jonathan: we have had repricing from central bank to central-bank throughout the week.hether it is the european central bank, bank of england, throw in the bank of canada as well -- across the board, expectations increased off of a loaded central-bank speech. margaret patel, do we have a market that is more in line with the direction of the central many, that in the words misjudge the speech? margaret: no, i think the banks will maintain the dovish posture. we have seen this pattern before with strong talk and weak action. it was a momentary reaction to the markets but i don't think it will be material change in rates. jonathan: my colleagues here at bloomberg news in london are pointing out that there is a strange paradox at the moment, more inflation expectations are diminishing or completely rolling over, and yet central banks are redefining and recalibrating the reaction at the same time. i have on my screen a charge related to the central discussion -- inflation breaks even in the eurozone as compared has beenthe bund trading, and if you look at the reaction for th

mark: it has been a key work of central bankers -- key week of central bankers.peeches that were given in portugal. janet yellen caused u.s. stocks to drop by the most in six weeks after her comments about rich asset prices. how do investors keep up with all of this? as central bankers keep is aware that they are going to be less loose and their policy action, how do we as investors prepare ourselves for this changing landscape of monetary policy? >> we have never seen a monetary experiment of this scale in size. i think the fact that despite the fed's tapering, the ecb and bank of japan have injected a further $1.5 trillion this year has been one of the winds in the sail of markets. as we start to contemplate reduction, we need to think what an impact across all asset. i always think, are the central bank is likely to move a little or a lot? are they likely to do it slowly or quickly? consensus remains that it will be a little bit and slowly. aret we're hearing our ne nuanced comments. mark: the biggest moving the year, that shows you that the precariousthe ness

yes, it is the central banks.ave spoken about the global economy and that will set the tone for markets in asia. u.s. stocks gaining the most in thateeks, so we are saying come into the asian trading session. gaine seeing the kospi wound is even at an all-time high. gainingh korean won after losing ground in the last session. brent crude continues to rise .2%, past $47 a barrel. central banks and seem webe turning more hawkish, could see fields continuing to sayingnd our colleague 2.25% is a key number to watch on the 10 year treasury, now resuming their trade in the asian session. that would be where the 50 day that key00 day and down trendline from march meet, passing this level for the 10 year yield and could mean we are leaving the bond market rallied behind us for a short while and could see yields continue to rise or the bear market in bonds , i should say. are seeing this yield continuing to rise in the asian session and we will see it those moves continue as we see more central banks turn hawkish and inves

record native central-bank action. -- the idea of coordinated central-bank action. ago the international monetary fund studied coordinated action. does it exist or is it a myth? luigi: it is more of a myth. in many situations, elite we would be useful, but when i hear central bankers talk among themselves, what they tend to say is we wish we could do it. we can't. so, do not think there is this coordination. certainly, they talk, they look at each other, but i do not think they can coordinate effectively because everybody is very mcuh influence buying the current -- much and so the current economic and private. wordif you say the transitory in chicago, you get thrown into the chicago river. is there such a thing as transitory inflation? is saying, what luca is interesting. the inflation is much softer than people sort of factored in in this stage of the cycle. so, it runs against the rhetoric that we should increase rates and the quantitative easing, europe should finish. so, i honestly i do not know but i think it is an interesting indicator to watch. francine: was

i have really struggled to understand, from big central-bank to big central-bank , what the reactiony seemed to switch it every other month now. michael: not expecting another financial crisis in a lifetime, micromanaging economies is a scary path. we would love nothing more than to see inflation growing, gdp and the market economies working, but instead we have been on training wheels for some time. the central banks just don't know how to take them away. they are trying to do it carefully, which i totally -- as they should, because there's the danger involved if they take anything away to quickly. by the same respect, no one would have expected a 4.3%, 4.4% unemployment rate with the fed funds rate that is 1.25%, basically. the environment we have had for ,ost of the last five years unemployment below 5%, 10 to 15 years ago? ben bernanke would have been ecstatic about that type of consistency. the crisis kind of changed everyone's out look and how the banks react. their reaction was so large and forceful on a global level, it's like they don't know where to start unwinding. it's wh

for 20 years the central government has been firm support for hong kong and the central government wille, as always supporting the development and improve the livelihood of hong kong people. the third is to plan the future. we would like to work with all sectors to review, over the 20 years, the eventful experiences and to ensure that the one country to system policy to be practiced, i look forward to experiencing in person the developments and the progress achieved in hong kong and the new changes made. i believe the events carried out in hong kong, we will definitely continue our belief in developing hong kong. thank you everyone, thank you. >> the chinese president speaking at the hong kong airport. he is quite frank thing his purpose for visiting is to wish them all the best in show support. let's talk to our studio guest. how do you understand his frank delivery of his purpose for visiting hong kong. >> i think he must be very happy to be in hong kong today and for the coming three days for the ceremony of the anniversary. i think his presidency will also make most of the people in

