at the rba will be on hold today that is fairly clear.uld be interesting is to they maintain what they have for a while which is tightening bias. inflation is were is -- where it should be but is it heading there fast enough? n -- if it is not heading there fast enough they will have to do a bit more tightening. australia has not done enough tightening so far. paul: only 400. in terms of inflation, the last monthly cpi print, yesterday's melbourne print was harder than expected. is that lagging impact we have seen enough? can the rba do enough considering that all of those really expensive mortgages that are on floating rates. >> in large part, they are in the narrow pathways. they had hoped to be in. they are getting the signs of the economy slowing down, they are getting the signs of the high interest rates they have delivered are slowing the consumer down the economy is slowing running below trend. inflation is past its peak. the question is whether it is on the right path. the rba is forecasting that inflation gets back to its target

i think we may see another rba rate rise before the end of the year.e: we will rain some more lines from the statement. returning inflation to target remains a priority. inflation australia about has passed its peak. the economy still experiencing a period of below trend growth. they still seeing the 2-3% target range for inflation in late 2025. uncertainty around china due to property. they are still talking about uncertainties around economic outlook. they are leaving the door open for another hike this year. how much higher can rates go in australia right now? >> i would've said they would not be able to have gone much higher given that australian household debt to income levels are at a record high. it is one of the most sensitive around the world. if we see a renewed spark in wages growth and an increase in inflation, then rates could go up another 25-50 basis points from here quite easily t be more in line with some of our global peers. its a risk over the next few months. rishaad: we saw the uptick in inflation. the thing is, we have seen quite

we start with the rba position. walk us through the logic of the rba holding pat. it is being characterized as a hawkish hold. >> this was michele bullock first statement as governor and policy continuity was the standout. she kept her statement unchanged from the previous month, but retained that titling bias. economists are expecting one more hike later this year. markets however were disappointed, and we saw a selloff in the aussie dollar, because despite a pickup in inflation and oil prices, the rba left the statement unchanged . that disappointed rates and dollar traders. kriti: it's going to be interesting to see what the rba says as their justification going into tomorrow's press conference. the real takeaway is what is the market reaction? for the rba, you didn't see much, which is counter to the global selloff in u.s. treasuries has a scary readthrough to the the rest of the world as you are seeing hawkish and this -- hawkishness take hold. >> we may need to raise the fed funds rate once more this year and hold it there sometime as we accumulate more infor

we are also - looking at a new rba governor holding herfirst looking at a new rba governor holding herng. looking at a new rba governor holding herfirst meeting. do you think that will influence different priorities? how will you see that? fix, different priorities? how will you see that?— different priorities? how will you see that? a very exciting da . you see that? a very exciting day. michele _ you see that? a very exciting day. michele bullock's- you see that? a very exciting day. michele bullock's first i day. michele bullock's first central bank meeting as governor but i don't think it changes the monetary policy outlook or monetary policy stance from the reserve bank of australia. it is very much steady as she goes, in terms of policy making. i don't think we'll see much of a change of stance. the priority remains on making sure inflation materially and persistently does return back to the central bank target, and we still have a while to go. our expectation is we won't see inflation retentive at two to 3% target band until mid to late life —— next year. that will continue to re

we will watch for what the new rba governor says.e saw the picture being reflected when it comes to new zealand bonds. kiwi stocks down 1/10 of 1%, watching a gap in expectations for the yen. close to the 150 hurdle but a real disparity as we got forecast on the yen. analysts are the most divided on the currency since 2016, nikkei futures looking soft. news flow, the data docket by china, futures looking flat has we expect modest appreciation or traction when it comes to domestic activity indicators. shery: watching data in the u.s. because they keep surprising to the upside. a large jump in retail sales, treasury yields were soaring today so were talking about a two year yield are the highest level in 17 years and of course stocks struggled for direction, s&p 500 finishing unchanged. we were digesting earnings from banks. a mixed picture with goldman sachs saying a huge drop in profit but it was all about treasury yields. the slump continuing and what that means for the fed as markets are pricing in a potentially another rate hike r

how has that impacted the calculus in thinking at the rba?e all the emerging markets, we are closely linked to the actions of global central banks because it has direct implications for our capital flows and currency. we have been seeing spikes in the global crude oil prices and also the prices of several nonenergy commodities etc. which again has started creating costs pressures. there is expectation that the u.s. fed is not yet done with the rate hikes and it could be one more rate hike coming from the fed. against that backdrop, i think emerging markets central banks will stay vigilant and their overall policy stance will remain hawkish. rishaad: rupa, how far did they set policy in response to what we have been seeing with the rupee and try to defend the rupee rather than actually do something about capping inflation? i think the record low for the rupee against the dollar is 27 pesach and we are six pesach below that level. that may be concentrating in their minds. rupa: the bank will not defend the rupee after the currency has become co

