>> that was a rare statement from the pboc.had a meeting with the fx market participants and others to talk about valuations one way on the yuan are not condoned by the central bank. also, importantly, they were saying currency will be used to offset the impact of inflation, but it also won't be weakened to boost exports. so this is very much a two way currency market. and don't speculate strongly in either direction. there was weakened and the offshore yuan market after the statement came out, but then that weakening was paired. so it is not a very strong signal -- weakening was pared. so it is not a very strong signal, just a signal not to put your dance in the yuan direction. yvonne: it puts in quite -- haslinda: it puts in question where the yuan goes from here. we have the likes of citi saying to expect the likes of 6.2 by the end of the year. sofia: yeah, one analyst was calling for six, strongest and's 1992. increasing inflation pressures for the yuan. the chinese interest rate for the rest of the world is a yield of mor

we have not heard the pboc pole and a levers to slow the flow of capital -- the pboc pull any leverslow of capital. tom: for those on radio, it is real simple. the history of 2005, where china gives in and it is an ever stronger yuan for years, we revisit that 2014 strength with somewhat of a move down to the six level. jonathan: in addition, what is key here is the chinese authorities have been tolerating it. they have been tolerating the additional strength. do you expect that to continue? are we going to be laser focused on the fix all week, all month, for the rest of this year? enda: i think it will remain in focus, but the real turning point will come when the export story starts to lose steam. exports have been going gangbusters. therefore, they have been able to tolerate this strong exchange rate. when we reach the point where that manufacturing story starts to ease off, that is when you will see these exporters start to say, wait a minute, we are suffering from higher input prices and strong exchange rates that will put pressure on the people's central bank. but there seems t

this morning from the x pboc -- ex pboc official saying the yuan is overbought trade, the focus being manage currency rather than it being something that reflects fundamentals is the key. when you look at the chart he does have a point. the yuan is in afford territory. you have the relative strength index firmly below 30, so it does seem like a coordinated approach to say that you want -- yuan's strength is too strong, blaming it on the market, speculators and not suggesting a strong intervention from the pboc. haidi: if job earnings does not work could they make some of the stronger measures? >> we will be watching at 9:15 as usual, any strong buyers on the weak side could suggest the pboc is acting to slow gains in the currency. any gap greater than 100 would be a strong signal there, unfortunately the pboc has refrained from using it to guide the currency in any direction. it wants to be seen as essential and allowing for two way flows. what will be interesting to see is how far they can push this, and how much further the currency appreciation will the pboc step back from the mark

what else can the pboc do to put a stop to this if they are not happy with the gains. ?e gains? >> it did seem that there needed -- that there was a mood shift at the central bank. they are not explicitly signaling they are unhappy with the yuan's current levels, there is a -- is not a sense of urgency. nonetheless, there is a feeling it is one way appreciation that won't go on forever. that's part of why you had the flurry of medications and commentary -- of communications and commentary. saying things will change, it could be the fed moves toward tightening over the near term, it will have an impact on the yuan. could be capital flows moving out of emerging markets slow down the yuan. is not necessarily an immediate signal of a course correction but the authorities are letting it be known that the yuan will not go in one direction indefinitely. yousef: thank you for that. let's get you the first word news, a bit of a roundup of the other stories we are watching. laura: the latest round of talks with iran over revising the 2015 nuclear deal have kicked off in vienna. th

it's a big step for the pboc. it's to reserve reserve ratios for foreign exchange from june 15 from 5% to 7%. so a 2% increase. the idea is you withdraw some of that foreign currency, primarily dollars, out of the onshore market. that pressure is the yuan weaker. as you point out, the move follows the attempts over the weekend to talk down the currency. clearly officials are concerned versus the u.s. dollar, a five-year high against a basket of trading partners. sophie: there could be a delayed reaction when new york comes back online. tom: commerzbank saying it's largely symbolic, they think longer-term the trajectory for that you want is higher -- y for theuan is higher. particularly the u.s., that's proving support for the currency. you have the likes of scotia bank saying 6.2 for the currency going forward. standard chartered saying they think this could be one of a series of measures by the pboc. they think this may not be a one-off. so continue to watch for action on this, but again, the move building on the

bitcoin follows the downward trend after a fresh morning from the pboc.rance gets back to business with non-essential stores and entertainment venues opening for the first time in over six weeks. a leadership shakeup at gpm -- jpm puts two women in the key role and pole position eventually to succeed jamie dimon. we are also waiting for the fomc minutes. 6:00 a.m. at home in london. how important are these fomc minutes? they will not include the jobs shot, the depth charts from cpi. these minutes will reflect a 27 and 28 of april. as we go into this fomc, two- year inflation expectations are breaking relative to guild to a record high -- yield to a record high. good morning. annmarie: it's very true. are these minutes just going to be a snooze fest? because the disappointing payroll are already baked in. still too early to talk about tapering. they will be monitoring the data. it's the bank of america fund managers survey you and i have been talking about all morning. 69% of those investors see growth, they see inflation very, very bullish. it's a record

