christine lagarde mentioned q3 and q4 and q1 of next year. the economy is a bit more resilient than we thought. but conditions are not very good. and i think it will be very difficult on the session in europe. guy: if it's difficult to escape the recession in europe. do people like giorgia meloni, the french prime -- the french present have a point, they are starting to complain about the fact that the ecb is tightening into a recession that is a supply-side recession not demand-side recession. -- demand-side inflation. do you think they have a point and do you worry the ecb if it continues to tighten could be on a collision course for some of its politicians. >> i was very much positively surprised when they changed even slightly the language. they want to dampen demand which i thought in september was quite strong actually in the context you describe. they seem to reduce support which is quite different actually. this language is much better than it was. markets notice. i think what they do here, and the key is the optionality. i think it's

coming up, the ecb signals a jumbo rate hike with christine lagarde saying that more will come ahead.his is bloomberg. ♪ >> i think qt is probably still a story for 2023. >> what is interesting is how christine lagarde has led the way on the rate rises. they have not been pushed into it by the market. >> it makes a fairly painful unpalatable decision when we are going through a slowdown, but the bank will have to be mindful that some of those inflationary pressures are starting to diminish, but they need to provide the market that the primers of inflation is the preeminent factor. >> it is not just interest rates but the energy equation is very relevant. we do not expect that qt will have any relevant impact moving forward. >> they have to close their eyes to what is the dollar right now, and what they are hoping for is that at least the natural gas prices will move in their favor and that will put down inflation for them. francine: bloomberg tv guests reacting to the ecb's rate hike yesterday. let's get to maria tadeo in brussels. you were there in the room at the press conference ye

away from the rate hike which is already priced in, is there anything christine lagarde needs to hones of message? silvia: good morning and thank you for having me here again. yes, we expect the focus will be on the tltro's as was just said. in terms of conditions, it will be changed so the cost of borrowing will be aligned with the deposit rate for the remaining part of borrowing, in an attempt to incentivize banks. in terms of communications, we think markets are also interested how the size of the future rate hike. we expect the ecb to high-five 50 basis points at the december meeting. it would be welcome although we don't expect at the present we will be committing to any kind of rate hike, nor any sort of clear indication of the neutral terminal rate. then there is qt as the last potential focus of the markets. and again, we can't expect much at this meeting. francine: will she give a timeline on when qt could start and how will the market interpret that? silvia: in terms of our expectation is that an announcement by the ecb will only partially invest material securities of the a

haidi: the ecb president christine lagarde doubling down on the hike bath but what was interesting inhat policy address there was also essentially what strategists were saying was lagarde was recognizing the risks of stagflation on the horizon. traders interpreting this as a dovish policy announcement and a path ahead given they did drop the words over the next several meetings and said substantial progress had been made on the rate hike so far. in terms of the reaction the euro was down more than 1% against the dollar, trading like this in the early asian session. very much focused on the terminal now, kishida plans to announce an extra budget of stimulus worth nearly ¥30 trillion. we are focusing on what the yen does ahead of the bank of japan policy decision later today. kathleen: let's get to our next guest, a bank of japan governor faces a key test trying to stick with rock-bottom rates without triggering a landside that required intervention. with us now, effexor ito -- professor ito. it is great to have you back. i want to go to this question people are raising. is the pressure

manus: christine lagarde,ed of the e.c.b.inor beat estimates to boost its extraordinary dividend. it's going to come in at 70 cents from 50-cents for the third quarter. a two-cent boost. let's get anders opeddal, why did you not increase the ordinary dividend? we have this extra dividend but why not move on the ordinary dividend? and does that just say it's a one and done moment for equinor? good morning. anders: good morning to both of you. yes, we are increasing the extraordinary dividend. we normally look into the long-term dividend plan every fourth quarter and then we're also looking into kind of how we are adjusting the fixed dividend. so this will come in more when we do our capital market update in february. for now we have the record results of $24.3 billion u.s. dollars in adjusted earnings. we continue to informs and continue to provide a competitive dividend to shareholders. dani: considering you have a record profit coming in here, i understand that you usually on a calendar basis evaluate the regular dividend fu

