madame lagarde: i am not a dove. should markets be looking at in the review to give us a sense of where goes? madame lagarde: if markets are interested in what happens in the next 12 months, they should not pay too much attention to the strategy review. we are conducting two separate exercises here. we will have our monetary policy assessment and review as usual. every six weeks, we all get together, look at the numbers, look at the markets, look at the views of the citizens in terms of inflation expectations, and we decide whether things should be vary one way or another. that exercise will be conducted irrespective of the strategy review. we might have different signals but we might reconsider. it will be two different exercises. the strategy review will be on its own, on a standalone basis. we are looking at what we do in the future, not what we do next week or in may or july. >> is it a warning to the markets not to over interpret to quickly?- too madame lagarde: issue dovish, hawkish -- is she dovish, hawkish? i

know it was this time president lagarde, the body language is different and as madam lagarde goes throught was different as e.c.b. president. she spoke to francine earlier. christine: for those who think it's autopilot is ridiculous p. there is a forward guidance setting a very clear timetable but that is act dependent. let's look how the economy involved. we need to be fight driven and clear in our communication and we will be and i'm saying today, don't assume it will be on ought himo pilot. you said tiering is working well and is there a side effect of negative rates meaning you need to scale it back? christine: we will be looking at the side effects as the start of the strategy review. we'll do that. financial stability is knots of concern trol but we'll have to look at it, of course. christine: we need a banking sector in the euro that acts as a good channel of transmission. francine: which means you could extend tiering or? christine: as i said yesterday we're not considering that the a the moment. francine: president trump left davos thinking of possible tariffs against germany and

vonnie: ecb president christine lagarde speaking with francine lagarde earlier.rg has launched bloomberg green, which uses data and in-depth reporting to illustrate the scale of the challenge facing the planet. find bloomberg green on the terminal, and here on bloomberg television and bloomberg radio. >> climate change is threatening the survival of our civilization. >> the conversations i've been having and davos are from many ceos saying we have been doing all of the work around esg already because it is important to our employees. >> all of the companies i interact within in the u.s. are very committed. they believe climate change is a real issue. they are committed to taking action. >> our industry has been very successful in reducing the carbon intensity of the product. >> we have a longer-term transition as we change the energy source and move towards a greener grade and a greater economy, but it is a transition. >> this whole conversation around climate, we will see an ambition to invest in low carbon climate resilient economy. ♪ ♪ guy: from london, i'm gu

we will bring you our interview with christine lagarde. caughtleagues in davos up with the ecb president a-day after announcements after the strategy review and some important guidance on what markets should or should not focus on. we will hear from the self-described towel of scent -- owl of central banking. this is bloomberg. ♪ matt: welcome back to bloomberg markets. this is the european open. we are 45 minutes away from the start of cash in equities trading. solid green arrows in terms of european equity index futures right now. you see gains in u.s. futures as well. this friday could be a risk on day. bloomberg first word news with lower right in london. china's virus is not a global problem yet. the world health organization decided against declaring the new coronavirus outbreak a worldwide health emergency. it has jumped to 25. 10 chinese cities and restricting travel. the outbreak will not impact credit ratings. wildfires in australia are set to push the rising global co2 levels to a record. willrecent updates say it release 900 mi

lagarde: that is to be debated.able we are setting for ourselves is ambitious and is to try to conclude before the end of this year. december 2020 hopefully we will have reached that platform of consensus on the various topics we have. we have to repeat the exercise every five years, every eight years, every 16 years. i have my views as well. we will debate that with the group to see how necessary it is, how helpful it can be. francine: markets are interpreting the exercise as having a dovish tilt. when you look at housing costs. owl, notarde: i am in a dove or a hawk. francine: what should markets be looking at in the review to give us a sense of where it goes? pres. lagarde: markets are interested in what happens in the next 12 months they should not pay much attention to the strategic review. we are undertaking two separate exercises. we will have our monetary policy assessment and review as usual every six weeks we will get together and look at the numbers, we look at the markets, we look at the views of the cit

