president lagarde? we have seen two negative quarters of gdp. pres. lagarde: i think the first quarter of 2023 was completely flat. it was not negative. so technically i think you could argue that we did not see a recession, but it's stagnant to say the least. the expectations for q2, particularly in the industrial sector, if i look at pmi numbers, are not giving us great hope there will be a strong recovery. we see a second half of 2023 up from the first half, certainly, but moderate. we have a 0.9% forecast for the whole year. sara: do you think you can get away with this tightening cycle without dragging europe into recession? pres. lagarde: our baseline does not include a recession, but it's part of the risk out there. sara: are you willing to tolerate a recession? gov. bailey: the thing for us is, if you go back to last autumn, last november, when we did a forecast, we were predicting quite a long but quite shallow recession. the economy has turned out to be much more resilient so far. i think you

christine lagarde has a very tough job.n a way it is even more difficult than powell because the data is already deteriorating in the european zone. the focus is very much on inflation. the inflation numbers are way too high in europe, and yet there are other aspects, especially in germany which is the largest economy. somehow they've got to get the message through that they are going to be tough, yet they recognize their coming toward the end of the cycle. there are -- there's room for bonds to converge closer. they will want to look at some signals that we are going to hike today but the chances of september are not as great as to where just a couple of weeks ago. if we get anything like that it would be quite good for equities and the european bond market, especially the spreads would be water. so italy will be watching this with particular interest. lizzy: i want to stay was central banks because bloomberg has learned that advisors to the u.k. chancellor are increasingly concerned that the bank of england risks raising

if you could, a question for lagarde? what would it be? were going to ask me that. jonathan: so you are prepared? james: i was thinking i would ask her about the balance sheet. lots of central banks the balance sheet is magic. but if the ecb is concerned about inflation, why it is they refused to engage with the idea of reinvestments, because they have concerned -- they have confirmed it will continue to go on, that seems a rather strange situation to be in. jonathan: i am not particularly these days. james athey of abrdn. here is the guy through the next 10 minutes or so. in five minutes you will get some economic data in america. you will get some gdp numbers, initial jobless claims all affected stuff. lisa and mike mckee will run that down. going through the opening bell after that news conference wraps up, it will start with president lagarde in 20 minutes time. we will come out the other side and break it down with winnie caesar -- peter to cheer and dance salmon. a press conference with christine lagarde in 20 minutes time. we are po

data upstaged christine lagarde today. dani: at first the euro started to get weaker and then it went into full force when we got the gdp data. data breaking on pending home sales is reinforcing the hawkishness. it's another set of strong data. month over month it is a rise of .3%. the expectation, it was a fall of half a percent. that is much better than the prior month. the housing market is strong. it falls 14 point 8%. the expectation was for a fall of 16%. not only is the overall economy doing well, it is the housing sector to remind you and our viewers that the data we got in the past two hours that has really switched up the bond market and sent the dollar stronger. initial jobless claims came in lower than expected. the expectation was for 230 5000. the other one was gdp. that came in at 2.4%. the expectation was for 1.8%. the breaking news continues. kailey: we have to talk about the tightening of regulations to the tightest that they will have been in the aftermath of the financial crisis, or at least a proposal

christine lagarde says the ecb could hike again even after a pause time.ther big week for earnings. almost as busy as last week. 169 companies reporting on the s&p 500 and 87 on the stoxx 600. out of austria we have the biggest bank in central and eastern europe. you have its capital ratio coming in at 14.9%, beating the estimate of 14.3%. ecb rate hikes were expected to boost its record net interest income even more in the second quarter. loan loss provisions were expected to stay muted. we will stay on top of the breaking headlines for you. we have an interview with the cfo in a few minutes. or broadly and markets as we approach the end of the month, the s&p 500 is on track for its fifth straight month in the green. august and september do tend to be at its worst two months of the year. strategists are asking if it is time to brace for a selloff. as for treasuries, the question hanging over from friday is whether japanese investors will rush home in pursuit of higher yields now that the bank of japan has tweaked its program. let's get over to tonya chen

lizzy: you've got to wonder about christine lagarde.'s turn to earnings, they are kicking up a notch. what is the dynamic investors need to be conscious of this week? mark: the overall theme for this earnings season globally really, but we always the our focus mainly on the u.s. is earnings expectations are depressed and it is easy to be them. there is one massive exception and that's the tech sector. that was the one sector where there is large optimism and it is very hard and ironically for the tech sector to be that optimism. that's the dynamic we've got overall. i think the fact that the broader sphere is depressed expectations earnings should be a tailwind for stocks, but this week is tech heavy. not only is a tech heavy, is the largest week for earnings by market capitalization. it's a really important week for earnings and markets and i think it will be the most problematic when trying to work out does the negative from tech outweigh or is it not enough to outweigh the enthusiasm from the rest of the broader equity sector? lizzy:

maybe this time around, the change from the ecb is a lagarde who is more dovish. we have seen it from hawkish members. that is the chart in front of me, the euro versus the dollar. the euro just a few weeks ago hit a high on the assumption that the ecb would be more hawkish than the fed. but a talk on the 18th of july said that it is not clear what happens after july they could stand still in september. that is a change because he had been committed to continuing their hiking cycle. saying he is unsure implies the hawks of lost ammo. we have seen the euro fall. it snaps that rally that brought it to a record. the light and goodbye is also a fair question for the ecb at this moment. kailey: we will get more on that in a moment. first, we heard from the deutsche bank ceo. he weighed in on what he expects from the fed and the ecb. >> we agree with the market that both the fed and the ecb are likely to move this week, 25 basis points. a question of what comes after that. we think the ecb may have one more move to make end of the fed pat. to us, the real question is no

to restore purchasing power lagarde will joined bruno le marie in france.his is after the riots broke out in france after the death of the 17-year-old in the paris suburb at the hands of police. the movement of the enterprises of france says the riots have cost businesses 1 billion euro in damage. let's get to charlotte now who joins us from france good morning >> reporter: good morning, julianna the economy is showing the difference with this which is free and open to the public forum. many ceos attending and central bank governors attending and members of the government, including the prime minister and several members of the government will be here because they have been hitting the road over the past few days, especially after the riots over the weekend across the country the economic minister is in marsaille. he will be meeting with shop owners who have been affected by the riots. the government is trying to speed up claims for the small businesses the message we heard from the government is telling tourists do not cancel. we saw a wave of cancellation

as for the euro, christine lagarde is maybe overplaying her confidence.hinks she is left the door open wider, for another ecb hike next month. but i wouldn't get too excited until you see the ecb projections in september, it is a long time to wait but if they ramped up moderation, looking at the data in germany, you really can't see those projections getting ramped up. if they get dialed back you may see more sanity in the ecb outlook emerge. kathleen: thank you so much. bloomberg fx reporter michael wilson. the ec president saying officials may hike or halt the next meeting after listing interest rates by another quarter-point. >> we have an open mind as to what the decisions will be in september and in subsequent meetings because, this determination, based on data might very from one month to the other. kathleen: joining us is irene a professor of international and public affairs at columbia university. it's great to have you back. the two big central banks one on either sides we could hike or will we can hold the ecb difference seems to be the economy

we'll hear from christine lagarde and katherineman, due to speak on friday.hat an agenda in the days ahead. thankfully paul donovan has agreed to join us. i'm an avid reader of your daily updates. also food for thought and fascinating takes of what's going on it feels like for the last year or so the investment community has been calling, expect a u.s. recession. it just hasn't arrived yet the u.s. has been a lot more resilient. why is that? >> i think one of the key things is the middle income families who are actually critical to the consumer story are fairing a bit better they're slowing down, absolutely so one of the things is your unemployment remains low so there's no sense of fear of job loss fear of job loss would tend to reduce consumption and reduce savings. we don't have that second, inflation for headline inflation numbers. inflation is actually lower for middle income families it's quite a lot lower that's because headline inflation includes this fictional housing measure which no one actually pays if you own your own home, the cost of living isn

we have ecb president christine lagarde speaking in aix-en-provence, a.k.a. "french davos" in sintra last week she confirmed another quarter-point hike, the question is what data is she watching to decide what is next? german manufacturing data was from her than estimates yesterday and yet still heavy losses on the dax. what do you expect today? kristine: the data is the data. what we saw in markets yesterday is a completely different story. it is this narrative once again of markets realizing that central banks the world over are just going to have to do more with inflation. we heard from christine lagarde in sintra last week, she confirmed there will be another quarter-point rate hike coming from the ecb. even if there is this kind of idea that more rate hikes will be making it difficult, economically speaking, for a lot of countries, it will have to be the way it is because of the way inflation is traveling. that is what captures the market reaction we saw yesterday. fears looking out six months beyond those rate hikes we're expecting down the pipeline fro

that is language christine lagarde is using example.ing, for good reason, that they need forward guidance. and that it will be too late if they decide to cut when the recession is already there. that is the current conundrum. supplementing argument is this idea that central banks cannot go fully into tightening back to 2%. markets tend to be on the dovish side and have been repricing the past 12 full months every month. this is a bit of a construction to reassure markets optimism. in correction -- i need a correction in markets in the second half. kailey: if the recession does come at the landing is hard, when are we going to have a conversation about easing policy rather than tightening? ludovic: with scenarios in the u.s., we still have a cut at the end of q1 or beginning of q2 in 2024. with europe, it is later. the problem is they should not go higher. they should stay for later. this is because we believe there is a third way between markets's optimism for rate cuts and central markets determination to go. he because they do not wan