ecb president christine lagarde speaking about all of this in the press conference after the decisionpres. lagarde: we have raised the three key ecb interest rates by 75 basis points. we expect to raise interest rates further to ensure the timely return of inflation to our medium-term target. economic activity in the euro area is likely to have slowed significantly in the third quarter of the year and we expect a further weakening in the remainder of this year and the beginning of next year. the incoming data confirms that risks to the economic growth outlook are clearly on the downside. especially in the near term of future policy rate decisions. we will continue to be data-dependent and follow a meeting by meeting approach. we stand ready to adjust all of our instruments within our mandate to ensure that inflation returns to our medium-term inflation target. guy: our european correspondent maria tadeo joins us from outside frankfurt. we got 75, but the view is that was a dovish decision. what is your view? maria: guy, listen, i think overall when you put the two together, that is a

haidi: at the previous meeting, christine lagarde had said the ecb would hike for several meetings to get inflation down. now she said you all should expect for the rate hikes. that made people think maybe that is less hawkish, the euro weakened on this and the dollar strengthened. markets are pricing the key rate peaking at 2.75%, they are extending their tltro, thanks can no longer part that cash in ecb accounts and earn cash pretty income which had become a thorn in the side for many people watching the ecb. let's get some more on the markets, as kathleen mentioned, those big tech stories today. let's bring in bloomberg tv's ed ludlow, and our equities reporter. let's kick this off with apple, what was your take away as we round out this week of tech earnings? >> it was a mixed bag for apple, we missed on iphone sales, partly because they knew i 14 -- launched with two weeks left in the quarter for them to get visibility on early sales. weakness in ipad, services revenue, also saying that currency headwind you and i have been discussing all we continuing to impact a company that is

what does christine lagarde need to juggle within your european continent?ot a economist by training. that has always been the criticism, she is not technically as mario draghi was. this idea that draghi was the master markets, he could talk are gets into doing anything he wanted. the reality is at this point, you alluded to this in your previous conversation, this is a central bank that has to cater to tensions that are different to countries that are in different positions. when you look at germany, italy, they are sitting on two opposite sides of the spectrum. what i hear repeatedly in frankfurt, she may not be a trained economist, not technically as good as mario draghi is. at this point, you need someone who has a political instinct to get to consensus and calm things down. at one point, mario draghi was someone who was perceived by some members of the european central bank as to aggressive and taking decisions by himself. the fact she is seen as a consensus maker at this point where this is in many ways territory for the central bank, frankfurt is the

yesterday, christine lagarde painted a balanced picture.he rest of the downside of economic growth balanced against risk to the upside against infant -- inflation. the expectation is the ecb goes from 75 basis points yesterday to 50 at the next reading. can you deliver 50 when we are seeing these numbers? zoÉ, does this data change the game for the ecb? doesn't put 75 potentially back on the table? >> it does. looking at markets, they changed yesterday after lagarde's comments that were by some seen as being more dovish. they paired bets on what happened in september, now that move has been reversed today. those numbers were shocking. spain the outlier, inflation has been slowing for the second month. two months ago, spain inflation was almost 11%. these things can move quickly. at the same time, these numbers are astounding and as we know, the ecb has a 2% inflation target. we could get worse numbers. the year is not over yet. we have very high energy prices feeding into these numbers. we -- that is the thing worrying policymakers. the inf

guy: that was the ecb president christine lagarde speaking earlier on central-bank cooperation for fiscalolicy and monetary policy. getting much cooperation. the question is is the u.k. an isolated incident or is reflective of this idea but when rates change quickly after volatility in the rates market, things are can a break. joining us as the head of rates and credit research from commerzbank. talking about individual countries in a moment. but the central point we are trying to calculate is as rates start to rise rapidly after a period of low volatility, effectively in the rates market. things are going a break. the u.k. story starting to break. where do you think could be next? >> markets are definitely in a different and difficult situation right now because the big difference is inflation, central banks at the end of the day cannot come to the rescue and yet the situation in the u.k. is unique in many ways. but parallels cannot -- it's an issue where governments need to fund more so there will be more debt and at the same time central-bank have to raise interest rates so the costs a

