mr. draghi: thank you.eat, perhaps say differently. i started saying the economic recovery is expected to continue. at a somewhat slower pace. reflecting the slowdown in emerging market economy primarily. i said it is premature to conclude whether this developments -- these developers could have a lasting impact on output inflation. downside risks have increased and emerging-market economies challenges are unlikely to be quickly reversed. let me add that the cutoff date of these projections was august 12. the events that took lace since then are a downside risk to the projections themselves. furthermore, financing conditions, especially in the .ast two weeks have tightened lower commodity prices, stronger euro, a somewhat lower growth, have increased the part of inflation toward 2%. on the other hand, monetary conditions remain supportive. convergedsion today on an assessment that the downside risk to output inflation have increased. we will monitor the risk to the outlook. emphasizedng council the willingn

mr. draghi: we may see inflation in the coming months.e tend to think these are transitory effects mostly due to oil price effects. however as i said before, we will closely monitor all .ncoming information and the council wanted to emphasize the discussion we today, its- we had willingness to act, its readiness to act, and the capacity and ability to act. the: mr. draghi also said stimulus is intended to help get inflation back toward the ecb target of just below 2%. the program is slated to run at least through september, 2016. and hungary's railway company says it has suspended all train west of the capital because of the migrant crisis. officials say it is for security reasons. more than 3000 refugees are currently camped outside the train station in budapest, many of them from war-torn syria, trying to get into western europe. marketre at home, turmoil did not keep the biggest part of the economy from moving ahead. service industries are moving at close to the fastest pace in a decade. as according to the im nonmanufacturing index. t

the f's decision not to raise interest rates may make mario draghi and mr. da's jobs more challenging. let's get out to hans nichols, and in japan, brian fowler. first to you, hans. mario draghi -- are they on the same page? i asked earlier whether draghi would have to send it for a hike. what is your idea? hans: i wouldn't presume to think how mr. draghi would vote. i think they are on the same page in terms of china. they both think that china, even though they danced around it, they are saying that china has forced them to rethink what they are doing. morer. draghi, that means quantitive easing, sending it further down, beyond that september deadline. for janet yellen, delaying this ultimate hike, whether it comes in october or december. if you look at the euro-dollar play, and this is just part of yellen didwhat ms. put a little more pressure on the european economy. upr-over-year, exports were to the united states, in large part because he has seen the big moves and the big weakening in the euro. if you look at the export story, which is one way to look

mr. draghi and has that factored into your calling european stocks? i don't think it's factored in at this point. in our opinion the ecb is in easing mode still and what we expect is to maintain a pretty dovish commentary. we don't think they're that close to doing anything additional, extending the duration of qe or up sizing it. they'll continue to just use verbal methods to continue to talk about what they could do if things get worse. so i don't see that as being a big driver of markets on the upside or the down side but it's worth bearing in mind while everyone is worried about the fed moving to a rate hike this year that europe and japan are still easing quite aggressively and draghi's qe is predicated on inflation. so the more the commodity prices fall the more it undershoots the target and the more scope there ultimately is for them to continue with qe. >> can i just ask you about the differences seen in european equity markets now? i look at the german market. it's had a very different performance since the beginning of this year. how do you

mr. draghi has more than doubled over the past year as they realize he will come with the other purchase in the united states potentially a major player in the quadruple play within telecom's mobile and internet. meantime, the spanish banks have done well. they're top gainers as well. morgan stanley and -- going through there. >> the snap election may have done himself a disservice. we may be talking about coalition talks in order to form a new government with neither party having an outright majority. >> something to look forward to. >> what would a weekend be without some election in greece. it's a great time. >> i know it makes you happy, carl. >> thank you, simon. >> when we come back, in sharp contrast to apple. amazon unveiling some cheaper products today, including a fire tablet for under $50. could that give it an edge going into the holiday season? "squawk alley" continues. proud of you, son. ge! a manufacturer. well that's why i dug this out for you. it's your grandpappy's hammer and he would have wanted you to have it. it meant a lot to him... yes, ge makes powerful machines.

