meeting there really consistent with mario draghi recent statements but how much is new here in terms of the multiple intervention strategies where they hope for a mutually reinforcing fact and then this idea of a cure deposit rate well actually some of it's new and some of it isn't so new that what they're talking about in terms of this is a multi-year approach is that it's the asset purchases and also reducing interest rates and that is going to be actually happening globally if you look at what's happened also in thailand new zealand india same thing and you look at the bank rate copy if i the fed in july what's happening by the european bank i think the only thing that's really surprising is that when there are sort of when there's a lot of turmoil and things a drastic it is a lot of instability it could be more expected it's rather frustrating in europe and it's frustrating european businessmen that i speak to because or underlying factors are relatively stable and that is what is troubling it's usually blamed on uncertainty. and the slowdown in china. hillary speaking of bragg's

economy and on and on rates and that's being unfair to the united states attacking this is made by mario draghi and his colleagues but the e.c.b. is a different case than china china directly sets a trading level for that you on so directly tries to influence the trading and the yuan pretty well trades at those levels that's that's a fact the e.c.b. doesn't do that it sets rates and it buys up securities at the moment not new new levels of securities but it can do that and has done not and that influences the way the currency trades so much more indirect level and remember also for germany the euro as it stands now may be a weak currency improving the competitiveness but not for southern europe for southern europe the euro is still a very hard euro for countries like italy spain portugal greece. only bonds in frankfurt thank you and it's only just said due to all that uncertainty investors are flocking to safe havens like gold the price of gold on world markets 6 year high of around 1400 $75.00 an ounce in india prices have also reached new peaks. india's gold traders have much to celebrate pri

decline in these remarks. >> incoming ecb president christine lagarde said she is willing to follow mario draghith. tools tothe eu has the address the downturn. int would you be advising terms of trading expectations? >> they have moved quite a bit. our economists are expecting a comprehensive package. end, 20 basisont points. forward guidance. are of these categories affecting different assets. front end cut seems to be quite well flagged. the things which seem to have a lot of disagreements and potentially not fully priced, certainly the qt. it depends how aggressive of you you want to take. the narrative is shifting into this meeting. you have had italian political risk come down. need from ais less civility point of view. you are in a tough spot. it is similar to the fed. hard not only driven by data on inflation and growth, but insurance cuts, where central banks have to make forward-looking judgments. that is why it is difficult. >> going more negative, will it possibly spur inflation? there is a study showing banks and negative rate regions actually lend less money out. help if the ecb lo

guy: mario draghi has navigated a different period during his tenure.istine lagarde's tenure going to be even more difficult and does she have the skill set to navigate it? bhanu: in terms of what is left in the toolkit, there is not a lot. you are looking at a difficult time. to be fair to draghi, he negotiated europe through a tough time. whatever takes was not easy. there were questions on the existence of the eu and eurozone. there is no doubt in my mind that christine lagarde would also have major challenges. she is a good communicator and that is what you need. there's not much else left in the toolkit. guy: thanks for stopping by to talk with us on a friday. bhanu baweja, ubs global head of strategy. european markets through the auction process. london got off to a slow start with a technical glitch. we wrapping up a reasonably quiet session after a very turbulent week. those are the final numbers in your. -- in europe. we will be continuing to talk about the markets on bloomberg radio. dab digital radio is where you'll find us. the cable show ta

last week european central bank chief mario draghi made it clear it they are going the same way withecting a rate cut in september along with more stimulus measures. today it's the turn of the bank of england. it's not expected to cut today, but markets are betting it will do so by december, amid rising risks of a no—deal brexit. it wasn't so long ago their next move was expected to be up. india's central bank was the first to cut rates, it has now done it three times this year. the reserve bank of australia has cut at each of its last two meetings, taking borrowing costs to a record low. and in the last few hours brazil's central bank has cut its interest rates — again to a record low. from the federal reserve in washington, here's michelle fleury. but the last time those inside this building cut interest rates, it was, as you pointed out, in the depths of the financial crisis. since then, america has enjoyed its longest period ever of uninterrupted growth. but the fed felt it was necessary to act now, to cut rates by 0.25%, because of trade tensions and also a weakening global econ

