mike mckee, with your work on g7, you were in prague, your work in russia, moscow. i looking at your job support and watching ruble and euro on the screen? mike: i suspect the folks at the fed are watching those headlines as well. leisure and hospitality was one of the big gainers. 179,000 jobs created in the overall category. you look at food services and drink in places, 123,000, almost 124,000. so, people are coming back to work in those areas. there was some concern that people would not want to be waiters and waitresses and bartenders again because of the contact with people, but it does look like they are starting to draw them back in. a lot of the minimum wage increases may have helped in that area. government, we saw a big decline last month in government hiring, but it looks like we are back up again overall. 24,000 in the education spaces. 15,000 in local government education. those jobs starting to come back a little bit. lisa: some people might say more people are coming into the labor force, that is good. it is going to decelerate the wage gains. is tha

mike mckee, thank you. great interview. as you might expect from mike mckee, with st.ouis said president jim bullard. mike tweeted out the picture of the hyperinflation poster. for anyone wondering about hyperinflation, because we always get messages about it, here's the definition at the st. louis fed. when inflation, general sustained upward movement of prices of goods and services in the economy, reaches more than 40% a month. then they have a list of countries with the worst hyperinflation in history. germany, greece, hungary, china, zimbabwe, as you might expect. lisa: that was the first thing you thought i would you thought of the money museum, was whether or not they were giving out samples? jonathan: at the central bank of austria in vienna, you can go in and lift up a bar of gold. they have a bar of gold in the entrance around the corner. i'm not giving anything away. you can go see it for yourselves. i'm just wondering what the experience is like at the money museum. that is all. let's start with faster is better. faster is better. i think 50 basis point move

mike mckee is our correspondent. mike, let me start with you. it appears that maybe the fed and the ecb could be on very different tracks. they have been on different tracks for a vile, but it is starting to close. given what is happening in europe, is the ecb and defense position significantly different? -- the fed's position significantly different? michael: i do not think they are vastly different. we have europeans and the u.s. with big inflation problems. the way they calculate, they are directly comparable. they are pretty close, in terms of how far over their targets they are. the europeans did not have was the tight labor markets that the fed has come of that are pushing up wages. one of the highest reports that came out is come of the reason that hiring went down is because a lot of companies cannot find workers. that will add to price pressures. as the economy in the u.s. grows , we will see that more and more. now it will be hampered by the warrior. they may not be on the same page as the months go on. kailey: they were talking about

we need to break down some data with mike mckee.will get into chairman powell, who we have barely discussed today, and catch up with bill goodling -- with deutsche bank in just a moment. this is bloomberg. ♪ as a small business owner, your bottom line is always top of mind. so start saving with comcast business mobile. flexible data plans mean you can get unlimited data or pay by the gig. all on the most reliable 5g network. with no line activation fees or term contracts. saving you up to $500 a year. so boost your bottom line by switching today. get the new samsung galaxy s22 series on comcast business mobile and for a limited time save up to $750 on a new samsung device with eligible trade-in. jonathan: 2011 highs on crude. wti $111.30. with breaking headlines on chariman powell, here is mike mckee. michael: we have the prepared text from the fed chairman and he basically confirms what everybody on wall street is betting on, saying with inflation well above 2% and a strong labor market, we expect it will be appropriate to raise th

let's get to mike mckee. michael: good morning.ou mentioned empire, the new york version of the ism index, down 11.8%. that is an index number. it was 3.1 in the month of february, so a big drop in manufacturing production, it seems, in new york, looking underneath the index. rices for goods seem to have gone up a little bit, while prices received for the raw materials they need goes down a little bit. that is some good news. but the ppi shows something also very interesting. final demand ppi up 0.8% on the month, down from 1% last month. takeout food and energy and ppi was up only 0.2% in the month, down from 0.8%, so a big drop in the increase in producer prices over the month of february. you take out the additional trade, which is retailer and wholesaler margins, you get a 0.2% increase as well. so over the year-over-year, we see the ppi for final demand up by 8.4%, ex-food and energy, 10% on a year-over-year basis headline. but it looks like maybe some good news going forward in terms of producer prices. we were restrained las

mike mckee is ready to break it down.rom new york, this is bloomberg. ♪ ♪ jonathan: where seconds away from economic data in the united states of america. futures down .4% on the s&p. on the nasdaq down .5%. with your initial jobless claims data and a lot more let's get to mike key. -- let's get the mike mckee. michael: jobless claims drop down to 214,000. continued improvement there. we can add because nobody really cares because we are back to normal. housing starts to matter because house prices have been contributing to inflation. housing starts for the month of february up 6.8%, which is a significant improvement over the drop of 4.1% a month before. building permits coming down 1.9%. all of this is very volatile. the numbers change every month. a lot depends on the weather, but if building permits were to reflect a change in builder sentiment, that that might be something that would affect the economy down the road. something to keep an ion. the philadelphia fed comes in at 27.4. last month 16, so strengthen manufac

