw that talk of cpi hit 4%, 3%, and also the monthly wages, the recent one is 4.8%, up. it's really clearly different from the past decade so even for him, he will think about the normalization for monetary policy. haidi: does that mean we are going to see more pressure for the equities space and for surge the japanese yen? even if his policy stance is neutral, the data shows they need to be tilting more hawkish. rie: yes, so i think the boj's december decisions, earlier than expected from the market. bank of japan has already considered that normalizati

she was a boj former official as well.this nomination by kishida, not choosing this woman to really be in the top three positions at the boj just shows how japan lags inequality front and is behind. we have had janet yellen for the fed, ecb, christine lagarde. maybe still a long way to go for japan in terms of equality, especially at leadership positions. david: kurumi mori live for us out of tokyo. let's bring back nicholas smith, japan strategist. let's try and make money for people. apart from banking stocks, which as my colleague was pointing out, five-year highs. does any other sector stand out for you in this equity market that might benefit from this path towards normalizing interest rates in japan? nicholas: obviously finance generally. what the bank of japan has been doing has been hurting not just the bank but the rest of the financial sectors, particularly the insurance companies. another candidate had been saying two things. one is that the damage in the banking sector and the longer you do it, the more it hurt

the boj can increase the monetary base.inally, they will remove all restrictions of the yield curve control operations. finally we will return to the traditional jgb style operation. tom: ok, takahiro sekido, chief japan strategists. important they would that experience at the boj himself. thank you so much for that analysis and context. we appreciate it. let's get to the business flash with alice atkins. >> bloomberg has learned that qatari investors have made an offer in coming days. the sovereign wealth fund is helping them with preparations for a bid. the future of the english premier league club has led to speculation since american owners were reported to be open to selling a stake. swedish battery maker says president biden's green tax is impossible to ignore. the tax credits included in the u.s. inflation act could cover 30% of the operating costs of the new plant. >> if we start tomorrow building a factory the size of northvolt up in north america and get it to be ready by 2026, between 2026 and 2030 we would be lo

but three men again set to lead the boj.could weigh may be negatively on the nomination process as a potential wrinkle. the federal reserve is led by janet yellen, and ecb by lagarde, but boj will keep lagging in gender diversity. tom: what will it mean for policy going forward? >> it means there will be a close eye on whether to keep this yield cap on 10-year government debt. that's the figure the market is betting against. that's a decision that ueda is to make. he needs to convince a lot of people that it makes sense to continue with stimulus, or to make change. tom: it all comes down to that yield curve control. excellent reporting. thank you both. coming up, in the wake of the ftx scandal, we look at what will it take to close crypto's doors to the country's banking system. this is bloomberg. ♪ u've been a huge help. at ameriprise financial, more than 9 out of 10 of our clients are likely to recommend us. our neighbors, the garcias, love working with you. because the advice we give is personalized, hey, john reese, jr.

we think rising pressure on the boj will weaken, too, and we think the boj will be able to maintain thewe are getting more lines from the nominee speaking with parliament, they will be closely coordinating with the government to receive approval aiming to achieve sustainable inflation if approved. the current easing measures are approved. it will take time to achieve sustainable inflation. we've been talking a lot about this idea of -- what is the phrase? immaculate disinflation, the idea you can bring down inflation and still manage to avoid a hit to demand. do you think that is possible in japan's case, given how extra complicated the settings are? >> inflation will definitely come down later this year simply because a lot of the process has been driven by the weaker yen and the search in energy prices. on the domestic front, there is much price pressure, but we are seeing now some signs that wage growth is accelerating, and our analysis suggests this is increasingly driven by -- it is kind of like a wage price barrel in its infancy. you can see the strongest growth in wages is happen

it is very beneficial for the boj.s the biggest challenge and the biggest risk as he takes on this role presumably when he gets there? >> i think the biggest risk is -- ok. he appears to be concerned about the lack of flexibility. he also said the boj should prepare a strategy [indiscernible] -- a large shock to the economy. [indiscernible] in terms of economic impact on japan's economy, so compromise, there are so many factors. a bigger challenge i think going forward. >> when it comes to the broader economy we have had these pretty firm domestic demand, the yen has helped as well but we are starting to see some of the potential headwinds globally things easing, did you think it is possible to get the virtuous cycle or is that too big of a challenge for the new boj? >> the gdp [indiscernible] far below market. we are not worried about this figure. going forward, [indiscernible] partly due to the need to address the issue of shortages which has been reemerging. we expect [indiscernible] exports, slow in goods, [indisce

that is predicated on part -- in part on the boj. it is not only predicated on the boj.ven if you took the boj out of the equation, we would argue we would see a stronger yen. we think bonds will outperform equities this year. in that environment, the yen tends to do best. japanese investors have been repatriating. >> many people are sending in those to danny and i. it is just delayed, not denied. the bond market will force his hand. >> we think so. when we look at longer-term valuations, they are above 130. this was a faster pace than the market was anticipating. u.s. raise volatility which kept the dollar elevated last year is now falling. the trend is low in the dollar. >> does it not threaten that narrative question mark course we don't think so. it provides near-term support for the dollar but ultimately the trend is for the dollar to decline. partly because of payrolls and probably because we're looking at a u.s. earnings possession. >> i am salivating. i want to know if it is the ecb that gets me to 130 or is it a procession denied? that manifests itself in two wa