mario draghi in past years made that clear over and over again another alternative is is that olli rehn wants to pressure others by putting out so much information that the market is pricing it in. and anything less than that will be a disappointment by september that could be one alternative. looking at what he's saying, that everything is on the table, and that also the market should not think that they can't do more than already anticipated, meaning on the interest rate front they could go lower than minus 0.1% now the speculation is whether it will be 0.2% or lower what happens to the deposit rate will we get tiering is the next question will there be any alleviation from the pain from negative deposit rates for the banks. and also his comments that he didn't rule out a move to purchase equities. previously it was a no-go area for the central bank that gives you an yt how bidea g the ecb might be going in september to boost inflation expectations it is clear if you listen to mario draghi in july that there's a huge amount of disappointment with how effective the current policy tool

but mario draghi looking out for his legacy.nts the eurozone to be anding when he leaves christine lagarde takes over. matt: he has the problem no matter what he does, he controls monetary policy and is not on the same page with anybody in terms of fiscal policy. we talked to the german finance minister who says there is no crisis with the german economy and he is not planning on spending more are cutting tax rates. what can draghi really do? he provides some support for the economy, but interest rate have gone a long way down. lending is accelerating. quite but, not getting closer. this is true of several other countries in the eurozone itself. line that will lead to financial stability risk. lendinglooking at bank growth of this magnitude and interest rates in germany going negative. you have to worry about financial stability risk down the line. at these levels of yields, there are problems, insurance companies, fund managers trying to find returns. anna: you worry about financial risk, but isn't that the point, they want to

the opinion piece today says mario draghi proves a central bank can be political. the author, next. this is bloomberg. ♪ ♪ vonnie: live from new york, i'm vonnie quinn. ."is is "bloomberg markets let's get an update on global markets in london with emma chandra. emma: we are looking at a mixed session for stocks. u.s. equities now and the green after opening low. if we look at europe, we are still negative, but we are off the lows. it is tech that is the laggard on both sides of the atlantic. the s&p 500 in positive territory. the tech heavy nasdaq is still negative on the day. investors waiting for anymore developments in the ever volatile trade war between the u.s. and china. we are just days away from the imposition of new tariffs. they are due to be staggered from september 1. it is trade weighing more heavily on some of the movers we are looking at today. autodesk,show you falling today some 12%, having its worst day since november 2017. analyst downgrades after the company cut its full-year outlook on fears about the trade war and the slow down in the chinese and german econom

matt: we do hear complaints outside of germany, they gain from mario draghi. -- begging from mario draghihere any chance that the rest of europe will get angela merkel to get on board? birgit: this has been going on for quite a while. the imf has been constantly calling for germany to do this. but germany is stuck on the fiscal discipline on the one hand, and on the other hand they are saying, we had so much tax spent all ofe have our surplus already in investments. they say the infrastructure, what you are pointing out, we are spending a lot in infrastructure. the domestic amount is not the problem. we have problems spending all that money because we do not have the workers to build all that. matt: exactly. i will say from personal experience, driving along the autobahn, it is construction site after construction site, and we never see anyone working on those construction sites. they really need more people, i guess would be one more to put it. thank you. a reminder that there is still no trading on the ftse 100 and the ftse 250 due to a technical glitch. the stock exchange says it is in

the fed introduced quantitative easing. 2014, it was all about mario draghi and his own plan for europek you maintain that the view for you is we do not get out of a stagnation mindset until the u.s. federal reserve uses. -- the federal reserve eases. anyou expect him to set aggressive tone at jackson hole? >> that would be quite a switch from the last fomc meeting. hand, the macro looks ok. inflation on target. you have the u.s. consumer doing pretty well. retail sales are high. traditional metrics you look at for the fed. on the flipside, you have to market relative issues in money markets. isld curve inversion boosting the value of the dollar. andou look at the macro they say the economy is doing fine, markets will take it badly. if you focus more on capital markets and the challenges capital markets are causing the , the strongworld dollar global manufacturing investment seen, the markets will take that very well. we have not seen that from many fed officials. i would say most of the fed president's focus on the macro side. people like your guest today, eric rosengren. there is relu