vonnie: ecb president christine lagarde speaking with francine lacqua.manda: raising the diversity bar. how goldman sachs is taking the first step to end the all-male board. this is bloomberg. ♪ vonnie: this is bloomberg markets. i'm vonnie quinn in new york. amanda: i"m amanda lang in toronto. seen a risk off tone embrace the markets since this morning. lows ofw we are at our the session with the s&p 500 down 1.1%, the dow down 0.8%, the nasdaq down 1%, even with semiconductors performing well today. consistent at 1.68, with that risk off tone. one stock i want to point out, boeing, down 1.3%. the reason i'm mentioning it, we another piece a relatively bad news for the company, saying it's considering another cut to the 787 dreamliner production. at the same time they are fending off all of his dad news, it is also debuting today it's 777x line. the wingsthe wings have just bet into place, the first time that's happened for a jetline. the wing tips are so long, they are facing up on the runway. right before it takes off, they fold into place. we are wai

lagarde speaking at her second press conference. the brooch she wore was an owl.he question is, was she more hawkish today. , at the margin, paul, a little more hawkish. paul: just a fraction. the euros spiked higher. that was when she said there were signs of an underlying improvement or improvement in underlying inflation. she medially went on to say inflation is still too low and a highly accommodative policy is needed. not all of this year or next year. that will bring to your back down again. the message is the tensions at ease, there's rumors revit -- room to have a rethink. that's a relief. ecb watchers get what they were looking for today? thatey did not get much they didn't already know to be honest. christine lagarde has said she want wide-ranging review that would tackle things like the inflation goal and climate as well as digitalization. the decision came particular into parts. one was the quantitive definition of price stability. in other words the inflation goal. but also the policy instruments, negative interest rates, both which have been unpopula

ecb lagarde will unveil the scope of the banks to teach it strategicbank's review.w why we are showing skiing, nobody skis in davos. there used to be a race of chief executives but nobody has skied for years. there are bets that the bank of england will cut rates at governor carnies meeting next month. they predict over a 70% chance of a cut. we are back with david stubbs from j.p. morgan. we had a policy speech from mark carney which was less data -- dovish that markets took it. then we have disappointing data and markets are expecting a 73% chance of a rate cut. certainly possible the bank could move in january. we've had other crucial data and there is a potential majority to cut. it's not a unanimous decision, this is a majority-east system -- based-system. but they absolutely would not want to get behind the economy if it looks like there is a recession coming and would want to do something modest and hope with good reason that the budget would be stimulative. if the data continues to slide, they would throw the kitchen sink at the economy -- -- economy. franci

i think lagarde is coming in with this notion that fiscal needs to take over.etary has done as much as it can do. i don't think markets are expecting very much, to be honest. i cannot disagree with that. greg: absolutely, ecb will be a snooze. the real question is if boe does something. jonathan: boe, that's a live meeting. on the ecb, is the pressure building on christine lagarde to defend where monetary policy is right now, defend the concept of negative interest rates? ken: i think she got a fair amount of support as super mario left the picture and made it clear that the policy that the ecb has followed has been the right one. he also brought up the message that we can only do so much lifting. what needs to happen next is the fiscal side of things. we have not seen that. we have to get germany to get off the dime on that and make moves in the right direction. jonathan: do you think that's going to happen anytime soon? ken: i don't think so. lisa: things have to get significantly worse before we see a real move on the fiscal side. jonathan: seems to be the t

there is an increasing sense about the ecb counsel probably shared by christine lagarde herself.pill into asset prices. it therefore continues to generate -- guy: i am glad you went there because that is hoping where you would go. let's talk a about the spillover. to what extent is that responsible for the extraordinary rally we are sitting at the moment? people are scratching their heads trying to figure out. to what extent is liquidity driven and what happens if they get turned off? peter: it is a good question. lotfed has done an awful with regards to that and not necessarily acquainting it to the market over the course of the last couple of weeks. there will be some spillover there. not usingid we are monetary policy further. effectively amounts to the same thing. think it does have an effect. will it be turned off? probably at some point it will be undoubtedly. i don't necessarily think that means the market will stop and allect, i think it means movement until such times until the market figures out what is happening in regard to the economy and how they deal with political