what the pboc is willing to do now.n the angst we have seen from china and beijing regarding the higher prices in commodities, i like the idea that this could be strategic in inflation. maybe it's all three wrapped into one. manus: it's a confluence. it is about the ability of china to pass through the price rise. if the path through the price rises. down the value chain. let's check in on the markets. asset management said they are not necessarily convinced of the concern that we have in these equity markets. we are lower this morning on covid concerns. they are holding asia back. stronger yuan. this is the highest in three years. volatility indicated every day higher on the offshore you on this week. you will expect a little more volatility there. the pboc will interfere in this currency market and extreme conditions. oil down by 4/10 of 1%. there's a little bit of anxiousness in the oil market. you put on 7% is as many sessions. there's concern about when the barrels come back. can opec-plus continue to taper on -- u

the pboc has raised -- to 7%. manner to the cease-and-desist order they have taking to jawboning the currency. crewed up 1.5%. i can tell you the opec report says demand will be 6 billion barrels. ringback accrued. crude is -- bring back the crude. ♪ (announcer) back pain hurts, and it's frustrating. you can spend thousands on drugs, doctors, devices, and mattresses, and still not get relief. now there's aerotrainer by golo, the ergonomically correct exercise breakthrough that cradles your body so you can stretch and strengthen your core, relieve back pain, and tone your entire body. since i've been using the aerotrainer, my back pain is gone. when you're stretching your lower back on there, there is no better feeling. (announcer) do pelvic tilts for perfect abs and to strengthen your back. do planks for maximum core and total body conditioning. (woman) aerotrainer makes me want to work out. look at me, it works 100%. (announcer) think it'll break on you? think again! even a jeep can't burst it. give the aerotrain

overnight, the most important news in the fx market came from the pboc. you can see the dollar is strengthening a bet against the yuan, but this is not just the pboc talking verbal intervention to talk down the strength area they are forcing banks to hold more foreign currencies and reserve, the first time we have seen since 2007. brent crude, $69.51, ever so close to that $70 a barrel line. but christyan malek, who we heard about an hour or so ago, was talking about the fact that we could see prices go towards $80 or even $100 for the end of the year, so demand is picking up as more countries reopen and vaccination campaigns get underway. we are going to kick off the markets with mike mccormick, td securities global head of fx strategy. inc. you so much for joining us, and what a perfect morning to have you on. given what we heard overnight from the pboc, it is not verbal intervention. it is real intervention. with this -- will this put a lid on the rally we have seen in the yuan? mark: i think the external forces are also starting to look a little bit o

>> pboc we are expecting to move in the first quarter. bok may go ahead of pboc.s far as the others, some of the central banks later on in 2022 may be prompted to hike rates. the fundamentals may not say so because of the pressure on the currency. bsp may be one of the first ones in the first half for the economies in the south because the currency comes under pressure. yvonne: we have seen china trying to absorb this inflation shock on global supply chains. they are clamping down on imports when it comes to corn, commodities like iron ore, copper, housing. do you think this approach is sustainable? at what point does china reach the breaking point? >> i think that's an important part. how much can some of the policies address the pressure as far as ppi is concerned? whether that is cutting the import tax or ending the refund for the vat of exports. if you look at what they are trying to do, there are several things weighing on the recovery of domestic demand. in terms of the strict fiscal posture by china, it has slowed down or limited the recovery. i think we ne

everyone was kind of on the alert for any signal from the pboc.ement from the central bank saying the currency wouldn't be used to reduce inflationary pressure. while analyst have been calling the ecb of weapon or a tool for that. saying the only way it is going right now is up. shery: the flexibility has long market-driven fundamentals. >> exactly. there are signs that beijing is relaxing its grips -- grip on the nation's currency. xi jinping's plan to liberalize the currency market, this is still china. the statement came out last night and the central bank met with major forex players. essentially telling the market, don't have a strong move in either direction. also saying the currency would not be in a depreciation narrative. it's really saying let's have a two-way flow. what are we seeing in terms of analyst calls? is it a more bullish sentiment? >> we had analyst calling for 6.2, which would be like the level before the devaluation in 2016. earlier this year, one analyst calling for 6. what will be interesting is to see whether it changes.

the pboc has been trying to slow down the fall for dollar, you want, but tickly around the 6.4 level. it's going to make them much more difficult if the euro keeps going, it's going to be very hard for china to stop that you want from gaining too far. they were not mind if european sentiment pushback against the euro strength, which is something we could see in the coming days. even the european central bank might not be too happy to see it getting this from. -- this strong. haslinda: we continue to track the euro. you can follow more on the story and all of the day's trading at our markets live log, that is on the bloomberg market go, analysis from expert editors so you can find out what is affecting your investments right now. the biden administration to delay by two weeks a ban on u.s. investments in certain chinese companies, according to sources, officials drop guidelines to clarify a trump era policy but it confused wall street. let's bring in our next guest from beijing. why the delay? tom: it confused wall street and they don't want to see a repeat of that. they give themselve

