to capitalize the central bank -- d capitalize the central bank.ublishing a mechanism that will allow central banks to use this reserves for the purpose of the central bank -- it is to bring stability and strengthen the currency and also stabilize the economy. it is very important. i think this function cannot fulfill its primary objective of stability [indiscernible] against foreign currency to provide stability. [indiscernible] if there are no stable prices, they're not going to be able to buy basic household goods at reasonable prices. inflation now is at 52%. optioning will allow a situation where this inflation of double-digit of 52% could be reduced. higher prices are one of the major causes of poverty. now more than 70% of the world's poorest people are women. you have women and children cannot afford to buy the basic necessities. they cannot buy bread. they cannot buy cooking oil. they cannot buy sugar in fuel. i think it is very important afghans be allowed to have their cash to be able to buy these basic necessities, to have access to cas

the last 10 years we were talking about this independent central bank story. that has changed over the last several years, and there is political pressure building on the bank of england and the federal reserve. tom: the governors saying, not for the independent bank of england to get involved in leadership election. maloney. -- baloney. they did this morning. jonathan: how big is the fiscal effort? what does that mean to the bank of england offset that may come down the road? tom: bond market, lisa, it is real simple. fixed income speaks. lisa: speaking and not a nice way. stocks have taken notice, as well. a lot of gains this morning. bond yields coming down. how much of this is in anticipation of the weakness that people are expecting from the move the central banks will make. curve inversion, 37 basis points. the two year yield was already seven basis points above the 10-year yield moments ago. it is really flashing some red signs. tom: we have so much talk about this morning. i am going to the continued equity lift. resiliency indicated by the vix. jonatha

it is the four largest central banks in the world. the federal reserve is the white line, the ecb is the blue line, the boj is the purple line, and the pboc is the yellow line. i go back 15 years, and it is a massive explosion in this part of the fed. it seemed so tiny, haired -- so tiny compared to what we saw before. what is interesting is that we have been talking about qt starting a couple of months ago and we have not seen a dent in the fed line. however, you are seeing the ecb priming this month to fall back below the fed. this is for the first time since the early part of the pandemic and there are only a couple of months when the fed was the largest central bank. the ecb is falling, be boj -- the boj is falling, the pboc is falling. you're focused on qt and acceleration of qt. but the strengthening dollar has had a greater impact on global central bank balance sheets in any tweeting -- tweaking of balance sheets themselves, and that is a tightening of financial conditions we are seeing around the world. that is why we get rest

into other currencies from central banks? that is a whole other debate. is the economic outlook? we have sanctions coming to bear at the end of this year and product sanctions on russia in february of next year. is this when the screw turns more aggressively on russia? >> the west can only hope so, but in the meantime you are seeing middle the pmi -- seeing it on the pmi data yesterday. we seem to be in the early painful stages of recession and it is because of putin cutting off gas supply. that is affecting germany and its eastern neighbors more. you have countries across europe scrambling to stock up for the winter. it is ramping up wholesale gas prices to dizzying heights. even the u.k. which is not dependent on russia for energy, because of its storage model, it is exposed to this as well. it is a headache for central banks and politicians across the continent. manus: thank. bruce einhorn on the very latest from the u.s. to ukraine in terms of aid and lizzy burden. credit suisse shifting the focus to a broader set of wealthy clients. what does that me

guy: the central bank, the bank of england continues to be behind the curve. it continues to underestimate the impact inflation is having and how sticky that inflation could prove to be. it is playing catch-up. is the perception that the bank of england is still behind the curve most people in the market and how does it correct that? >> it is an easy criticism to make. you speak to economists or underestimating inflation it's not to the boe officials, and then every time it happened they add on the difference that they got it wrong to the next print. yet inflation keeps on getting higher. you now seeing cities saying you'll see inflation at 15%. is the bank of in the behind this curve, there's a huge recession risk. already talked about a long recession the likes of which we haven't seen since the 1990's. to be fair to the bank of england they have a difficult line to tread. >> i feel like it gets worse really quickly because now we have transportation strikes all over london and in the u.k.. i can't believe guy made it into the office. i'm wondering why the s

investors continuing to adjust to a high environment and more hawkish central banks.for longer was the message from jackson hole. plenty more coming up. " surveillance" is next. stay with us. this is bloomberg. ♪ - [announcer] imagine having fuller, thicker, more voluminous hair instantly. all it takes is just one session at hairclub. introducing xtrands. xtrands adds hundreds or even thousands of hair strands to your existing hair at the root. they're personalized to match your own natural hair color and texture, so they'll blend right in for a natural, effortless look. call in the next five minutes and when you buy 500 strands, you get 500 strands free. call right now. (upbeat music) >> the federal open market committee's overarching focus right now is to bring inflation back to our 2% goal. >> i think we will have to move them up above 4%, and probably hold them there next year. >>