. >> home prices showing strength in september driven by soaring demand read the rba expected to holdates again on tuesday. and some breaking news out of the gates in australia. bank pmi's for september a a slight pickup, 48.7 is the reading from the 48.2 we saw in august we are still in negative territory but a strange trading day including australia. there is a pu holiday in australia. dsx will trade as normal however we might see less volume tha usual. elsewhere we've got the dollar below $.65. we are anticipating a weaker opg when we get going in australia. futures are down by half of 1% at the moment read you've got new zealand trading, coming down to election day, 12 days away and the yen is at 149.49, not a great deal of movement. you might anticipate to see a bit of intervention from the ministry of finance. we've got me key futures in negative territory and today is the day we get business survey results. markets closed for the golden week holiday and that includes china, south korea and hong kong. no trade today. shery: we are headed towards the first trading day of the quar

headlines coming through, the rba needs to tighten further. inflation is running hotter than what central bankers would like. they say we need further rate increase next week during the meeting tuesday. there is the expectation we could see a 25 basis point move to the upside, but very much a live decision. yields moving higher, but fairly flat as we get underway. the government and australia, the imf says to support the rba, governments across australia need to be wary of when they spend on things like infrastructure and make sure they are coordinating between themselves. that is the open for stocks. asx 200 fairly flat but modestly higher. the rba, and the big focus for first central banks in asia, the boj and we had the decision yesterday coming out essentially , what the boj gave themselves is a little more flexibility. that was the hope of allowing the 10 year yield to move higher. this is something that could have led to further strengthen the japanese currency. we have seen further week this coming through in trading, around a fresh yea

headline inflation is something the rba is willing to look through if there are temporary supply stock bullock talked about shock aftershock aftershock, so it is hard to overlook supply related things. but core measure is what they are really going to be looking very closely at, that is a measure they are worried about as well because that strips off the volatility and focuses on measures which are not really volatile. so if that remain sticky and services inflation remains sticky, definitely it is a cause for concern. paul: economics reporter swati. the australian government announced an expansion including minerals financing as part of an effort to move toward clean energy and boost exports. the announcement follows talks between the prime minister and u.s. officials. the issue of critical minerals was a key agenda for albanese in washington on a four day visit. tune into bloomberg radio to hear more from today's big newsmakers and get in-depth analysis from the daybreak team broadcasting live from her studio in hong kong, listen via the app for bloombergradio.com. plenty more to com

so these are not factors that rba can control, but it is interest rates.ionary factors make up a small proportion of the basket but responsible for an outsized impact. does this mean on the balance of probability, we won't get a rate increase? >> if the rba doesn't want to raise interest rates, they can use this as an argument but if you want inflation to come back to a 2%, you have a blunt tool, which the governor has spoken about. you have been talking about your determination to control inflation, so if you do not act on higher prices, on data showing this, it will look like just talk and no action. if they want people to believe that they are determined to bring inflation down, they will have to raise interest rates. paul: plenty more ahead on daybreak. this is bloomberg. ♪ (sfx: stone wheel crafting) ♪ the biggest ideas inspire new ones. 30 years ago, state street created an etf that inspired the world to invest differently. it still does. what can you do with spy? ♪ is it possible to fall in love with your home... ...before you even step inside? ♪ di

shery: our economics reporter with a preview of what to expect from the rba decision today. .an get around above all the stories you need to know to get your day going including the rba rate decision. terminal subscribers go to dayb . also available on the mobile bloomberg app. you can customize your settings so you only get news on the industries and assets you care about. this is bloomberg. ♪ that first time you take a step back. i made that. with your very own online store. i sold that. and you can manage it all in one place. i built this. and it was easy, with a partner that puts you first. godaddy. shery: shares have reversed initial losses with investors looking past third-quarter deliveries that missed expectations. su joins us with the latest. we know tesla has been shifting their production focus. is that something to do with why investors seem optimistic? su: yes. the fact they reaffirmed their annual target for shipments. investors really shrugged off this particular number. analysts as well. that is despite the sequential drop in output, which the company says

