obviously, the rba has already brought down rates to 1%.ve had those two cuts and a lot of the market expecting another 50 basis points' worth of cuts. in that context, you would expect this bond rally to push on quite significantly. indeed, as you can see on that chart, that upward trend remains pretty well intact, so you could get record highs for australian bond futures if yields continue to be pressured by further pressure in the economy. it is typically quite a volatile number on a month-to-month basis, so we are about 43,000. volatility in that number. but what it does is help inform the longer-term trend of how the labor market is playing out and how the rba are continuing to assess what is more of a lack of inflation story really than material weakness in the jobs market. shery: thank you very much for that. you can find adam's charts on the g tv library on the bloomberg. let's look closer at big bank earnings with bank of america reporting records for the fifth quarter in a row. joining us now is our finance reporter. talk bri

above the cashow rate of the rba 1%.kong dollar has been surging on the back of the hong kong monetary authority trying to propel that dollar, support oft dollar in the wake protests. we have seen moves come through in terms of futures curves. the2 of 1% moving past midpoint range against the u.s. dollar for the first time since september. nejra: thank you. the u.s. has added more products from the eu to a list of goods that could be hit with tariffs as part of a long-running subsidy dispute between boeing and airbus. around $4 billion worth of goods could be hit. u.s. stock futures fell off at the announcement. with us for the rest of the show, our guest. great to have you with us. so as we move on from the fact we have a trade truce and we saw this rally in global equities yesterday, the concern turns back to what we have she's in the manufacturing gauges. what does that mean to help you would construct your portfolio right now around equities? paul: one has been the direction of markets over the last several years whi

the rba holding study today. she joins us on 11:00. is on daybreak australia but get a check of the markets trading he vstoxx up 4/10 of 1% but we are seeing futures also gaining 3/10 of 1%. the key news this hour has been the u.s. proposing adding more tariffs to $4 billion of eu goods. take a look at what the euro is doing against some other crosses likely euro-dollar at the moment unchanged after it took a little bit of a hit on that news. the u.s. adding eu daily products and metals to propose tariffs. we will have much more in the next hour. this is bloomberg. ♪ hey! i'm bill slowsky jr., i live on my own now! i've got xfinity, because i like to live life in the fast lane. unlike my parents. you rambling about xfinity again? you're so cute when you get excited... anyways... i've got their app right here, i can troubleshoot. i can schedule a time for them to call me back, it's great! you have our number programmed in? ya i don't even know your phone anymore... excuse me?! what? i don't know your phone number. aw well. he doesn't kn

for the governor at the rba, more data to consider today.rade and building approval which will offer the australian economy after the central banks cuts. paul? paul: thank you very much. let's check in on the first word news. subsidiesg-running dispute between airbus and boeing have dragged more eu products to a risk of potential tariff targets. washington has identified $4 billion of eu goods ranging from fruit and cheese to tubes and pipes. $21 billion of product that the u.s. published. the eu has a similar case pending against boeing and has tariffs of its own. imf boss christine lagarde is set to become the first woman to leave the european central bank after being nominated to succeed mario draghi. she is such a takeover in november. eu leaders have nominated the german defense minister to become the european commission's next president. she will be the first german to hold the post in more than 50 years and will have more reaction to christine lagarde's new role in a moment. oil had its worse reaction to an opec meeting in four years

the first rba governor, he led the last darwin meeting and retired.ours east of darwin. he negotiated on the note. they really took him into their hearts in that community. that is what they plan to do tomorrow. this is quite a significant australian figure. >> thank you. manufacturing took another debt at the end of the second quarter. trade tensions continue to simmer across asia and europe. the u.s. showed only meager growth. let's get the details from our southeast asia economic reporter. we have south korea, malaysia, taiwan. what is the key data that we need to watch, looking ahead? tomorrow, we do get cigna part. the neighborhood is falling apart. it will be interesting to see what singapore turns up. consensus ofg at a this going deeper into the contraction territory. the heels of the monetary authority showing their annual report in singapore. singapore has remained pretty resilient so far. this kind of looks a little bit weaker now. >> the markets are saying one thing and the economists are saying something else. yesterday, sixmi months of c