we can say central banks blew it. they misjudged inflation, they overstimulated, etc., but bottom line, on top of that, there was all these other things that they did not cause. supply chain constraints. in order to battle all that and push back, very slow growth could be and probably will be required. if central banks are not willing to signal that they are not going to help change expectations, maybe that is another big part of this. you have to change people's expectations about what the central banks are going to do and what that means so that you can start reaching that. it was very interesting. i pushed him on how high he will go. we really think that this is the top. we think that we are there. it is a pretty strong message and again, i think it does apply not just to the rbnz and the fed but to a lot of central banks around the world. manus: thank. we will catch up on monday with the big reveal. kathleen in jackson hole. you can catch the special coverage. the whole team are at the symposium right now for bloo

was the first major central bank to cut rates., you are getting a lot of pushback, a lot of questioning, a lot of criticism. how do you respond to them? are central banks being expected to do more question mark people taking this as an exact science rather than something you have to try to do in steps? what do you think about this after surging inflation? >> central banks need to be very open and willing to show all of their workings of how they get to where they are and what they are trying to achieve. the hardest thing for a central bank is to explain to the public what you cannot achieve. we cannot expand your labor force, we can't print people. we can't make your health kit -- we can make your health system better. we can educate your children but a lot of the public says you are part of the government, you should be achieving those things. we are victims of our own position of being out there in the public as a regular feature on economic news and announcements. we are targeting consumer processes. people think you have targe

that is the think that will reverberate across a lot of economies, central banks will see their reserves come down, lots of assets will feel the pinch. because the fed is more reluctant to prevent, that will make it harder especially for the rba but also the bank of korea and other central banks to prevent away -- pivot away from high rates. kathleen: that was enda curran and garfield reynolds. you guys leave us features. thanks to our colleagues. garfield just mentioned the bank of korea governor is keeping the door open. i spoke to him at jackson hole. he told me he would join fed chairman jerome powell if prices remain out of control. >> we are not exactly targeting the interest rate cap as our prime political objective. the high interest rate in the united states will have depreciation pressure to korea, and that will impede our inflation rate. two big large differences, one thing i deal. we have to without the exchange rate to move and we have to focus on our own inflation rate. kathleen: the bank of korea will reach two quarters of 3%, you said that is reasonable. how does that loo

central bank independence?d center in discussions here in jackson hole. it is not just central banks, but in general, the economics profession has not done wonders with their ability to project economic growth and inflation, things that are critical, nor understand how policymakers should react. there is going to be a big reassessment all the way around at the central banks and others are going to regain credibility, and it is going to be shall we say on horseback, by producing results. kathleen: central banks and markets, in other countries as well, what does it mean? john: the markets are paying close attention to what the central banks are going to do. it is not that they look to the central banks to make it clear what the economy is going to be doing, but they need to know how the central banks are going to react because central banks have fallen behind their job in keeping inflation low and stable and now, we have to figure out how they are going to go about trying to restore that. kathleen: and will that

and let's return to the top storage of central bank cutting a key interest rate. and let's good more on this from jacob gunter senior analyst at the mercator institute for china studies. welcome to the w, jacob received central bank intervening for the 2nd time this year. do you see more than just macroeconomic factors at play here? yeah, there's certainly more than just the macro economic factors. and when you look at this 10 basis points reduction, it's quite notable because it's the opposite of what's happening ever else in the world. everyone else is rushing up their rates and trying to their, their lowering it effectively because they have the opposite problems that we have . the united states and europe. consumption is incredibly low and weak relative to supply. so they're, they're definitely trying to keep the economy from kind of falling out in large part because of the plumping investor and consumer confidence is coming as a result of kind of 0 policies as long as it maintains, if you're hoping approach consumer consumer investor confidence is going to be

manus: it sounds as if the rbi central bank governor is talking about this regime change by global central banks. they will not be stop. -- they will not be stopped. let's look at key items on the slate for the trading day. production data in germany at 7:00 a.m., followed by france and italy. the bank of england chief economist will speak on the monetary policy report briefing. he will join bloomberg later in the day. it was said the recession could happen in the process of recession. dani: finally, the u.s. jobs report inspected to show again of 250,000 jobs in july and unchanged unemployment rate of 3.6%. coming up, we get more into the conversation on the test the ceo. manus: we will also dive into the earnings from allianz, with the ceo, who joins us in a short while. looking at the numbers, you have outflows from pimco at the moment, 28 though you and. -- 28 billion. ♪ >> mild, moderate recession, maybe 18 months-ish. and i think inflation will drop rapidly, that is my guess. manus: elon musk speaking at the tesla on inflation and the risk of recession. a trading model by jp morgan s