james reynolds, bbc news, central portugal. bbc news. a security incident at the central railway station in brussels. we can bring any colleague from the bbc, adam fleming, who is live from the brussels newsroom. four people joining us, can you start the beginning? this security incident started a couple of years ago at the brussels central station which is a stones throw from the grand place, the historic centre of brussels. a couple of miles from the eu headquarters weird i am speaking to you from. this is the home to many european institutions. a man was seen at the central station carrying a rucksack. and reports are stating they could've been an explosive vest on his body. the let of a small explosion that caused panic in the train station. a few moments later, the man was shot by the belgian military because the city is still filled with armed soldiers guarding key points after a series of terrorist attacks in the past few yea rs. terrorist attacks in the past few years. belgian security sources stating that the suspect h

central bank.y are looking at an agenda, which is what we criticized greens bank for not having many years ago. guy: what is interesting is, in some ways, central bank are doing this for different reasons. carney was out yesterday and we will hear from him later on as well, talking about pockets of concern within the u.k. surrounding credit cards, car finances, etc. it is not clear that there are threads that joined the central banks together. it is an individual their attempt that in aggregate makes sense. >> i think this is coincidental policy. i agree we have seen a shift, but every central bank is acting for a different reason. the economy in canada has been picking up this year, and the macroeconomy got worried about the home capital problems and possibly, the property market. overall though, the economy is doing well and it makes sense that it turned hawkish. as george said, the ecb is getting closer to tapering more aggressively than we thought, but it is nothing too massive. tom: george, i

the tornado warning continues for, again, central camden county in southern new jersey, north central gloucester county, southwestern burlington county up until 7:00 a.m. right now they have listed it be around glassboro at 6:30, magnolia and turnersville around 6:35 a.m., lindenwald he echelon area, 6:40 a.m. atco 6:50 a.m. they have not seen a tornado tornado on the ground. it is radar indicated tornado. which means the cell is capable of producing the rotating windsful this is a serious situation, again it is this area here all the way down, actually i'm going to push this a little bit farther to the south. this area all in through here, looks like it might be this cell. this almost looks like a little hook here, let's zoom into this part of the viewing area, right here, i'm going to make a couple of street locaters right here. here's route 30, this right here is the new jersey turnpike. again it will be this area from marlton through gibbs borough and berlin. keep an eye out make sure you're trying to find i don't way to the basement. if you don't have access to the basement, get

this is brussels central station in the centre of the city.has been evacuated and these are the pictures that we have coming in to the news room. from just outside the central station. you can see the area cordoned off. only a few police officers inside. let's bring in... in a minute we will bring in some more updates from oui’ will bring in some more updates from our colleagues in brussels. at the moment, the police are saying the situation is under control. one person who was at the centre of the incident has been neutralised, although we don't have a definition of neutralised from the police. they say the situation is under control. we believe this large train station has been evacuated. more tension in the syrian sky. a tweet saying: aircraft shoots down armed shaheed—129 pro—syrian #uav near #altanf #syria. that's an armed drone to you and me. the reason? "it displayed hostile intent and advanced on coalition forces." the coalition being referred to is the us and its allies. see all this in the context of the us shooting down a syrian jet

it is not far from the big central square in brussels and ona big central square in brussels and on aal station in the centre of brussels. police are apparently saying, according to local media, there was according to local media, there was a small blast at the station and the area has been cordoned off. we will bring more to you when we get it. more now on chancellor philip hammond's speech today at mansion house in central london saying he would put britain's future economic prosperity centre stage in any brexit deal. mr hammond called for a "jobs first" settlement and also wants immigration to be managed but not shut down altogether. the future of our economy is inexorably linked to the kingdom brexit deal that we reach with the eu over the next 20 odd months. i am confident we can do a brexit deal that puts jobs and prosperity first. that reassures employers that they will still be able to access the talent that they need. that keeps markets for goods and services and capital open. that cheese early agreement on transitional arrangements so that trade can continue flowing smoothly

there's been an incident at the central train station there.own all rail service to and from this large central station in brussels. it has caused the evacuation of the station. so what happened? well, here's the best we know. the local media are recording there was a small explosion inside that station. there's a large police force at the brussels, the attack a year or so ago. and they're on very high alert. the home of the european union and police patrols are very visible. the police responded, it seems shots were fired as well. we believe the authorities fired those shots. a massive police presence came to the station, lots of ambulances at the place. if you've been watching on twitter, you've probably seen fears -- the first video that we've gotten cleared. the fears of a terror strike. any time there's something unusual at a train station like this, the fears are high. our understanding of things right now is that the situation is under control. that these are live pictures coming to us. a much calmer atmosphere. maybe ambulances have com

it was built in a farming region 20 kilometers southeast of central shanghai. the area was once accessible only by car, but a new railway has been she was able to see the enchanted story book she sees images of mickey mouse and friends ensuring the safety of passengers by the platform doors. disney characters welcome passengers everywhere around the station. a subway from central shanghai to the center of disney resort is being developed with the full cooperation of the chinese government. disneyland is right outside the station. since the subway began running in late april, the number of tourists has been steadily increasing. 1 million people have visited in one [ speaking foreign language ] [ speaking foreign language ] [ speaking foreign language ] >> the happiest place on earth is just beyond the iron bars. the opening of shanghai d disneyland was proposed in 2007. initial lit park was slated to open in 2015 but construction was delayed. the compound is 390 hectors in total. the main park is just one fourth of that space. adjacent to that is a natured theme