the rba in australia cutting twice in the last month or so. more dovish signals coming from the eurozone with the nomination of christine lagarde, but the key question then is -- what are central banks trying to achieve? if you are trying to spare demand, isn't it problematic when you have other issues such estimate graphics and other fundamental hurdles that you need to get over? >> i think that's right. there are a lot of different things going on. i think every central bank is facing something different and the most important thing as we talk about u.s. jobs and the u.s. economy, the u.s. economy is still in really good shape right now. rate,rcent unemployment 3.1% year on year wage. the fed does not really have a justification to do too much for cutting right now because the data is really good, and core cpi is still at 2%. coreemployment, 2% inflation, that is the fed's mandate right there. this is not something falling from the sky as catastrophic -- that is not where we are at with the fed right now, but the situation in the eurozone is

commentary from the rba regarding monetary policy.ar lower off .2 of 1% on the week of that fight. a 1% fall. let's check in on the first word news. >> president trump says congress has reached a deal in suspending the debt limit on raising government spending. we are told the agreement would offset 75 billion dollars of higher expenditure that would give the administration and the republicans about half the savings they are seeking. the news will likely push the budget deficit over $1 trillion next year. supports from beijing suggest face-to-face trade talks may resume in the coming days after what state media describes as goodwill gestures from china. shan juan says mainland u.s.nies have contacted exports about cultural products and have applied for exemptions from china's retaliatory tariffs. the south china morning post says the u.s. trade team will fly to china next week. the man who led the international atomic energy agency for 10 years was key to the iran nuclear deal has died unexpectedly. a veteran of diplomacy and had let

that we expect 5.2% unemployment numbers and the risk for the rba is that we have a surprise upside up to 5.4. the plans scuff because then the pressure will come and they muni -- may need to cut rates earlier. they are hoping for a small increase in jobs. that would suit the nicely, but if we do get a jump in the unemployment numbers, certainly people would be surprised. the rba meeting the -- may need to consider moving ahead and they may have to bring your ford, so certainly there's a lot on the table. mark cranfield, thanks for joining us. you can follow more on this story and all of today's trading and you can find the on the .loomberg at mliv you can find out what is affecting your investments right now. plenty more to come on daybreak asia. stay with us. this is bloomberg. ♪ >> this is daybreak asia. let's get a quick check of the latest business flash headlines. netflix shocked investors by reporting a drop in u.s. customers and much lower expected growth. want to make clear it was a loss of subscribers, not an accounting loss. hi subscription costs have not supported n

the rba has already cut twice this year.would have to cut more aggressively than that rba to see the aussie move higher. the chance of a 50 basis point cut is something that traders are looking at closely. also the speech by the rba governor on thursday could provide some catalyst. weit's not a downtrend, could see a significant move ither given the has faced that resistant many times -- faced that resistance many times. yvonne: i think i like andrea's chart. .avid: i like andrea's too yvonne: the interest rate differentials. david: and it is true! [laughter] yvonne: but that was an interesting coincidence of that we all love when talking about this. david: if your dreams are not big enough, if they don't square best scare you, they are not big enough. [laughter] really come i think with india's aspirations, i think it tells you where the index is going. although it is a very serious correlation. i pick andrea's as well. yvonne: sorry, jeanette. but definitely a fun chart. gtv is where to go to check out all these chart

west back bringing forward the rba's next rate cut. they are citing a 0.5% target for the rba cash rate. we saw a move in bonds, yields are down two basis points. away from record lows. the kiwi continuing to see weakness today. we might need to go unconventional in policy tools. david: we were down as much as one for the 1%. -- much as one fourth of 1%. lows. off of two month commodities very much in focus for the bloomberg dollar index. a good month against all of g10. yvonne: iron ore, we are watching it down in singapore. perhaps the imf growth concerns are weighing on them. oil, continuing higher after we saw the stockpiles in the u.s. edging lower here. it is up about .6%. david: you don't see it here, we may talk about it today. beef imports in china are reaching a record after what has been happening with the african swine flu. a top story is the imf. lowering its global growth the of and the expected u.s./china trade talks. hays,g us now is kathleen our global economics and policy editor out of new york, and air china correspo

rba dues this week.he aussie edged closer, a four-month level against the kiwi as investors assess if a third breakout is in the cards this year for australia. penciling in that for november. paul: thanks very much. let's get the first word news with ritika gupta. ritika: reports from beijing suggest face-to-face trade talks may resume in the coming days, after what state leaders described as goodwill gesture from china. mainland companies have taunted u.s. exporters -- contacted u.s. exporters about agricultural products. the south china morning post says a u.s. trade team will fly to china next week. a new report from london says the u.k.'s stumble towards brexit may have triggered a technical recession. the national institute of economic and social research says even if there is a split, the u.k. economy will only grow by 1% this year and next. the think tank says there was about a one in four chance the economy is already in reserve. the governor of the bank of japan says he and his team are keeping