the ecb president christine lagarde says the september is a life policy meeting after a ninth straight rate plus, standard chartered announces a $1 billion share buyback after reporting better-than-expected second quarter profits. don't miss our exquisite interview with ceo bill winters at 6:30 a.m. u.k. time. good morning. happy friday and we are going out of this week with a bang. there's only one show in town and is the boj. it has kept policy rates at -0.1% but adjusted the yield curve control program, not widening the band but giving more flexibility. we will bring you full team coverage let me bring you up to speed on the market moves. the yen slumped against the dollar and then the traders realized this is a change in the band effectively even if not officially. now we are at 138 handle. you have seen dollar strength after strong u.s. data yesterday and then speculation on the boj ruined it taking yields another leg higher. of course, the yen on treasurers have a difficult place but the fed has to stop at some stage and the boj had to start. we look ahead to the welsh reopen, s&

christine lagarde did say data out of europe is looking pretty dire. what is the sense you are getting on what the next move will be? >> the growth data is weaker as christine lagarde said. but they are further behind the u.s. in terms of disinflation. i think the hawkish camp at the ecb is in the driving seat. as with the fed, they have moved into data dependent mode here, but it seems plausible they go at least one more time, possibly more. it is going to be very important to see the trajectory for inflation confirmed in europe that we are starting to see in the u.s.. haslinda: what does it mean for the european bond market? >> the markets are expecting some further tightening. almost a full hike. it is very interesting, you see yields in europe which look pretty attractive. the ecb getting may be up to 4%, so there has been a big shift in terms of european markets. we are going to be looking for the same indications as in the u.s. on inflation. the world of negative yield is one that looks a long way back in the rearview mirror. rishaad: the boj and

christine lagarde and her team expected to follow the fed. is that a good thing?ome analysis coming next. this is bloomberg. ♪ never cros sed my mind. what if we live to like 100? that's 35 years of being retired. i don't want to outlive our money. and i have been eating all these stupid chia seeds! i could totally live to be 100! why do i keep taking such good care of my- since we started working with empower, we're able to get all our financial questions answered, so we don't have to worry. so you never- no. never. join 17 million people and take control of your financial future to empower what's next. start today at empower.com fabulous surroundings... but everyone's looking at their phones for financial insights from merrill. is he hailing a ride to the concert hall? no. he's making sure his portfolio and retirement plans work in harmony. they want to adopt a child and build a new home. so they're talking numbers with their merrill adviser. she's not researching her next role. she's learning how to handle market ups and downs without the drama. personalized ad

christine lagarde will be there tomorrow. these guys go to a lot of nice places for conferences. that sets us up to our question of the day, is the fed going to 6% and the boe 7%? can the ecb stick it forward? our guest is a financial economist. do we see the fed at 6%? can the ecb stay at 4%? guest: it's possible. given how sticky core inflation has been. i wouldn't be surprised if that happened and if that happened come at the ecb will have to push rates higher. it's unlikely the ecb will stay there if rates in the u.k. go to 7%. guy: how does she sound or hawkish? -- more hawkish? guest: it's about reiterating the message and that being validated by data. data has not softened enough. core inflation remains strong. the employment data is still strong even in europe. that will eventually validate what she has to say. alix: why the big lag in transmission? we know it takes a while. when do you think we will really see it and is it going to be intense tightening the cripples the market or a gradual thing and where the crocs w

i can't see the fed doing that before christmas him but christine lagarde is a different egg. a november -- and there is a november fed meeting so people looking to trade euro the euro or to trade a mismatch and timing, there could be an opportunity there where she has to give no, deal -- you know, deal with what she has got [indiscernible] in the eurozone area but she has to anticipate what may or may not come to fruition. if it is a lame christmas, ecb might be ready to go early next year, if not sooner. shery: that was the bloomberg fx rates reporter mike wilson. stellantis says it has no regrets downsizing in china. the ceo says they are under pressure in the world's largest auto market as local competitors cut prices. he has told us the current period requires carmakers to do more to survive. >> this is a periods wher if you don't adapt to a new world of electrification, a world of very strong demand for quality, if we don't adapt, didn't we put ourselves at risk. it is not stellantis triggering that. stellantis is adapting to a new world and we are inviting our suppliers

this is the challenge lagarde has got.nch growth was ok so you set policy for french or germany -- france or germany maybe you have a different conclusion if we hike in september or not. lisa: you see inflation accelerating in places like spain. were going to get that read on cpi in germany at 8 a.m. eastern do we see a deceleration? just to give a says to the ecb tightening and living conditions -- doesn't give a sense to the ecb tightening and lending conditions are working? is this going to be the transmission mechanism you finally start to see bring down inflation? jonathan: how do you balance everything in between. it is so difficult. never mind one economy, try doing for tons of economies across the euro zone. lisa: i wonder if jay powell gave her a pass because he was so ambiguous, she could be ambiguous and not make anything to concrete that could rather any feathers. this is the easy time before they have to start countering whether they are being more aggressive in the face of weakness. jonathan: ambiguity seems