let's talk about the central banks. talking about the gathering, a cola singh, a meeting of minds around one message. the cost of borrowing will be higher. there has been a clear signal that the near zero interest rates were appropriate. mark carney suggested yesterday that the time may be nearing for an increase. the fed chair janet yellen said her policy tightening is on track. >> economic conditions have improved and [inaudible] experienced record profits. where in -- cautious about increasing investment, spending including investment. >> some removal of stimulus is likely to become necessary if continues tof listen. you can see the chart and plot your view on where it is headed. because as it lessons, the policy decision becomes more conventional. >> monetary policy should not be overburdened by other tasks besides the one it has now. we cannot underestimate the importance of innovation, productivity, and of growth. important in informing our monetary policy. now, great to us have you with us. we will circle back to

central banks incredibly supportive. we have central bankers coming out and saying the outlook isn't bad. it's just reflecting reality. the economic outlook isn't bad. we've finally got inflation modestly picking up. last year we were concerned about inflation. -- deflation. trading revenues in the next quarter a probably going to be really off again. loan origination's are an issue. they stumbled a bit because they wind up having a lot of credit card billing quincy. there is a loan component. they're obviously risk cases. it's not a completely clean story. the starting point with respect , at the margins shareholder friendly in dividends alix: we think will support the sector. alix: is it going to be investment banks or wells fargo or bank of america with respects -- relationships to the consumer ? we are just taking a broader financials approach. anna: the fed was worried about those companies. they were worried more about anything it was those with big consumer credit card businesses. stuff.reat simon of ubs, you are

. >> good morning for the kid up in central bucks we just saw twitter account, from central bucks highchool just sent out no school for central bucks today all because of this shelter in place and police activity along route 611 at edison furlong road. it is all centered and quarry up street from the bucks county jail and youth center to give you an idea another mile or so up the road is central bucks west high school , and of course, doyletown hospital, now sabina is out their life we will go to her in just a moment but traffic through this area will be impact for morning rush hour. 611, and 202, busy corridor in the heart of the doyletown, and a live look at i-95, no problems out of northeast philadelphia most of the construction crews took the night off they did in the work sunday into monday. so that is good news as we kick off this monday morning. live look here atwood haven road in northeast philadelphia , but the construction pattern from last week be careful, i-95, they have moved off ramp for girard avenue so that will catch you by surprise, mass transit looking good with no r

central government are not here.that there is a grip, central government needs to make us feel it is on the side of the people. the extra foot patrols promised by theresa may are 110w patrols promised by theresa may are now on the ground, brought in from other parts of london to bring reassurance and information. the leader of the local council says he understands the criticism his authority faced, but he has also defended their response. yes, of course their resolve ways more we can do, and we are attempting to do that, but this was an enormous disaster. it has profound consequences. gratitude this afternoon for the firefighters who we re afternoon for the firefighters who were searching for the lost night and day. there is a growing sense here that all the emotion unleashed by the fire must lead to change. angry, not simply at the poor response in the days afterwards from the council and the government, but the council and the government, but the years of neglect from the council and successive governments. while p

we are seeing live pictures from brussels central station.s currently an ongoing military and police operation and according to several belgian media outlets, witnesses are saying the man was shouting something before setting off the explosion? the right conflicting reports about whether the man was shouting slogans as he did try to set off his device, the small device he managed to set off. that has not been confirmed by the authorities. but they are treating this as a terrorist attack. to make sure people had decent information, belgian authorities were quick to ta ke to belgian authorities were quick to take to social media when reports came out saying it incident is under control and provided as much reassurance is possible to people and that seems to have worked because after these fresh reports, i made my way into the studio and people were still out on the streets, enjoy a beer, enjoying a meal at cafes and pubs. although one of the metro stations were close. there are more police outside. they are telling people not to get on the trai

as i say, there would have been dozens of people inside the central station.t around the station there are a number of hotels which are popular are holiday-makers. as i said in my first answer, some hotel staff have said they've been told to evacuate those places as the police continue their investigations. >> james, as we learned in london in the recent attack, what we -- the london police have troops that they can move around the city deliberately in case something happens in the city as opposed to getting them from far-flung areas. what's the police versus military presence like inside of brussels? do they roam around, or are they stationed at hot spots, potential hot spots? >> right. so what the situation was until a few weeks ago, there were military stations at hot spots outside certain embassies, tourist museum where we saw the attack two years ago. as i have already said, government officials were starting to draw down that visible military presence. you still do have some military personnel who are stationed still in certain hot spots around brussels.