on the central bank front, the rba polished minutes -- rba's minutes are due. i'mick check now commodities. iron ore and copper futures are extending gains on positive activity indicators from china. iron ore was the big winner from that data dump which saw record steel output on the mainland. that has stoked demand concerns over oil which is extending losses with wti below $60 a barrel after posting the biggest drop in almost two weeks while gold is adding ground as the drop in treasury yields is seen supporting demand. paul: think very much. let's check in on a first word news now with ritika gupta. the divorce looms ever closer for brexit. officials say a meeting was one of the most difficult at any time in the past three years with the british team seemingly trying to bully its way into new concessions. the e.u. is bracing for the expected appointment of boris johnson as prime minister. he threatened to quit the e.u. in october with or without a deal. its nuclearise program back to the state is reached before the 20 14th your was signed. tehran said it may

cut targetshe rba this week. signaling a pause in the easing cycle.e dollar -- aussie dollar rally. weakening.one -- won in.ave data coming >> thank you. fidelity's hour, cross asset specialist joins me to talk investment strategy. heramy king gives us opinion. we have the market open next, this is bloomberg. >> good morning, i am paul all in -- alan. >> i am shery ahn. >> i am sophie kamaruddin. welcome to "daybreak asia." ♪ top stories this thursday, asian markets look set to rise. risk assets set to enjoy the holiday. talks with china resume in the headline. beijing and brussels accused of currency manipulation. >> going offers $100 million to the victims of the 737 max 8 disaster's. the final cost may be higher. straight to the market action. >> we are seeing green shoots with the nikkei and the topix. aftervery much and focus benchmark treasury rates fall. jgb, not moving much. aftered to strengthen that. the yen is holding steady. a break for the july 4 weekend. taking a look at the mood in korea, upside for the korean won . the index up a third

we are seeing the rba here in australia. the government needs to step up and do some of the heavy lifting and really step on the fiscal , as they have ample room to do so. i think that is the conversation that will be played out in other economies across the globe. we will see more focus on the fiscal side of things. we have a situation, a fragmentation of global supply chains with globalization taking place. on the backdrop of enormous debt. manufacturing, slowdown there, that spreading into services. we have a trade contraction taking place globally. pension liabilities on top of all this. in developing countries, seeing populations, it is all a heavy mix of gloom and doom, isn't it? when you put it like that, it does sound very negative. but i guess the one glimmer of hope that we have to hold onto is the fact that governments now step up to their responsibility and focus on productivity, focus on fiscal stimulus, and really work towards getting the global economy back on track. i think that is what we would like to see f

macro also seeing credential easing and we have seen two quick rate cuts by the rba. combination of stimulatory measures going through the australian economy, clearly ones we believed were necessary, but i think we are already starting to see signs, particularly in the housing markets, generally where the transmissions work first. we are seeing signs of movement. i think it is surprising people how quickly the market has responded. auction clearance rates are at an 18 month high. we have seen signs of stabilization. for an rba which is clearly of the view that monetary policy is perhaps running toward the end of its natural life, perhaps we are going to be seeing better macro data in the next six months and that alone will allow time to assess before needing to do anything more. rishaad: thank you so much, beverley morris from qic. david: from fixed income, back to equities. , big corporate well.movers as we will talk about what you are seeing on your boards right here coming up next. this is bloomberg. ♪ is is bloomberg. ♪ yvonne: let's look at the latest business fl

this coming days after the rba cut rates. what is driving it? of the problem is that the rba cut rates and signaled it was not really a surprise that they would do this. they signaled they will probably now sit for a wild see how that plays out. they don't have a lot of ammunition left in the tank, down at 1%, and there has been chatter at various times that about 0.5% would probably be as far as it would be worth them going, though they would have been inclined to sit anyway. meanwhile, the fed is strongly expected to cut this month or soon after and then to cut again , so that is helping to drive the aussie. the relative rate picture is only going to sit in their favor. yesterday, we had two bits of news. first of all, a record trade surplus, so that helped drive the aussie. come the same sort of thing is helping to drive the kiwi and the loonie because new zealand and canada also demonstrating strong trade surpluses -- as you can see, the same sort of thing is helping to drive the kiwi and the loonie. it became clearer this morning the govern