he needs to do what the mario draghi did when the ecb was falling apart.to do whatever it takes to insure u.s. growth stays put. that is all he had to say. that would allow the market to continue on massive growth streak. he said maybe one and done. that messaging, became so muddled, the markets are confused on top of all the trump tweets and everything else. the correction, maybe during the jackson hole conference, they come out say do whatever it takes. that is what it takes to calm markets. liz: the old mario draghi, do whatever it takes. jason, central banks are scissor happy. this morning india, thailand, new zealand all sliced interest rates. as you look at the market. you have to talk from an investor standpoint what are people supposed to do? >> this morning the move or sprint to zero interest rates was palpable. we're paring some of that as we head into the close. what are investors to do? frankly sometimes the best trade is no trade. i think you have a lot of central banks trying to get ahead of the fed to keep their currency competitive. liz: lo

what we are used to from mario draghi, janet yellen, alan greenspan, they really get the committee on a message, or at least come in with we are easing conditions, that is the thrust of the committee's move today. bestat way, you have the chance of easing financial conditions. if you come in and talk about maybe we will raise rates before confuses things.you go back and the reason i say that, his approach is, i'll just a completely transparent. in a way he reflected with the committee told us in june which is half of them do not want to cut at all. and they are getting dragged, kicking and screaming. what we saw in the fourth quarter of last year is the fed will be hiking right, but he said absolutely not. this is an unsustainable gap between yields and u.s. yields. it will be destabilizing. you are going to have to get on board with the global program. oksana: the issue here is that the market refuses to be weaned off of the central bank banking. the past couple days, the fed says we don't need anything other than an insurance cut, and the market hates it. the following day we have a

spoke andlagarde also she was much more in line with mario draghi. . you always have these people who do not completely agree with one another. once they get around the table and the leader of the pack tries to push them in a certain direction, the ecb comes around. not everybody is in the same page. let's see how it goes. poor,ta for europe is especially germany. from that point of view, they can probably justify another lowering of rates. it needs a few more people to come around. that is what she is therefore. she is there to win hearts and minds. >> the question is, is going more negative on rates going to quantitativeas easing? thank you for joining us. a bloomberg mliv strategist. the tradeback to story. the u.s. chamber of commerce xiing presidents trump and to withdraw tariffs. footwear and other apparel will be the target. china will slap a duty on u.s. soil. joining us for more, judy schneider. keep tabs on which tariffs for which goods. waserday, donald trump saying there were talks scheduled for last night. lot about heard a possible talks.

a very mario draghi approach to life. but that is not going to happen.rump will continue to lay on the pressure. it has been a fascinating move away from a completely independent central bank, to ones that are getting increasing political pressure. still independent but that political pressure has to weigh on them in the long term. lisa: everyone will stick with me and we will talk more about this coming up. the auction block. the world's first 30-year bond offering. weak demand as a yields in europe dive into negative territory. that conversation is coming up next. this is bloomberg "real yield." ♪ ♪ lisa: i'm lisa abramowicz. this is bloomberg "real yield." i want to head to the auction block. let's begin in sweden where the country's oldest lender tapped the market for so-called additional tier 1 bonds for the first time in three years. the bank received orders for more than nine times, yielding just over 5.6% as record low interest rates continue to lure issuers. in the u.s., the treasury sold $7 billion at 30 year tips. the yields the lowest in near

we are going to do everything it takes to get inflation back to 2% and support growth, a very mario draghiind of approach. but that is not going to happen. i think trump is going to continue to lay on the pressure. it has been a fascinating move away from a completely -- from completely independent central banks, to ones that are getting increasing political pressure. still independent, but that political pressure has got to weigh on them over the long-term. lisa: everyone will stick with me, and we will be talking more about all of this coming up. the auction block. the world's first 30-year bond offering, a zero coupon, weak demand. diving into negative territory. that conversation is coming up next. this is bloomberg "real yield." ♪ ♪ lisa: i am lisa abramowicz in for jonathan ferro. this is bloomberg "real yield." i want to head to the auction block. let's begin in sweden where the country's oldest lender tapped the market for so-called additional tier 1 bonds for the first time in almost three years. the bank received orders for more than nine times the $500 million, yielding just ove