for central banks this means addressing an unusual situation. we see growth above trend and well distributed across the euro area but inflation dynamics remain more muted than one would expect on the basis of output estimates and historical patterns an accurate diagnosis of this apparent contradiction is crucial to delivering the appropriate policy response. and the diagnosis by in large is this -- monetary policy is working to build up reflationary pressures. but this process has been slowed by a combination of external price shoc >>> shares of generic drugmaker s, most likely in the labor market and a changing relationship between inflation the past period of low inflation is perpetuating these dynamics these effects, however, are on hold temporary and should not cause inflation to deviate from its strength over the immediate term, so long as monetary policy continues to maintain the solid anchors of inflation expectations hence we can be confidence our policy is working and its full effects on inflation will gradually materialize. but for tha

. >>> some of the world's most influential central bankers will meet at the ecb forum sgo and sto. >>> and stocks to watch. we'll round up the movers. it's wednesday june 28, 2017 "worldwide exchange" begins right now. >>> good morning welcome to "worldwide exchange" on cnbc. i'm sara eisen >> i'm mike santoli in for wilfred frost. >> and the rest of the week. happy to have you. >> until the end of the quarter. >> especially with this market move yesterday >> a lot going on. >> so let's check on global markets. after we did see a selloff s&p closed lower by 0.8%, the worst day since mid-may for stocks certainly the s&p and the dow. futures looking positive there the nasdaq still under pressure which is the concern for the overall market now those tech stocks weighing down. we have a quick early indication of the so-called f.a.n.g. stocks which have been driving the markets. facebook, amazon, netflix and google or alphabet alphabet is the only one higher in the premarket otherwise seeing some declines for amazon, netflix, facebook. the winners yesterday got crushed. the broadcoms of th

what -- parsing what the central banks had to say, the boe there. we are taking a look at the shanghai and hong kong markets just kicking over to the open. shery: a pretty good start for the markets in china. the hang seng index gaining .7%, and you mentioned tech shares leading the gains, up 1.4%. the only sector losing ground is energy, although oil prices are gaining for a fifth consecutive session. regulators will start looking into that sell off of some small s we saw earlier in the week, 17 companies losing 40% of their stock price in the last few hours. gainingghai composite .2%. in the green, continuing that momentum we are seeing across asian markets. we are seeing materials lead gains in asia. take a look at the chinese 10 year. this is not updated. a survey of fixed income traders, they all expect the bond market in china to end its losing streak, the longest in six years, and may see gains in the latter half of this year by about the third quarter of this year, that sovereign debt rise and weekly see yields falling to lower levels than r

our hidden over the past twenty years from beijing central government. has been a strong backer of hong kon. and will as always young young support its economic development. and improvement of people's lives. guys i mean some. i mean hong kong don't agree that this is a celebration ahead of xi's visit protest system discount she. gift from beijing to mark the cities returned to china. the ancient hebrews means. several prominent democracy activists including joshua wong and knowing the kidney from little. well rested. i'm all about. i think that that is not a great. but. protests simmons on thursday. home was placed under unprecedented security lockdown. thousands of police deploye. to maintain order. but to discuss that story i'm joined in the studio by jove hassan who say he's the vice president for research at the inn now because national institute of oriental languages and culture thank you for being with us on the. cross twenty four tonight and now and then. way back out when that hong kong was handed back to beijing it was supposed to be. out. one

we had central bankers from the top three central banks in the last week signaling even more hawkishting. is this a watershed moment for money markets? ewen: let us be clear. less dovish, not more hawkish. i think that is an important point to put on the table. what interests me about the tone from the central banks is that it is all slightly different. interests are starting to be more important in the dialogue and there is a subtle sort of switch from the inflation to growth in terms of the comments. really what the central bankers are saying is if we do not reduce accommodation as economies continue to expand, we will be loosening. we do not want to do that because financial conditions are loose. we are concerned about some of the implications. have got a look at financial conditions with the bloomberg screen. our users can access this at home. 9221 is the command to access this chart. eurozone financial conditions in white. obviously, they have clearly underperformed the u.s.. financial conditions in blue. they are coming back a bit. what do you think about the ecb and draghi's c

even if they increase rates, it is unlikely that asian central banks will follow suit.spite a lot of talk and a text book approach that other central banks would have to move along, the reality is that in the past, when the us fed has done this, asian central bank said not necessarily that long. and so much of the issues are actually local issues and dagger to base their decisions on local conditions. not what the us fed does. how could this impact asian companies? there are several potential impact. these are, ageing committee to borrow us dollars could face higher borrowing costs if the us dollar appreciates. but on the other hand, the outlook for growth in asia is still very good. there has been close to 6% growth in asia projected by the adb. even with higher us interest rates 01’ even with higher us interest rates ora even with higher us interest rates or a higher borrowing cost, asian companies ago to make money this year based on local economic conditions, and given that the other plagiarist generally positive, the fa ct plagiarist generally positive, the fact th