kriti: mike mckee, bloomberg international economics and policy correspondent, and heidi shierholz, iannot policy institute president, we thank you for your time. this is bloomberg. ♪ ♪ kriti: it is time for the bloomberg business flash. let's bring in ritika gupta. ritika: jp morgan's warning that russia's economy could be headed for a major collapse. with increasing disruptions, the country could see a situation comparable to the fallout from the default back in 1998. jp morgan is predicting a peak to trough crash in russian gdp of about 11%. traders are delivering a swift, punishing verdict on the aspect it hit two russian corporations from the ukraine war, basic lead turning the country into a nation of junk bonds. 3/4 of bonds issued by investment grade nonfinancial corporations and rich are now trading at the stress levels or carry risk in with junk rated debt, according to bloomberg's market-based default risk model. microsoft is the latest company to limit business in russia. the tech giant says it is holding all new sales of products and services in russia as it condemns the

he spoke exclusively with bloomberg's mike mckee. >> faster is better in the 1994 tightening cycle oroval of accommodations cycle is the best analogy here. that was quite successful. the fed moved 300 basis points in a single year. they made some adjustments afterwards and the result was we had our 2% inflation target and the economy boomed in the second half of the 1990's. this is a situation like that. we were surprised by inflation but now you have to move the policy rate up discreetly a fair amount, not to be too disruptive. then get to a level we can be neutral and decide if we want to be restrictive and put further downward pressure. but we are putting upward pressure and it's the wrong place to be. >> the markets, when you look at swaps where futures are pricing in 50. the fed doesn't like to surprise the markets. should we assume that's what you are going to do? >> i'm just one person on the committee. i don't know where the rest of the committee will be and the chair has to manage that process. i thought it was a good speech yesterday that laid out the situation and we will s

mike mckee was citing an economist survey earlier that said those schooled in the arts think we willget four this year, and the market is pricing in seven. where are you? frances: i have three to four hikes and quantitative easing. i expect the economic data to slow quickly in the u.s. we are not facing a great situation in the u.s. or canada. huge drops in government spending are creating declines in monthly income. even the consumption is rising, that is coming from excess savings that is getting dried up. we have some of the worst declines in real wages that i have seen since the 1990's. consumer sentiment in the u.s. fell again this morning, at recession levels. all indications are that pmi's will decline. unlike history went typically we see central bankers hiking into strength, they are probably just going to get their foot off the gas and see things decline. that will give them little room to pivot. the challenge is making sure that inflation does not become embedded into our psyche. i expect the rhetoric to remain more hawkish than dovish for the next couple months. jon: anyo

mike mckee is joined by mary daly. she is the san francisco federal reserve president. o mike's questions. mike: things like inflation and the war that are going on. we have a lot of concerns. yesterday you said in a speech that it is time to remove the accommodation we have been providing. that means marching up to neutral i'm looking at whether we need to go over neutral to tighten a little bit, restrict the economy to ensure inflation comes back down. my first thought was, what song are we marching to? but my second thought is, what is neutral? how high do you have to go and how fast do have to get there? mary: let me say that the song -- and i am picking up a what you said -- but the song we are marching to is that we have a dual mandate -- price stability and full employment. but the labor market so strong, inflation, inflation, inflation is at the top of everyone's mind. it is about removing that accommodation. if you think about the estimates of the neutral rate -- i will just use what i think more or less is the consensus estimate, which is that the real neutral

mike mckee joins us and abigail doolittle's back. mike, what do you think? is this good news or bad news? demand on one side and supply story on the other. mike: i think you would have to say it is good news. you look at where we are in terms of crude oil and it is almost back to where we were at the beginning of february -- end of february before the invasion. it suggests maybe some of the inflation pressure the fed has to deal with is going to come off. you were talking about how do you forecast it if you are the fed and what it is going to do for the economy? it is really difficult. i think for the fed it is reasonably good news. to the extent it shows demand -- and opec report came out moment to go saying demand will fall around the world -- that does part of the fed's job for it. the only thing harder than forecasting for the fed what is going to happen is the markets forecasting with the fed is going to do. kailey: abigail, you look at the technicals to give us some sense of where things are going to go. there was a day last week when i said, what happ