federal reserve chairman jeremy powell and christine lagarde central bank europeans know that gold is very sensitive to rising interest rates because they increase the opportunity cost of holding cashews with no yield . central bank of america data shows that us and european business activity decreased in july, and this is closer to the end of the interest rate increase wheel indicates that based on these expectations, global market analysts, traders are waiting for the federal reserve to keep the interest rate in the fifth range of 25% to 50% for 2024. the market analyst said that the best gold company would be to reach the highest all-time record. that federal reservation of cars to announce that the market value of cryptocurrencies decreased by 100% since yesterday evening and reached one trillion and 170 billion dollars. over the past two weeks, this amount of decline in the market value of cryptocurrencies has been unprecedented. yesterday, he said, it reached 26,119 dollars. according to experts, the continuation of the downward movement up to channel 28070 with inter is possibl

a slight change in language from christine lagarde but if you want to see the drama, you've got to looko the euro. >> let's get the u.s. side of the trade. this is part of the macro and part of the micro. the nasdaq 100 is up 1.2% at this point. a huge point of this is the move in meta after topping expectations on the guidance. but your point, the bond market is much more exciting here in the states. the two year yield right now up about nine basis points, or .93% after that blowout gdp 2.4% growth in the u.s. economy. does not look like it is slowing down in the face even of all of those rate hikes we've seen from the dead. the other side of that story is, of course, the stronger dollar. the data are not good. we had basically the gdp in the next three quarters and quarter three, as you seem, the pmi has been deteriorating further. >> to that point that we are already seeing the deterioration when it comes to pmi, it begs the question to me before we even get to september, can the ecb come to the realization that it has already over-tightened, that it may be but a step too far? >> the

ecb president christine lagarde speaking at the conference, present biden speaking at the white houseering costs for americans is expected around 3:30 p.m. new york time. he will reference the jobs report today. alix: looking forward to that very much. that wraps it up for me and guy on the week. it just already when i came back so fair enough. there is more to go today and it will be interesting to see how we close, the ticket lowly in the dollar weakness and what happens in the two-year after a crazy 24 hours. coming up on tech, cara brennan will be joining "bloomberg technology" with caroline hyde and ed ludlow. this is bloomberg. ♪ i don't want you to move. i'm gonna miss you so much. you realize we'll have internet waiting for us at the new place, right? oh, we know. we just like making a scene. transferring your services has never been easier. get connected on the day of your move with the xfinity app. can i sleep over at your new place? can katie sleep over tonight? sure, honey! this generation is so dramatic! move with the xfinity 10g network. >> from the heart of where innova

madame lagarde will take the trophy as barbie.rts with what we see in data created last week, the data was soft. no other way to put it. jonathan: better-than-expected. tom: ok. jonathan: stood up to a massive rate hike and cycle from the federal reserve. still have unemployment around 3.5%. inflation going from 3%, 4% down to 2%. you are assuming unappointed has to go higher. tom: the pressure on the wall of money out there to get on board in some way hedge, unhedged, whatever. the pressure is extraordinary. jonathan: 5%, good the first couple weeks of 2023, and then tech absolutely ripped. this week alone, you will get alphabet, google, microsoft tomorrow, and then on wednesday, meta, facebook, amazon on thursday. the following thursday, more. tom: you did not hear from apple, but you wonder how much is owned. some say it is under owned by wall street. it is an old war horse. i will not mention the name. one year come up 13%. i believe that is a double digit return. do they feel like a failure? that pressure is there. jonathan:

it more valuable federal reserve chair jeremy powell and european central bank president christine lagarde know that gold is very sensitive to rising interest rates because they increase the opportunity cost of holding a boxwood with no yield. america and europe decreased in july and this indicates that the end of the interest rate increase cycle is nearing . based on these expectations of global market analysts, traders are waiting for the federal reserve to keep the interest rate in the range of 5.25% for 2024. market analyst he said that the best bet for gold to reach the highest record will be when the federal reserve ends the contraction cycle of cars, the global price of red metal in the world markets is on the rise, and they believe that in the short term , due to the increase in the volume of copper stock in the london metal exchange , there is a possibility of a significant decrease in the value of this widely used metal there are these and more in the report of my colleague tawhidi, the effective global lot related to that world in the two trading days of the week on the london m

federal reserve chairman jeremy powell and european central bank president christine lagarde understandt gold is very sensitive to rising interest rates because the opportunity cost of holding and unyielding bullion increases. give the data of the central bank of america activities american and european trade decreased in july, and this indicates that the end of the interest rate increase cycle is nearing. according to the expectations of global market analysts, traders are waiting for the federal reserve to raise the interest rate in the range of 5.25% market percentage for 2024. gold's best bet to reach record highs will be when the federal reserve ends the auto contraction cycle , an exchange closes lending services , bitcoin investment fund exits, and u.s. regulators insist on legalizing digital assets in today's crypto market close. aruzha coinbase has informed its users that the platform's lending services are going to be gradually shut down. this program, called baro, previously did not allow customers of this exchange to use their bitcoins as collateral and borrow up to one mill