central bankers don't do that. central bankers are very cautious people, and they will move slowly in the direction of raising rates and reducing their balance sheets. mark: but does the market reaction -- you saw the euro rise 1.4% -- biggest jump in a year, the movement to bond yields this week -- does the market reaction highlight the different -- the difficulty in communicating this transition? oh, obviously, it is very hard, because central bankers, as i said, are cautious. they want to communicate as much as possible, but markets regularly overreact, and there is not much they can do about it. draghi's remarks were rolled back a little bit, but i think markets just don't understand that nothing big or sudden is going to come out of a central bank, but the situation does justify less stimulus as far as we can tell, and that is all they are saying. , on that notevlin on central banks, you have worked in administrations in all sorts of capacities under various administrations on both sides, and you have been at

some of the world's biggest central banks. the bailout deal reached for greece, but it is not enough to get the img lending to them for now. good morning, everyone. this is "bloomberg surveillance" and i'm francine lacqua. let's quickly check on your markets. global stocks are definitely rising. shares in japan are probably advancing the most. the yen weakening after the bank of japan left monetary policy unchanged. treasuries holding onto losses. traders still, i think trying to digest the more hawkish tone struck by the federal reserve. i wanted to put gold in there as well, practically flat. let's get straight to the bloomberg first word news. reporter: russia has verified that the islamic state leader has been killed. isisuld be among about 30 commanders killed during a bombing raid last month. it is also said the attack killed another 300 islamic state fighters, but provided no explanation on the delay in reporting the airstrike. anger is growing over the deadly blow that struck the apartment tower in london. the official

i am in central london where the attack took place.country's second terrorist attack in less than two weeks. we understand a van with three men ploughed into people on london bridge. they got out of the van and started attacking people with knives on the street. emergency services, we understand, were at the scene quickly reacting. behind me you can see the strong police presence. counterterrorism services are still investigating the incident and making sure security is tight and the investigation can continue without interference as much as possible. we can understand now that mark rowley, the assistant commissioner of the metropolitan police, has been reacting to this. we can hear from police, has been reacting to this. we can hearfrom him. we have been responding. we are treating this as a terrorist incident and a full investigation is already under way by the counter terrorism command of london. you will understand knowledge of the incident is still growing. at the moment, what we understand is as follows. at eight minutes past ten

week of central bankers.th.traight slow rise means that inflation bba far cry from the oj's target. vonnie: we have the perfect person to talk to about this. he is focused on bonds. heard a flurry of hawkish comments from bankers this week. joining us is george cohen called -- george goncalves. you changed your call. right timing? >> i think so. markets are complacent around the idea that you see lower inflation. so far we have had low inflation , but the central banks are operating at a different tune. it is a concerted effort to turn more hawkish and we think they are realizing that they probably overstay their welcome in the bond market. we think reducing liquidity, by doing so, grace should be having .igher vonnie: you see the vix is ever lower. if you look at the move in next -- sorry, move come index, gpo -- [laughter] vonnie: you see it aspect of a little bit. does that continue, too? george: i think so. investors have to take a step back. we are in the summer months, right? typical summer doldrums, th

feature of central banks.ark: let's talk about the euro because i love this chart. these are the levels. electionhe post trump levels. 114.28 was the post brexit point level, 117 was the 2015 high. we are at the 114.28 point now. talk to me about those levels and how easy it will be to break through them. road: there is a tough ahead, i think. i am certainly looking at back. you can see north of 150 and although we have been there a few times, it has been briefed. since quantitative easing and native rates when you had the 105, 105om 140 down to to 150 has been the range. the other point i make is despite this hawkish shift -- if you want to call it that, from draghi, the spread with the u.s. has not really changed and a lot of the short-term metrics were telling us that already euro-dollar is looking over expanded. i am not convinced that we are on a sustained march higher from here. draghi as a tough job. the communication from him is, the risks of inflation have gone. we now have reflationary conditions, th

inflation itself is now slowly rising to a central banks are wanting to be. if you look globally, it is only the fed trying to slowly normalize rates. everywhere else, everybody is still easing. everywhere else, they are struggling with growth and traction, and we are 10 years since the global financial crisis. jonathan: a big week. everyone is going to stick with us. coming up on this program, santander steps in, raising questions for the $181 billion coco bond market. that conversation is ahead. this is "bloomberg real yield." ♪ ♪ jonathan: from the city of london, i am jonathan ferro. this is "bloomberg real yield." convertible bonds -- when european regulators decided banco popular of spain, debt was wiped out, senior bondholders were protected, and authorities averted a run, saving taxpayers from pain costs. it was a textbook success for the regulator, and captured by the chart, but what about the investor? back with us are our guests. scott, a success for the regulator, i see that. is there a warning for the investor though that thought they could go in

nearly every central bank is on hold this whole year.nly one at the moment hiking is the philippine central bank. and even then we are not sure. the risk with this fomc is that janet yellen and the fomc sound more hawkish than the markets. next year they are forecasting three rate hikes! in other business news making headlines, ge's chairman and chief executive is retiring after 16 yea rs. executive is retiring after 16 years. this comes after ge has been under pressure to slash costs and boost profits in the core industrial business. a high level shakeup at the joint—ventu re business. a high level shakeup at the joint—venture between fuji business. a high level shakeup at thejoint—venture between fuji film and xerox. the chairman and three executives are stepping down after accounting problems in australia and new zealand. fuji film says irregularities were larger than thought at $2110 million. apple and toshiba willjoin. they are also in talks with the owner of google, alphabet, and microsoft. toshiba is selling off its chip unit to c