people close to the boj said just that. he was on the board from 1998 to 2005, he graduated from m.i.t.. stanley fisher was among the people who taught him then but this is many years since. right now, you kind of have to guess is he going to be more hawkish? or is he going to be dovish? when he was approached by reporters in the last couple of days he said the current policy is appropriate. monetary easing needs to be continued at this point. he also said the amount of policy review should be done at some point. he also said recently in an article that the boj is far from achieving 2% inflation that is sustainable, and rate hikes would only lead to economic deterioration. you see a variety of things coming from him, and i think that it is interesting. that would be the first academic in the postwar period. usually it is someone at the bank of japan or ministry of finance and the two deputy governors are the former commissioner of the financial services agency, and then the boj executive director. he is the current bank of

tom: let's move to the boj.ast year, japanese institutional investors dropping about $180 billion of foreign debt and they still have $2 trillion worth of foreign debt. what is your level of concern about financial ruptures if indeed yield curve control is abandoned or gradually moved away from in terms of the fund flows back to japan? saed: i think that is a wildcard. you have the exit of kuroda and the new bank of japan governor potentially in the next few weeks. i think the real risk is we see a sudden shift in policy, unlikely in the first part of the new governorship. i think if we see a massive shift in terms of policy, this is an academic coming in, an unknown commodity, we could see substantial change in equity markets, especially given the qe policy in japan the past few years. that could be considerable shift in terms of outflows out of japan. i think in the short term, it is unlikely we will see a significant shift in boj policy as we basically assess global policy. i think japan is still lagging subs

i have one more question on the boj story.the boj as it makes this pivot need a weaker yen to provide cover for what they have to do elsewhere and are they going to try to make that happen? i am wondering what a weaker yen looks like to the boj. mark: at this point they don't need the weaker yen. if you think about the framework for last year and why they were reluctant to move when everyone else was moving was they were looking at gross national income. japan is a national importer of energy along with the eurozone and korea. the boj took an approach that they are not looking at gdp. they are looking at gross national income and this is a massive income shock because of the cost of energy and the things they were importing. they wanted to stay on hold to provide a cushion on easing monetary policy and easing monetary conditions as a function of the energy shock. they took a different approach than everyone else. i feel they have wages higher, that inflation is more sustainable now that negotiation wages should be higher in re

in this as well boj. david: yes and really in what way it comes out roughly this time tomorrow based on the recording out there, but there is a name at their shocking markets and trying to scramble over the weekend made reading what his orientation might look like when he takes office. we get a little bit more for everything. tumbling right now, dollar yields are pushing higher across the board in the asia-pacific. yvonne: it is a fed repricing starting last week where the peak rate went from 5% the market was pricing into five and a quarter. they started pricing out the prospect of more than one rate cut one this year, so that is what most of these losses here today, geopolitics are not helping either when it comes to these objects, but the boj is a wildcard as well. look at what the yen has been doing, shown a lot of volatility. the yen strengthened. people are guessing how hawkish is he going to be. yields edge higher. we are watching to see if the boj does anything. rishaad: stanley fischer school of

boj. very important.en the architect of all of governor kuroda does key policies -- the move to quantitative and qualitative in january of 2014. he went on to expand and enlarge that. importantly, yield curve control. . that is his baby, by all accounts, and one of kuroda's key policies. he is seen keeping policies flexible, adjusting what needs to be adjusted to keep the stimulus in place. he was a deputy governor himself in kuroda's first term, well-known and an expert in banks and banking. his concern with the extraordinary stimulus of governor kuroda is that it makes markets unstable and it hits banks in an printable ways. it could be a source of financial instability. in terms of where they stand, where mr. mme a stands, he is definitely did dovish -- mr. masayoshi amamiya. he is seen as perhaps being able to adjust more what needs to be done, but definitely in the camp -- you don't have any hawks at the boj right now. [laughter] haidi: i was just looking at that great visual and having a chuckle. i

what were your takeaways on what we heard from the boj governor nominee?arfield: the way it ended up came across as a continuity candidate. he started out sounding a little bit unsure about exactly how committed he was to sticking with policies of his predecessors and taking a gradual approach. we had some gains early on. probably the biggest sign right from the get-go, japanese bond futures were well bid. they traded up. they got as high as 36 up during the session. they did come back a little bit. now they are back up to that 32 level. so the bond market liked what they heard. no great surprises there. yields creeping down a little bit. probably that was helped by a general risk off tome -- tone that seeped across the asia pacific. equities were down in a lot of places. taking that is the context, japanese government bonds, the yen is strengthening a little bit now. it's hard to dissociate that from the grub -- broader moves. there was a strong gain early on. that was taken away. it made it clear that he is a long way away from doing anything in the near