you could see a catalyst when we hear from the rba governor philip lowe on thursday.ulls watching to see if we could break out of that resistance level. more weakness coming through on the back of the rba rate cut today. nejra: thank you. set to. and china are resume face-to-face trade talks for the first time since may. sources tell us that robert lighthizer will fly to shanghai on monday. negotiations are scheduled to run through wednesday and are expected to review issues dividing the two sides. the imf has cut its global close outlook again. it says the world economy will expand 3.2% this year. joining us now for the hour is our guest host. head of equity strategy at standard chartered private bank. us.t to have you with let's start with the outlook for trade. yesterday, we saw the s&p 500 get a lift on this news. we close above 3000. you have a preference for u.s. equities. is that because you think they will be more shielded than other global equities? >> in general, when you look at lewis -- u.s. equities, they are more trait -- less trade oriented than your ar

the rba just cut interest rates and the policy rate is 1%.raight down. we are seeing something symptomatic of a liquidity trap going through into the global market. tom: what does that inertial force due to financial stability and the short paper market? jim: it is difficult to get any yield. it makes short-term funding and financing cheap which could be dangerous. we are not seeing people lever up the way they use to, so if this was 2005, 2004, you would see more financial leverage in the market. what we are seeing instead is a grab for longer dated, high quality bonds. that is one reason you are yields coming down and spain, u.s. treasury yields coming down. one of the most crowded positions we have this year as people's positions in cash and positions in high quality bonds. that is extremely different than last year. if we think about this last year , the market was more risk on and we know how that ended. this quarter, we have been risk off almost the entire year. you doe: overall, what with the negative yields on german bund banks -- ger

we heard from the rba, the july minutes meeting, saying it is watching closely and will adjust ratesneeded. and watching moves in the philippines talk, entering -- philippines stocks, entering bull market territory. some stocks in detail, interesting to see south korean samson suppliers doing well today, on a trade spat not between the u.s. and china, but with japan. analysts coming through saying people might come more tow ards domestic buying if japan ups the rhetoric on the suppliers. upsung, a samson supplier, -- samsung supplier, up over 70% in seoul. strengths in the financial sector, analysts saying it remains undervalued, and that you could see the bull market continue in the philippines. downside, looking at financial stocks, perpetual in australia on its worse today loss in -- two-day loss in four years, with net outflows in june. saly, thank you so much. treasury secretary steven mnuchin says he and trade represent it rob -- representative robert lighthizer my travel to beijing if talks are productive. this comes after china reported the slowest growth on record, which pre

we want to get her thoughts as well about what is going to happen with the rba.raders are saying that there is a 77% chance of a continent. our economist ismist is back wis next. this is bloomberg. you are watching bloomberg markets, i am rishaad salamat in taipei. -- am juliet. the city leader has condemned those that storm the building as gathered rapidly. we are talking to david outside of the building. how things look into the -- looking today? david: we are seeing a massive cleanup from the devastation. it looked as if there was some movie.f post-apocalyptic they have really cleaned it up. you can see the legislative council. we were allowed in earlier. now it is being courted off because it is a crime scene. if you go further in, you can see the front windows, these big thick plate glass windows leading into the legislative council have all been smashed by protesters using everything they could possibly find, including roadside barricades. fromoffense they have torn fences and used as weapons to gain entrance to the council. got in there, they trashed the i

the aussie dollar staying steady this morning, in the wake of the rba rate cut.he government's second-half economic forecast to consider later today, export data looking shaky and pointing to continued weakness. the global bond rout continues after the 10-year treasury yield tested lows, and the aussie 1%, the yield below five year moving in on that level. lowslimbing off overnight after an industry report showed tighter u.s. supplies, and gold extending gains over $1400. paul: let's get the first word news. >> imf boss christine lagarde is set to become the first woman to lead the european central bank after being nominated to succeed mario draghi, taking over in december. the german defense minister has been nominated to become the european commission's next president, the first german to hold the post in over 50 years. more reaction to christine lagarde's new role in a moment. oil had its worst reaction to a opec meeting in four years, prices tumbling after the cartel and allies agreed to extend production cuts into 2020. russia and other independent nations b