mike mckee joins us with an exclusive interview with tom barkin. over to you. >> thank you and thank you for joining us today on bloomberg. great to see you again. hopefully we will do it in person sometime soon as the pandemic fades. you said last week monetary policy is a good nine to 10 rate increases away from neutral, but you have not said that you would favor any 50 basis point moves, so are you in that camp? what will be the point of waiting if you have that far to go? >> i am open to it. i think i will make this decision would be get to the meeting in may, how strong the economy still looks in its ability to make rate increases and how high inflation is persisting, so looking at both of those we will make our call in may. michael: do you agree with those who say you will not be able to bring inflation under control until you get the rate above neutral? tom: there is a chance that is true. two things are going to happen. some of these pressures, whether geopolitical or pandemic era, will presumably fade. we will get chips and cars at some poi

jonathan: mike mckee is going to break down that number for you in a moment.hat is the moving target into tomorrow. that is the latest beatty an estimate, 490,000 for payrolls in america. yields lower by three basis points, and crude down more than 6%. this is bloomberg. ♪ (announcer) enough with the calorie counting, carb cutting, diet fatigue, and stress. just taking one golo release capsule with three balanced meals a day has been clinically proven to repair metabolism, optimize insulin levels, and balance the hormones that make weight loss easy. release works with your body, not against it, so you can put dieting behind you and go live your life. head to golo.com now to join the over 2 million people who have found the right way to lose weight and get healthier with golo. jonathan: michael mckee just said it is not about jobless claims, it is about the pce data. tom: so rude. jonathan: they do not know the real michael mckee. the academy would ask him to leave. he is going to stay. [laughter] lisa: the bloomberg academy. tom: we are waiting for the data. j

matt: mike mckee thank you for joining us and thank you also lara rhame. we will continue keeping you up-to-date -- up-to-date with news from around the world. let's go to mark crumpton. mark: in a state of the union last night biden vowed to create -- convert -- confront russia over the invasion of ukraine. he warned russia that the word would leave his country weaker and more isolated. mr. biden said his top priority would be to fight rising prices. ukraine may hold a second round of talks with russia as of the war enters a more brutal stage with russia intensifying attacks on key ukrainian cities. western military officials worn this new phase will be a more deadly time for the country's civilians and army. early signs is that russian commanders are abandoning the approach of lightning spikes into cities. as sanctions against russia mount, officials in ukraine want a broad crackdown on russians investing in cryptocurrency. the cofounder and ceo of the biggest crypto exchange has ruled that out. >> whoever is on the sanction list will not be able to use

tom: i know mike mckee forwarded the notes on that. you are absolutely right. what is important here is, these markets will clear, and we are watching a bloomberg screen to see those dynamics. the number one dynamic this morning is the euro swiss has not given up. jonathan: futures down .2% on the s&p. the nasdaq 100 down .4%. this treasury market has been all over the place over the last couple of days. up 17 basis points in yesterday's session alone. jonathan: those ranges are -- tom: those ranges are wide. the two tins is ecstatic. john, those ratios are important. the real yield was a -.100. that is a lot of stress. jonathan: lisa, euro weakness? lisa: really the big question is what is the offramp? how do we end this near-term? that is what i am watching. ukraine may be holding a second round of talks with russia on the border of belarus and poland , as the devastation does continue. we are hearing from the kremlin that need -- that ukraine negotiators are in a rush to come to talks. how much can we see an exit strategy at a time when so many people are lo

let's get to mike mckee. michael: it has become something of a tradition for fed officials who dissent on decisions to explain that decision the moment the blackout lifts. jim bullard is explaining why he voted against the 25 basis point move the fed made on wednesday. he said the economy is stronger than people think and will remain so into 2023. he has a rather scathing criticism of the open market committee, saying that the policy rate is currently far too low to manage the u.s. macroeconomic situation. he goes on to say u.s. policy has been unwittingly easing further because inflation has risen sharply while the policy rate has remained very low. that pushes real yields lower, and he goes on to say the committee will have to move quickly to address this situation or risk losing credibility on its inflation target. bullard points to 1994, when the fed moved 50 basis points, and even 75, and managed to bring the economy in to a soft landing. he said that should be the model. so jim bullard making a very str