and fumio kishida is why he is said to be the next boj governor.e is certainly going to be watched for his reaction to the yield curve control and how adeptly he can contain monetary easing and the government facing a big budget deficit. when that is only going to get bigger on the defense spending when that kicks in and you don't want your boundary at -- your bond yields to be rising a lot. shery: kathleen hays with the latest on what to expect from the boj as we continue to watch the latest elements around the downed objects across north america. we are hearing from the assistant secretary of defense briefing reporters, saying there was possible danger to civilian aviation, that objects had neared sensitive military sites. the reason objects don't pose genetic -- kinetic threat but the u.s. is scrutinizing airspace as we saw four objects being downed in the past eight days. let's bring in rebecca choong wilkins. the u.s. has been very careful in not directly linking this with china, but what do we know at this point? rebecca: this is the fourth b

does the boj need to move soon? >> look, you can make the case that they should move very, very soon. i understand the caution but have five or eight years of excessive inflation, they have a few decades. i think they really want to make sure that the labor market is responding. corporate pricing structures have adjusted to think more about inflation around 2% rather than something closer to zero. it does not seem like they are quite there yet. yvonne: if they are saying -- what will normalize policy if they reach that inflation target and it is stable? what would define stable to you? does it have to be several months, does it have to be -- i just don't know, right, for them to flip the switch? >> i don't know that it is about the months on the inflation data, it's about the picture and are we seeing the things you would expect to see to be confident that inflation will persist at that level. it can be higher than 2%, but i do not think the labor market is quite there were business behavior is not quite there. i wo

[indiscernible] at the same time the boj needs to pay attention.he boj will take a little bit of time to assess negative parts. haidi: there were so many negative parts when it comes to conflicting economic and policy conditions. how difficult and narrow is the path ahead to policy adjustment and how big do you think the risk is of a policy error? ayako: ok. ycc adjustment is a difficult challenge not just for the boj but all central banks. communication is also an issue. also there is expectation among the higher rates. [indiscernible] ycc is quite challenging. to remove it is the most difficult part. that is why this nomination includes the deputy governor who is specialized for the financial system. haidi: how much influence does market pressure play here? ayako: in terms of ycc, removal market pressure is kind of a big deal for the boj. the boj has not paid much attention to timing of negative interest rates. but for ycc, market functionality is becoming a big problem. inflation is critical, but we think inflation has already justified the chan

francine: do we have a sense of who else could be in the running to lead the boj?st of the speculation has centered on amamiya, as well as the former deputy governor. he would be a more hawkish choice than amamiya would be. there are other names in the mix. another name that surfaced was yamaguchi, the deputy governor to kuroda's predecessor. he would represent, or certainly would suggest, that prime minister kishida is looking for a larger change in policy rather than a continuation of the decade of kuroda economics we have had. francine: what are you hearing from analysts? a number of banks have put out interesting notes. >> certainly, the reports today, i think people are reluctant to commit to much given the wording that amamiya was being sounded out, the wording is weak given we expect the nomination to happen in a couple weeks, but people are saying this choice would reduce the likelihood of a major shift in the couple of months from the boj, but that would be positive probably except for stocks that are financial in japan, and suggests weaker yen in the near

ueda said consumer prices are rising at 4%, higher than the boj's 2% inflation target.added the inflation is mainly cost push stemming from rising import prices, not strong demand. ueda, who is an economist, says he think the cost push factors will likely diminish and inflation will fall below 2% late in the year. >> translator: i think it will take a while to achieve the 2% target. i believe it's appropriate for the boj to continue with the current monetary easing in view of the current economic activity and prices and future prospects. >> an analyst at a securities firm says ueda's comments friday offered no surprises. >> translator: but i don't think this is a conclusion. something new will come out sooner or later. investors will continue to be cautious in the short term. >> ueda indicated he'll continue the monetary easing policy. the analyst mentioned moves to sell bonds, in the belief the next governor will tighten the policy. the sell runniing will increase interest rates in the short term. he noted a continued rise is unlikely if the easing policy is prolonged.

boj, we talked about that. the deputy may be heading when the current head steps down in a couple of weeks. according to this report, let's bring in kathleen hays, are global economics and policy correspondent. kathleen, remind us who this is and what that might mean in terms of orientation of monetary policy. kathleen: he is a long time bank of japan -- some call him a life, but this is the big question now as governor gets ready to finish his second term. who is going to replace him? and amamiya's name has long been in the lead. there are others. this is based on a report by the nikkei, a prominent news organization that members of the ruling coalition party of talk to him about taking the job. of course, we don't know if they talk to anyone else, that occurred to me and the last few hours that we've been talking about this. but we do know that he has been approached because he has been the lead. most people have given him the upperhand hand getting the job, because he is for many reasons right there behind t

he has a lifer at the boj. he started their in 1979 and has held many positions before he took the post of deputy governor about 4.5 years ago. he is called mr. boj. he is expected to be in favor of keeping policy flexible for now. but he was one of the architects of some the major moves made under the governor coming yield curve control in 2016, moved to negative rates at the beginning of that year and he is one that is also considered as someone that could steer them through the markets. and a former deputy boj governor has been more concerned the last several years about keeping the extraordinary stimulus in place for so long will create financial instability. that is one of his calling cards. but the closeness that amamiya has with the governor is a factor. in terms of where he stands we have a chart showing he is in the dovish camp. that is something that would keep him in this let's keep things going as we figure out how quickly we will have to exit yield curve control. let me add that a couple weeks ago

