mark cranfield from bloomberg's mliv team joins us with the market reaction. what does this mean, they offshore yuan under pressure, chinese assets in focus, just a fiscal response from beijing offset pressure on chinese assets? the market reaction to this move? >> i think you have an interesting situation here. on the one hand, traders will believe there is no incentive for china to allow the yuan to get stronger. as long as it remains on a gradual weakening path, that will be where investors expected to go given the amount of uncertainty, whether the united states will retaliate more, for china will do more, the net result will be the yuan could stay on a weakening path. in the background you have a different scenario for chinese equities. there is already some differentiation going on where people are picking up on the fact that the progress china has made on a i, particularly related to deepseek, looks as though it will benefit some chinese companies regardless of what the u.s. does. you have all the publishers doing extremely well. they have results out l

let's check in with mark cranfield. i know you have been monitoring the impact across the treasury curve. it's difficult to know which asset classes to zoom in on. what stands out to you in terms of how the markets are adjusting to this news? >> it's the macro traders in control so far today and that's not too surprising because we have the cash markets that have not opened so we have to take into account what we have seen. the dollar is strong across the board. suspension of stealth intervention already to try and keep them stable and that certainly the genesis of an article suggesting they are preparing talks with the u.s. but what's interesting is that the short end is looking at the inflation impact from tariffs and higher yields, especially the two year. that's where the dollar bid is coming from but if you look at the long end we are seeing much more demand, particularly around the 30 year sector and that suggests people think the growth factor will be a factor. we predict more than 1% will be shaved off this year