the pboc is being tricky. i think the second thing is really the reaction to the virus.to the virus across asia has been anything from incompetent to sluggish to autocratic to complacent. you can take your favorite country and put them into one of those categories. so we get a better hold on vaccinations and are scheduled to reopen economies, i thing i read they will take a test it will take 1.7 years to reopen. kathleen: i would like to jump in. it is ironic to me -- the u.s. was criticized for its response to the virus and yet it is leading the world with vaccines, producing them, vaccines are rolling out like crazy. and another irony is although stimulus checks have helped fuel china's recovery, ages recovery. if you look at the latest trade deficit, half of that big deficit is with china now. that is what those $1400 checks have done. buy a lot of stuff from overseas. when you look at asia, how important is it that more u.s. fiscal stimulus comes to help asia keep afloat? especially countries hit hard by the virus. it move ahead once they finally can get this whole v

the pboc is not as transparent.e have seen credit reduced a little bit, the credit growth impulses have slowed somewhat. we know china takes a bit of a step back, especially in terms of shadow banking, but liquidity has remained quite abundant. we will probably see two speeds. we have the u.s. continuing to expand both on the monetary and fiscal side, and something of the opposite in china. the dichotomy is probably going to raise questions for investors over time as well, especially if we continue to get the reiteration from the fed they will not change the past compared to what they have told us. annmarie: i want to go a little off script for a moment. elon musk was debating with a twitter user about potentially whether or not, signaling at least, whether tesla will divest and sell off some bitcoin. this morning you had bitcoin 43 k on the handle. do you think bitcoin is still a place that institutional investors want to be part of? esty: so, there are so many questions surrounding bitcoin and there are plenty of

and now will put pressure on the pboc to allow us to go below 640.ately the more important signal is what happened to the onshore yuan, the dollar cny. there are three levels to watch. offshore is the first leader, that will set the direction for dollar cny. if it validates with the offshore is doing, that provides permission for the bloomberg dollar index to break down. that's where we are watching this. we had the first signals go, we have not had the other validation, but the dollar can break down. anna: down .1 .6 percent on treasury yield. mark: it's definitely helping, at the moment we are seeing a little bit of inflation and threats come out of it. we have seen the pressure come off the rates move. a little bit of that from the u.s. has not come off much recently. the subsiding rates move is supporting a little bit of dollar weakness in the margin, but it's not breaking just yet. anna: something to watch. we will keep an eye on what's going on with the currency market. there weakness in the dollar. thank you for spending the past hour with us.

has the pboc many -- has the pboc made any statements about this? simon: quite a lot in terms of trying to control the strength of the rally. they have -- they have said we should not be buying you on. it -- yuan. it should not be used as an inflation to appear a lot of talk from the pboc but the actions so far have not been significant enough. in yuan terms, we do not expect a significant follow-up. to help push dollar-renminbi upwards. a lot of talk but not much action so far. dani: simon, we also had the pmi figure come out as well. the idea seemed to be that it shows that manufacturing has peaked. can we use it as a blueprint for other economies considering china was one of the first to open up and see that growth? simon: to some extent that is true and global manufacturing has significantly outpaced services and retail. china was the first to exit. manufacturing in china is probably operating at its capacity. not true yet in most of the western world. matt: simon, we have to stop you there. our emerging market strategist. this is bloomberg. ♪♪

bitcoin follows a downward trend after a fresh morning from the pboc. france gets back to business with non-essential stores and entertainment venues opening for the first time in over six weeks. and a leadership shakeup at jp morgan put two women in a key role and position to eventually succeed jamie dimon. welcome to the european markets open. welcome to wednesday's program. let's get to the markets in singapore. tell us what the markets are saying, mark. mark: good morning. it has been a crazy day. it has been quiet in fx and rates, but it has been carnage in the crypto sector. it has been poor across the commodity sector, and there is generally risk aversion with equities on the back foot. we have a couple holidays in the region, but it is a risk-averse mood coming into the european session. anna: and we will talk about why that is. let's get to the breaking news this morning. we've got inflation numbers coming through this morning. also got numbers coming from the auto sector in europe. european car sales surging 266 percent from april from a pande

we are seeing with the pboc conducting a little bit of window guidance telling the commercial banks that you should be more differentiated and terms of the pricing strategy on loans when it comes down to which sectors should actually get it cheaper while others just get it. but we have not seen a very tight grip on overall credit expansion tastes, and we think that is probably not going to come until second half, after july 1, after the celebration of the 100th year celebration very -- anniversary, we will probably see a higher chance of the next central policy meeting which is expected to be held at the end of july to gradually kill this policy position. and by then, we will probably see more notable or official lysed -- officiallized kind of sense especially when it comes down to guidance to slow down some lending. haslinda: what is the outlook for the you -- yo -- yuan? helen: the pressure on china is that indeed, the china is seeing the terms of trade deterioration and paying more on imports, and in theory, this would reduce the current account surplus, and therefore, china would pro