>> it seems to be a message of continuity coming out of boj at the moment.r made the point that the cost push inflation pressures do not last long. that speaks to the idea that a lot of what japan is dealing with is trey level. -- he also speaks to the inflation target debate. all of this discussion in japan and elsewhere around whether the target should be change. no real hint of a change. the same for -- commentary yesterday, he has given two parliamentary hearings stressing his point that monetary policy at the moment is where it should be because of the economy needs support he is not a buyer of this hawkish inflation story. he thinks inflation is going to come down but he is open-minded and willing to tweak what he wants. he has not making himself a hostage to fortune. the initial messaging, the new governor coming in, certainly one of continuity. they are not trying to spook markets, but trying to send a message of one dollar at a time. shery: philip jeff isn't arguing against raising that's 2% inflation. >> this is an interesting debate. some people a

d or boj says the current value at the end of last year was 555 trillion yen or $4 trillion.s lower than the book price. the central bank raised the long-term interest rate cap in december. that triggered bond selling and pushed down the prices. the governor told the diet unrealized losses would have no impact since the boj plans to hold on to the bonds until maturi maturity. >> translator: even if appraisal losses increase, it won't affect boj's profit and loss for the period. >> kuroda says they are, nevertheless, paying close attention to the bank's fiscal health. >>> japan's financial services agency has decided to set up a framework to help startups raise funds more easily. an agency panel says the new system will let companies leverage their future business prospects as collateral, rather than having to rely on property. the firm's technological abilities and innovations will be qualifying factors. this comes as startups face difficulties getting loans from financial institutions. many don't own buildings or land to be offered as collateral. some entrepreneurs have no c

there's lots of speculation when the official narrative will come from the new boj governor. we are expecting it in the next few days. as a result, i'm looking at the japanese yield curve. this has been a big play of the macro hedge fund community over the last year. there are four different snapshots of what has happened under governor kuroda's tenure under the boj. an upward sloping normal yield curve positive all the way. all wonderful. that was just before governor kuroda took over. then at 16, the curve flattened. the front end went negative and the backend is a yielding well below 1%. it's a pretty depressed curve appeared than the pandemic in september 2020. it's an even more broken curve, flat all the way. we saw 30-year-old -- 30 year yields negative. this is a broken market. now suddenly, 2023, this is the curve as of yesterday. look at this. we are back to the pre-governor kuroda world. we are upward sloping. the front end is still negative, but the backend is up towards 1.7% yields. this looks like governor kuroda has done the full round trip and restoring his suc

on the outset in japan, a lot of focus coming down to the boj.hat -- could be taking the helm yesterday is what led gains in the nikkei. we don't have an announcement yet, but local media is reporting we could get the nominations next week. kyoto saying without attribution. a key factor that will weigh into the policy will be the strength of wage growth. we saw nominal wages in december , rising at the fastest pace since 1997. jumping 4.8% from a year earlier. that could fuel speculation in the markets that we are going to say -- see a boj policy pivot. in terms of trading, we are looking fairly range bound. partly what is driving that is this risk off mood that is coming into markets. investors in a wait-and-see mode because we have jay powell giving a key interview later today or the question is whether he will start to tamper that optimism we have seen from investors over the past couple of weeks that perhaps the end of the rate cycle could be near. we had bostick speaking earlier, he said the strong jobs report we got friday could be somethin

the boj is also close to getting a new governor.we expect a big revision to inflation expectations from the rba? kathleen: we will have to see. since they did 25-basis point hike up to 3.35%, which is widely expected everybody expected shortly after their decision that they will say, yes, we think we have done enough, or signals to that effect. instead it is that well, inflation is still high, more rate hikes may be coming. that is what surprised the markets. usually this time of year when the ripping out, for low is coming -- phil lowe is speaking somewhere. he is not speaking today. we will certainly be watching that. it will be all over it. for the bank of japan, this is the time of year, every five years when there has to be another boj governor appointed, when this announcement would be coming. a major broadcaster saying today it will happen on february 14. three people in contention. you have heard masayoshi amamiya's name several times. two more deputy governors behind him also being looked at. the third one, yamaguchi, we ha