we know the rba has set the stage for further monetary easing. thank you very much. the next hour of daybreak asia, we continue markets discussion with the ecb head of asia strategy. this is bloomberg. ♪ we're the slowskys. we like drip coffee, layovers- -and waiting on hold. what we don't like is relying on fancy technology for help. snail mail! we were invited to a y2k party... uh, didn't that happen, like, 20 years ago? oh, look, karolyn, we've got a mathematician on our hands! check it out! now you can schedule a callback or reschedule an appointment, even on nights and weekends. today's xfinity service. simple. easy. awesome. i'd rather not. paul: i am paul allen in sydney. asia's major markets are about to [shery: good evening from bloomberg school headquarters in new york, i am shery ahn. to "daybreak: asia." ♪ paul: our top stories. trade talks get back on track this week. there is little hope of a breakthrough in shanghai. neither side seems ready to compromise. marcus prepare for the first fed rate cut in a decade. the week brings policy decisions from toky

we have heard from the rba ready to cuts again. do they have leeway to do so?recognize is the asian central banks, barring the bank of indonesia and possibly r.b.i. which moved last year, for most of the other asian central banks, they didn't tighten much last year. i think in terms of the flow, more dovish moves to come, they are fairly limited. we did see from the rba suggestion the policy will go to zero point 5%, so we are looking at one or two more moves. similar story for the bank of korea and for the bank of indonesia, although they did .ike 175 basis points last year they are only down 25 and could do another 25 this year as long as the itr remains a stable. they have to take a cue from the federal reserve. if the fed cuts 75 basis point this year, maybe the window will not remain open for that long. we are coming into possibly the end of summer. if we get indications the insurance cuts are the fed will be done by december, the story will change in the fourth quarter as well. paul: insurance cuts. language is quite intriguing because the fed is meant to

the fedtmare scenario, for the ecb, rba and others is that they all chase each other down with interest rates. we have a bunch a currency market volatility, but all the affect rates are more or less where they were and they are adding firepower. just very quickly, we know the market expectation is to cut chief economists. is there an economic case? tom: when it is more expensive to borrow short than it is long, that is a problem for the economy. most of the driver of these cases, expectations of further weakness and market signals but that is still a case to come. rishaad: looking at the bloomberg dollar index, since trump assume the presidency, it is down by 6% only. it has been in range as of late. mid-pointare at the from the election. it depreciated against the major currencies. there you have the yuan and sterling coming through. the euro is a very big part of this. you have a lot of the em currencies here as well. thank you both. let's head over to beijing and selina wang is there with an update of our first word news. the u.s. government is hitting back at huawei's constitutional

with all of that going on and the rba has put rates at a record low, that stimulus should feed throughe economy. plus, commodity prices, in particular iron ore, have been on a bit of a tear. mostly, australian commodity prices have been going much better than some of the others out there. look at the chart, you can see there's no sign of a blowoff top. it has been mostly gradually moving up. there was a little bit of a breakdown in june, but that $2 trillion australian dollar mark inside, it would probably take something like perhaps a breakdown of the trade talks between the u.s. and china or some major global breakdown i think, to snap the aussie stock index out of its happy space. "happy space." it has been a different story for the chinese market. what is next for them? >> the chinese market very much approaching something of a pivotal point, both when it comes to local sentiment and when it comes to foreign sentiment. one of the things that helped to drive china earlier this year was the flood of foreign money as the msci inclusions .ncrease as you see the chart we have up shows s

the rba really in a position of chasing a deal on the aussie 10-year yield lower.seems to be a race to the bottom. we are counting down to gdp figures from south korea in the next half hour. we will discuss issues weighing on growth next. this is bloomberg. ♪ shery: the next hour will bring the latest gdp numbers from south korea. the median forecast of economists we surveyed project economic growth for the seven quarter as 1.9% year on year and a fraction over 2% for 2019 as a whole. that would put growth at close to a decade low. the surprise rate cut was announced last week underscoring a sense of urgency about the pressures facing the economy. when be ok governor says they will consider responding if the economic picture worsens and that they still have room to act, but not much. economics sees south korea's suffering from external pressures such as weaker global demand and the downturn in the tech cycle. also, any recovery could be hindered our shortfalls at home. paul: thanks. if there is a rebound in second-quarter gdp, what will it mean for the bank of kore

australian bonds and pretty much every security now, government bonds in australia trading below the rba'son target. over in south america, this kind of influx of century bonds keeps going in places like mexico. this great chart shows you how much those have been outperforming the broader emerging markets. argentina is a popular one as well. some of these returns are double what you are seeing in the em petsmart which is a reasonably good place to be. the backdrop to all of this is the fact the negative yielding aspect of the global bond market continues to grow. we are now past $13 trillion in terms of the overall bonds around the world that yield less than zero. all that plays into that. as we go into today's fed meeting in a very uncertain outlook for policy, although people are expecting reasonable chance the fed indeed does cut this month, beyond that, the policy is very unsure. with all the trade uncertainties, i think what this bond backdrop really shows is how fragile the world is right now and how far people are prepared to go to find yield. shery: we are very close to kicking off