the central bank holds classes, but there are nonetheless.he concept of social engineering, uh, which scammers are very good at using. another one expert council initiative. enable customers to report fraud to the police through the call centers of credit institutions along with appeals. they could automatically transfer information about the disputed operation to the central bank , this proposal is considered ineffective, but they are working in terms of interaction with the ministry of internal affairs between the bank of russia and the ministry of internal affairs, it is planned to organize an information exchange that will allow law enforcement officials to receive information about accounts on which funds are transferred stolen from our citizens, in our opinion. the one-stop-shop mode will make it possible to speed up the process of obtaining information about an operation without consent as efficiently as possible and to help identify all persons involved in illegal activities. this bill has already been adopted in the first place. blue

european central bank's gave those signs as well.reassessment about how high interest rates in the euro zone will go. in terms of the story of the day, it hasn't moved on. we started the day in negative territory. that's attached to higher interest rate expectations. that's where we are, that's were we are starting, down 0.8%. tomorrow, we will get london back into the frame. here is the picture. for a lot of today's trading, we did not have any sectors in positive territory. energy is moving a little bit higher. technology is the worst performer. those are really called into question when you see higher interest rates. that was a feature of the early selloff. as we are reminded, there's no surprise to those. there are a few assets we need to focus on. there are plenty of macro moves. this is supported by the expectations. that didn't last when the market digested the commentary. we moved higher in the euro. bond markets were seen the pressure of that. there are higher yields on the horizon. the yields are moving higher. we cap menti

this news that we got that the central bank is demanding banks, it in particular policy banks lending more to the real economy. we are hearing from sources that the special loans package that was announced late friday, and never got more illustration of it from the pboc yesterday -- we got more illustration from the pboc yesterday to the tune of $29 million to -- billion dollars. what happened to xi jinping's three red lines from the developer to contain the debt? they said it was essentially a backstop right now. this is to boost confidence. homes that have not been delivered, that our projects in disarray, cannot be completed can be completed. there is a societal element to it as well. if you will boost confidence it is for existing properties. what about stimulant and demand for future projects? that is the big question, that is when the reasons we get the loan crime rates cut --prime rates cut, particularly five-year. that could stimulate mortgages, confidence is very weak right now in a very troubled sector. we hear from lady -- larry who, who estimates average mortgage rates cou

but the global environment is still for central banks.ank you, win thin, brown brothers global head of current strength -- currency strategy on the dollar outlook. opec to push into surplus quarter. that as u.s. gas prices fall to the lowest since march. denny adkins is part of the team of oil associates and joins us now. you think back to the decision on production activity recently by opec-plus. it was modest and maybe this outlook feeds into that in a bigger way. >> for sure. the revision into their forecast was largely due to a downward revision to their demand expectations. so at the end of the year they expect demand to grow by 300,000 barrels a day less space on this -- based on this forecast. and that is not largely due to demand destruction reserve -- concerns, it is partly due to the china lockdowns and increased political tension in russia. caroline: how are you looking at these different institutions giving their outlooks? i thought oil was big today. but they came out and said we see demand higher than we expected. >> yeah. t

wei: the focus is on central banks and central-bank policy response. also inflation dynamics. so far, we have seen the 60-40 portfolios beating earlier in the year and rebounding somewhat in recent weeks. we believe this is a bear market rally. we wouldn't want to change that because -- chase that because any -- from central banks is premature at that point. francine: what is the entry point? wei: we want to see a proper acknowledgment from central banks about the trade-off between growth and inflation as they make policy decisions at this point, and we also want to see them tuned into inflation. if they acknowledge the trade-off and decide to fight inflation with slamming the brakes, that would be inevitable for growth. so far, we have only seen the boe doing that. the ecb and the fed have not yet done that. we are hesitant to give that into the markets. francine: thank you. that is wei li, blackrock chief investment strategist. coming up, saudi aramco post the biggest listed profit of any company ever. this is bloomberg. ♪ francine: welcome back to the open. 11 minutes into