you have mariota rock he saying if things get worse, we need more fiscal policy -- we have mario draghi seeing if things get worse, we need more fiscal policy. when there is no problem with fiscal sustainability, you issue a whole load. you can see the seeds. it is a bit like the tmt bubble. you drove technology stocks up to levels and ratings we have never seen before just as earnings were about to collapse. bond prices have collapsed to levels we have never seen before. yields have collapsed to levels we have never seen before just as you are setting the conditions that can reverse the fundamental picture behind these assets. nejra: a lot of people have come on the show and send what bond markets are trying to do is push governments into having a physical response, because they are pointing to the limits of monetary policy, saying all it can do right now is halt the slowdown, but it can't stop a recession coming. the thing is, in the u.s. there has already been some fiscal response. eric: for sure. there is a big difference between what might happen in europe and what might happen in

invoking mario draghi's famous speech. says he will gauge the inflationary impact of this month unexpectedly large rate cut before considering further easing. >> looking forward, we were saying, everyone is telling us we need to be lower. global growth is slowing. let's get ahead of this. let's move now and reduce the probability of having to do more later. we are pleased with where we are. naomi: undermining trust. japan's prime minister has accused his south korean counterpart of damaging the relationship between the two countries. that's after so pulled out of an intelligence sharing pact with tokyo. shinzo abe has pledged to work with the u.s. to maintain security cooperation. the battle to host the world's biggest ever initial public offering is heating up. a host of the largest global exchanges are stepping up their courting of saudi aramco. we are told senior officials from london, new york, and hong kong have been actively pitching the saudi oil giant in recent weeks. global news 24 hours a day on air and on twitte

i think what we are used to from a mario draghi, alan greenspan or janet yellen, is they get the committee on a message, or come in at least with -- we are easing conditions, that is the thrust of the committee's move today. no if's, and's or but's. in that way, you have the best chance of easing financial conditions. if you come in and talk about, maybe we will raise rates before we cut rates and you go back and forth, it confuses things. there are different ways of doing it. the reason i say that, his approach is, i'll just be completely transparent. in a way, he reflected what the committee told us in june which is half of them do not want to cut at all. and they mean it, and they are getting dragged, kicking and screaming. what we saw in the fourth quarter of last year is the fed will be hiking rates, and he said absolutely not. this is an unsustainable gap between u.s. yields and other yields. the u.s. is going to be to be destabilizing. you are going to have to get on board with the global program. oksana: the issue here is that the market absolutely refuses to be weaned off of the c

the president mario draghi has given very broad and clear indications that such measures are on the way including interest rate cuts in a defacto return to the policy of quantitative easing with bond purchases among the familiar actions are now widely expected but the e.c.b. may also be feeling pressure to develop new interventions as the minister recorded a discussion of multi-tiered deposit.

president mario draghi has given.

back in 2014 mario draghi, unemployment was the big problem. 2010 mentioned the words securities 32 timeser what we will talk about this time. rishaad: talking about inflation 57 times when there is not any inflation. itid: just because you say does not mean it will not happen. rishaad: maybe it becomes a self-fulfilling prophecy. any negligent inflation. hays,talking to kathleen waiting to see before further easing. where at jackson hole people are gathering for the symposium. >> we are looking forward, everyone is telling us the global growth is slowing. let's get ahead of this and move now and reduce the probability of doing more later. we are pleased with where we yard. >> on the downside risk materializing, manufacturing index posted a first drop below 50, signaling contraction. >> yes, without a doubt there has been a lot around uncertainty. our fiscal position is strong, the government is outstanding. global trade uncertainty has held everyone back from investing. it is the business confidence that is the anomaly. >> when you look down the road, people are talking about the next ca

last week european central bank chief mario draghi made it clear it they are going the same way — withtember — along with more stimulus measures today it's the turn of the bank of england. it's not expected to cut today — but markets are betting it will do so by december, amid rising risks of a no—deal brexit. it wasn't so long ago their next move was expected to be up. india's central bank was the first to cut rates — it has now done it three times this year. the reserve bank of australia has cut at each of its last two meetings — taking borrowing costs to a record low. and brazil's central bank has also just cut its interest rates — again to a record low. ben... with us isjulian howard, head of multi—asset solutions at gam. good to have you with this. with the cut, that was expected but the response was very counterintuitive, wasn't it? markets fell, normally on an interest rate cut, they rise. wasn't it? markets fell, normally on an interest rate cut, they riseli think a lot of this was about the language that surrounded the cut, the market expecting this to be the beginning of a pr