mr. draghi is expected to talk about ecb.the pope here in new york and i will get to that in a moment. we have a wonderful guest to talk about vw. we have robert nardelli, who has immense experience in bad things happening to corporations. he has lived through good times and bad times for companies like general electric and chrysler and home depot. we are thrilled to bring you him in our 7:00 hour and we will address the w at that moment. and also we will get an update on money -- it is cheap, it is free. whether it is the bank of england said, money is dirt cheap. we will talk about the ipo market and a bit on mergers and acquisitions. and we will go to jonathan ferro. he is on the road with the ecb interview, but far more portly, these markets are most interesting. francine: jon did this great interview with one of the ecb governing council members. he was a lot less dovish than i was expecting him to be, and the ecb is saying that there is still divergence to in the fed and ecb. tom: well, it is one big punch bowl filled t

mr. draghi is quite as updebt as in july and just before the summer. and perhaps what the e.c.b.t it reduces the hicp or its inflation forecast. september's meeting will come up with a new forecast. i had also emphasize the q.e. program can be extended or the pace of bond buying can be increased. we'll get if you like a warning from the governing count that if necessary the e.c.b. can ease more aggressively. manus: we're clamoring for more from the e.c.b. the euro is the second best perform tovering past month up 3.49%. thank you for coming in. great to get you to share your thoughts with our viewers. come up right here on "the pulse," a different kind of cyberattack. we'll have a look at a new team at barclays attacking the bank's defenses, all in a race to find the holes before the hackers do. that's what you want to do. stay with "the pulse." ♪ manus: welcome back. why would a company hack its own computer systems? barclays has set up a new team to do just exactly that, to attack the bank's digital defenses, find the holes before the thieves and the terrorists exploit them. le

mr. draghi was there in his armchair watching the press conference. . are he and yellen on the same page right now? hans: they are on the view of china. the slowdown in china has forced them to rethink macro policies. but in some ways there interests do not align. wants a weak euro. when the euro went close to 140, you saw it rise. now it is all the way to 114. looking formy growth outside the eurozone, and we saw how weak growth is within the eurozone, we know the emerging markets looked grim. it is that that point that the helped exporters. we have the second quarter year t figures.expor up 20% year after year. by the weakained currency in part. in may for strongly to enlarge or lengthen quantitative easing. thet yellen may have sent emerging markets a lifeline. the brazils and turkeys will have less full authority -- volatility for their currency. they would take the u.s. alternative. that is why mario draghi may be painted into a corner with his next round three at whatever he says next on the size and scope of quantitative easing. guy: hans nichols

mr. mario draghi. gifts instead of receiving gifts.id the ecb can buy a higher proportion of each euro numbers that -- you're a member pot's each euro member's debt. the euro fell, stocks rose. it's clear what happened because of mario draghi. here are some of the big individual movers. has raised its full-year guidance up by 5.4%. air france, another company in the news. considering starting a low-cost carrier to be a competitor of this stop right here, unicredit. jobs.utting 10,000 when will we hear more detail about that? this is the stock 600, up by 2.4%. i want to show you the mario draghi impact. he cut growth forecasts, but what he did was he adjusted the qe program. that is different for the birthday boy. brendan: you will be the only person allowed to pronounce -- on television. the biggestt says investment opportunity is in europe. let's take a look at what happened today. marioump from draghi. is that the demand story in china or the monetary story in frankfurt. chris: what's driving interest in europe is the same issue that

mr. draghi has done it again. it is paved the way for a more dovish ecb going forward.e absolutely crucial. mark: data on manufacturing this week showed a contraction, at least italy's showed an expansion and spain showed an expansion. right now it is ugly, but if you get an extension of cutie beyond september 2016, that can push the euro down to parity -- of qe the on 2016, that can push the euro down to parity. in order to clear the path, we will see that. it will make a big difference to france in particular. mark: thank you. , with us for the entire hour. we will talk to the finance chief. and the secretary-general of ecb. we will look at his take on the 2016, right after the break. ♪ mark: let's look at what is happening in equity markets today. it's stocks are dropping, it looks like last week or the european stock 600. it was a mirage. one point 6% lower today. the ftse is down by 1.6%. the dax 1.7%. everyone is focused on the big release, 11:30 local time, the u.s. jobs report. will it be enough, whatever the figure, to change the fed's mind on interest rate pol