but is all of that enough to appease central banks? that is our big take story that we will talk about later this hour. this is bloomberg. ♪ manus: this is bloomberg daybreak: europe, i'm manus cranny in dubai, dani for her alongside be in london. fortescue metals has a 40% drop in full your profit as record iron or shipments failed to offset the decline in prices amid concern over the slowdown in china. we are joined by the ceo, elizabeth gaines. this is the second-highest profit you have ever had. what went through my mind before the conversation was, to stand still at fortescue, you are going to have to ship the same record amount next year or more. is that the correct assumption? elizabeth: we have never been a company to stand still. we have had great success growing our iron ore business. we have gone to 189 million tons in the year reported. in the new financial year we also had a new project which is expected to come online in the first quarter of next calendar year. that will add to our product suite, that is another 22 millio

the central bank has been hiking aggressively although it is not done yet. two i would highlight. other countries have some effectiveness like south africa, indonesia, perhaps hungary could be a candidate. francine: is this because they look cheap compared to the fundamentals, or you are expecting reforms to come into play for local currency markets? carlos: it is a combination of attractive carry, cheap currency valuations, and it depends on every case. south africa is a completely different case. and hungry you have yields you have not seen in recent times. the central bank is becoming more than in the past but not sufficiently yet, but i believe they are getting there. it is not about structural reforms. francine: thank you so much, carlos de sousa, strategist / portfolio manager, vontobel asset management. let's get to the bloomberg first word news. laura: goldman sachs has downgraded the forecast for china, and goldman lowered its projection for this year to 3% from 3.3%. the energy crisis is adding more uncertainty to the outlook. egypt's central bank

the same central banks that intentionally caused inflation, the central banks that are hiking rates -- destroying demand. the problem is, this is not a demand problem, this is a supply problem. it stems primarily from the work

central bank don't focus as you just had that biggest rate hike in 27 euros from the bank of england.rs from the bank of england. >> the outlook from the boe looking like we are in for a long session. we are hearing from elon musk speaking at the test lecture holding that a shareholders meeting that he feels inflationary pressures are coming down. >> that is the central -- theme of central banks to rein in those pressures we are seeing. forecast treasuries as well as the markets in japan, korea and australia. focused on earnings as well. we've seen mixed numbers coming through from the u.s., mostly to the upside. still that global outlook, we are seeing an economic slowdown from the fed. geopolitical fears there as well as nancy pelosi continues her trip to north asia. we did see china calling up a meeting with japan after joined a g7 announcement questioning beijing's threatening actions around taiwan. this morning, we are sitting the dollar holding fairly steady. fairly tight range on japanese stocks pretty flat. let's go to what were sitting in korea. we are keeping an eye on chipm

the central bank is urging banks to lend more. the saudi arabian energy minister warns of extreme volatility in the oil market and it may force opec-plus to cut output. u.s. futures up slightly to the upside early in the asian session. this after we saw the s&p 500 plunging today. we are talking about some consolidation after the best start to the third quarter since the 1930's or so. there seems to be a lot of pessimism, nervousness about what is going to happen at jackson hole. we have a lot of positioning ahead of what could be the hawkish fed for the symposium. we also have oil prices under pressure in the new york session. this is all at we heard from the saudi oil minister. this is all about what we are seeing with supply so opec-plus could be forced to act. all eyes on what is happening in the european energy prices. look at this chart on the bloomberg. there was panic overnight when it came to the gas prices and power prices soaring. more politicians came out, really wanting people to brace for tough times ahead. we contin

so in 2020 the central bank spent $68000000.00 showing up de leon. now it isn't seeing how much the initiative will cost, but it will be hoping it will riley, the currency, and the economy. it res al jazeera freetown center leon. ah, georgia al jazeera and kim fidel, these, the top stories you inspector general antenna. curtis is due to meet ukraine's president vladimir polanski and turkeys leader. friendship type ottawa on the talks, elevators will focus on grain exports and the safety of europe's largest nuclear power plants.

government and central bank to take action.he biden administration is waiting iran's response to european union proposal and at reviving the 2014 nuclear accord. officials are signaling the possibility a could finally emerge after more than a year of false starts. former president donald trump withdrew from the accord and 2018. president biden has made restoring it a top foreign-policy priority. japanese prosecutors say this man took nearly $380,000 from executives looking for sponsorships and licensing contracts. global news, 24 hours a day on air and on quicktake, powered by more than 2700 journalists and analysts in more than 120 countries. i am vonnie quinn, this is bloomberg. >> pension funds are increasingly turning their backs on riskier assets and embracing bonds as the economic picture darkened. allen joins us with more. bonds have becoming a bit more relevant in the portfolio recently but what are we hearing from these big funds? >> they are very big, combined. when they moved, it is worth paying attention to where th