we see a more dovish posture coming from mario draghi and the ecb.y want to set the table to enabling lagarde to be more dovish. clearly, the weakness in growth numbers we're seeing from germany and the rest of the euro zone is weighing on monetary policy. what powell is pointing to they want to make sure that weakness in growth we're seeing abroad doesn't materialize, and supporting the inflation metrics, avoiding deflation at the same time. the cut we saw yesterday was more insurance oriented to both of those aspects. not exactly clarifying his equation on which one carried more weight. vonnie: when you see mark carney saying there are limits to what , thennk of england can do you have the fed chair talking about this is an insurance cut, partially because of obstructions that may come down the pipe, what do you tell your clients? the boe is maintaining their insurance policies and their ammunition so if they get a hard brexit, they can react. today's announcements were perceived a little hawkish because they did not do anything in anticipation of

mario draghi facing down the hawks, officials pushing back against further stimulus. good morning.ning price action. aroundfutures positive .6 -- around 16 points on the s&p 500, up .5%. in the bond market, treasury yields higher by two basis points. the euro-dollar, 1.1040. let's begin with the big issue. a week of trade happy talk not enough to shake away the trait concerns. >> we have an uneasy calm. >> perhaps a cease-fire for now. >> they are saying c

president christine lagarde is offering signs she will stay on the dovish pat said by mario draghi. in her first comments on policy since winning the job, she says the bank has the tools to tackle the downturn in europe and must be ready to use them. policy makers meet in two weeks and are expected to launch another round of stimulus. lagarde takes the reins at the ecb in november. u.s. prosecutors are investigating huawei over new allegations of technology theft, this according to a dow jones report. beyond existing criminal cases against the company and features accusations intellectualaling property from multiple people and companies over several years. huawei said it is committed to complying with laws and proper ip process. oni can't really comment ongoing litigation and i believe related investigations. ip theftncerned about as anyone because we hold a significant number of patents and we want to see those issues addressed, but we are a process and due handling of ip in appropriate manners. su: global news 24 hours a day, powered by more than 2700 journalists and analysts in m

she told the european parliament she would basically follow mario draghi's policy, and that there wasn't an end to the lower bound , that there is still room to maneuver. then we have some on the ecb saying conditions do not yet warrant the need for further qe. how do things proceed? alberto: i think the last comments are definitely a tale of hawkish comments. i wouldn't take them too seriously. but we will probably include a tiering to smooth the impact of negative rates on banks on deposits, and a resumption of qe. the euro zone does need a return to qe. however, negative rates for a prolonged time tend to have a lot of collateral effects, particularly on an economy that depends on banks. is from banks, and if you keep rates low, banks have problems lending to small businesses. , someinders job creation on the one hand, the ecb wants to keep the euro low, but we think they should focus on quantitative easing and helping interest rates converge to a lower level for periphery countries, which are the ones that need it the most. it is probably not the end of the qe process for the ecb. vo

offering lagarde is clear signs she will stay on the dovish path set by mario draghi. the toolshe bank has to tackle the downturn in europe and must be ready to use them. policymakers meet in two weeks and are expected to launch another round of stimulus. she takes the reins of the ecb in november. chinese news agency has issued what it calls the strongest for antigovernment protesters in hong kong. it says any activities that challenge the one country, two systems sensible or harm security will not be tolerated. the message comes a day after a pro-democracy leader was attacked by two masked man in a restaurant. agreements to be no on territorial disputes in the south china sea, despite top level talks in beijing. met with xi jinping his counterpart but the two accord.o reach an the leaders did sign a range of deals including a loan agreement or a new rail project across the island. global news 24 hours a day on air and at tictoc on twitter. powered by more than 2700 journalists and analysts and more than 120 countries. i'm jessica summers. this is bloomberg. paul: tha