ahead, christine lagarde says an economic slowdown in the inflation we face pose a significant risk toconomic stability. mario centeno his joining us next, this is bloomberg. ♪ guy: just a few moments ago we heard from the british prime minister, liz truss, a physical u-turn is underway. it poses huge challenges for the bank of england governor and we will hear from him next week. it will be fascinating to see what the bank does next. clearly, there has been some real pull -- ripple effect through the markets, particularly the euro zone. mario centeno banco de portugal is the governor. what lessons are you learning from what you are observing in the united kingdom? mario: thank you for having me. the lessons that we are learning today and in the last few weeks are very important for us as policymakers. and they reinforce may idea that gradual policymaking is important. the worst case for all of us is if we need to go back and forth in our decisions. we need to be a source of stability to our citizens. we can't be seen as going nowhere or at some point having to backtrack on our decisio

are going to of course have to potentially see some of their debt serviced and purchased by christine lagardeat was what was expected at least by economists ahead of time, that they would do another 75-basis-point hike seeing the euro drop like that, though, was there some sort of whisper expectation that maybe they would do more or was there some sort of expectation there would be stronger language than they saw in the initial press release? >> i think we're going to have to wait for the press conference, but in my opinion, watching what's going on with regard to rates moving a bit lower and the euro moving a bit lower, most likely has to do with the recessionary implications and the slowing of the economy. we all know that there's an awful lot of natural gas all of a sudden that seems to be floating around infrastructure and costs are still a major issue. and of course, we saw that germany is going to subsidize their high energy costs such an extent that they put the rest of europe at a disadvantage, and all these issues are negative for their economy, which is most likely trumping what we

guy: christine lagarde has come under pressure for saying this inflation came out of nowhere. it clearly did not come out of nowhere. do you think the ecb have a handle on what is happening? inflation keeps exceeding expectations by some margin. melanie: i think we have to give the ecb somewhat of a break because a lot of us got it wrong. the inflation numbers especially for energy have continued to surprise us. that is because of the lag that comes in in different countries and because of fiscal policy being different across the board. for example, the italian number previously mentioned, the inflation rate jumped there because of the 59% increase in bills households are about to see in october. then you have countries like spain where we saw inflation come down sharply because the government has introduced a fuel subsidy. they are working on capping electricity prices. the ecb is having to deal with all these different nuances across countries which makes its job more hard when it comes to dealing with inflation, for all of our jobs very hard when forecasting. alix: you have

the part that got people's attention was what christine lagarde said about further rate hikes. what she said was there would be further rate hikes. but in the past she said they would be rate hikes at several meetings in the future. she was really pressed on that. what do you mean by changing from several meetings to just further rate hikes? anyway, let's just listen to what she had to say. >> it might well be several meetings. how several will be determined meeting by meeting. we know the path, we know the journey, we know the destination, which is not as clear as a figure that you would like to pin down, because we cannot do that. kathleen: yet another central banker bringing up some new concepts. how several is several? i think that was interesting. but it did weaken the euro, it hit the bond market as well because people think it is slightly dovish. we will not know until the next meeting. you have the war in ukraine, energy prices soaring, you are going to have a cold winter. so for now, we are going to debate how several is several. david: more than one. [laughter] kathle

guy: christine lagarde tried that yesterday, got tough inflation data out of the euro zone today.n inflation, back to levels we have not seen since the 1950's. last time we had these numbers is when we had west germany and east germany. do you think inflation will be stickier than we think it is? michael: for sure. at the same time, it can come down to the headline rate and come down on the core rate and still be sticky. i would not be surprised to see headline cpi from eight unchanged to get to five, to get excited about that. then, getting it below five when you look at those components, really becomes quite difficult. alix: do you think we hit the terminal rate 5% by march like the survey said and tip into a recession? michael: -- corporations to mole over debt is a bigger headline for the fed then the s&p at a particular level. i have -- maybe taking the view since the fed started hiking, but financial market risk is greater than economic risk because the fed was so far behind the curve before they started hiking. financial markets war -- were themselves so extended. i think i

we'll go to christine lagarde if she starts speaking. we're taking a look at earnings setting the tone, meta a disappointment last night, set the tone for a negative market. elon musk is visiting twitter headquarters to complete the acquisition of twitter, he tweeted out entering twitter headquarters, let that sink in, while he was carrying a sink through the building, telling employees he won't lay off 75% of the workforce. mark, what do you think happens here? >> the first let that sink in, that was pretty cool. elon's like the god of twitter right now. everything he does goes viral. his initial claim was to lay off 75% of staff. then i kind of heard it backed off to getting rid of 75% of the thought police or the content moderators which would be a welcome thing. maria: yeah, it would of. >> for preserving free speech and democracy. maria: the so-called arbiters of truth. >> all they've done is suppressed conservative voices. so it's interesting to me, like when we look 20, 30 years down the road, what willie lon's legacy -- will elon