and central banks are not going to stick lower than that inflation target. we have been longing for inflation for the last decade. not as high of inflation as we have had, but if it stabilizes around 3%, it will be ok for the equity markets. francine: beata, what are you buying right now? is there anything you are trading with conviction? beata: i worry that the rally has come a bit too far. i am bullish on equities over the longer-term. but the markets do not -- until july, so i worry there is bad news ahead before the good news. i prefer the u.k. over the continental europe because of volatility towards value. if there is the threat of more hawkish rhetoric from the fed and the central banks, i would be particularly worried about growth cyclicals than most. what i did last week was to downgrade parts of growth. that is in the areas of industrial and wage chemicals. i worry that if recessionary worries start up in the market, they might start to realize that these prices in the markets are the most to move. tom: what is the call on the u.k.? you mentioned t

when you came _ pressure of central bank. when you came up — pressure of central bank._ pressure of central bank. when you came up with this - pressure of central bank. when | you came up with this research, was this prior to the current heat waves we are experiencing in europe? that is impacting food, isn't it? olive oil in spain and italy, many farmers here in the uk saying if we don't get rain soon, crops will fail. has that been factored into all this? it fail. has that been factored into all this?— into all this? it is true, there is _ into all this? it is true, there is a _ into all this? it is true, there is a huge - into all this? it is true, | there is a huge amount into all this? it is true, - there is a huge amount short term, the weather impacts are very important and hard to predict, so, no, we don't factor that in. the risks from the recent surge in gas prices, pushes fertiliser prices again, we could see these broader forces that i spoke about quite powerful, certainly strong enough to read the rate of inflation down sharply in 2023 on the food price.— on

in the 1st place, the central bank says re denominating. the young was significantly reduce the amount of cash people and businesses carry around on the risk that go with that. but critics say removing 3 zeros from the currency won't show up. it's about critics, a previous monetary policy of saroyan hit the reality of the economy by adding zeroes to the currency. as a result, the leone lost its value and inflation worse, and the governor of the central bank says the decision was tough to make. given the cost of printing new notes and taking the old ones out of circulation, i would not have done this at this time. but the cost for the economy, the cost a reserves that a central bank, as we kept month on a monthly basis, putting out dollars to give to people who are whored, a list of bring it into the system so that economic can keep going. doing that for a foreseeable future, we would have wasted our entire reserves. some banks and business people say the public response and acceptance of the new currency has been encouraging. this no one ma

the country central bank says the re denomination of saloons. currency. has it been necessary, though that magical re denomination is that where you take those zeros away people that thinking that they are poorer than they actually are? and as a result of that, they will ball game all windy a, go to a, buy a, go assess services that should put a lead on price. it's a little bit. so the corner we say the idea can only work if government doesn't return to the policies that lead to the collapse in the body of the money. in the 1st place, the central bank says re denominating the young was significantly reduce the amount of cash people and businesses carry around on the risk that go with that. but critics say removing 3 zeros from the currency won't show up. it's vac critics. a previous monetary policy instead of young hit the realities of the economy by adding zeros to the currency. as a result, the leon lost his value and inflation worse and the governor, the central bank, says the decision was tough to make. given the cost of printing new notes on taking t

are going to have to adopt this winter -- central banks in europe are going to have to adopt thister, when economies are possibly facing energy rations, blackouts, what kind of sales pitch do they need to adopt? what kind of simple language why it makes sense for rates to go higher? peter: once the consumer and political forces have become attuned to seeing inflation as a real negative, and one that needs to be fought aggressively, central banks will see they have a mandate to move in aggressive steps. inflation fighting will become about winter and creating inflation -- winner and creating inflation will become about loser. it is still not something which is commonly understood by the masses, but i think the larger inflation gets, the more i watering it becomes and the more embedded in the economy it becomes, we will see inflation becoming something which can win , fighting inflation can win political capital and to be easy for central banks to stop fighting aggressively against it. alix: zero to 10, 10 being 2008, what recession are you expecting? peter: different to 2008, i am

paul: that is the finish central bank governor.get some reactions from jackson hole, we are looking at a risk off day ahead for the major market open in asia? annabelle: that is right, we are taking a look at futures, open in japan and australia, new zealand is trading to the downside as well. it is dow's reaction we are getting from jackson hole, the call we got from powell that rates will stay higher for longer to tackle inflation and there are more catalysts for volatility because not only do you have the critical u.s. job data coming up, they're also the two fed key programs pick up. there are concerns around risk of recession. a lot of australians assigned the bounce we are seeing in the global stocks is going to be tested. we are on another drop on a weekly basis near the levels we last saw during the period. not a lot there for the optimist. kathleen: chinese stocks, what is going on there? economically, how about in terms of equities? annabelle: it has been a diversification play over the last few months. the open today, th