s&p is down about three points of course ahead of powell 'rba ile tn re wee ckn sshathe mns. >>> a newrs to block online bullies and banning comments on posts and hiding those comments from everyone else but the commonter. restricting will help users avoid escalating the situation by publicly blocking someone instagram plans to roll out and restrict soon following another an anti-bullying feature asking consumers if they want to post the comment in question. instagram was considered safe considered to others but they are dealing with some of the issues that twitter has been dealing with for a while >> i wonder if that is the new head of insta out in san francisco some really good reporting around this. that makes it seem like he is really serious why does he have this objective and does mark zuckerberg have the same thing for facebook. i think it's real interesting. the company is willing to make decisions that people use instagram less if it keeps more people safe. >> boeing where teenage users are concerned. we all know people who have been affected by it i think it's also noteworthy

data as well as rba minutes.n the tech sector in the radar after talks ended between broadcom and symantec. holidayff-line for the this tuesday. paul: thank you. let's chicken on the first word news with ridicka. >> brexit talks are becoming more hostile as divorce looms ever closer. officials in brussels say a meeting last week was one of the most difficult of every time in the last three years. the british team seeming to bully gets way to new concessions. the eu is bracing for the expected appointment of boris johnson for prime minister. he is threatening to quit brexit with or without a deal. iran is warnick and might revive its nuclear program back to the status it had back before 2015. tehran may back away if eu powers do not do more to offset u.s. ancients. --sanctions. a return to conditions would createa balance. . the eu says there is still time to save a deal. >> we will see how we can together with all the member states an internal test -- international partners to maintain the deal with iran and put

favorite part of the show, "the desk" is answering your questions on amc and oil reach out to us at 'rbaerhiets.ime or twe u wee ckft ts. ♪ ♪ here i go again on my own ♪ goin' down the only road i've ever known ♪ ♪ like a-- ♪ drifter i was ♪born to walk alone! you're a drifter? i thought you were kevin's dad. little bit of both. if you ride, you get it. geico motorcycle. 15 minutes could save you 15% or more. welcome back to requesting the halftime report. are we lost now is the name. here is your tweet incredible run but is it time to ring the register? what do you tell beyond lost now? >> that's a question that you are always monitoring your risk but the right question is how could you protect your position. you go to jon and pete's area of the world, which is options and i think you utilize that as a way to protect i don't think you flat out sell because you believe it's the time to ring the register. they report earnings july 29th, it's important you want to listen to what goes on in the call and you need toed a social phenomenon surrounding plant-based meats and only going to build

tomorrow, policy decisions from the rba. if they cut rates at the last minute.t three year hiatus before they did that, expected to cut again. nejra: july 4, u.s. markets will be closed. make sure to turn into bloomberg's special coverage that evening. after the fireworks have died down, friday, we get the jobs report for june. markets turning to this after the trade truce. payrolls expected to rebound. this is bloomberg. ♪ nejra: this is "bloomberg daybreak: europe." let's get your bloomberg business flash. >> deutsche bank may cut more than a fifth of its global workforce. the lender's biggest shakeup in years. the chief executive may approve the loss of as many as 20,000 jobs. saying last month he was working on tough cutbacks after failed merger talks with commerzbank. a bloomberg scoop. 8.ing outsourced the 737 max the playmaker relied on temporary workers to develop and test programming. the code was not being written correctly. that is your bloomberg business flash. nejra: the u.s. and china declared a truce this weekend heavy on hoopla, but light on deta

the rba is in focus.ompany rates have been widely anticipated but it raises questions about whether they carry on doing that. i suppose there are questions as to what is the point in going to quickly if central banks have not quite got there. mark: there waiting for the bank to clarify what path they might take. there is a bit of uncertainty around with the fed policy given we do not have clarity at the g20. is this from talks, is there going to be a deal? many people think if there is a byl, the fed might unwind cutting later. many of the central banks are waiting. monetary policy is [inaudible] for the fed it matters what they are doing and how they are doing relative to the fed. anna: there is time for the fed to steer markets away from an expectation of cuts. that is quite a range of outcomes. mark: it is unlikely he will go to 50 points. if there is a severe downturn, i think if they are unwinding the idea of cutting it at the end of july there will have to get the communication going quickly. a cut