they were hoping he would sort say we mario draghi and will do whatever it takes to keep the expansion. he tempered that. he is keeping those cards close to the vest saying it is a midcycle adjustment, which the markets signal, maybe it is just one interest rate cut, maybe two, not this full on aggressive easing president trump was hoping for. carol: there was so much debate going into that fed meeting about, could we possibly see on aggressive fed and can we possibly see 50 basis points? >> there was some conflicting messaging coming out of the various speakers from the federal reserve leading up to that. there was this notion that a big awe 50 point basis cut might be enough to kickstart the economy. that was always priced in as kind of long odds. the market did not really expect that, but enough people expected that. it is not that this would be a very whatever it takes type of reaction to what's going on in markets. . they did not get that that's really what set the ball rolling. carol: one day after -- >> president comes out and threatens tariffs on the remainder of imports from c

as mario draghi said, the outlook is getting worse and worse.be regional banks, smaller banks, for example france that might hit out with a strong quarter of trading, but they are still struggling and swimming in the same swamp. guy: a tough place, wherever you are in your. thanks for much indeed. ing joining us on the banking sector. this is how europe has settled. not much movement. broadly positive at the close. we have rallied in the last hour and a half. individual names worth pointing out, commerzbank down hard. fire training strongly on the german market. of more coverage coming up on bloomberg radio at the top of the hour. jonathan ferro is in new york, i will be joining him in london for the cable show on dab digital radio in the london area. this is bloomberg. ♪ vonnie: live from new york, i'm vonnie quinn. guy: from london, i'm guy johnson. this is the european close on bloomberg markets. let's get the bloomberg first word news update with courtney donohoe. courtney: president trump has resumed his campaign against the federal reserve

>> mario draghi. manus: do you think that is credible? don't the he wants this particular job.case for barclays is a 50% rate cut. this curve inverted for the first time since 2008. is there a deeper inversion to come? >> probably, yes. we are going to have negatives coming out from the political economic front. nejra: we are seeing some of that. thank you so much for joining us. coming up, light at the end of the tunnel. a rival takeover offer. now it is down to shareholders to the side. we will speak exclusively to the german lighting makers cfo. this is bloomberg. ♪ nejra: investors are awaiting shape house keynote address at jackson hole tomorrow. what keyword should investors be looking out for? these are the words that stood out in previous years. in 2002, the word was bubble. alan greenspan said it 23 times. in 2007, ben said the word mortgage 23 times. manus: in 2010, it was securities. he was talking about central bank purchases. draghi warned of an unemployment crisis. that is probably why he used the word 46 times in his speech. last year, jay powell focused on infla

statement to the european parliament this week, looking like she will continue on the policies of mario draghi movements afoot to maybe push her off that force, which you say? vonnie: that is a very good way of putting it. she has just come off having $170 billion in -- that has not gone especially well. the fact that the guy who could have got the position, the head of the german bank, he did not get the top job. easy-going orore politically adept person in christine lagarde. she is a politician. stern sabr of the buddhist bank flame has rediscovered himself and is perhaps pushing back, not against rate cuts, i think that is a given, but three buddhist three ecb voters have come out in the last couple of have come out and said they do not want to do more qe. vonnie: an interesting one in september. marcus, thank you for spending august with us and we will see you in september. that is tuesday and the united states. coming up, "balance of power" with david westin. he will be talking china trade and hong kong. the former u.s. ambassador to china will be our guest. ♪ david: from bloomberg world

i thing mario draghi has been pretty clear about that, and i'm sure christine lagarde will continue toe that case in the future as well. in a way, it is almost the inverse of what we are seeing in the u.s., where the fiscal theort has been there for u.s. government, but the cutter approach for monetary policy. vonnie: ben, thank you for joining us today and being so generous with your time. aberdeenen ritchie, head of u.s. equities. the familyma and that controls it has made an $11.2 billion offer to declare settle alland opioid-related cases. for the latest on all of this, let's bring in bloomberg pharma reporter cynthia koons. offermily have made this of purdue for $11.5 billion worth of settlement. does yesterday's johnson & johnson finding change anything about this offer? cynthia: they sort of tell two different stories. what j&j did in oklahoma is decide to take their case to trial. while it was a good day in the market, concerns that had could have been worse, it spoke to the idea that it might be better to settle. the companies that had settled prior didn't have to pay nearly a