mr. draghi about this, that we could be structurally low growth, but that is the new norm.hink it is fair to say that the situation, the financial crisis has posed significant challenges for central banks. implication that interest rates remain low, inflation remain low, and in some countries negative, and i think it is correct to say that for many areas and countries, due to difficulties in fiscal policy or lack of room on fiscal isicy, monetary policy acting, but it is overburdened. ,hat is different in our case even though we have some solutions now to oil prices. we have a good system of managing oil wells. we have significant room of fiscal policy, which is very different from other countries, and we have a good structure in our economy in the sense that we have lower unemployment, and we already see positives for the krone. worries, but ime don't think we should be too pessimistic. guy: governor, it has been a pleasure. take you for your time. governor olson, the norwegian central bank governor. we are now at .75 in terms of the main rate. the bias field still very do

mr. draghi, it is all about you as you decide on interest rates and q.e. .that news conference just after the monetary policy meeting. this is the chart you should care about. this is draghi's preferred inflation -- yes, we know we want him to reassure us to, soothe our nerves. he is willing to expand monetary policy because of the deflair -- deflationary threats. this is gauge of price growth expectations in the five-years starting 2020. now it is 1.69%. it was 1.8% two months ago. inflation in the eurozone is pretty much at zero. you know the e.c.b.'s targets just below 2%. this is problematic for draghi. mario, you need to address this today. manus: thank you very much. i would he has probably tuned in today. he got that message interest mark barton. francine: we're back with our guest. george, i wouldn't want to be a central banker now. i wouldn't want draghi's position. >> it is incredibly difficult for a policy maker. this dilemma i talked about before, you contradictory signals. the external signals are pointing the other way and you have the addition

mr. draghi gave europe advantage, like in tennis. advantage euro, weak euro. it is a trade issue. two day on the bunds. they have reversed. maybe they have direction again. the switch is on. look at a two-day 10 and the two-day 30. they didn't really break yesterday's range. this goes to the ongoing story that the u.s. fixed income market is doing something a little different. you need to pay attention. normally, it is flattening when you are expecting the fed. i bet against the fed for all of 2015. in mid 14, i hope i lose. i tell you what, i think i may lose. i central bankers in this country are a bit nervous around dead man's curve in the next 10 to 12 months and what that type of global economy will look like. you will see that in the recent steepening. carl and the gang, back to you. >> two weeks from today, a big run. crude oil is almost almost $1. >> good morning to you, carl. we are seeing some strength here in crude oil prices, just trading over $47 a barrel. session highs. crude, remember, shrugging off that stronger dollar. trading more in line with equities here and a

mr. mario draghi. he spoke at 2:00 p.m.oubtless was a short while ago and i think people thought he would be a bit more dovish than he was. the euro was up 5.5 of 1%. 1.11 range. finally, we have the charts up, let me show you folks like an because the day would not become -- folks like an -- folks like in which is a .3% today. pretty extraordinary but let's face it. take a look at the six months for this stock and it is down by more than 50%. monday and tuesday alone, killer days for the stock. it lost more than 35% of its value on those two days. it is back a little bit. ite some investors saying has been punished too much but there is an awful lot of negative news flow. the ceo of the company of the last eight years bought close to 600,000 people and he is teetering in front of some of the most important people in the supervisory board trying to hang onto his job. you have the french and germans both talking about how the crackdown on the company needs to continue. matt, over to you. interesting toe see how the market re

mr. draghi from the ecb speaking today. >> right. >> if he suggests they consider considering purchases asset go down on that? >> i don't think in europe it's enough to drive the economy or the market lower, but i think in the u.s., if we admitted that $4.5 trillion was not enough and we need more, that would have a very negative read through to europe, to japan meaning that qe basically does not work, central bankers can't control the stock market. that's what i worry about. we're at the point where nothing is going to get us out of this economic duldrums. >> are inflation fears relevant now? is it something we could slide into you think -- >> for the u.s.? >> anywhere. there's inflation fears around the world supposedly still, another inflection point we've turned, and i think with, you know, there's so much disagreement. people say it's not five, and it's a patient course. >> that's the fed's issue too. >> which is it? >> you can find any set of data tsh. >> is it 50/50? one will kill us, hyperinflation, deflation, it's -- >> bullard is not even worried about deflation. >> who is? aren't y