us now is pooja what you expect from christine lagarde and the ecb?ing should not come with many deliverables. we should get an updated forecast. the risk for growth has subsided. happier withto be the outlook for the euro area. last time this took place in 2003. it took around six months. during this time, they will go to each and every area for the ecb. price stability is the mandate. do they want to stick to this mandate? do they want to stick to the 2% target for inflation? how will they do find medium-term? how will they look at the policies that the ecb has been implementing? they will be looking at the pros and cons of using qe. they are going through everything step-by-step which makes sense. reviewt time there was a was in 2000 three. and many central banks are struggling with the inflation target whether it is be a we or ecb. -- boe it is time to address these concerns in the coming months. lagardees christine want to get out of negative rates? issue going to be able to do that? atja: in terms of looking pricing right now with respect to mar

lagarde poised to make her marks -- remarks with their biggest ever strategy review.ion is stubbornly low and almost 90% of respondents to the bloomberg survey predict the ecb will alter its strategy to give equal weight to too low and too high inflation. at the core of the debate is price stability. the wording is too vague. an era -- their other policy tools could be reviewed. central bank relies on negative rates, easing, and long-term lowest two -- loans to banks. one item is climate change. the boldest move to be favoring so-called green bonds in qe or discouraging bonds for carbon intestate -- her officials doubt schedule of finishing any review before the end of the year, knowing how long the fed has taken, which is still happening. cracking elasticity of pricing for green bonds. week with the climate discussion has been top of the agenda. he highlighted key areas of focus in a bid to be more sustainable. he sees a robust economy in the u.s. and in europe. two key themes are plastic waste. the entire plastic goods industry is making significant efforts and tryi

on thursday, christine lagarde will ask colleagues to do a strategic review.centerpieces is a review of the central target they hit. the last time they did this was 2003. heading into this week, we've seen investors play it by flattening on the euroyen skew. s gettingsee i closer, still below zero, means is overall bearish. this is only bearish since 2017. it's clear investors are expecting movement. nejra: thank you also much. let's get the first word news with annabelle droulers in hong kong. annabelle: thanks, nejra. libya's oil industry caught in the crossfire of civil war. forces of the military commander have shut down an oil pipeline and block exports. will be thes output lowest since 2011. it gets underway in germany. in iraq, work has been halted in an oilfield, that's widespread on exports on opec's oil producers. there's also a risk of closure. local media reports its shut down border crossings across iran. around 600 people have died and thousands wounded. they are pro se sting government -- protesting government corruption. in china, at least thou

. >> christine lagarde is posed to post the first review in years and talking about the fine line between monetary and fiscal policy >> politicians were in charge of central banks or a world where it sometimes has to shut up even when difficult, i'd rather choose the latter. >> coming up shortly on "street signs," we'll be spoeaking to th ceo of volkswagen as he speaks of a radical shake up of the carmaker >> welcome to everyone on our continued coverage u.s. treasury secretary mnuchin has warned european countries against arbitrary taxes. he addressed italy and the uk's plans to forge ahead with the levee and said they will retaliate by taxing european companies. a warning came after saying they would strike a trade deal. >> already having some private conversations we don't need to have on tv >> please do please do. >> i've made some comments on this already we'll be having some private conversations. i'm sure the president and boris will be speaking on it as well as the president did with macron >> this is a principal issue for you and the american government. you just don't want forei

we are expecting christine lagarde to take questions on it.r promise the market they will not go into deeper negative territory. there is a strong idea that negative rates -- germany,e a saver in italy, or france and you've suddenly realize you don't have -- [indiscernible] this is a social cohesion problem. the man fromion by barclays is simple, does it translate over into bond price up and yield prices down and equity prices to the sky? that is what we have. francine: i am looking forward to hearing from christine lagarde and the ecb press conference with the rate decision, the first one of 2020. let's move to the u.k.. we have a spokesperson of boris johnson, one of the key world leaders that did not show up here in davos. talking about a number of things, they were talking about what they could do in trying to achieve a trade deal with the eu. conversations with that are ongoing. we spoke to ursula yesterday. tom: she has been very visible. francine: she was here for three .ays here, am a foreigner considering what we have seen before from