is there a sense that perhaps the pboc is concerned about you on strength -- yuan strength? >> you have seen a significant -- returning. it's a bit more stable. i don't think i sense too much of a concern at this stage but as you start seeing pressure with the u.s. demand, i think you could see them pressurized again to make sure the exports stay very attractive. whether this has enough demand, i don't see that as a huge concern. yvonne: thank you for joining us from state street global advisors. first word news with vonnie quinn in new york. hey. vonnie: thanks. the european union agreed to new sanctions on belarus after the fourth version of orion or passenger jet and the arrest of a journalist on board. these include banning airlines from airspace and airports. further sanctions targeting lukashenko and his associates are also being imposed. russia is backing its allies following belarus's explanation of it actions. >> this outrageous behavior needs a strong answer. therefore, the european council decided that there will be an additional sanctions on individuals that are

it was whipsawed wednesday after a series of volatility events like tweets and the pboc statement asbitcoin, because we saw crypto stocks moving around after the fighting tax plan indicated they are going to target cryptocurrencies. gold hanging at a four-month i, declining dollar, declining bond yields helping their little bit. iron ore under pressure is the pboc continues to single -- signal they are going to crack down commodity prices. lumbar futures in the u.s. jump up the maximum $63, given demand in the housing sector. home depot also rising in after hours session after they announced a $20 billion share buyback, this on the back of strong earnings earlier in the week. haidi: we are looking at the vegan food and drink maker oatly jumping 80% -- jumping 18% in its u.s. ipo debut. we talked about the ipo timing and global ambitions. >> we think the timing is absolutely right. we need to expand production capacities across three continents. we are building across three continents successfully, multiple channels, from niche to mass, and generating demand we haven't been able to su

up two percentage points in march the first time the pboc has made such a move in a decade.tudy has found that the sinovac's vaccine can effectively control covid-19 where 75% of adults in a small brazilian town were covered with a second shot. the study may offer clues into how much of the public needs to be vaccinated in order to move past the pandemic. deaths, hospitalizations and cases dropped sharply after a second shot of sinovac's was given. -- of sinovax was given. details are still in the early stages but newly appointed finance ministers is leading the initiative in bloomberg understands it could be monetary, fiscal or both. pakistan's economy is expected to expand this year after a rare contraction. >> as developed in the common -- economies in the west open back up, singapore spry mr. pledge the country would not be left behind -- singapore's prime minister pledged the country would not be left behind. let's get more context. we are joined by haslinda amin. our chief north asia correspondent stephen engle out of hong kong. has, we have heard more about singapore'

annmarie: what does this mean for the pboc? >> pboc has a difficult counseling act at the moment in china. when it really wants to do is keep on tightening policy ever so gently and slowly. particularly if it feels inflationary concerns building. that is the sensible thing to do at the moment. it wants to control natural risks, as well. it really does not want a stock route on their hand and it does not want the market to start to turn into that kind of negative feedback cycle we have seen so often in the past. policymakers are still trying to be very consistent in their messaging, talking about no sharp turns, but at the same time they were going to be doing everything they could to avoid loosening policy at this stage in the cycle. annmarie: paul dobson, thank you so much for joining us. we want to get more insight with our guest hosts this morning. tim, the ppi search in china -- we have expectations for an absolute surgeon u.s. cpi, how are you walking through all these inflation figures in the angst is causing in the marke

the latest news is china central bank pboc was firm, cryptocurrencies in particular are not officialms of payment. when you have such a big player in world financial markets like the pboc come in and stamp down, clamp down on cryptocurrency, it impacts sentiment. the other big thing over the last 48 hours is elon musk's tweets. a number of strategists and wall street analysts saying as long as elon musk keeps impacting the market with tweets in one direction or another, even though he has thrown his own weight behind bitcoin and dogecoin, it is going to keep those a legacy institutional investors on the sidelines. for as long as those big banks, big asset managers are not involved in cryptocurrencies, we will continue to see the volatility. that is what it boils down to. it is how vulnerable swings are to what we see on the news. but also, it is volatility keeping big players a bit too cautious. emily: and if one thing is for sure, it is that the swings will continue. coinedbase president and coo -- coinface -- coinvbase -- coinbase president and coo emily emily choi said buckle up,

offshore youan trading just around the 637 handle ahead of the pboc's pressure on the pandemic.he yuan hit 23 high against a basket of currencies. a bullish forecast on the renminbi from analysts for the onshore rate. it could go over 800 but he does see consolidation given that we are seeing oversold territory on the ris part that dollar-china currency. over at socgen, the u.s. bound taper tantrum is done. we are seeing yields picking up faster which could lead to a divergence in rates that will have may be the euro and the yen looking cheap. this morning trading at a seven-week low. hayley: president biden insect to unveil a budget. it will also run an annual deficit of 1.3 trillion over the next decade. the plan would offer a first look at the administration's effort to boost the size and scope of government. this is a pretty comprehensive accounting of everything that we have heard so far. it also a thing for the first time offers projections on how it could impact growth, inflation and the implement forecast. >> exactly. we have heard the white house and the president layou