tom: the other big news item today is kazuo ueda, the nominee for the boj giving testimony in japan, sticking to the script it seems but suggesting if you see evidence moving to that 2% target, maybe you can start to end easy policy. your concerns, are you concerned about the flows we could be seeing back to japan if we see an unwind of yield curve control? and what that means in this high-yield environment. christian: later today we get japanese inflation data. we should start talking about this more. ueda did not give unsurprising indications. if japan moves off the ycc control, and probably 10-year yields will overshoot. there are indications that once they are 1% or so, a lot of local investors say they would go back into local bonds. they have been flowing out into the u.s. but also parts of the euro market, the french government bonds, etc. they will not continue to do this in that respect. possibly also drawback. that is something markets are looking out for. francine: christian, thank you so much, head of economic research at barclays. let's get back to oliver in ukraine. >>

at his background, he doesn't come from the ministry of finance and he is also not too close to the bojt for the current prime minister, because the current governor had such a close working relationship with former prime minister shinzo abe, to stimulate the economy when the boj is supposed to be independent. that is something he could possibly bring. aha, independent. that is something he could possibly bring. fix. lat he could possibly bring. a lot of pressure _ he could possibly bring. a lot of pressure on _ he could possibly bring. a lot of pressure on the _ he could possibly bring. a lot of pressure on the japanese | of pressure on the japanese central bank to normalise its monetary policy isn't there? absolutely and i don't think anyone expects him to start raising interest rates any time simply because he would risk the fragile economy growth. but investors are looking at other more controversial policy of the japanese central bank, which has had basically back in 2016 the boj started controlling interest rates on japanese government bonds. it was supposed to be a short—term solu

does the pog -- boj need to be more urgent when it comes to inflation?> i think the first priority now is negotiations. the problem with japan is we had labor shortages that they met transferred to wage growth. we have created this cycle of 2% inflation and wage growth. i think the labor unions are asking for 5%. big companies are full of profits and able to do that. hopefully in march we see these wage negotiations finished and we will see gains of more than 3% and that will put us on the path. to think right now would send the negotiations -- tightening right now would send the wrong message to the negotiations. it is frustrating that he has not been more demanding and trying to get these wage increases. we should get healthy wages and start to exit from yield curve control. >> we had a guest yesterday best said it is not just this, but they do have to wait until 2024 to see if it is really emerging. how much do wages really have to go up in order to see 2% inflation be sustained? >> we had 1.8% in 2021. if we could get above three, that would be consi

professor of economics and former boj member -- board member there. let's have a look now at another central-bank, certainly the departure of lael brainard has left a vacancy. who's going to fill it. here's first word news with vonnie quinn. vonnie: officials reached out to a key democratic ally discussing filling that vacant role. chicago five -- the chicago fed president is under consideration. he says he spoke about white house officials about the vacancy but would not disclose if any names were circulating. a key china advisor president biden is said to -- the security council. special assistant to the president and the nsc senior director for china and taiwan is leaving her post next month. white house officials say her exit plans are not related to tensions over the alleged chinese spy balloon. world bank president david is stepping down early giving the buy demonstration more time to find a replacement. the lender says he believe his job by the end of june. washington has called for reforms of the world bank to reprove its ability to respond cr

dani: perhaps one risk for tomorrow that is diminished is the boj announcement.ack on that so far, but the question becomes, who is this guy? considering he was at the boj sometime ago, i found myself reading research papers from the 1990's to try to figure out his policy view. the market says perhaps more dovish. we are looking at the yen weakening again. how are you thinking about him and the direction of the yen? kamal: i think we are looking at the same research papers. the most important point is the initial reaction and the market rallied on the back of that. i think we will get more clarity over the next few weeks or so when we have confirmation hearings. the bank of japan will exit the yield curve control strategy, the pace of which is important. markets are more aggressive than we thought, so maybe too much is priced in at the moment for that to particularly play out, but we are coming toward the end and clients we speak to believe the yen is the big trade of this year. so it is really just watch this space and see the confirmation hearings. alix: you gu

perhaps a sign that bond traders are not ready to give up the challenge that the boj sooner or later will have to relax that ultra loose monetary stance. i'm jp in singapore. >>> and an earthquake in turkey and syria has killed several hun hundred. the search for survivors is under way. president erdogan has called for assistance and allies are mobilizing support there has been a reaction in the turkish lira of course, we are focusey. >>> italian authorities lifted a tsunami alert after the earthquake downgrading the concern for italy. let's get to claudio in rome claudio, the earthquake affected turkey and syria i have family in lebanon they felt the shockwave there is v -- shockwaves there. what is the concern about the aftermath? >> reporter: the earthquake was so strong and felt in neighboring countries like lebanon and jordan and israel and egypt. there were reports earlier tonight that there was a tsunami alert that went all the way to italy. that was then canceled there is no risk of tsunami coming toward the coast. certainly most dramatic effects were felt mostly in syria and