going us to discuss is julian lee and bloomberg's mike mckee. let's bring up the subject that kailey and i have been wrestling with all morning. is this market capable of accurately pricing the price of energy right now? julian: no, i don't think it is. i absolutely agree with your view that what we have at the moment is not an attempt to price risk. it is an attempt to price uncertainty. everyone is floundering at the moment, i think. everyone is trying to get a grip on what is going to happen. is there an end to this that is some kind of a negotiated settlement that means this is over relatively quickly, or is this going to be a long and grinding conflict similar to what we have seen with the russian involvement in syria? people are just struggling to really understand what is going to happen. i really don't think anybody has a really good idea on that at the moment. kailey: just to follow up quickly, what would the impact of an oil embargo be when it does not seem like anyone is touching russian crude in the first place at the moment? julian:

mike mckee joins us now. how will jerome powell be reading these numbers that i just read out? give us some smart analysis of what is going on here. mike: if you look below the headline, we don't know whether it was omicron-caused or something to do with the economy slowing down overall. people are getting less money from the government. the supply and delivery times and inventories are not good numbers. it suggests there are bottlenecks causing inflation, and that leads us to jay powell and what he is going to think and talk about, since he has kailey's permission today. he said he will raise rates 25 basis points. he is in favor of it. what the chairman wants, the chairman is going to get. this is a message basically to the hawks on the committee saying you are not marginalized, we agree there is an inflation problem, and we can talk about it if things don't improve. inflation likely to fall this year. that is a statement made in yesterday's testimony that the fed is clinging to. it is transitory without transitory. they expect prices to fall. as we have seen, prices for oil a

thanks to mike mckee and amy wu silverman of rbc capital markets.et's listen to jay powell give his semiannual testimony before the house financials of this committee. chair powell: we pursue these goals based on data and objective analysis and were committed to do so in a clear and transparent manner so that the american people and representatives in congress understand are policy actions and can hold us accountable. i will review the current economic situation to monetary policy. economic activity expanded at a robust 5.5% pace last year, rich progress on vaccinations in the reopening of the economy, as well as monetary support and the healthy financial positions of households and businesses. the rapid spread of the omicron variant led to some slowing in economic activity earlier this year, but with cases having declined sharply since mid-january, the slowdown seems to have been briefed. the labor market is extremely tight. unemployment rose by 6.7 million in 2021 and job gains were robust in january. the unemployment rate declined substantially o

because the fed rate decision is due out at 2:00 p.m., mike mckee is with us for more on the decisionpped what is the first thing -- when those headlines drop, what is the first thing you are looking for? michael: we know the fed will do 25 basis point rate increase today and increase the interest on reserves at the same time. we want to know what they think will happen with growth, inflation, and unemployment. and then how does that translate into the idea of higher rates. how fast and far do they go. the dot plot will tell us what they think is going to happen. the question you want to ask jay powell is how will you do all of this without tipping the economy into recession bring the fed has had a very hard time avoiding recessions may be only once in the last 40 years or so when they start raising rates and if that is the case again, than it is quite a trade-off for the fed. guy: mike we are looking forward to the coverage in the next few hours. coming up with the fed special, certainly looking for that. in terms of what we are watching other than the fed decision, president biden a

guy: that was an exclusive interview speaking to mike mckee. let's get some reaction.ormer richmond fed president is join us. he is now a professor. i promoted you earlier as the former fed chair. i apologize for that. let's talk you of the current rocket pricing, 50 in may. do you think that's about right? jeff: i would be advocating for a series of moves like that. the story of the day is the fed is trying to recover its credibility. it was badly damaged last year by their misdiagnosis of inflation and the delay why they -- while they cleared out the tapering process. they made a big step in the right direction with last week's meeting. it was incredible. there economic projections don't hold together. they are not believable. they are a move in the right direction to indicate a series of rate hikes. chairman powell yesterday was a recalibration, tightening the hawkish in us. i think he realized the messaging was not coming across well. i expect more of that in the future. messaging alone isn't going to do this. the fed spent the 70's proclaiming it wanted inflation

to walk us through what is happening, bloomberg international economics and policy correspondent mike mckeeael: you would immediately .2 rates rising and say that is the reason, but rumor, the fed is only raise rates now for a little over 24 hours. but the markets front run the fed, and you can see what has happened. we had a 7.2% decline in existing home sales in the month of february, 7% for single family homes, which is the one most people follow. prices continue to rise, up 2%. that just adds to the overall inflationary pressure. people say that is going to continue for a while. one of the reasons for that is that there is not enough supply. 1.7 months, there's not enough homes for people to buy. but this was the winter season. we'll get into the spring selling season and cf more people put their homes on the market. they will find a little bit less support from the fed. the yellow line is the mortgage bond buying that the fed was doing. you can see how in the crisis, the redline is when cut would -- when covid started, the fannie mae acceptance rate, now they are going the other direct