how manufacturing get a, the challenges facing mario draghi and his successor.is coming up shortly. this is bloomberg. ♪ francine: this is "bloomberg surveillance." i am francine lacqua in london. let's get to the first word news with viviana hurtado. lender's largest restructuring in years begins to take shape, stockton achieving is 24 a target for capital requirements and says it is on track to keep the metric at that level. 12%e are posting this midyear and beating our trajectory taking into account a 50% ratio in cash. when you look at the figure, no reason to cut dividends. >> first half results that beat expectations this fight u.s.-china trade tensions, and asia in focus lender reported $7.7 billion of underlying revenue, the stock has been rising, helped by a $1 billion buyback program announced in april. costs were lower on reported basis than last year by 3% on constant currency they were flat with last year. the costs are well under control. >> the london stock exchange agreeing to snap up definitive in a blockbuster $27 billion deal, the transaction

obviously signaling to the european parliament that she's going to continue the type of policies mario draghi been effectuating. she says the precise mix deployed will have to depend on the nature of shocks and outlook on inflation. are there shocks affecting the outlook for inflation on the horizon? john: germany just printed a lower-than-expected inflation rate. german inflation is at 1%. germany may, quite likely is, in recession. is the problem with europe that too much emphasis is being put on monetary policy and not on fiscal policy. germany now has the fiscal space without breaking ecb rules to undertake significant fiscal stimulus. that's what tax cuts and stimulus in journey would be much more helpful for the european economy then making interest rates -- in germany would be much more helpful for the european economy than making interest rates lower. seen --t the data you the data. you seen german gdp come down, running a surplus is the economy goes into potential recession. to me, there's no rational reason not to undertake some kind of fiscal action in germany. vonnie: i have to as

on the yield curve will continue to go lower, but we feel that despite mario draghi leaving, his last meeting coming up, with lagarde joining, we feel that there must be some continuation of the monetary path they've taken to ease economic tensions while there is no fiscal backstop coming. prime minister johnson has come to say they are leaving at the end of october, come what may. the bank of an led will make sure they sail through. guy: you bring up the issue of fiscal, and i appreciate germany being kicking and screaming in that direction. most people think it will in up there. brexit will probably end up there as well with some kind of fiscal stimulus. other parts of europe may or may not, depending where they are with their debt levels. if we get significant amount of fiscal spending and europe, the bond market is out of position for that. how out of position to you think it is? grant: if we have a large, concerted fiscal stimulus package across the euro zone, ultimately we see yield curves steepen into an inflationary dynamic that will cause inflation expectations to go up, not

. >> the worsening trade war has been cited not only by jay powell but mario draghi.npect interest europe to move further negative? how does that affect your business? >> yesterday, it was that -45. 30 basis points lower compared to the japanese government bond yield. markets,look at the -75 basis points. from that point of view, they can go lower. they can go even lower. anywhere they are not going to go higher. i think they are going to be at this level. potentially lower. for our business, it means we did the right thing. stringent asset liability management. we did the right thing. this is going to serve us well in the future. at theneed to look production we are selling. potentially adjust the production to the condition we see in the market. this is nothing new for us. whetheroing to evaluate we need to do any changes. fundamentally we have the book which has been protected by our action. >> thank you soma -- thank you for your time. quickly show you some of the trades that are coming through this morning. with off, wound trading the yield moving down to an all-

from jerome powell to mario draghi, pressure is mounting for governments to loosen their budgets if thelowdown takes hold. bob baur is still with us in sydney. thank you for sticking around. we have seen a lot of frustration with the fed action in july, despite the fact that they cut for the first time in over a decade. what will the fed need to do in the coming months to support the economy, and also keep markets happy? bob: i think they are going to 0.25% ined rate by september. if markets are not too erratic or we do not get too much of a plunge in markets and the data continues the way it is, we may or may not get another cut toward the end of the year. i think the fed is concerned with the uncertainties of business. right now, those uncertainties have not lurched over into hiring plans. households are doing quite well in the u.s.. but i think that is the fed's main concern, that despite slowing spending we could see the business uncertainties work their way into pruning hiring plans from what they have been. shery: of course, it does not help that a stronger u.s. dollar is eroding