maria: it will come in handy but i spoke to christine lagarde -- christian lightner.ss communication or misunderstanding of what the german plan wants to do. 200 billion euros looks enormous but the size of the german economy would fit in that. there responding to the size of the problem, which were germany is also enormous. he says they are not the only country coming up with domestic measures. it has created political tension behind the scenes, no question about it. jonathan: thank you. maria tadeo, thank you very much. i'm going straight to a note from citi. we continue to see fundamental economic risks in low risk asset prices. friday's job report is growing in importance. a softer reading would continue with the bad news is no news narrative. tom: nothing to offer on good news is bad news. jonathan: veronica clark, we can explore this note a little further. lisa: no news is bad news. the other point they are making is right now still the economic risks are tilted to lower risk assets. they are not necessarily seen the groundwork. we are not seeing though the init

the head of ecb christine lagarde said inflation pretty much came out of nowhere.>> inflation has, just, pretty much come about from nowhere? >> do you think about people at home you know, earning an honest wage who work a long week, are you thinking of them? >> i think of them first and foremost. charles: what, danielle, it came from nowhere? these central bank folks, these are the people who are in charge, who can make-or-break economies. she is saying it came from nowhere. >> charles, you cannot be that obtuse. you cannot be that far removed. for heaven's sake there's a war going on a lot closer to her than it is to us, the bread basket of the world has been completely impaired as well. talking about food, energy, households biggest expense, line items. there has been a housing crisis in europe longer than a housing crisis here in terms of what it cost. if it was coming out of nowhere, i pray to god she is not planning on going trick-or-treating. she will get the day lights scared out of her. charles: the ability to except any blame really angers a whole lot of

its exclusivity on all other countries, by the way, within the framework of the same meeting, christine lagarden director of the distributor of e, international monetary fund. said a phrase about the same meaning. she said that globalization today equals china. what does this mean? this means technology multinational corporations development projects are now starting from chinese territory, that is, yes, and in europe and in the states there were smart people able to consider this. but as for the states, i want to say, uh, i wouldn't underestimate here, uh, the strength of the united states of america . so the states are now sitting on their military bayonets around the world. and the truth is felt the fatigue of the metal in these bayonets. that is , microcracks have already passed there, this metal began to deform, but they will be able to hold out on them for some time. you see, this week on the anti-russian resolution. she is very indicative of the united states awakening to be friends, and not categorically refused to vote by secret ballot, for what? it's pressure, come on. vote, then, and

if you could do back-to-back with christine lagarde what you did with andrew bailey yesterday, that isonathan: what have they gotten common, president lagarde and andrew bailey? did you get the same feel from governor bailey, you have three days? lisa: i saw that on twitter that you put that and i figured you were highly skeptical. basically, england is not going to be able to hold firm to something and will have to eat their words rather than threaten to undermine credibility. this is a different scenario for one reason. that is inflation. as you get inflation creeping up, it becomes difficult. with the u.k. post for its second monthly contraction in months, and will wait are they forced to accept higher inflation longer? jonathan: they are worried about the perspective of a flip-flop that they back away too early and then have to go high again. lisa: it is incredibly messy. frontloading is being called, do you frontload or go gradual? jonathan: i am a cynic. from new york city, this is bloomberg. ♪ >> had you explained to markets in the public that you have to resolve inflation if yo

christine lagarde talking about several consecutive rate hikes in the meeting after there was perspective for the downside of the ecb yesterday. 10 year yields jumped by more than 16 basis points, the most going back to march 2020. it was a reversal of the potential pivot of the first two days -- earlier days of the week, the australian central bank, make your gamble. but early betting is it has to do with gas prices in europe. the u.s. initial jobs claim at 8:30, how much does this give the tea leaves of the market? some of the projections on bloomberg surveillance have been dire in terms of how low they would have to go before the fed starts to accelerate or how high the jobless rates have to go before they pull back. some of the questions heading into tomorrow's non-formed pre-roll and today this is for you. minneapolis president neel kashkari, chicago president, cleveland fed president and anyone else on the federal reserve who wants to speak are welcome to come on the show it we will make room. jonathan: we get kashkari twice and metzger twice as well. twice in a day. -- mesler twice