so in 2020 the central bank spent $68000000.00 showing up de leon. now it isn't saying how much the initiative will cost, but it will be hoping it will riley, the currency, and the economy committees, al jazeera, free town steadily on. the rhine river flows through 6 european countries. it is a key was away for transporting coal iron and on the national was o says the weeks of high temperatures, missile and no rainfall have made it impossible for many ships. on a dominant came the ports now from cologne. it could almost be a picture postcard of the rhine goods barges chug up and down the river, while children explore the pebbles on the bank. and yet a closer look shows something else. for in most summers, much of this area would be submerged. but months of high temperatures and little or no rainfall have changed things, or we see right now with a low or water levels in rivers is the new normal or it's even worse of the new normal will be even more extreme. we have seen a global temperature increase of 1.2 degrees on global average right now seen from

the us central bank has promised to fight inflation, but warned it will be painful.pakistan after almost 1,000 people died following severe monsoon flooding that started in june. more than 33 million people have been affected by the country's heaviest rainfall in decades. hundreds of thousands of homes have been destroyed and thousands of people have taken refuge in relief camps. the worst—affected areas are in the provinces of balochistan and sindh in the south, from where our correspondent pumza fihlani sent this report. moving to higher ground. families wade through the water with the only belongings they could salvage. in southern pakistan, many streets have been turned into rivers. families have set up tents on the few roads that are still visible. it's been more than ten days of heavy rains and yet, the streets of sukkur are still flooded. this is one of the main roads linking this community to the outside world. now, something has also happened here — many of the people of this community say they've lost their homes to the floods. what they could do was they m

it's a bit like that for central banks.this time last year essentially said with transitory inflation we've got this covered. it's not all their fault. governments as well as central bank, too long. guy: it doesn't, because they don't know what went wrong? marcus: i don't expect them to admit they got it wrong. pointing out perhaps that on the they not understand everything as useful in the future. perhaps where the trade-off is. and that's what really boils down to. that only makes it worse with a high interest rate. if that's the case, than they need to think about what the targeting is. is to present a fixed number, a landing point. guy: to that point -- kailey: to that point is the 2% inflation target going to go the way of forward guidance? marcus: i think it needs to be more flexible. something the fed is a little more flexible compared to where the bank of england is. we don't understand inflation. guy: if your european central bank are arriving in jackson hole. what are you going to take away from it. from european

or is he were serving the central bank? i can tell you this i know jay very well. we tax each other and we play golf together. we don't talk about policy anymore. i'm not allowed to but he doesn't want to be arthur burns and i should be a saving grace. >> let me ask you one other question. in 1971 there was a huge debate about the so-called -- the trade-off between inflation and unemployment and a lot of distinguished economist said the phillips curve is no longer a guide for policy and a lot of them admitted that they knew how to stimulate the economy but they really didn't know how to deal with inflation and the kind of inflation that they were seeing had not existed in the u.s. except maybe in wartime. do you think that we really understand this phenomenon? as i follow the current thinking there's a lot of conflict among so-called experts but here it is 50 years later. are we more sophisticated about inflation or did paul volcker have a right that there's only one way to do it and that is tighten rates to dupe point that the economy softened and to do it in such

and economy struggling haunted by its own 0 covert policy and constant lock downs. china central bank earlier today, trimming, lending rates for the 2nd time this year, taking its key rate down 10 points to 2 points. 75 percent. that as latest economic data showed there was need 4 more stimulus to support the economy. retail sales and industrial production rose slower than expected last month, as did total exports out of china. now this has caused much concern in beijing. at this, the mortgage was china's once stellar property sector has sharply declined during the last 2 months with both new investment and sales down sharply. earlier i spoke to jab cup gunter, senior analyst at the mercator institute for china studies, and i asked him if he saw more than just macro economic reasons for the central bank to intervene for the 2nd time this year. yeah there, there's certainly more than just the macroeconomic factors and, and when you look at this 10 basis points reduction it's, it's, it's quite notable because it's the opposite of what's happening everywhere else on the world. and everyo

central banks are innate extremely difficult position. the credibility to tackle inflation, which they can. at the same time chasing a recession. i think the bank of england will hike by 50 basis points in september. and there will be more hikes afterwards. then probably all of western europe will be in a winter recession. >> how deep is that recession going to be? how deep does it need to be to get rid of some of this inflation or prevent it becoming second round inflation. >> i think we are already at some kind of turning point. if you look at how companies answer to service, up to the summer to mid summer they were all selling enormous pricing power. the companies could pass through higher energy costs to consumers and it's going to change now in the second half of the year. inflation is so high that consumers can no longer afford to buy the services, the products and then demand will go down automatically. this means there is a kind of built in mechanism in this high inflation story, of the demand will go down. and how deep this recess