people aren't willing to buy on the dip on the cost be. 4/10 of 1%.y weird from the rba governor sayingif there's back to back rate cut in australia, they are willing to act again. fa aussie has fall and -- llen. i want to focus on the tech sector. we have been looking closely at high decks in seoul. it came through with numbers that were amiss. it's going to rein in its chip output amid the trade concerns. that seems to have impressed investors. shares tracking higher in seoul. we heard from apple supplier saying they see demand for new iphones starting to stabilize. you have one of the biggest apple suppliers in taipei off by 3%. samsung coming through, saying that it is ready to launch its foldable phone by september. that was put on hold a few months ago after early reviewers saw a defect. samsung shares up by over 1.5% in the afternoon session. nejra: thank you. underway.eason well we've seen second-quarter numbers coming in better than expected. the s&p 500 and nasdaq closing at record highs yesterday. estimates for the third and fourth quarters are moving the wrong way, worsening

we have the rba meeting this week, but how much can these banks cut when they are already at record lowsr them to cut, they maybe have a little bit of room. what they have to do is continue looking at some extraordinary orsures, whether that is qe even different packages -- the real issue is what we've seen over the last few years, that monetary policy is on the only policy that is trying to boost growth. much fiscaleen too packages coming along and governments have had a hard time and we've had the rise of populism which was making everything harder. but one has to be mindful of the market we are creating. the issue is that the market always wants more and they always will. if they start pricing and rates zero or negative, it becomes a given. this is not a given. it is extremely exceptional. but the market is taking it as the new norm. the fed has been trying to hike rates and now they are saying you shouldn't. this is an extremely dangerous environment, because whether in the short-term it is positive, in the long-term it could create seeds. >> we will see what the next six months brin

we wait on the rba governor later today. checking in on the aussie dollar looking study. downside for the currency from the record 2019 given expected cuts this year and australia trade. were affectedents by the cyclone in northwest australia. they do see shipments rising this year. also average revenue came in higher at $65 a ton. up 50% year on year. up to a five-year high. shery: thank you so much. we had surprise on korea's growth numbers after worrisome contraction. let's look at what korea's gdp numbers mean. we also have germany's latest manufacturer reading ahead of -- kathleen hays is here with all the details. let's get started with south korea's surprising upside. kathleen: absolutely. first quarter the number was down 0.4%. the first contraction they have had in more than a decade. not with swings up 1.1%. alsoear-over-year rate is comforting. i do not think it absolves they are worries that there may be more rate cuts because exports are still looking grim. jump into the bloomberg library with me and you can see this latest move back up. year-over-year in the

coming at a time when we've seen a surprise election victory by incumbent scott morrison and the rbadovish. thenikkei of .4% as japanese yen near its weakest level in almost three weeks. we had some disappointing i.t. numbers earlier but coming ahead of the boj decision later today, the policy is expected to stay unchanged. kospi futures of .3% and we are expecting more movement coming from the korean won after that big gain in the previous session. let's check in on the first word news. >> president trump has won his on a block on arms sales to saudi arabia. muster theailed to majority needed to quash the bill on capitol hill, despite aiding the support of a handful of republicans. the president's critics say saudi arabia must be punished for the war in yemen and the murder of journalist jamal khashoggi. tried talks resume later tuesday after -- with little expectation of anything other than a broad framework for further negotiations. the two sides are holding their first face-to-face meeting since may with key differences remaining and neither team shows any inclination to compromi

the australian dollar is steady nearing one make high ahead of the rba's meeting.s policy to decision, the korean won is little changed, after capping a second weekly decline. for 2019, should governor lee cut rates on thursday. samsung is holding a four-day gain amid this trade spat with japan. tosung reportedly managing secure emergency supplies for three key materials targeted by those restrictions. among soft numbers of note, the capital in sydney sliding to a record low after a $2.3 billion plan to sell its life insurance unit to the u.k. resolution life. is unlikely to proceed. plans to overhaul business and the scandal. and p does not expect to pay a dividend for the first half. so in b-shares have slumped in the past years. cutting is market cap to 5.8 billion aussie dollars. shelving of the year's hottest offering has taken the wind out of the sales of the hong kong ipo market. and even its own plans to clear its debt. kong, how from hong important was this deal for the exchange? importance.y it could have doubled or almost doubled the first time. it was a