a broad brush from madame lagarde on what will be studied. policy instruments on one hand and other considerations like financial stability, potentially controversial, on the other. we understand that was deliberate. people have told us the policymakers inside the governing council did not want to get into specifics for fear of steering the conversation toward potential outcomes. they want to broad, open-minded review, a thorough analysis, before they start getting down to the nitty-gritty. david: i have no doubt this is a worthwhile thing. is there a little bit of politics involved? it does involve -- it does allow madame lagarde time to take over her job. she does not have to make any decisions. she can say we are studying it, wait until the end of the year. paul: she made clear the policy decisions taken this year and the review will be kept separate. they will not not take a policy decision because the review is underway. she has time. locked inessor interest rates at record lows. the easing promised or at least a year or a year and a hal

i sat down with christine lagarde in new york a month

lagarde: good morning, and it is very nice to be with the group. i am delighted that she is my successor. i have to say it was tempting to go along with some of the communications with her because it was my life. now i have to focus on a slightly narrower field, which is essentially the european union, and more specifically the 19 members of the euro area, which has the benefit of sharing one single currency, the euro. so when i look at that part of the world, i see some positive signs, and i see some concerning signs as well. in the positive, i look at the employment numbers and the unemployment numbers just like steven. we never had such good employment numbers. we are certainly back to the precrisis times. when i look at the wage increase, we are roughly on average at about 2.5% wage increase. for a central banker like us, we are happy with that because hopefully there will be a transmission channel to prices, which in turn would generate inflation, which would make our lives easier and give us room to fight the next shock when there is one. we

gregory: to oversimplify it, lagarde is more of the diplomat.on the germans then draghi. what the germans want is to stop the negative rate scenario. this is the dark horse trait. the probability is low. we have seen a lot of low probability events manifest themselves in the last few years. we could see lagarde very diplomatically exit negative rates. that way they both get what they're want. matt: -- that way they both get what they want. matt: i expect this is a higher likelihood then getting away from negative rates. i asked bank ceos all the time, can you give christine lagarde advice on how to go about getting out of negative rates and they always tell me they don't know how it could possibly happen even though they want to get back to positive territory. what would it do to the economy if the ecb brought us back to positive rates within the year? janet: i think it would come as a real shock to the market. when we look at the real economy , growth is still quite low and potential growth is still quite low and inflation is way too low. for t

we had a spectacular french from christine lagarde.e are not expecting all that much to happen in 2020 we are looking at strategic. for that policy to occur the modest improvements in the fiscal stance will likely push on and help growth recover from the some what lack luster numbers. this is not the package some of these companies are hoping for the packages rumored over the past months. if there is a structural reform, there the april tide remains weak we can see some amount of france as he continues to push through the agenda we are not expecting that much to happen over the year. >> talking at the moment i'm reading comments here talking about the idea that the bank of england should resist calls for policies not related to monetary policy in terms of the environment. i want to ask you, do you think that based on the recent data, would you say the transmission of the policy right now is having the affect that the ecb intended >> that's a very good question the question what did the ecb instead. we saw them start back up in septembe

president christine lagarde who when she took over said that the e.c.b. had to become more green and consider that in its forecasts mark carney the outgoing back of england governor taking on a climate advocate role at the un that in the statement itself a high public official like this in such a visible role advocating for climate at the united nations what about if i could thank you so much and catch up with you later again. yes. gratian media calls it knows to defeat the most difficult test of the country's maturity sense and dependence croatia the youngest member of the european union has just assumed to the 6 month rotating presidency of the council has yet to adopt to the euro it will tell the country's tourism and business but not everyone sings croatia's economy is ready to join the common currency. for the croatians the treasured national currency is more than just a means of payment it's a symbol of their national independence croatian see the stable and reliable even though it's an e.u. member croatia has been reluctant to join the european com