the damage compared to bitcoin, following a lot of volatility, whether because of elon musk or the pbocing that digital tokens cannot be used as a form of payment. >> let's turn to the latest on the vaccinations. the rate in hong kong is lagging singapore in new york. that is despite relatively few cases and a wide vaccination rollout. it could change the competitiveness and changes future. we have this report. >> fewer than 15% of people have had the covid shots in hong kong. that has the business community worried. >> other areas including singapore are moving ahead. >> hong kong can fall behind if it does not do that as well. >> the measures are among the strictest in the world, which one person sees as a major issue for those who have gone months or years without singlet the ones. >> it becomes a factor in mood and makes people wonder if they're going to be stuck here, and whether it is worth it. >> a relocation agency is reporting fewer international arrivals. >> we are 60% down on the number of inbounds, and that is very dramatic. >> prompting calls for guidance from government. >

meanwhile, the boj topped out in december, pboc topped out in january.ets have been the real outperforms this year. u.s. markets are doing pretty well. we have seen the chinese stock market do quite poorly this year. we have seen the boj suffer the last couple of months as well. i think there is some connection. anna: that's interesting, to think about the output of this. is there a connection with stocks? what's interesting is to think about what is driving the decision-making at these central banks and why their balance sheets are growing. i don't understand why the bank of japan's balance sheet would be shrinking if that is still the intention. we have seen inflation overnight in japan dropping for the 9th straight month in the month of april. we are not seeing inflation surging there as in the you can the united states. mark: clearly, japan is not getting inflation, why are they stopping? the bank of japan has been doing extraordinary monetary policy for the longest time. when you put these balance sheets in comparison to gdp, the boj is still by far

the pboc just like the fed and others is going to say, let's see what happens. going to go up and come back down to trend. for now, investors will not take any scary signals from this. shery: let's see if they use the word transitory. our bloomberg's economics and policy editor. some upcoming eco-data out of china. jp morgan's grace. the chairman of the commerce in china joins us later. glad to return to the booming commodities, which is fueling concerns about inflations. iron ore is surging more than 10%. su keenan joins us with the latest. we have seen bloomberg commodity prices reaching multi-year highs as this chart shows. what are traders saying about a potential tightening of environmental rules in china that could affect this? su: that tightening of the rules has added to the bowl cage for copper. copper is seen as vital to the energy transition taking place around the globe. the change in these restrictions is seen as fueling speculation on iron ore. some buying or frontloading they are buying to get in front of any change in the rules. if we go into the

we believe the pboc will try to keep liquidity supportive.ever, the rest of the market is waiting for a pickup and local government bond supplies. you may see relatively high bond sales in the months ahead. combining the central bank's stance and this supply outlook, we think the china government may be biased to steepening. if you try to come i -- try to compare that china bond, it is more appealing than its peers. shery: great to have you on. coming up, we had to south korea, global funds are piling back into shortselling. tech and health care companies are in the firing line. this is bloomberg. ♪ is is bloomberg. ♪ shery: this is -- vonnie: this is daybreak: asia. microsoft reported bill gates need to step down from his position in 2020 over allegations with a -- allegations of a relationship with a female employee. the board hired a law from to investigate the affairs. gates is reported to have resigned before the and gritty -- before the inquiry started. singapore tightened lockdown measures to stop a surgeon -- a surge in cases. childre

what else is the pboc saying? >> that there isn't actually ability to use bitcoin or any other no currencies in chinese products, payment institutions, they can't be priced in cryptocurrencies, so you cannot use them as payment. this is not unusual. we know that beijing since 2017 has clamped down on those offerings, saying virtual currency trading's within its borders is limited. a lot of the mining and capacity within the borders has gone abroad, so not all that surprising coming out of beijing , but enough to sink bitcoin. >> it comes under bearish circumstances for bitcoin, falling to the lowest since february. we are seeing a reversal of the legitimization of it? >> absolutely. you nailed it. you are starting to see bitcoin making steps towards getting mainstream. you saw it in tesla and several other financial payment companies saying not only do we accept it, but we will put it on our balance sheet. the latest tumble after elon musk said they could have sold their holdings in bitcoin or plan to hold their h

haslinda: before we let you go, very quickly, the yuan has been strengthening, prompting pboc officials to --. your take on where the yuan is headed? rajeev: one or two people mentioning concern about the trend, it like we saw last week, they are initial signs. but now we got another warning as well. as a currency investor, i am taking it much more seriously that the chinese leadership know about the strength of the yuan. strengthened not against the dollar but also against other partners as well. so i think one has to be respectful of what they are saying right now. probably going to be good levels to buy the yuan later on, probably just not now or the next month or so. rishaad: rajeev de mello from deep learning investments, thank you. let's look at what is going on with the virus in china. vonnie: good morning. while joe has ordered residents in one of its neighborhoods to stay home to contain the coronavirus outbreak. infections stem from the very first detected in india, five confirmed cases and 21 asymptomatic infections since may 21. the government says only selected household me