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this was stated a little earlier by the chairman of the ecb, christine lagarde.o purely a conversation with our pranksters. in france, they are conducting a law on a state of emergency , president emmanuel macron said because of the pogroms, local businesses lost over a billion euros. and this figure continues to grow . entrepreneurs no longer believe in serious support from the state. why will maria skorodilka tell? there everything exploded, the fire completely burned the store. i was so scared. i heard it all like this literally, as far as his business , this frenchman only remembers that terrible night when a crowd of migrants destroyed everything by burning the paths. and this is the next street local. they say. she does not recognize her, burnt cars, broken glass, summer verandas of cafes, one ashes smells of harry, now we omit emotions. i can say one thing, you have to close, you need to do repairs from scratch, take a loan, pogroms. traffic disrupted. migrants in marseille. bus depots were burned, hundreds of cars cannot be restored. uh, these buses cost

this was stated a little earlier by the chairman of the ecb, christine lagarde. private conversation with our pranksters. yes, he formulated the idea that the russians can be defeated only if ukraine is set against them. the main task was swift offensive and access to our western border. to overcome here was an eye 3 km wide under the prevailing western world. this is a very serious obstacle. we had to overcome the battle in a day, 2.438 people turned out in just the entire previous history of the heroes. the russian air defense forces intercepted 6 hymars rockets and the same number of drones were reflected in the south-donetsk direction five. the attack of the allied forces finds special operations, the ministry of defense told during the day, the armed forces of ukraine continued to attempt offensive actions on donetsk krasnolimansk south-donetsk zaporozhye direction in the donetsk direction, competently and courageously, the defending unit of the southern group of forces successfully repelled nine enemy attacks in the areas of settlements, belorovka, pervomai

this was stated a little earlier by the chairman of the ecb, christine lagarde.te conversation with our pranksters. the british and french wanted to do everything they could to prevent war. my grandfather always considered an alliance with russia as the main condition . more than 20,000 people a day biblo during the great patriotic war, we are at a very dangerous moment in human history. german-soviet war. well, ukraine has nothing to do with the lessons of the past. otherwise, we will repeat it from history and make a decision on the basis.

this was stated a little earlier by the chairman of the ecb, christine lagarde. private conversation with our pranksters. the hope of the european union to end the ukrainian conflict with a counteroffensive failed, this was recognized by the prime minister of romania, he called for preparing for a long confrontation with russia, but it is increasingly difficult for the west to maintain the current level of military and financial support for the kiev regime with details aliko komarova, chairman of the military committee. on taro bauer said it's not worth it underestimate the military capabilities of russia in his opinion. our country still remains the main threat to the north of the atlantic alliance, and cnn reports another collapse of western expectations regarding the ukrainian counteroffensive and allegedly. right now, several european dollars are seriously thinking about ending support for the independent, because they themselves are already making ends meet. so london is actively looking for cheap analogues of its own storm shadow missiles, those with combin

jonathan: president lagarde, thursday. tom: shall be on the show? no but she has a news conference you can attend in germany if you would likely to fly you out. tom: interesting. jonathan: dan, good to see you. we got the spoiler there. you are optimistic on earnings season. constructive. tell us why. and: first of all let's look at who has reported. airline demand is strong. homebuilders reporting has said demand is strong. banks were terrific. underreported story, the ceo of pnc bank. they are obviously not jp morgan but it is a tremendously large bank within a norma's lone booking and asked about the current state of the environment the ceo of pnc cut himself off and said we are having a soft landing right now, the economy has been quite strong. from my standpoint i think that will translate into actual operating results. that hasn't fully materialized of yet but i have been optimistic this will be a bigger than expected earnings season. tom: for the goalie crew, where is the greatest misjudgment? revenue? down the line? in -- the input costs deb

now, this rate hike was as good as promised by ecb president christine lagarde in thejune meeting sore very much pricing that in. the big question here is what comes next and it is quite interesting because in contrast to the us, we are seeing signs of slowing, of an economic downturn, much more acute in the eurozone, we have had data out this week which has shown that business activity is contracting in the eurozone, we have had german iif business confidence done at an eight—month low and we have seen demand for loans has dropped to a record low. that really does imply that as borrowing costs are increasing, demand for loans in order to drive expansion has dropped quite considerably. so, with those thoughts in mind, it seems unlikely that the ecb will continue pressing ahead vocally with lots more interest rate hikes to come, we can probably get the sensation that they could also be nearing the end of their rate hiking cycle. let's talk very briefly about the uk, we are going to hear from the bank of england next week, its monthly decision on interest rates, inflation is down by no