i will go higher if those continue to go higher, inflation costs go higher, too that means the central bank will have to relook at things the bank of england and ecb may have to hike rates on a continued basis. that is the sentiment coming out in the united states we will have to keep on doing that to alleviate the pressure you have the energy crisis which continues to affect things it doesn't just affect things at the end of the scale, but even right here just to pump the water from that reservoir to irrigate some of the plants has meant that the cost has gone up at least th threefold as well. that is the energy cost at a primary level at one of the farms in suffolk the situation is dire. the costing is going to go back to the consumer. they are the ones that will have to pay that increase and it means that inflation is bound to stay high for a whole lot longer we spoke to andrew blank, the estate director at euston estate he said it will get worse for wear they are not worried about security food shortage i should say, because things could get better, but it is just about whether they wil

also changing on taking a look at another central bank. hing the bank of korea in their decision is due in the next couple of hours. the overall consensus here today is we will see a quarter-point move higher, that is that 50 basis point move we had for the first time ever previously. we will check this 2.5% that's now a 2.25%. certainly there has been a lot of focus here in korea on inflation that is running quite hot, but in the last survey did come in below the consensus forecast. that does give a little bit of breathing space, especially when you see oil prices coming down, food prices, that does give them a bit more room to go back to this basis point. >> really choppy trading in the energy sector. wti is above. but after a lot of pressure earlier in the week we see natural gas futures store once again. bloomberg su keenan joins us with the latest on the energy market, and of course, this procession that the iran supplies could come back to the market anytime soon. su: that's a big part. we also know now that iran is aiming to fill the

central banks cannot hike to aggressively. that is the view. >> raising interest rates did not solve the supply side. what we want to do right now is invest more in supply-side bottlenecks. raising interest rates makes it more difficult for those investments. manus: jackson hole oppose them. what kind of message will he put forward? let's talk to garfield reynolds. it has to be a tough job for jay powell. his you go towards jackson hole, where do you think he is going to lean? is he going to lean steady or will we get more pools toward state? >> they have been preaching not to give them much freedom at all. markets are seeing financial conditions almost mutual at one stage. they are extremely concerned about inflation. they want to see if powell go through the hawkish. i think it will be hard not to go hawkish. i also think that is open to a volatile session. next week there could be another situation where there is one set of takeaways and we will have fed seekers coming out next week they could try and pick apart some of the

i want to see mark cudmore in a poker game maybe with the world's central banks. mark: i'd enjoy that, too. i hope you can arrange it, francine. francine: mark cudmore with the very latest looking at u.s. jobs. the bank of england says the u.k. base is protracted recession after raising interest rates by 50 basis points, the biggest interest rate increase in 27 years. we spoke with the governor andrew bailey. >> since we last did the monetary policy reports at the beginning of may, that shock from russia in terms of the impact on gas prices has been huge. we have highlighted the risks as we see them. i think there are risks both internationally and domestically. yes, it is unpredictable. we have seen very big things happen. by the way many other commodity prices have gone down since we last looked. francine: it just seems like a spiral. given where we are now, could it get much worse and can fiscal policy help in trying to temper that downturn? >> fiscal policy, we condition our view on what has been announced, but the last pattern was, i look forward to working wi

the central bank holds classes, but there are nonetheless.gineering, uh, which scammers are very good at using. another initiative of the expert council. enable customers to report fraud to the police through the call centers of credit institutions along with appeals. they could automatically transfer information about the disputed operation in the central bank , this proposal is considered ineffective, but they are working in terms of interaction with the ministry of internal affairs between the bank of russia and the ministry of internal affairs. funds stolen from our citizens, in our opinion. single window mode will speed up the process of obtaining information about the operation as efficiently as possible without consent and contribute to the identification of all persons involved in illegal activities. this bill has already passed in the first. don't gossip. here is one innovation that will definitely work from october 1, customers will be able to independently install in banks that service the ban on online transactions. or limit their

or is he really preserving the independence of the central bank? tell you this, i know jay very well, we text each other and play golf together, we did not talk about policy anymore because i am not allowed to. he does not want to be arthur burns. that should hopefully be a saving grace. >> let me ask you one other question, in 1971 there was a huge debate about they so false phillips trade. the trade-off between inflation and unemployment. a lot of distinguished economists said the phillips curve is no longer a guide for policy. a lot of them admitted they knew how to stimulate the economy but they did not know how to deal with inflation. that the kind of inflation they were saying i had not existed in the u.s. except maybe in wartime. do you think that we really understand this phenomenon any better today? you know, as i follow the current thinking there is obviously a lot of conflict among experts. here it is, 50 years later, are we more sophisticated about inflation, or did paul volcker have it right? but there is only one way to do it, and tha