we had speculation that the rba could hold off on a third rate cut after the latest jobs data shows somee. the korean won, 11.78. paul. paul: let's check in on commodities briefly as well. sophie mentioned the oil price gaining, as we see renewed ofsion in the strait hormuz. silver closing the gap with gold. coming up in the next hour of "daybreak asia," brian gibson joins us to offer his outlook on global rates. the market open, next. this is bloomberg. ♪ his is bloomberg. ♪ paul: good morning. ages maker -- major markets are about to open for trade. shery: good morning. sophie: i'm sophie kamaruddin. welcome to daybreak asia. ♪ paul: our top stories this friday, shinzo abe hopes victory is on the menu in the elections. korean companies say they can handle japan's restrictions for now but are looking to diversify the global supply chain. shery: 50 years since the historic giant leap. how much has changed since apollo 11 took mankind to the moon. let's get straight to the market action with sophie in hong kong. what are you seeing? sophie: green shoots in tokyo %ith the nikkei opening 0.

essentially, you have the rba still in easing mode even if they might take a little hiatus over the nextcommodities performed a lot more strongly than expected. essentially going forward, it's going to be an issue where if it games,xtending its clearly the market needs to be prepared for an aussie dollar that may have been stronger-than-expected. fed expectations play into that as well. from aussie side, there's crosscurrents. shery: what about other global currencies? we have seen more positive data out of the u.s.. it seems that the global macro backdrop is still a bit of a slowdown everywhere. have you position when it comes to currencies? >> yeah. it was interesting to see the move in the u.s. dollar overnight. it had clearly been under pressure given the fed dialogue. at the same time, always the story for the dollar is, it can potentially be very strong when the rest of the world is weak. we have yet to see. was a coming through from other parts of the globe. there's still a lot of concerns around europe. we have week maybe -- had better china data and the u.s. data is coming in be

. >> up next, we'll speak with one amazon worker who is protesting 'rba rhtft ts prime day event.. break. ♪ ooo! ♪ ♪ and protect it all. customer records, our financials, they better be secured. but i also need easy access, to manage data across my clouds - no matter where it lives. ♪ ♪ so if an auditor shows up, i can be a step ahead. that's the cloud i want. is that to much to ask? expect more from your cloud. ibm cloud. whai tell clients, etfs can follow an index, but which ones target your goals? it's not about quantity. it's about quality. no trendy stuff. i want etfs backed by research. is it built for the long-term? my reputation depends on it. flexshares etfs are designed and managed around investor objectives. so you can advise with confidence. before investing, consider the fund's investment objectives, risks, charges and expenses. go to flexshares.com for a prospectus containing this information. read it carefully. with sofi, get your credit cards right- by consolidating your credit card debt into one monthly payment. and get your interest rate right. so you can save bi

story, thes its own rba ready to cut rates. there is the agony of japan.erman statistic now? , go back to marvin goodfriend it is basically unimaginable. francine: we asked andreas utermann about it a while ago and he said, we do not have the same demographics although there are parallels with japan. how do you interpret that number? wolfgang: we are business secular, no question. we are in a form of secular stagnation. i believe it is fiscal. we can get out of it if we let fiscal policy do the job, but with a declining demographic and fiscal retrenchment, that is what we end up with. francine: we have been talking about a repricing for a year and a half. when will it come? what is the catalyst? andreas: bond markets need to have the sense that the central banks will exit qed. -- qe. we thought it was done and we have seen a rapid reversal as the markets digested this and repriced risk assets, which the central bank did not like. we need that to happen again and we need some growth numbers to be positive, continued low unemployment, and core inflation numb

to report this morning we'll let you know what to expect you're watching "squawk box" on wee ckn mo 'rbaa ment fifty years ago, humanity went to a place it had never been. a place without rivals, hostilities, or cultural differences. "the eagle has landed" that place wasn't 240,000 miles away, "one small step for man" for a few moments, it was right here at home, "one giant leap for mankind" over 4,000 people from ibm helped apollo 11 get us there, today, we are ready to take the next giant leap, wherever it may lead. i had a few good tricks to help hide my bladder leak pad. like the old "tunic tug". but always discreet is less bulky. and it really protects. 'cause it turns liquid to gel. so i have nothing to hide. always discreet. >>> the marijuana business is in focus today later in washington. the senate banking committee will hold its first hearing on challenges that the cannabis industry faces joining us on the phone from san jose, california, bruce linton thank you for joining us the last time we spoke to you was literally the day that you announced you were leaving the company, an