inflation itself is now slowly rising to a central banks are wanting to be. if you look globally, it is only the fed trying to slowly normalize rates. everywhere else, everybody is still easing. everywhere else, they are struggling with growth and traction, and we are 10 years since the global financial crisis. jonathan: luke, genius move, isn't it? have a referendum, make sure it is a mess come and hold an election as well. [laughter] >> look, we will see how consumers and other surveys respond all of this as well. it just might be that it settles down a little bit from what has been a tough couple of months, a tough first quarter in the u.k., who knows? but i am always on optimistic side. it will give us something to talk about. jonathan: a big week. everyone is going to stick with us. coming up on this program, santander steps in, raising questions for the $181 billion coco bond market. that conversation is ahead. this is "bloomberg real yield." ♪ ♪ jonathan: from the city of london, i am jonathan ferro. this is "bloomberg real yield." -- whenble bonds eur

central banks push real rates down and then you inflate assets.point about europe or emerging markets -- the reason we love emerging markets is that they are away from the distortion. the ecb is not buying mexico. you trade closer to equilibrium. do you buy places like emerging markets where inflation is coming down? you can get easier policy while the developing markets are raising rates. going into europe, i don't think people are saying i've got to get into european interest rates close to zero. when the discount rate remains low and growth can be pretty good, they can drop the equity -- drive the equity market up in europe. there is still value in fixed income. volatility going up, we like to buy a lot of front end assets. get away from the distortion, create balance in your portfolio so that when volatility picks up, you do not have too much beta attached to your portfolio. jonathan: e.m. has been one big fat directional trade for people. does that change in the back half of this year? >> we are expecting to see way more dispersion in the fir

the results, yes, the central right one, but i don't think read too much into it. i think that would be wrong. >> i wonder then should we be watching what's happening with the italian banking sector more closely than what happens with narrow votes >> i think that's an interesting point. what happened over the weekend i think is arguably a template of how restructuring should be done, even though they were done very, very fast. cudos could go off to all of the people involved in the restructuring. the politicians because when the going gets tough, the tough get going. the two banks, declared bankrupt friday and over the weekend offered to buy good assets for one euro take over approximately 1,000 branches from the two banks that were going to be disappearing. today at the opening no depos ters have problems with assets and have a run on the bank biggest problem even for a aaa bank, all the depositors one day ask for money, no bank in the world has those assets at hand available. so did a good job as did the government and the minister of finance, of economic activit

i'm glad you mentioned central bankers.you think we're getting some kind of coordinated move up in rates? are they working behind the scenes to say that we need to focus on asset price rises? are not think they nearly as coordinated as we think they are. i think the sort of ham-handed thing that happened here with draghi -- on wednesday after the tuesday comments, the ecb was right out there walking back the statements. i think draghi was a little taken off guard by how the market reacted. there is an issue here i think we have to be concerned about. as the fed begins to shrink its and the other central banks start to consider tapering, i think we are vulnerable, given where asset prices are, but for the moment, i think we are probably fine. julia: when you see a pullback , it actuallyates has an impact on u.s. rates as well. as the sensitivity something we need to be careful of, or is it something -- is it just because u.s. rates have gotten to such extreme lows that there is that kind of reflective response? scott: i thin

we are supposed to blame the fed and central banks in aggregate. they are supposed to step up the reduction of size of their aggregate ounce sheet. maybe the fed starting up isn't enough. until that ends, you will feel the pain. money is being printed, it will be exported to us in the u.s., and we will have to invest it in asset we do have valuation. guest: or reach out more robin. 50% is not high cash position. jonathan: but where are you reaching out? guest: currency ndm corporate. what is going on here in the u.s. is about technology, globalization, the challenge to get growth going. there is a lot of upside, a lot of growth potential in e.m. and markets are nervous about it because of growth potential. that's a quantum increase in risk and you are predicated about the market being robust. talk about china slowing down and central banks not pulling liquidity. you are talking about the perception of risk. i would argue that e.m. corporate and reform potential in e.m. countries are a much better risk to take than to take the risk with 10 year trea

but it mightjust mean a central data base and it cards but it mightjust mean a central database and which of those it means. but actually there is an awful lot that this policy document suggests. eu nationals could potentially be losing. it isn't clear whether they will be allowed to vote in local elections which obviously they can at the moment, yet they would be paying tax. sounds unlikely if the eu court ofjustice will be upholding this. when you look at this and look at the offer coming from britain, all right, a bit late again, but people saying there is room for compromise. there is goodwill on this question. from what i hear from people in brussels they are saying thank you so much that you will not deport us, we appreciate that, generous negotiating position. the europeans are saying there is not enough clarity and it is too little too late. there was a tweet that said it was not ambitious enough and not enough clarity. i think we risk, with all these people who are looking at it on a purely economic basis, we are going to lose the people we want to hold onto most and thatis