combatting the fastest rise in prices in nearly four decades, the us central bank promises to fight inflationbut warns it will be painful. # hold me closer tiny dancer... and, did she do it again? what the critics said about britney spears�* comeback single with eltonjohn. hello and welcome to bbc news. a national emergency�*s been declared in pakistan, after almost 1,000 people died following severe monsoon flooding that began injune. more than 33 million people have been affected by the country's heaviest rainfall in decades. hundreds of thousands of homes have been destroyed, and thousands of people have taken refuge in relief camps. the worst affected areas are in the provinces of balochistan and sindh in the south, from where our correspondent pumza fihlani sent this report. moving to higher ground, families wade through the water with the only belongs they can salvage. in southern pakistan, many streets have turned into rivers. families have set up tents on the few roads are still visible. it has been more than ten days of heavy rains and get the streets of sukkur are still flooded. thi

they are way ahead of us in terms of central bank and digital currencies.are going to use this digital currency, not only within china, but with countries that are trading heavily with china. and before we know it, unless we are really alert, i think that a sizeable part of the world, given chinese trade, may actually be using china's central bank digital currency. i cannot prove it, i am sure nobody knows whether that is the case. we are entering a very new era when it comes to digital currency. even set aside the cryptocurrencies, i think that younger generations really do not trust government when it comes to a lot of things. including currency. so, i am not predicting that the dollar is going to be eclipsed, but, i think we are facing a situation we have not faced before. and what our strong military position, which is also been a cause of people coming to the dollar in terms of crisis. i think that's an account for less as we go forward and the nature of warfare is not gonna be tanks and planes but cyber. >> so, jeffrey, you mentioned there was confide

haidi: asian markets, asian central banks, the relatively new head of the bank of korea, says he is watchingurrency closely. he made other comments about watching inflation, having to keep up with the fed. how is this going to wash across all asian markets? steve: i hate to think currency is going to be increasingly important. you mention korea of obviously european central bank is aware. and chinese authorities are trying to level everyone against the weight -- recent weakness. the central banks are taking into account currency moves and maybe trying to lean against it. korea's of that means the outlook is for higher interest rates. china, it's going to be really interesting, the economy is weak at the moment of giving covid lockdowns and the property sector, we are seeing them try to fight that and also fiscal policy stimulus, but also that wide interest rate, spiking at the moment. it will be interesting to see how the authorities counteract that. haidi: if we go down that road, what does that mean for investors? steve: the bottom line for us is that china is a different stage of the econ

investors tend to like leaders staying clear of central banks.a she may end up changing the mandate may not be positive. haslinda: investors want clarity. how will it play out? david: the dollar is the key driver at the moment. when fed powell comes in, he comes in very hawkish. he says let's make this really clear. we will raise rates. we're not going to cut rates next year. markets are beginning to reprice that. how does it feed into the dot plot? it was basically 3.75% was median. the chicago president is on the more dovish side. he to seize 3.75% to 4%. there is a good chance the dot plot in september goes higher which is against what the market is expecting. haslinda: so much for the dollar peaking. here we are with the dollar index at a 20 year high. david finnerty. just thankful it has been resilient. david: i'm thankful for the quarantine and travel restrictions because i will not be able to be disadvantaged by the singapore dollar. there always silver linings. let's continue talking about macro and the currency markets. how hawkish will

haidi: the central bank is supposedly fall from -- far from done at bringing inflation down. shery: biden's domestic agenda moves closer to becoming law with the senate passing that tax, climate, and health care bill. u.s. futures at the moment are unchanged. three weeks of consecutive gains in the u.s. stock in the asian trading session. positive data and earnings outlook looked good. 80% of the s&p 500 already reported results. competing profit estimates. treasury yields rallied across the curve. two year yield added almost 50 basis points friday. we are seeing some downside in oil prices after they gained ground friday but still below $90 a barrel. concerns of recession continue but we were watching the odds of the fed rate hike being bigger than expected and now traders are putting a 75 basis point hike for september given that jobless rate fell to 3.5%, the lowest since 1969. so a record number of americans on payroll now. haidi: this all feeding into where we sit with the inflation debate. let's look at asian markets. it's a big week for australian earnings. key pressur