the european central bank signaling here is what christine lagarde said. >> we have an open mind as to what the decisions will be in september. this might vary from one month to another. >> it is the end of the central bank bonanza as we get to the end of this week. friday because the bank of japan decision. in repeated consistent guidance we had had. he does not think inflation is sustainable. at the same time, you see this among all the major peers here. we are seeing protection demand. fx traders are concerned about this. we saw the yen rallying as much as 2%. 1% against the grain. kathleen, you have been following the boj for a long time. if this happens, it would be surprising. they are trying to communicate to the markets. if there is a sudden change, we might throw some of that communication skill into question. it was above the forecast. much better than the 2% previous number. the forecast was for 1.3. jobless claims down, down to 221,000. you're going a little bit higher. also interesting how that caused a rally that the boj did. >> walk us through the u.s. session. >> it was

ecb president christine lagarde has warned consumer prices are still rising too fast and kept its optionsfor further increases. what i can assure you of, is that we are not going to cut. that is a definite no. but, on the other side, it could be a hike, it could be a pause. if it is a pause, it would not necessarily be for an extended period of time, because as i said, it will vary from meeting to meeting, because we continue to decide on a meeting by meeting basis, every time, informed by the data. a day after the us federal reserve raised its interest rate for the 11th time, new data suggests that it's not excessively dampening the world's biggest economy. a preliminary estimate suggests that the us economy grew 2.4% on an annualised basis between april and june; much stronger than expected. on the downside, growth in consumer spending slowed after an unusually strong start to the year, but the reduction was more than offset by strong business investment. joining me now is katharina neiss — she is the chief european economist at p—gym fixed income. thank you for being with us today. let

tom: it is a different story and for lagarde that is beneath the radar today. i agree. i just looked down here. i have not looked at lease us in saieh walked in the door 10 minutes a -- lisa since i walked in the door 10 minutes ago. 1.49 on the 10 year yield this same as the verbiage out of the ecb. jonathan: let's just sit on this for a second. the euro against the dollar,, positive stronger for nine consecutive sessions. that is the biggest street going back to 2004. lisa: if you have a dovish tone from the ecb the fact that there is still euro strength suggests something deeper and stickier. the bank earnings we were just talking about, the analyst calls, 8:30 and 9:30 a.m. respectively. i amwhich of the winners, j.p. morgan the clear winner at a 17, morgan stanley at a 3% gain, bank of america today, central bank governors continue their talks, talking about the ecb, cloud notch, over the past couple hours, talk about the ecb, very different tone weeks ago, giving support to the european bond market. 8:30 a.m., retail sales, i'm watching how much higher gasoline pr

investors are now paying all their attention to the press conference the head of the ecb , christine lagarde walking at this moment the russian stock market is trading in positive territory, looking at the fact that oil is trembling by 5% , shares of vtb banks are growing today, then said, that its net profit by international standards. in the first half of the year there was a record almost 290 billion rubles. on the result of vtb, as well as on the record profit of the entire russian banking sector. in the first half of the year, it had a big impact. the so-called currency revaluation, that is, after a strong fall in the ruble, the assets that banks hold in foreign currency when converted into russian currency. the ruble became much more after morning reflections. now the dollar has come down and costs 90 37 euros, 99, 97 passengers of russian trains want to identify by face, as kommersant russian railways newspaper found out, min figures ministry of transport is going to conduct an experiment at the beginning of next year , long-distance trains will be allowed passengers not only with a p

the data has clearly been reflecting the ecb is in a restricted stance and it is going to be up to lagarde on thursday if whether she thinks this restricted stance needs to go any further. >> thank you to bloomberg's valerie tytel, as always with our morning roundtable. we have some breaking news across the terminal, this is that -- for 3.6 billion dollars. we will get more on that in the program, coming up chinese stocks surged after beijing signals fresh support for the struggling economic recovery. plenty more to discuss on our top stories this morning, this is bloomberg. ♪ >> welcome back to bloomberg daybreak: europe, china's top leaders have signaled or support the trouble real estate sector along side pledges to reduce consumption and resolve debt. the announcement fell short of announcing large-scale stimulus to support the slowing economic recovery. to tell us more we have bloomberg's mliv strategist mark cranfield on the line, why are china equities suddenly so happy? >> it is really all about removing the wording related to housing being speculative, that has really got traders

kailey: the market rob to sit through an entire press conference from christine lagarde.ith that in mind, guy was running us through what we are seeing. how much further could that realistically go? ven: i don't think it could go too far. i don't think it is a prescription for funds to rally. even though to not open the possibility of september, i do think a 4% trade is still likely . they are still factoring in 38 basis points a tightening. the markets are taking in july and possibly in september. guy: jana thinks class is just being pragmatic. there is to to do, and we need to work our way through that data. is there a danger? is he seeing something in data which may cause him to think maybe they have done enough? ven: i don't think there is any compelling evidence we have seen since the june 16 meeting. we have seen one set of inflation data and that showed core inflation ticking higher, not lower. the markets latched onto a different message, it was probably in the delivery of what he said which is why i don't think there is too much scope for boones to write from her