we had christine lagarde just last week say we need to be doing more talking across that divide. this is part of what she said. risks caused by climate change on corporate, on the economy, have been largely underestimated. the climate risk in 30 years needs action now if we want to remedy those risks. that is difficult. we need to do it. that is christine lagarde on a somewhat different point, but a very important point, climate change. it could disrupt the financial markets. vice chair clarida: as chair powell indicated at a press conference on wednesday, we are participating in this network for the financial system. in the u.s. and other countries climate change policy is the domain of the legislature and executive branch. we do not do climate change policy, but the american people have a right to expect that as part of our oversight of the financial system, we want to make sure financial institutions are appropriately prepared and have business models that are robust to any climate change issues. david: one of the things being suggested is that in europe to stimulate growth's

think the lagarde approach seems to be appropriate.e gone through a long time in which we have seen central bankers being confronted with a new environment, in particular the fact that inflation seems to have disappeared more or less. the question has been raised by a number of economists and market participants about the best questions. the fact that after the announcement made last september by the ecb, there had been so strong negative remarks about the conduct of monetary policy by the ecb, justified the fact that the ecb reset the basis of its monetary policy. consensus around the monetary policy and therefore the basis will be as clear as possible. i think at this juncture in honesty to is no modify the course of monetary policy, it is a good way to take advantage of the timing to try to think through these problems and refine the goals of monetary policy and the instruments of monetary policy. how long -- vonnie: how long can european banks and asset managers withstand the current rate environment? germany's 10 year yield at -16

christine lagarde speaks tonight in frankfurt. we have the accounts today, a big policy meeting next week. where there hints in those accounts that the ecb may be willing to go a little further on the easing story? jane:jane: i think it would be surprising if the ecb shut the door to further easing because if you look at fundamentals, particularly at inflation, with inflation this subdued and the euros own, it would be perhaps full hardy for the -- perhaps full hardy -- perhaps foolhardy for the ecb to signal that that door is shut. in theeen some slow down employment situation in germany. as long as concerns are out there, i think the ecb has to leave that door open. particularly given the hike we saw in sweden some weeks ago, there is a lot of talk as to whether or not the ecb really has enough room to cut again, but i think at this stage, with lagarde having only just taken the reins, she's got a lot of work to do to fix the divisions within the ecb board, etc. i don't imagine that she wants to close off her options at this sta

the bcp's inclination toward negative rates, lagarde has been clear on as they rethink some of thesessues, negative rates are on the table. it has punished european banks. i think the u.s. banks have been the star performer in the post crisis. period.crisis it would be prudent that they and the negative rate policy over the medium turn. lisa: there are two things going on -- there is the problem with banks and the transition magazine -- mechanism, but as far as boosting inflation, a positive. at question that was raised by some who were interviewed in davos -- is there -- has a bubble been created as a result of these measures that are extreme. >> i do not think they are particularly rich by those measures. as the ecb has influenced risk evaluations, does not seem to be particularly bubblicious there. dichotomy between how negative rates seem to affect real economies and financial economies. when you look in regions that have a low competition in the banking sector such as scandinavia that have introduced negative interest rates, they seem to have less negative side effects of those

left of, him but i am christine lagarde, the former boss of inf -- imf. we have next to her, steve mnuchin the, treasury secretary of united states. then we have the minister for finance of germany and last, obviously not least, and under person -- important purse or -- managing director of the international monetary fund. please give a big hand to this really, really excellent, excellent panel. so, i would like to start with you. you just issued it up to the global economic a look. so, tell us where you see the world economics in 2020. but you have only three minutes. i understand we might take 30 or 40 minutes here. >> it is a message that can easily be summed up in three minutes. we are in a better place in january of 2020 than we were in october of 2019 during our annual meetings. we are projecting growth this year at 3.3%, next year 3.4%. this is clearly an improvement vis-a-vis last year's record low of 2.9%. what is driving this positive momentum are three things. one, trade relations are receding. the signing of the u.s.-china trade deal creates m