what do you expect from mario draghi as he heads out?going to see more quantitative easing and further big at of? what kind of problems does that bring with it? burkhard: it is monetary policy to the weakest link of the chain. it is a shame mario draghi wasn't able to during the course of his presidency raise rates but that is what it is. the ecb will continue to kick the can down the road and to do what they can, even though they have made it clear that at this point, really fiscal policy must step up more significantly. that is not just physical spending, really far more important if you want to sustainably reinvigorate europe's ailing economies is to deregulate labor markets. taxes,simplify and lower corporate as well as private sectors. matt: burkhard, we are going to keep you with us. the cio stays with us. we are going to bring you the market reaction as the g7 leaders continue their talks. ahead of the press conference between president trump and president macron, there you see president trump's wife, the first lady speaking with

what can the -- what can she do that mario draghi did not?ill realize she knows this, of course -- that really there is very little ammunition left. despite the big compression, german yields only went down about half as much as u.s. yields. that is a sign that we are hitting rock bottom in terms of how low you can hit rock bottom with interest rates. my guess is if we go into that region firemen -- in that environment, we will see regime change. one element of this will be a blurring of fiscal and monetary activities and responsibilities. and actually for that type of environment, if we go into that kind of policy regime, christine lagarde, frankly, is ideally qualified. it may well turn out that her appointment ends up being a very fortunate thing in the future, just the way ben bernanke was very fortunate to be the -- we were fortunate to have him the chairman of the fed at the time since he was the greatest student of the great depression. wherego into this world fiscal and monetary inevitable be become blurred and one has to do with how

kristi lagarde is saying she is seeing clear signs on the dovish path set by mario and draghi.he policy since winning the job, she said the bank has the jobs to tackle the downturn in europe and must be really to use them. the reins of the ecb in november. used agencyhin one has issued what it calls the strongest warning at two antigovernment protesters in hong kong. any commentary, it says activities that harm the security of china's sovereignty or challenge the one country, two systems principal will not be tolerated. it comes a day after pro-democracy protest leader gigemnation was attacked by two masked man in a calhoun restaurant. tanker sought by the u.s. for alleged smuggling seems to have change course in eastern mediterranean. website shows it sailing away from its expected destination of turkey, but it is unclear whether the course is temporary or permanent. last weekend, the ship was showed to the turkish sport as its intended destination. this is bloomberg. ♪ --global news 24 hours a day on air and on @tictoc on twitter, powered by more than 2700 journalists and ana

leaders chose at her place mario draghi as the european central bank president under a convention with the u.s. a european usually leads the i.m.f. and an american national head to the well bank. and u.s. rapper asap rocky has been released from custody pending a verdict in his assault trial in sweden prosecutors have asked judges to impose a 6 month prison sentence the lawyers say asap israel name is ricky myers should be sentenced harshly because they believe he threw a bottle at the alleged victim during a street fight on june 30th why is denies using the bottle in the scuffle but admits he acted in self defense judges will hand down the verdict on aug 14th rewind now continues but i will be back with the news hour $2100.00 g.m.t. in about half an hour from now do join me then. if the dreamliner represents boeing's future. and i've come to the place where that future will be built. in this assembly plant in charleston south carolina. i've been called to a meeting with a man who works inside the plant. he's taking a huge risk even talking to me. it's been eating me alive to know what

and all of the connectivity there so if ecb is going to give more stimulus at the basic end of mario draghi's tenure before we get new leadership of course, then that is going to put even more pressure op the markon the markets. what happens is speculators institution, much buying goes on in front of these hints about more qe, more stimulus. that brought boone rates down rather democratically. the euro currency also followed. how can does that correlate with tens listen el arian said it this morning. many respects since all stimulus is spongeable, the ecb is is setting policy for many of the central banks in the world by making the first move in the chess game then those hints being much activity into that sector and that pressure's rates and puts pressure on other central banks to try to make sure they keep up so their currencies don't appreciate you can see our dollar is still firm and that's one of f the lynch pins in how the counterintuitive nature of this story as the fed tries to get ahead of weakness, but they really end up doing is losing a bit of control not necessarily their fault,