central banks across europe and asia are exploring using virtual currencies.t is despite the influx of cyberattacks and the wild swings of crypto currencies. dormant college economics professor andrew evans told bloomberg digital currencies can benefit small businesses and consumers. vietnam, china, and denmark's central banks are said to be considering options. investors blame a brokerage firm on the regulatory inflation for the sudden plunge of hong kong stocks. companies say more than 90% while 17 others dropped more than 40%, losing a combined $6 billion in market value. hong kong's benchmark indexes among the year's best performers.the selloff drop those enterprise markets, the most since 2015. 2015.ce joe: i wanted to talk a little bit about the hong kong crash. check out this chart. there are two reasons i like this chart. one is you do not see stocks plunged 95% in a day very often. this is an umbrella company. you do not hear about publicly traded umbrella companies that often. publicly traded umbrella companies in hong kong that are part of the big s

it is highly affected by central bank behavior.ave negative interest rates forcing people into underwriting levels that are not economic conomic you have a non-e driving force. jonathan: there will be a lot of people watching this program that agree with the premise. >> equity markets are less expensive than fixed income markets. there are areas of the equity markets that are more attractive. the key issue is we are valuing equities against an environment where you are not going back to a 5% or 6% interest rate or environment. if you are persistently low interest rate environment, the whole paradigm has to be rethought. jonathan: pablo, em, it is like trade. europe is that becoming somewhat crowded? significante seeing amounts of flows into the asset class. they are mostly driven by flows in this drop in volatility worldwide. theou value em today with vix where it is, -- the where it is, em is not that expensive. changes a little bit. markets,to emerging emerging market rates, that is one of the portions of the asset last that is b

what matters most is the central banks inflation forecast. that is their intermediate target of policy. whereflation reflects monetary policy was 12-18 months ago, so the fact they have low inflation today, monetary policy one year ago. r.b.i.tters most is the forecast and they expect inflation to pick up. secondly, again, this feeds to your point, the banking system after demonetization remains awash with excess liquidity. than threere trillion rupees and liquidity, which the r.b.i. is doing its best to mop up. strongl means quite downward pressure on lending rates, and this is something a lot of people have been missing. rbis own data, the benchmark weighted lending rate has fallen by 10 basis points over the last month. deal, but at the margin, and excess liquidity means monetary conditions are still easing and therefore no real reason for the r.b.i. to -- haidi: i want to add to that point. you are talking about demonetization and this liquidity in the system. i want to throw this chart up, 15 05, master banking loans close to a quarter c

that is in central london.n marching with similar protests, similar slogans, similar anger. banners that say justice the g re nfell tower. banners that say justice the grenfell tower. —— justice for grenfell. they were in the heart of central london in oxford circus, now moving up towards broadcasting house, the bbc‘s headquarters. complaining about, as we were hearing from mark, how will this disaster happened, how awful warnings from residents about safety concerns were ignored. and complaining about the response of both the borough council and the government. i want quicker action to identify the dead, we house the homeless, —— they want quicker action. they want a faster response to this disaster. politicians from all parties, the prime minister in particular, are facing a barrage of criticism from local people over how they've responded to the fire. many feel their voices have been ignored for years. today, the local government secretary sajid javid promised that — whatever recommendations are made by safe

the simple fact little rock central high school, the infamous little rock central high school is predom nanly black, surrounded by a white neighborhood disturbs me. you know. why are kids not coming to this particular school? gard to central, surrounded by the predominantly white -- it's almost like two schools. every time i go over there i get mad. where are all the black kids in the a.p. classes and why are the white kids in these mobile home things outside the school? if you go to one side of the school at the end of the day there are black parents picking up black kids or black kids walking home. if you go to the other side there are white kids being picked up. it disturbs me we haven't gone any further than that. i do think with the programs around the country i see a lot ore schools, more kids getting into schools that are serving them better. my granddaughter is in a charter school here in d.c. where she is thriving and in visual arts and art and those kinds of things which are her interests. and is looking to go to wilson ext year, traditional public school. i like the families

comment should not be taken as a central bankers forecast or a central bank is objective. be reasonable if you take into account the strength of the mexican economy. if you take into account, the policies we have undertaken. also, the reasons that generated the depreciation that was not sustainable. in yes, i mean, think it is the realm of the feasible. francine: jeremy stretch still with us. look at the peso. let me bring you to my chart. this has a like to do with the trump administration. arstench does mr. c have control over his currency? you are absolutely right. that is reflective of the uncertainty in the market and the relationship to trump. that is still an issue to wait to see how that renegotiation process will play out. we have seen a very impressive timing cycle. the bank of mexico is close if not and of the cycle. clearly, they want to rein in the inflationary pressures of that one-off adjustment in the currency. it is going to be the case with issuing political risk in mexico and also an ending of the tightening cycle that maybe it will be tough to see it mo