>> if prices keep increasing, the pboc will have no choice but to start tightening.s in china have -- the impact on the economy will be muted and that price increase remains generally under control. economists have told us they expect policymakers to slow the pace of credit expansion rather than raise interest rates because they want to avoid too much pressure on that, seeing significant increase during the pandemic. officials in china have pledged to keep an eye on the raw material prices in order to limit cost to companies. >> thank you. our shanghai bureau chief joining us with the latest on inflation numbers. let's bring in the global investment strategist for -- investments. the chinese inflation story playing into what we have been seeing globally. how are you viewing these numbers, which are going to be scary for the next couple months? >> that's exactly right. we will know about base effects. we were expecting inflation figures to basically rise through the second quarter, now is an addition to that, where there is a fair amount of uncertainty is the impact o

we heard from the pboc that they are worried about rising import prices, as well. it would point fingers at the commodity space. it is understandable that there is high demand for commodities. what the chinese authorities don't like is the idea that people are just speculating, just trying to push community prices higher just to try to make some money. particularly in the futures market. this is not the first time they have pushed back. although iron ore prices are lower, 6% lower in china this morning, they have been following the last couple of weeks, which was when china started to hint that they were not keen on the leverage that was going on in the market. this is not the first time they have done this. the past few years, whenever there has been a steep increase in speculation onshore in china, authorities usually come in and remind people that leverage is not a great thing to have an they are concerned about it. so they will probably keep the pressure up until they are satisfied that the futures prices have come back to more realistic levels. that could stil

looking to the pboc later today. pulling up a chart, tuesday's was the weakest in two weeks time.not appreciation for the yen will be on the card. switching out the chart on the terminal as the yen climbed, we have seen e.m. currencies rise in tandem here. with that, you have the likes of credit saying you could see depreciation pressures continue for asian currencies if the renminbi continues. you have jeffrey's saying it bodes well for the csi 300. haidi: the entire world has been battling the same virus for over a year but the quality of life and control of the pathogen spread took vastly different terms -- terms depending on where you live. this is what the ranking looks at. there has been a shakeup. last month's number one singapore, falling among other asian countries. tell us about the most notable changes in the rankings. >> this month's story is really about reversal of fortune. where we are seeing asian economies lauded for the containment of the virus were almost a year, now they are falling significantly in the rankings. singapore fro from number one, taiwan and japan

the pboc will likely mitigate the rally on china's exports. do not see the renminbi moving far from that 640 level. dollar depreciation will moderate. the u.s. is seeing the tightening shift globally. haidi: let's get back to one of our top stories. the u.s. trade representative expecting to hold discussions with her chinese counterpart in the coming hours. china is stressing the importance of tariff rollbacks. our white house reporter in washington, and our markets coanchor, tom mackenzie. what do we know about these talks said to be taking place soon? >> we don't know a ton yet. the ambassador will speak with beijing as early as this evening. the timing is fluid. we are not sure who won the chinese side she will be talking to. a key counterpart during the trump administration's trade talks. a lot of similar conversations. we will be looking to see if he is the person she ends up talking to. in the earlier call, as a prerequisite, they wanted to see tariff rollbacks the u.s. side expects china to live up to massive agricultural purchases they

we have elon musk tweets and pboc statement.ild ride is continuing. >> of course, a major voice in the argument. cathie wood back in april, she predicted bitcoin would go to $500,000. earlier, she spoke with bloomberg again about whether he could get to that level and what is driving the wild ride. >> i think what is happening right now is because the stock market, the volatile part of the stock market, the innovation part has come to such a correction. the correlations among volatile assets are going to one right now and that's including bitcoin. >> in april you told dow jones that could go to $5,000. you still hold that target? >> we do. our crypto analyst, we go through soul-searching times like this and scrape the models and our conviction is as high. the one thing that has changed here however is the environmental concerns around bitcoin in particular have caused people like elon musk pull away and say let me make sure i understand this. we believe that even this is going to change because first of all, right now the percen

the pboc took to we chat to say, this won't be used when you want to buy consumer goods.nstitutional players who haven't already gotten in that are concerned about its volatile profile or how it is treated by governments, this episode is not going to make them feel any better. socgen had a note out saying, if you try to comparable to bitcoin, you can't do it. the volatility gap is too big. bitcoin doesn't have a place in a traditional portfolio as a piece of protection. for the bitcoin bulls like jim bianco, this is proof that this decentralized system of currencies works. i do centralized exchange has held up during these times of bitcoin volatility. it's a win for the new form of finance. annmarie: interesting. dani burger be all across this today. it's her birthday. happy birthday. dani: thank. annmarie: she will be tracking bitcoin on her birthday. lucky girl. that does it for us. ahead is the european market open. u.s. and european equity futures are looking brighter this morning. we are in the green. the market is looking into the narrative of economic recovery, les

and we are looking up the difference between the estimated vix and the actual fix coming out of the pbocwhen you look at the difference, it is back on the stronger side of estimates. in recent days, it has been on the weaker side. it did open up a little bit more room. i guess this is more important. a six-year low. it is probably the most important indicator right now. negative real yields. that is leading a lot of traders to sell the u.s. dollar. and here you go, a difference between the estimates and where you are on the actual fix up-to-date. back to you. >> let's talk about taiwan. it has extended virus related restrictions until the middle of june as it continues to fight the latest outbreak. the stock market has rebounded more than 8% since the brutal selloff sparked by a sudden surge in coronavirus cases. is the worst over? let's bring in our guest, ally chen. she joins us from taipei. we have seen it when it comes to taiwanese stocks, but it has been quite while. we are still set for a monthly loss. do you think markets are likely to stay volatile, or have we reached a point whe