hideo hayakawa there, former boj official. let's have a look at the first word news.dent biden pledging more military aid to help ukraine fight back against russia. the defense department saying it $460 million package will include artillery and radar systems. this is while meeting president volodymyr zelenskyy on a surprise unannounced visit to kyiv. biden further promised to put sanctions on people and companies assisting the russian war effort. >> putin thought ukraine was weak, and the west was divided. as you know, mr. president, i said to you at the beginning, he's counting on us not sticking together. he was counting on an inability to keep nato united. he was counting on us not to be able to bring in others. rishaad: china laying out a fresh list of problems it has with how the u.s. uses its power. the official news agency is publishing a 4000 word article titled, u.s. hegemony and its perils. it blasts the u.s. and underscores how tensions have worsened over the suspected spy balloon incident as well as the war in ukraine. top chinese scientists outlined plan

that is what the boj is watching the spring negotiations. is a huge unspoken, the vcu research on this is the emotion of behavior that people have, society has over a new inflation regime. japan, where inflation is a new experience for millions of people, this is unspoken. jonathon: the leadership of the boj sees this as a once-in-a-lifetime opportunity. that's why it will be difficult to move away from this. i want to get to the epicenter of your piece on the federal reserve and the u.s. economy. you think the data we have seen so far might be a head fake that turns the fed to do something stupid? erik: if you look at the past seven or eight recessions in the u.s., it's common to see an acceleration in things like real incomes or payrolls. these are coincidental or lagging indicators. the leading indicators, the housing market, manufacturing sector, there is plenty of reason to think there are some quirks this time around because of covid. to me, there is a strong signal coming from leading indicators that is hard to ignore and i do worry a

boj purchases of jgb's are bigger than fed qt. just think about that.igger than fed qt and central banks are out of liquidity for financial markets. tom: decades of experience, i set in tokyo at the bank of japan and said to myself, this is really foreign and i don't understand what's going on here. every single pro from jordan rochester to say robbie feldman at morgan stanley saying never underestimate the effect of japan on u.s. finance and investment. lisa: if they do back away from quantitative easing that offsets with the u.s. is doing on the tightening side, what effect does it have on the markets? this is what jordan rochester was saying and six months ago people were talking about the potential for boj change to disrupt mobile markets in a significant way. a lot of people have pushed back and said japan never does anything rapidly. they don't make big moves. they are gentle and managed. jonathan: sometimes they make bad moves. let's see if they make a bad move in the next a few -- next few months. lisa: it points to not just how high they are fo

do you expect that rally to continue in light of what we've seen from the tweaks from the boj in termst: we are waiting for the next announcement with any certain -- what that means in terms of long-term policy. some of the things that are very interesting about the japanese market, the fact that we are seeing wage increases implemented across such a broad range of companies. they are announcing these and implementing that. one of the things we have been looking at, whether or not japan can sustain 2% inflation. that is not a question outside. with japan, with high commodity prices, it is still much lower on its inflation outlook. we have seen some of those pressures abate. the question is if they can maintain 2%. things such as wage increases are permanent. they are the second derivative effect and have a much longer and lasting impact. haidi: that is interesting to hear. you always think wage increase is not great for corporate margin so it may be a negative. for a country like japan people are optimistic this will lead to a better cycle after 70 years. -- so many years. >> we have b

that conversation with the boj former executive director hideo hayakawa.ly have them speaking in parliament right now. when it comes to inflation, he believes inflation will slow midyear 2023. private sector lending has been increasing. labor demand, and elation likely to push up wages. he believes 4% can slow down from here. still seems to be dovish but when it comes to wages, that will be the big swing factor potentially. will we get that wage growth that will lead to this virtuous cycle when it comes to inflation? that remains to be seen. we saw the negotiations in japan. the march meeting is not going to do anything. it is his last meeting. we have plenty more on daybreak asia. this is bloomberg. ♪ get help reaching your goals with j.p. morgan wealth plan, a new tool in the chase mobile® app. use it to set and track your goals, big and small... and see how changes you make today... could help put them within reach. from your first big move to retiring poolside and the other goals along the way wealth plan can help get you there. j.p. morgan wealth mana

i'm explaining why everyone is so excited about boj. here is a chart of the four largest central banks in the world, and the size of their balance sheets relative to domestic gdp. this line way up in the sky is the bank of japan, its balance sheet is more than 120% of gdp. the ecb 60%, the fed below 40%, and pboc about 30%. the bank of japan is similarly as large as the pboc in terms of balance sheet under management, that is why people care who the new governor is. it also means they knew governor has an immense task, the bank of japan owns more than 100% of certain issuances of bonds. which shows that the bank of japan has been very unique task when the new governor comes in to unwind qe and their yield curve control. the impact is because the bank of japan owns many foreign assets around the world, so the ramifications of any change in policy will filter through to the rest of the world. tom: mark cudmore on the complexities facing the next boj governor, and what it means for international fund flows. u.s. cpi data tomorrow will be c