that is the kind of messaging we are hoping for christine lagarde to give more nuance, more signaling at the press conference after their meeting this week. haidi: and i suppose nuance is also what we are hoping for from the bank of japan. continues to be the outlier, expected to stay on hold again. the one major central bank specter to potentially cut? kathleen: let's start with the boj because they are expecting to be on hold again. governor ueda has said over and over that until the boj is convinced that their inflation rate is sustainably and stably above 2%, they are not ready to move. even though all the indicators of the major part of the cpi report are well above 2%, not ready to move, and not even tweak yield curve control. the 10 year jgb has been bouncing up. it is the top of the range at .50 but not pushing above it. the yen and the bond market. no need to tweak ycc. as sherry pointed out earlier in our premeeting show, chile is ready to go 100 basis points for a cut. many central american banks were among the first to raise very aggressively and now starting to cut. that

for powell and lagarde, how do they stick on a hawkish message and have the market believe them?chair powell, what is message will be is we hyped this week, and we don't know what we are going to do in the future. the fed's projections say they are going to hike once more. he won't say they will definitely do that. he will say they are data-dependent, and he will emphasize that they have no plans to cut anytime soon. that is all he can say, because the fed is data-dependent at this point. whether they hike again or not will depend on the inflation data. dani: i, for one, am most excited about the boj, because i wake up very early in europe and i would be awake, unfortunately, for the decision. there was a great bloomberg skip that japan is considering upping the inflation target to 2.5% this fiscal year. currently production stands at 120%. that is a pretty -- 1.8%. that is a pretty big upgrade in inflation. does it make sense to leave yield curve control unchanged? dean: it would make sense for the boj to shift their yield curve control policy or get rid of it altogether relativ

expectations are the central bank will raise rates by 25 basis points, christine lagarde will hold ares of shell under pressure adjusted earnings of $5.1 billion missed analysts' expectations fuelled in part by weaker energy price, shares down over 1%. >>> samsung reporting a 95% plunge in profit for the second quarter as weak demand for its memory chips continued while the company says global demand is expected to gradually improve in the second half of the year. macro economic risk could make that rebound challenging shares of samsung right now, just off over 2.5%. >>> we want to bring your attention to breaking news out of europe. eu antitrust regulators opened an investigation into microsoft of tying its chat and video app teams with its office product, the eu says microsoft may be abusing and defending its market position and productivity software shares up 1%, again, that news just breaking. eu regulators taking a look into microsoft and antitrust possible violations >>> coming up on "worldwide exchange," the one word every investor needs to know today, plus we lay out a busy d

point rate is what they expected from the ecb decision, with traders eyeing president christine lagarde's press conference this afternoon. harmonized inflation stuck at 5.5% in june that is down from may, but core inflation increased in the period to 5.4%, leaving an uncertain path for the central bank as pmi indicators show the first signs of an economic contraction. annetteta is live in frankfort with more. the outlook going forward is a little more uncertain, isn't it? >> exactly i think we can expect the ecb to reiterate its stance that everything is very data dependent. and in we can't like expect committing herself for another rate hike in september especially given that we will be se seeing they are worse than expected and that could factor in a new round of staff projections by the ecb in september when they have new data, also what they think about the inflation trajectory, of course, but also how the cooling of the economy will reflect inflation going forward. then they will make an assessment, whether there needs to be more hike or whether it's time to pause. clearly, the gover

see the fed move, but certainly, when it comes to the ecb, it's a really tough place for christine lagarde to be. in between at germany already on a recession, most economies already showing very severe levels of weakness when it comes to data. of course, inflation still staying high. shery: the bank of england is also expected to hike rates thursday. of course, we are watching geopolitics this week as well. the u.s. will be supplying taiwan with 340 $5 million in defense equipment, services, and trading -- 340 $5 million in defense equipment, services, and training. in the past this has been criticized by beijing. vonnie: this is a step further because it is the first time the u.s. is providing arms directly to taiwan. previously the u.s. approved the sale of weapons to taiwan. the mechanism is basically the same mechanism as allow for the passage of weapons to ukraine. so, a presidential drawdown of authority. essentially, congress authorized the divide into use as much as $1 billion in u.s. inventory come already existing weapons, for taiwan, for the night -- island democracy national d

that's the message christine lagarde has signaled in the past. >> the ecb chief economist warning againsticing and any cuts over the next two years we're talking about hawkish commentary in the u.s., similar tone in europe, but the markets are acting the same across both oceans people are hearing what they want to hear, assuming that everybody's done, the central banks are done when you haven't gotten a clear indication of that the fed, whether it was austan goolsbee on our air a couple of weeks ago saying, you should expect two more hikes. they really believe the soft landing is achievable. >> the market is fighting the fed and the ecb on hawkish views. every time we get an inflation report, the market gets more excited about it i think it will be interesting to see how the central bankers frame the rest of the economic activity because europe is weakening. >> there's a famous movie quote, you're saying there's a chance but the movie is "dumb & dumber." so thag there's a chance of them stopping, and the fed keeps saying, no we're not going to do that how many central bankers have to say