thunderstorms have been erupting across the central and northern plains of the united states and in central thunderstorms are affecting central canada and the great lakes. on friday they will erupt once again and push slowly eastwards. they will affect the eastern states and canada later on in the week. meanwhile in the west there is that dry air and that very high wildfire risk. that line of thunderstorms continues to work its way closer to the eastern seaboard as we head through to saturday, bringing the threat of flash flooding and possibly tornadoes. in south as yet the south—west monsoon has got its act together and it has been pushing into the north—west corner of india and into the south east pakistan. the bright colours mean exceptionally heavy rain, potentially around gujarat and rajasthan. it is inevitable we could see some serious flooding in the next couple of days. heavy rain saturday and sunday across new delhi as well. and also in the north east of india and bangladesh where it will stay very wet. interesting weather in europe. it is unseasonably cool in the north—west corner

parliamentaryench elections, a wave of central-bank decisions.parliament, prime minister may hanging onto power. confirming right now that chancellor hammond will remain the chancellor in her new. a swiss central bank decision and the boj as well. ahead to break it down, let's begin with you. but sketcher thoughts on the fed. 10 year yields have rented new lows in the last couple of weeks .14%. is there a message in the curve for the federal reserve? >> bond markets have been rallying. equity markets have gone up, so bond yields falling, equities going up, one of the two is wrong, and the fed as well. the fed would like to start raising rates. it,y time they start to do there is an external issues stopping them from doing it. is a 95% chance they will go 25 basis points next week. i think it is one and done for the rest of the year. jonathan: a lot of people are saying the treasury's market is one of the most messed priced markets on the planet. is there anything to like about treasuries right now? mostxed income is the missed price because of th

our top stories: an attempted terrorist attack in the central station of brussels. the attacker is a dead but no one else is hurt. the suspect has been neutralised by the military that were present at the scene immediately after the explosion. us officials said north korea is directly to blame for the death of american student, otto warmbier. also ahead, the hunt continues fall fourforeign prisoners also ahead, the hunt continues fall four foreign prisoners who tunnelled their way out ofjail in bali. the new leader of hong kong says she will not be a bull to guarantee freedom of speech in the territory. live from our studios in singapore and london, this is bbc world news — it's newsday. welcome to viewers around the world and for those joining us in the uk. it is 7am in singapore, midnight in london and 1am in brussels where a suspected terrorist has been shot dead after an attempted attack in the central station of brussels. people heard him shout "allahu akbar" before that was a small explosion. brussels central station evacuated shortly after police say a man tr

haidi: putting an end to this jampacked week of central-bank policy.itiesmarket falling after the dollar strengthens. if it will bes bad when it comes to capital outflows from this part of the world. the bank of korea's suggesting it could tightening. i press conference from governor kuroda today whether the doj is ready to start thinking about an exit strategy. david is having look at the market for us. david: yesterday was a sharp drop. thinking of it, but making a public is another matter. , ae a look at equity markets strong dollar. git. a look at the ring .5%.outh korean won that me shift to this. .1%. taiwan. but techy selloff, heavy indices seeing the most pressure. have a look at the bond markets in australia. yields on the way up. asia.s a breakdown of hynix down 1%. softbank getting an upgrade from morningstar. look.racks the three-day there is the reflection of the post-fed drop in yields. we are back to levels of two days ago. 2028 bonds were sold this morning, yield 2.25%, given the strong jobs number, 2.5%, there is your demand. boj fromt

>> central is 99% black now so it's changed. when they did the 40th anniversary, was there some conversation about the fact that central was now 90% black and how that was going to look on the media, so i think they highlighted white kids which i thought was just tacky, but you know, it took many years. i was talking to my sister's friends who were three years behind us, and i was saying we had a rough time at central and she said we did, too. so we know three years hadn't changed and i remember one of the times i really got in trouble. my father was the first black superintendent of the little rock school district and my father was brown skin and we were light skin and nobody would put us together and a teacher was mean to me, and i remember saying to her do you know who my father is? you're going to be in big trouble and he probably hired you. my dad told me not to do that, but that was the way we had to survive, you know? we needed a hook. we needed some way to get through it. it took a long time. i don't -- we had a facebook

rest is central. it's almost like two schools. and so every time i go over there i ged mad. where are the black kids in ap classes? and why are the black kids in the mobile home things outside for school? if you go to one sued of the school, at the endst day there are black parents picking up black kids or black kids walking home f you go to the other side, the white kids are being picked up. so it disturbs me that we haven't gone any further than that. i think i see a lot more schools -- more kids getting into environment that's are vie ders. mo -- diverse. more kids getting into schools that are serving them better. my daughter is in a charter school here in d.c. where she is thriving in visual arts and art and those kind of things. those are her interests. she's looking to what's going on. i live in arkansas and they still have so far to go. as far as what they're doing with kids, black kids and white kids and them still bussing kids to white communities outside of the areas where they live. kids a