right now the market is essentially broken 100% owned by boj.linda: and what do we have yields on. the 10 year, .49. strategy 60/40, is that back. it was not a good trade lasher. -- last year. >> return prospects have returned a lot. we looked at the launch of capital assumptions. and are seeing that the 60-40 portfolio is going to potentially develop much better returns than the beginning of 2022. 60-40 is not a bad idea. however we do think it will likely remain, now a fixed-income we are seeing high-grade. however, we are cautiously lengthening duration, because as we enter a recession in the u.s., which is the base case, we think duration will once again help to stabilize mixed asset preferably is -- portfolios. rishaad: it is got more juice? >> it is true. but if you extend out a little bit, that duration will help you provide that bang for the buck when rates fall, we think, when markets sees the fed pivoting towards the end of this year. we are not saying six or seven year duration. rishaad: a stellar months for asia. where do you see the

the current easing policy stance is appropriate and nothing decided amid reports he could be the next boj governor. >>> and standard charter reports that fab is rejecting the takeover bid. >>> and economists predict it will take years to make up the lost output. >>> and adidas tumbles after warning it could take a loss after it doesn't move the inventory of disgraced rapper kanye west >>> we are just over an hour and a half into the trading session. we have fairly down beat session on our hands majority of indexes trading lower. dax down .60%. adidas shares falling sharply after another profit warning as we mentioned in the immediate lines. we have green on the board ftse mib is 8 points higher. in switzerland, a pullback of .70%. >>> foreign exchanges showing a lot of focus on the yen. dollar/yen as the yen is holding firm as investors make sense of the reports we could have a new governor on our hands of kazuo ueda he said the decision has not been final yet, but offering color into the monetary policy moving forward we have the dollar trading firmly against the swiss franc euro trading

the data is likely to increase pressure on the boj to ease its yield curve control measures.ed president rafael bostic says january's strong jobs report could mean the central bank needs to increase interest rates to a higher peak. bostic told us his base case remains for rates to reach 5.1 percent, in line with the median of policymakers' december forecast. fed chair jay powell speaks exclusively later today with bloomberg tv host david rubenstein. global news, 24 hours a day, on air, and on bloomberg quicktake. powered by more than 2700 journalists and analysts in more than 120 countries. tom: thank you very much indeed. francine: last year's south africa power outages spiked to record levels, it has put eskom in focus as the state utility company struggles to maintain the national grid and buckles under growing debt. we are joined by bloomberg's africa correspondent, you did this great interview with the outgoing ceo, what did he lay out as priorities for the company? >> it was great that we were able to speak to him, especially considering a lot of the challenges the comp

david: support behind the boj governing nominee kazuo ueda.headed into the lunch break in japan. seconds left until we go on a one hour break. dollar-yen closing in on 135. we will check what that means. yields are pushing higher as we speak. it goes to what the boj does next i guess. yvonne: and how the market is betting on this. we have had a few days. there's a survey that came out post nomination of what could actually change. people are thinking maybe the tightening cycle could pick up earlier than before. what they are saying is 70% of about 39 respondents think we could see movement this summer, which basically -- take a look at what wiest saw last month, that was a jump from 50% or so. in terms of yield curve control, more than half of economists see the boj scrapping yield curve control sometime. rishaad: it normally lasts until early april. it's going to be muddied by the handover. a new man at the helm. david: assuming he goes through. that's the man himself of course. april or june -- that's when top one and top two as far as the s

word following on to that, what about the rest of thecurve, should it be equally as attractive >> the boj or ecb and how the u.s. treasury deals with qt while there's a lot of supply. the ten-year is much more difficult to call here ky make an argument it should go to 4 1/2 to 5, or i can say it should be 3 if we go into recession. the shorter end is more obvious. >> we'll leave it there. thank you both it's been great to have you here today. >>> coming up, wing stop flying to a new all-time high, but less than a year ago, the ceo told investors they were in the midst of a perfect storm what is behind this reversal we'll ask him next and a trio of tech titans are on deck we'll get the trade on that one. as we head to break, let's look at the markets, broadly speaking, where we see yields for the ten-year down below 3.9%, supporting about a half per spent rise in the nasdaq back after this. all across the country, people are working hard to build a better future. so we're hard at work helping them achieve financial freedom. we're proud to serve people everywhere, in investing for the retir

what does this mean for the boj given that kuroda is nearing the end of his term?at the g20 meetings over the weekend and said his peers understand the need for the bank of japan to stick with its easing policies. now let's change. we are having the open from stocks in korea. we are seeing the kospi lower by the tune of 1% in the first few moments. it is down to inflation what that means for stocks. we saw foreigners getting nervous year in the kospi. in the prior week we saw outflows to the true -- to the tune of around $.5 billion, the first time we have seen that selling on this basis in 2023. the korean won likewise leaker -- tracking weaker today's training -- trading. the tune of risk aversion we are seeing in markets, we are still moving past the 1300 level. in australia again, the sentiment is being driven by more macro factors. we still have the earnings in focus. we are seeing woodside they're looking a little higher at the start of the day. we have an exclusive interview with the ceo later. it is australia's biggest lng producer that saw its highest ever