they are also a leader in the experiment of digital currencies from the central banks, from the pbocve right? it seems the biden administration is concerned about the digital u.n. how far forward are they? how advanced is china when it comes to digital spending and digital economy? andy: they want digital all right. they absolutely want digital currency but they want no part of the peer to peer currency of crypto. what they mean is central bank issued currency. that is the control they want. they want full visibility over financial flows. one of the problems they have with cryptocurrency is it allows individuals in china to evade very strict capital control. they want top-down, central bank issued currency to -- for purposes of financial surveillance and to give them better tools to micromanage the economy. matt: i read somewhere if you are taking a cab somewhere in beijing or shanghai, you have to pay digitally. you can only pay with cash if you get in a pirate cap apparently. andy: nobody cares cash. matt: it is that far advanced, exactly. thank you for joining us. we appreciate yo

the pboc added to the negative sentiment by reiterating digital tokens cannot be used for payment.ning us is bloomberg's crypto czar. one thing that struck me yesterday was the fact that she saw capitulation flashing on her screen. was this a buying opportunity? do you expect the price to rise? >> it could be. bitcoin went down almost 30,000, now it is back up around $40,000. it does look like capitulation but a lot of people were taken off by that. you can say it was cost, but there was a significant number of retail investors who took it on the chin. there were all sorts of twitter posts and everything going around saying keep buying on the dip. what do you use to buy the next time? definitely for people who had just a small portion or might have been saying i don't want to buy at $55,000, this could be an entry point for somebody longer-term looking to get in. manus: we do have to have a health warning which is obviously, kathy wood, elon musk, etc. all have a vested interest in remaining fully committed to the big story on this. how much credibility does kathy would have she sa

it's likely to be folded into aholding company with oversight by the pboc.going to have to curve its expansion. and it's going to be regulated by a bank not a think tank. lots of questions going forward on ant. >> what are we going to expect when it comes to alibaba's fourth quarter results, though? >> good numbers because it's coming from a base effect. re, the first calendar quarter of last year which is the fourth fiscal quarter was a disaster in china. everything shutdown. the pandemic, china was the first major nation to get hit with this pandemic. and alibaba suffered like everybody else. this is a comparison quarter. sales are expected to be about 58% year over year gain in sales. however, because of that i in part because of that 2.8 billion fine that they're going take on the chin in this quarter, net income growth is likely the tail that blistering sales growth outlook. but generally speaking alibaba is still the big leader in china. they've been knocked down a peg. and now analysts are starting to come out and say maybe it's time to look at alibab

whereas in china specifically, the pboc disallow any companies from owning bitcoin assets. so you have some chinese companies listed on foreign exchanges. they may try to test and buy some cryptocurrency, but the vast majority of the real companies doing business in china, they don't want to offend the regulators, they don't touch bitcoin. and it comes back down to, why is that? china is a capital controlled society. we all know it, we just don't think about it. it is under cap a controls. bitcoin itself is a free currency. so it is fundamentally incompatible for a capital controlled society. in other words, china has its hands tied behind its back. it cannot allow for free market trading of bitcoin because its own capital currency control. haslinda: --. yvonne: it begs the question that, analysts are saying winter is coming, we could see volatility for days to come. what is your take? what is the fair value for bitcoin? bobby: winter will come after the bull market runs over. however, in my opinion, this is not nearly the end of the bull market for 2021. i think this year,

the pboc posted the announcement on its official wechat account as they warned about a recent reboundency speculation. it says financial payment institutions cannot price products or services with digital money, nor can they conduct insurance business with them. overall covid-19 cases in the u.s. are going down, but when it comes to a rare sometimes deadly inflammation in kids, the story may be less clear-cut. the cdc says about 3700 cases in children have been diagnosed since early in the pandemic, and the real number may be higher. as large parts of india continue to struggle against a rise in covid cases, the financial center of mumbai has reported fewer casualties and has been able to quell its outbreak more quickly. it reported under 2800 deaths since march 1. that is about one quarter of the more than 10,000 deaths in new delhi. they say the city health system was better prepared. russia's representative has do not reports he expects an imminent breakthrough in ongoing negotiations to restore the iranian nuclear deal. he said on twitter while significant progress has been made,

indiscernible] lisa: does it seem like the ecb and other central banks around the world, including frankly the pboc, have raised concerns about froth in u.s. markets? the federal reserve has been sanguine to -- sanguine about that froth. could you tell us what you make about this dynamic? gilles: echoes back to my old days in public service, i used to work or the bank. i was there at the time of the big story. this was 2004-2005, everything was about the u.s. running the economy red hot, green stand not wanting to [indiscernible] everyone else in the world and the ecb was saying you are playing with fire here and you should try to stop this si closed bubble before it is too late. we got it wrong in the sense, that the shock was not asset prices, not financial asset prices, it was housing. but foreign central banks, you are always playing with fire. my guess is that, again, we need to pay attention to the fact there is this disconnect between the u.s. economy doing really well, ahead of most other economies, and when you are in this situation, you will always have the same dialogue. the fed is going