lagarde noticed that lower wages are underpinning the euro economy along with a sluggish manufacturing particular, the weakness in the manufacturing sector remains a drag on euro-area growth momentum. >> now, adding to pressure in europe are growing fears of the spread of coronavirus. the european center for disease prevention and control noted the further spread of the virus is likely we've been watching the impact on luxury retailers that rely on the chinese market, like lvmh, richemont lower. >> seema, thank you very much. sue herera has a news update >> hello, everyone here's what's happening at this hour the trump administration publishing new visa rules aimed at restricting what's called birth tourism in which women travel to the u.s. to give birth so their children can have u.s. citizenship. birth tourism is a lucrative business in the u.s. companies take out advertisements and charge up to $80,000 to facilitate the practice >>> three people including a 9-year-old boy remain hospitalized this morning after police say several people opened fire in the busiest part of downtown sea

ism numbers, president trump delivering the state of the union address, and we hear from christine lagardethursday. friday, the u.s. payrolls report. their final thoughts, kathy jones, subadra rajappa, rob waldner. that the friday. become a nonevent considering everything around us? almost everything has become a nonevent tracking the coronavirus. it will be an important data point. manufacturing will be important next week, given we had a week chicago pmi. of in the correlation of chicago pmi and ism manufacturing is also not great. one more data point on the week manufacturing sector. in jobthat any slowdown growth, the markets will not take that well. kathy: wages will be the big one. we have seen a little leveling off in wage growth, but if that continues or turns down, that will be a significant number. rob: very little uncertainty around the labor market. jobs number comes in pretty close, not much of an issue. jonathan: let's get to the rapidfire round. three quick questions, answers around the desk. beginning with the coronavirus. the economic impact, transitory or long-lasting? su

the ecb's position toward negative rates in this year long pause that lagarde has been clear on as they rethink some of these policy issues, negative rates are on the table to perhaps end. certainly has punished european banks. u.s. banks have been a star performer in the post crisis period. negative rates sound great and very but they actually hurt the transmission mechanism of the european economy. i think it would be prudent that they stop and end the negative rate policy in the near-term. lisa: two things going on. perhaps a problem with banks, transmission mechanism that may have been negative. as far as helping to boost inflation and growth, a positive. the question that was raised by some of those interviewed in davos, has there been a bubble created as a result of some of these measures? i don't think risk asset valuations in europe are particularly rich. influenced risk asset valuations, it doesn't seem to be bubbleishous. there is a really dichotomy between how negative rates seem to affect real economies and financial economies. if you look in regions that have very low compe

guy: for you expecting from christine lagarde? policy review that is underway. that sounds great, but do we get anything that is market moving? adam: not at this stage. we know that review formally starts, but we are likely to get very little in the way of publicly available information on where the debate is going until much later in the year. the ecb, shorter-term, has also laid out the stance of policy in the near term, so i think of the four central-bank meetings we get this week, the ecb is likely to be one of the less interesting. guy: ok. i understand why you would say that, adam. as you say, laid out the short-term. medium-term is going to be discussed. , doese policy situation the market fully understand that? is there pressure to explain a little bit more? the data is still relatively bad out of the eurozone. is there going to be more in the medium near-term? adam: i would certainly be skewed in that direction. the data are just less negative than they have been recently, certainly not turning positive. the pressure for

make sure we'll invite lagarde back next year so tell him -- tell her reveal is ours. i think that would be absolutely amazing. governor, you just said your continued -- are you really concerned about negative interest rates? how can you, and also the world, get out of this issue? >> bank of japan introduced minus or negative interest rate in 2016. and we have continued to maintain 1% policy rate imposed on a small portion of commercial banks deposit at the bank of japan. positive 0.1% interest rate on large amount of bank deposit at the bank of japan. so that impact is quite small. but, of course, with a large-scale asset purchase, negative interest rate, a couple of negative interest rate, reduced income substantially. now, that contributed to revive the economy and -- and, also, eradicat eradicated differentiation. we had from 1998 -- however, certainly, low interest rate situation prevailing for so long time, including minus or negative interest rate, means that there might be some side effect on the financial system, including the banking system. on the one hand,