he intends to appoint the executive director of the boj, who is in charge of the easing program currentlyted to be tapped is the former commissioner of the financial services agency, who led an effort to financially support struggling companies battered by the coronavirus pandemic. the government will present the candidates' names to the diet on tuesday. the lower house steering committee expects to hear from the candidates on february 24th. japanese consumers have been buffeted by rising prices in recent months. >>> the company behind coca-cola says it is raising the prices of its drinks. coca-cola bottlers japan says the increases will start in may and affect 75 items, including a can of coke. prices will go up by 3% to 22%. it's the first time in 25 years the suggested retail price for a can of coke will rise. a 350 millimeter can will now cost 125 yen before tax, about 95 cents, up by 10 yen, about 8 cents. canned coffee will rise by 10 to 25 yen or 8 to 19 cents. coca-cola bottlers japan says it can no longer absorb the soaring cost of raw materials, energy and packaging. >>> and the

overnight coming out with a surprising succession decision when it comes to the new boj governor.ive us more insight. michael: he is leaving after 10 years as governor of the bank of japan. his last day is march 20. there had been a thought that he would be replaced by ionic --the chief deputy. it turns out according to reporting, he didn't want the job. the prime minister is turning to ueda, a university professor, but a former member of the bank of japan and is seen as something of a citrus. what the markets are wondering about is what he is going to do about yield curve control. a lot of talk about new governor coming in and maybe getting rid of it. what we are seeing is a kink in the japanese yield curve. the 10 year note yield has been held down. some people are thinking it is about time for that to go away. he has suggested a review ahead, but says it is not time yet. the question is after he takes over, what is he going to do? kriti: bloomberg's mike mckee walking us through what i think is a very important decision. i have been earning out about this all morning. matt mill

he is a professor and former boj board member. ueda has expressed caution on raising interest rates prematurely. in turkey, three survivors were pulled from the rubble today more than 100 hours after they were trapped by killer earthquakes. rescuers had worked for more than three straight days. the death toll in turkey and syria has climbed to 22,000. russia has launched a number of cruise missile attacks on ukraine. ukraine says the targets were critical infrastructure in several cities. meanwhile olaf scholz has asked leaders to deliver german tanks to ukraine as promised. the goal is to have 80 tanks by the end of march. more revelations about the chinese balloon shot down over the coast of south carolina. the biden administration is presenting evidence the balloon was capable of collected communication signals and carried an array of surveillance equipment. bloomberg has learned congress has been told some of the components had english language written on them. global news powered by more than 2700 journalists and analysts in

looking at this whole be able -- boj story. being told that the new nominee for the central bank will be elected next tuesday in japan. the liberal democratic party says they see their chances of division in the party -- decisional he the party. some lawmakers say that the more hawkish deputy governor will ace opposition if he faces the prime minister's choice. the traffic bureau is saying it is facing -- trafigura's cargo did not contain the nickel it was supposed to. the company started legal action against indiaand the company collected to him alleging fraud. we get a comment from the suppliers. hong kong stock exchange seeing a tremendous increase in investments from gulf sovereign wealth funds. the ceo said the stock connecting hong kong with china is key, when asked about a secondary salary he said that there is compatibility in the two sides interest. >> a lot of areas where we can see investors from the middle east which is a high investment base which is going high investing in hong kong and in china or in china throug

>> next friday when the new boj governor talks to parliament, that is going to be significant and havinghe lowest interest rate economy repriced probably higher. maybe there will be some details about how the control may be changed. then it's about march 22. the fomc, i'm interested about the summary of economic projections, the dot plot is going to entail. that's where the market pricing has changed so much and has a lot of room for repricing further. it's about whether the neutral dots and where the 2024 dots are. alix: if we start to see a higher terminal rate from the fed and we get to 5.3% or even more, what is the ecb do with that? doesn't the fed have to keep going? >> i think there is a limit as to how far the ecb will be able to match the fed. that's interesting when it comes into fx currency dynamics. that's why the ecb is probably more inclined rather than jacking up rates now to match the fed, they will be more inclined to using forward guidance for next year's interest rate policies may be the year after that to try to redress the balance between them and the fed. the fed fr

the boj governor will be taking over to face something japan has not really seen in decades.es rising at their fastest pace since 1997. this is adding to inflationary pressures that the central bank wants to control. let's get more with bloomberg senior editor in tokyo. even if we see wage growth, how sustainable is this? parks when you look at what is happening here in japan, we have figure showing the fastest pace of wage increases in decades as well as a lot of headlines from top-notch companies. fast retailing raising salaries as much as 40%. nintendo hiking compensation by 10%. you take a close look at the underlying trends, they are not enough despite all the headlines and news. most of japan are smaller companies and still struggling. the wage increases aren't quite going to get to the level of a sustained 3% that the boj his signal it wants to see before making any shift in policy. while there are positive signs, i don't think we're quite there yet. >> it doesn't seem to be consistent either, these wage gains tend to be patchy depending on sector industry company and