from christine lagarde, same story there.m the ecb? are they going to walk the walk along with talking the talk? >> they will walk the walk for a while. the rate hike in july is a done deal. september is a possibility. but the ecb is far too optimistic as to the growth outlook for europe. they expect significant growth over the summer. if you look at recent indicators manufacturing is heading for a recession. i think that in september they will have to revise down there forecasts for growth quite a lot, and then probably the doves would say, look, if growth is significantly weaker than expected and probably co-inflation, underlying inflation ought to be weaker in the future as well, so let's stop. there is one thing to the higher for longer story, where i believe may be for longer. the ecb next year probably will not cut rates. dani: what do they do with the balance sheet then? holger: they let the balance sheet shrink. dani: do they do more than letting it roll off? holger: absolutely not. with the ecb no longer reinvesting

signal that the rate could be raised again at the next meeting, today the head of the ecbristin, lagardet investors would not change the rate at the next meeting. well, it’s true, the ecb is very close to ending this long cycle of raising rates, something similar is happening, and in the united states, the federal reserve there also realized the key rate by a quarter of a percentage point the day before, but the head of fedor jerome powell also admitted that on the next meeting rate may remain unchanged. but today, american stock exchanges have a new reason for optimism, in the second quarter , the us economy showed an increase of two and four tenths of a percent. this is more than forecasts and more than the growth in the first quarter , all this gives investors hope that , despite the increase in the key rate. it is in america, after this yesterday's increase , now at a maximum for 22 years, the us economy will still slow down gently, and therefore american stock indices at this moment. as we see in the black, the russian stock market is also leaving work today. in such a slightly elat

christine lagarde saying a pause is not just a pause. they can go again.is is under surveillance and this is great economics around the world and the only thing under surveillance is kane has got one foot in germany. they are arguing about value. jon: daniel leavy, who once the club, i understand -- there is have a we can -- meeting going in the weekend and the meeting got rescheduled. tom: is that the same quality of league? jon: i would not say it is. the premier league is the elites of european football. they are not and that is the issue and if he is going to leave, you think he would go to a club like that instead of across town rival where he would be hated by fans. four going up to somewhere like manchester or liverpool. this is his last big chance of getting a contract. tom: you look at the mess, you can probably understand -- as well. on what we have done with surveillance and looking at the pacific rim, the chief economist joins us. he is deep in financial crisis on the international basis and his notes on china and japan have been definitive. wh

it may be that lagarde takes a page out of powell's play book, which is to give much more of a wait-and-seehey have this problem ecb is simply a one-mandate bank, which is just the inflation mandate so they're pretty much required to follow the inflation trail more than they are the growth trail. and of course coming up in a few minutes here, we have the u.s. economic growth numbers coming out for this second quarter expected around 2% so we'll see in the press conference if lagarde takes that page out of powell's play book and says, you know what, we'll wait till the data come in becky? >> steve, thank you. >> coming up, breaking gdp data plus a postearnings interview as barbie continues to hit at the box office and talk of giant hershey posted mixed earnings, better than expected per share but missing on revenues. stay tuned you're watching "squawk box" on cnbc what do you get from the morgan stanley client experience? listening more than talking, and a personalized plan ♪ to guide you through a changing world. ♪ we earn your trust. maintain our financial strength and stability. and deliv

spain has these good stats but that adds to the conundrum facing christine lagarde and the european central of things. she has got to balance it all out. that is a look at what is going on with the spanish election. we should hopefully get something in the next few days. market wise, we are looking at a little bit of a mixed bag ultimately. yvonne: it is. i think the property sector in china is a concern. take a look at the bright spots. watching korea. some of these big names like sk innovation. posco up close to 30%. and then china developers here. it seems like the asset sale we got from wanda did not do enough to lift this market. we did see the stock of rui up after resuming trade. country garden, cut to underweight by jp morgan citing liquidity concerns. coming up, we talk more about the china credit space with the dying wanda note. evergrande back pushing its restructuring plan. moody's investors service giving us their outlook next. ♪ yvonne: 11:29 a.m. in tokyo. just about to head into the lunch break with the nikkei doing well. at the boj, ueda did enough. and a report came out th

but, lagarde indicated that might be it. they are considering certainly holding in september because europe's economy is not in a good way. certainly, short term. then, finally, of course we had japan, the noisiest of the lot. and is still the unclearest. all that will play out across markets. in australia we have a meeting tomorrow from the rba, one where there is a lot of uncertainty regarding both whether they will hike and also if they do -- do they have anymore hikes left in them? so, economists are 15 to 11 i think it is in favor of a hike. markets are 75% sure they will hold. that in of itself sets off plenty of volatility tomorrow from the rba. then on the ongoing basis as is the data releases start to come in elsewhere and we look at what japanese investors do now that yield curve control has been kind of relaxed. maybe it has been double. maybe it has not. you also wait to see how the bank of japan carries out its interventions in the bond market. because it will now be nimble and flexible about what it does when i