she has got that sort of bit like christine lagarde, formally running the imf, she has that gravitasn the issue, johnson, get brexit done mantra was very clever during the general election and clearly surveyed a lot of people but it only means you get the formal departure done, nothing of substance and certainly nothing that affects real people, the hundreds of thousands here and in europe. nothing has been settled nor is it close to be settle and every day goes by in increases people '5 anxiety. this is specifically as the telegraph headline suggests about not watering down right for that citizens living here? this has been something we have been talking about for three years both under theresa may and borisjohnson. lots of warm words about reciprocal guarantees for what eu citizens living here and our citizens living in the eu and yet we still don't have an agreement on that. the clock is ticking again so everyone will say a breath of relief when we leave on the 31st of january when we leave finally but we are not, it will be the very beginning of our discussions on our relationshi

lagarde is keen to prevent the debate from spiraling out of control.ws, 24 hours a day, on air and on quicktake by bloomberg, powered by more than 2700 journalists and analysts in over 120 countries. i am su keenan. this is bloomberg. recap linesnt to coming through from china costumes about these blowout numbers we saw. yuan imports the highest we have seen since october 2018. they are flagging this based on the easing of trade tensions as well as a low base in december. they mentioned higher commodity prices increasing the trade value we saw last month. especially when we look at pork. 75% increase year-over-year. figurerican swine displacing the loss of supply indigenously. we have this line coming through. in terms ofigher the import of pork. that figure from the united states. we do not know where the 75% increase came from. that is a global figure. david: the food inflation can bring headline inflation down. if you have commodity prices moving up, that should show up in gpi at some point. it is becoming a different picture in china when it comes

christine lagarde is poised to make her mark with her biggest ever strategy review.ost 90% of responses in a survey predict they will alter the strategy for too low and too high inflation. concerns are that the wording is just too vague. it's the legacy of an era where the only worry is too much inflation. the central bank currency relies on negative rates and quantitative easing. one item expected to feature prominently is climate change. movesne of the boldest since two these could be so-called green bonds, quantitative easing, or discouraging bonds. this is widely resisted by many colleagues and certainly want to watch. finally, some officials doubt lagarde's schedule, noting how long the fed has taken. matt: thanks very much for that. let's get to our bloomberg business flash. deutsche bank is zeroing in on its management bonus cuts. that is after taking an ax to discretionary pay. they'll have the biggest annual loss in the options range from no bonuses top management. boeing expects to restart production of the 737 max within months. output, they will return to

christine lagarde has to do that to provide the safety blanket for the euro zone. all right, simon, you are going to stay with us. our guest cohost for the hour. is beginning already. the countdown to the 2020 election. if president trump wins again, he will be the first impeached president to win reelection. we will preview the key dates to andh this election year talk about how markets could react. that is next. this is bloomberg. ♪ whether you're out here on lte or here on a wifi hotspot, xfinity mobile has more coverage to keep you connected to what matters most. moooo. that's because it's the only wireless network that automatically connects you to millions of secure wifi hotspots and the best lte everywhere else. save up to $400 a year when you switch. plus, unwrap $250 off our best phones. click, call or visit a store today. matt: the pboc plans the rrr as chinese stock falls near two year highs. this comes amid reports beijing has suspended plans for the shanghai-london stock connect. hong kong starts the new year just as it ended the last one, with protest

francine: that was christine lagarde speaking to us in davos on friday. of the few interviews that lagarde has done. in the meantime, greek bonds are rallying. it sent 10-year yields to a record low. you can see that greek italian -- that greek 10-year yield at 1.16. still with us kallum pickering and federico santi from eurasia. there's a big move and bonds. what are they looking at? lagarde says they are not on autopilot. she is asking the markets to do their job. are they? >> on the basis of those bond spreads between germany, italy, greece, i think i prefer greek bonds over italian bonds, just looking at the political outlook. yields.has lowered bond i think there a real question in europe, how much more can the ecb do? the ecb is the financial backstop. it cannot really do much to lift domestic demand for that you need more of a fiscal stimulus. crisis, buthere for it cannot engender a material recovery. it goes back to your wheelhouse, you look at politics for eurasia and this is what people have been saying that the ecb is running out of tools. she