mr. mario draghi try to achieve with lowering the value of the currency, which is to create a depression in real income and a confession of world terms, and a contraction of trade in dollar terms, which is negative for economic growth around the world. matt: who is next, if you had to bet? marc: i think the chinese will let the currency go down somewhat, but the safest bet if you want to bet against the currency, in my income is too short the hong kong dollar because it will not be revalued against the u.s. dollar. that is out of the question. if the chinese currency, the yuan, continues to weaken, then there will be a lot of pressure in hong kong on asset prices, and then maybe the government chooses to caution through devaluinge peg and the hong kong dollar. so, you have upside potential without downside risk. rc, i know you are of quantitative easing, but u.s. stocks -- mr. bernanke it, and then janet yellen after that, got what they wanted. u.s. stocks, until recently, were on a six-year care. why is it we should not expect something similar out of japan, where stocks have done well

mr. draghi's press conference shortly, 282,000 initial claims.om a slightly revised 270,000. if we look at the trade balance for july, we were expecting the number in the camp of 42 and change. a bit smaller deficitism should say it is trade balance that happens to be a deficit. the number is minus 41.86. so a little larger than minus 41 billion. and historically, how does that figure out? well, our loews read, 37 billion in february, highest read in march at 50.5. not bad. in the lower third. lot of volatility in the dollar, effects by multinationals. more confusing to make this just a black and white issue only the value of the dollars, there's been so much readjustment, recalibration and of course, people still talking about challenger as we continue to get layoffs. we continue to get better numbers out of europe. but a lot of this may be old news, considering some of the equity shrinkage over the last several weeks, but we will look forward to hearing from mario draghi. looks as though the euro currency is very close to unchanged, more a ques

more qe mr bond buying coming from mario draghi and a downgrade in inflation. suddenly, this appetite is out there. let's have a look at what is happening in metal. the volatility has avid as the chinese market shots. but victory parade, but no such luck for oil. president obama getting its approval it seems for the iranian nuclear deal. .7%.own by pompeii and was in the dollar gained a little bit against the rest of the currency. one dollar buying you for swedish currency. the number coming out of sweden later today. no change is expected for the europe is a little bit lower. i want to focus on some of the giving aboutngenta $2 billion back to shareholders will stop barclays sales is portuguese assets. jonathan: fantastic work. we are up by 1.2%. also up this morning. early moves for the markets here is what is coming up. -- will be talking with the ecb decisions. one of our guests sits a 40% shot at china flexes and markets take a breather. the political story takes his and stage. don't miss our interview. that is in less than 30 minutes. the top story is the

more qe mr bond buying coming from mario draghi and a downgrade in inflation.

draghi is, were mark carney is. is everybody doing qe? willem: no, mr. carney is not doing qe.nd has been ,itting at 375 billion pounds no qe ceiling for a couple of years now. 50 basis points for a bank rate. the ecb is doing qe. the u.s. is of course not doing qe in the sense that it is no longer increasing the stock of its financial exercises balance sheet. but it is still -- tom: is any of this at the textbooks you used at the london school of economics to teach? the interest rates get stuck at some floor. we never thought of it as the zero floor, but, sure. we know what happens. tom: looking back at the chart -- here is the liquidity trap. there is no equivalent of this back to paul volcker. brendan: tom the sense that i gt from our audience is that the fed is making a choice to keep rates where they are. forced to make a choice based on the savings? -- logo its two objectives inflation and employment dictate for an increase now is not obvious. in the past, certainly, going the other way. by the weakness of aggregate demand value that potential out put. tom: let's come bac

tomorrow, draghi in frankfurt, and in japan that wonderful rapport on the credit rating markdown in tokyo. over to china, i want to make clear that mrio is adamant that china is not a basket case. he spoke highly of their continued economic growth, and centered more on the structural shift the chinese economy has to have. he thinks they will get through challenges, thinking challenges, and political challenges. but the big challenge with china is the idea of moving from the investment led economy over to saidso many of your guests has to occur. he was very optimistic all in all in china. angie: how does he feel though, about the state intervention, and the fact that hedge fund is a bad word in china right now? guest: that's a very important point. we did have to ask the controversy of risk. he associated with bridgewater -- risk parity associated with bridgewater. he is adamant that risk how ready cash. he is not a lot of the challenge of volatility. there are many hedge funds that are naive about the structural that we are in -- you bet we are in, and also naive about the buildup of leverage. he is taking a very cautious approach.