we heard about that from pboc, and now hearing increasingly about it from the federal reserve.th me for bringing this up, but i am wondering how much you care about this. how much you care that the fed is going to release this document later this summer about the digital dollar and its potential disruption to the financial system. shahab: i think it is important because any technological change that could affect the way business is done needs to be taken seriously. certainly the cryptocurrency space is a hot space, not just for speculators, but there are people who feel that there will he will be longer-term applications for the financial sector coming after that space. so this is a reaction to competitive pressure, you could argue, from the private sector of the global currency space. to that extent, the fact that there is a response from central banks that is positive now, they could even find ways of adapting their policies around digital currency. maybe there could be better ways of meeting some of the targets down the line if they embrace the technological change. so i cer

in the current -- enda curran on the pboc, and maria tadeo, i was almost in tears. peter tchir of academy securities, why aren't yields moving given are fiscal numbers? peter: the fed continues to buy debt, so that is offsetting it. companies are net sellers of equity to buy debt. i think no one really believes that we are either going to get the fiscal stimulus that will extend because that bipartisan feeling is gone, and quite frankly, no one seems to believe that inflation is going to be anything but transitory. right now, the market hasn't seen inflation and so long that they are downplaying the potential. jonathan: i don't think the number one question has changed that much. how self-limiting what a treasury market selloff? peter: i think it would be very limiting. when people want to talk about taper tantrum's, you see much different positioning. all you have to do is look at some of the etf's. tlt come along dated treasuries. they have all had significant outflows, so the market is much more prepared for a tapering type event. if the fed needed to, they have

the latest catalyst is the pboc says the exchange rate cannot be used to offset commodity inflation,piece of the puzzle to try to tamp down the commodity rally that we have seen. this is a chart that shows it. you saw maximum drawdown for the singapore contract as we saw that correction territory, so tons of selling. does china really have the power this go around to put the top in when it comes to commodity prices? guy: is going to be different this time around, isn't it? we are going to hear a lot more about this over the next few days. president biden's infrastructure plan is going to be a huge demand for electrification. you are seeing a similar thing here in europe. copper obviously core to all of this. it is interesting what china is doing with its currency right now. cameron crise was pointing this out a little bit earlier on. there may be an attempt here to front run u.s. tapering and get the currency a little bit stronger because last time we had that paper, the chinese currency asked that -- that taper, the chinese currency weakened significantly behind it. but their abilit

the pboc, though, reiterating a comment it has made previously.here was nothing necessarily new there. joe, if there is one reason he could pinpoint for today's selloff, is there one or just a lot of things? joe: i think a lot of people should always be skeptical when it comes to crypto of telling too need of a story. first of all, this is crypto, so we have times like this all the time. these drawdowns ar really large, and this was a large one by crypto standards, but it was largely an unprecedented one or even one that will stand out that much in history. you see that chart? it has been kind of week. i think it lost momentum. it was even lower than it was in february, it has been going sideways in recent months. you saw the rise of alt coins. people in this space, a lot of them are at dwrena allen and volatility junkies. people looking for their fix elsewhere in the further reaches of the crypto spectrum. so you saw so much hype the last few days. i was transfixed by portnoy saying that he was going to get into alt coins. he said if it is a ponz

there's been no sign of the pboc fighting the move.he bloomberg dollar index will break down but it hasn't yet. euro and sterling have been struggling to make progress. it's a matter of time. the other thing to draw attention to is, you can see that the commodities are doing well our iron ore and aluminum. this ties in with that you want strength. that gives china more purchasing power. that's good for commodities. we know that china has been focused on metal prices recently. anna: it's interesting, taking about iron ore. you say there's an fx impact we need to take into account. perhaps this will start to put commodities back on the agenda for chinese authorities. we've heard a lot of commentary from china about how they don't want to see speculation or things passed on to consumers. the bloomberg commodities bought index has been playing attention to those lines coming through from china. 2.4% in the past few weeks. i think we need to take into context that we came along way and we've spent the last couple of weeks pulling back. i su

i have been drawn to comments by the pboc and others in china talking about being concerned about commoditys generally , but specifically oil. there was a lot of news flow on iran yesterday. a geopolitical front as well as the more usual demand story. 6692 is where we sit on brent. where do you see that heading? mark: what is most a -- most amazing as oil was not talked about more yesterday. this is one of the world's most important assets. there is more delivered in physical oil markets than all crypto markets put together. no matter how ambitious you are on the environmental side, it fuels every way of life all around the world at the moment. normally any eruptions have an impact. we have seen large dips when we have heard positive potential news on an iran deal. this shows an iran deal is not priced. iran are paving the way away from the negotiations, getting there set up ready to create supply if they are given the green light. we are right at the top of this two-year range in brent crude up $70 a barrel. we have not closed above $70 since nearly two years ago. everyone in the oil marke