i think the best course of action for the ecb would be for christine lagarde ripped the bandage off.tes are penalizing the banking sector. while it may be fun to eat up on bankers after the global financial crisis -- we certainly don't do that here. but a healthy banking sector is necessary negative interest rates do not foster a healthy banking environment. thatne: one of the things bernanke he kind of hinted at was that we should not be surprised if we do get to subzero or near zero. there is a sort of sinkers asian effect. if everyone is at or near zero, than the u.s. can't stay two points above them for long. >> of the rest of the pack goes into negative territory, i could not advise u.s. policymakers to follow suit. this is one of the reasons jay powell -- he did not have a phd in economics. but he has a strong understanding and private sector finance. that is a strong edge for him. that is why there have been more rational minds to say that negative interest rates will clobber private sector finance. >> forget the bankers. to what extent are we seeing negative interest rates hu

big snooze was already expected by the european central bank today yes we have a new head christine lagarde and she is still very much downplaying the risk associated with the european economy but the question as you pointed out is that if these negative rates are going to stay and the more importantly how long are they going to stay that can answer can only be answered once she has. a review which is never been done in nearly 7 years because i think that the last time that the e.c.b. really looked at the definition for a price stability that was back in 2003 from from that particular moment and until now we still do not have a clarity of what price stability really means we should really makes a composition of inflation. you know we talked a little earlier with another guest about while way but i want to kind of broach the subject with you as well the u.s. to continue applying this pressure on britain over its use of war way to build up the country's 5 g. infrastructure the u.s. has indicated that allowing while way to have a role in the 5 g. buildout could risk the u.k.'s involvement in i

you would put forward as a candidate to lead the imf, the next manager director after christine lagardeat will happen in the future? first of all, i think she will be a great... that is not what i am asking. britain has never been able to land at the imfjob since its creation even though british economist came up with the idea. i do not know whether it was brexit induced... your main job is editing the london evening standard. we talked about theresa may earlier, have you used your platform to go after people. some of the things about theresa may have been absolutely brutal. as a former politician do you ever wonder about getting the tone right? what i try to do with the newspaper speak with the more than a million readers we have in the capital and the paper has a has been a liberal conservative paper, conservative of the conservative party but prior engagement in europe... the headlines, do you regret that?|j headlines, do you regret that?” would say... look, people will take a judgement. i would say the things isaid a judgement. i would say the things i said that were inevitable once

put forward as a candidate to lead the imf, to become the next managing director, after christine lagardeich was kristalina georgieva, the bulgarian economist, rather than go with you. is that symptomatic of what is going to happen in the future? britain, frankly, will have a much less important seat at the multi—lateral international table. firstly, i think kristalina georgieva is going to be a good... that is not the question i am asking you... look, i don‘t know, is the short answer to your question because britain has never been able to land the imfjob since its creation, even though a british economist came up with the idea. i do not know whether it was brexit induced or whatever. .. your mainjob is editing the london evening standard. we talked about theresa may earlier, have you in a sense, used your platform at the evening standard, to go after some of your political enemies? because some of your headlines about theresa may, and your editorials, have been absolutely brutal. and as a former politician, do you ever wonder about getting the tone right? what i certainly try and do wit

we are in particular looking ahead to the ecb with christine at lagarde -- christine lagarde at the helm. let's get more on this. it is an interesting start to the year for global banks centrally because we are looking at a wait and see mode for a lot of these central banks. focuses? our >> it is likely to hold. we are looking at positive news for the trend of the year, the cyclical recovery globally. the data is showing stabilization growth in europe. both in asia, stabilization and manufacturing sector particularly. we have some positive momentum building. that is underlying the cyclical recovery,the massive the squeeze chute which is what everyone is hoping for, that the very dovish tone they have taken so far with easing monetary conditions will support it further. the back of this is really the last of ammunition moving forward. they have adopted a negative interest rate, but in the ecb itself there is increasingly likely to adopt a move away from this. it means they have to wait and see while striking a tone that will be supportive. among the rba, questions over whether they will m