we saw inflation linked along positions failing after the rba testimony in particular toward the endt comes to australia, the state of the economy, the data points, there is uncertainty as to how rba will progress over the next few meetings. annabelle: the decision tuesday is going to come down to the wire. a hold or hike but we are into the trading session, a start to the week in asia and you can see markets are trending to the downside underway here. there are a couple of different factors over the weekend as we have been discussing. israel started its ground offensive into gaza, proceeding cautiously. still the second stage of the warm is something that could last from a couple of weeks up to six months and the u.s. is among those flagging the chance that it becomes a regional conflict and expands further is certainly going higher and traders are cautious. it's not just the middle east that is front and center but a lot of central bank decisions in the coming days, rba is tuesday but this is about the fed, boe, boj. another level of uncertainty. the moves and treasuries have been

we have concerns over where the rba goes, now that the inflation number, even as the rba governor says they will -- were not terribly surprised. we are seeing repricing when it comes to the expectations in the aussie dollar moves. david: yeah. it looks like halloween. or valentine's day. these colors on your screens. thailand is joining the fun. in fact, that specific market, we have just gone in one direction. we are effectively at 2.5 year lows on the set index. we are 19,000, nifty futures opening up in a couple of hours. thailand. the broad pay point -- pain point. we will talk more about that in a moment. now just a pivot away and look at the trading session in europe, it will be a big day in europe. you have the ecb decision. we are one forth into the earnings season there. as it pertains to some of the futures you have stat charts coming out the earnings. volvo. a couple of other names, nestle is coming out as well. bnp is out. just a snapshot across -- of some of the earnings coming through in europe. something to watch. futures are down as well indicating that yields are likel

and it sort of poured water on rba height -- hike bets.round the expectation is still around 40%. maybe a bit more but wherever they go on tuesday, whether that happens, i am not sold on they idea especially yet. having said that i think bullock might have boxed yourself in a little bit because she said she won't hesitate. but now she has created this new narrative which is what we got right now, is it enough for her to pull the trigger on a rate hike at the policy meeting on november 7? i think the majority of still split on that one, if they will go all in on the trade. shery: bloomberg's fx and rates reporter michael wilson there. indonesian election season has begun with investors watching closely if the next government will continue or append a presidential key policy. he spoke about the country's ambitious growth plans in the first episode of latitude with haslinda. >> if you are proud that you have a bullet train when even the u.s. does not have one? >> yes. >> it is just one of dozens of aggressive infrastructure projects that the

whether you talk about the rba, the fed, any other central bank.n that resurgence when it comes to energy reflation as well as an uptick in the property market, do you think that the likelihood of more tightening being needed by the rba is a reality? >> well, we do think there continue to be upside risks to inflation and australia. likely, the rba will need to implement at least one more rate hike. that has been our view for the last couple of quarters or so. the rba remains concerned about the health hold sector in australia. most of the debt is concentrated in the household sector, linked to mortgages and the real estate bubble. whenever there's is an increase in borrowing costs, households tend to get hit more strongly. they are mindful and they've been dragging their feet. they are lagging other central banks in the region including the reserve bank of new zealand. they will need clear signs that there's a reflation price -- process in the making in order to deliver the last 25 basis point rate hike. what we are observing at this point is upsid

the rba is more hawkish than everybody thought. i think you can see more of that coming from other central banks. yvonne: how are you look at at where rates are? do think we have reached the peak of this cycle? >> historically, the 10 year typically meets the eventual terminal rate of the fed. right now, 5.5%. the 10-year is that 4.7 or so right now. i think there is still a little ways to go. there's no reason to believe that will not eventually come true. rishaad: scott solomon from t. rowe price associates there. let's get to our top story. yvonne: president biden traveled to israel wednesday in efforts to prevent the conflict from escalating. >> on wednesday present by the will visit israel. he is coming here at a critical moment for israel, for the region and the world. first, the present will reaffirm the united states solidarity with israel. rishaad: olivarez in tel aviv and joins us now. -- albert is in tel aviv and joins us now. >> there is this dual function of this trip which is to show the unflinching solidarity with th

. >> we have to take the rba meeting very seriously.ers came in hotter than expected. the market was not prepared for it. people were probably short of aussie as well before the cpi number today. it will probably go to the y europe because if the fed does not hike rates again, the rba would probably be reluctant to as well. they would probably like to know the fed has more to do before they do something themselves. the central bank in australia would probably like the aussie to stay soft. they do not wanted to be too strong, they realize there could be some inflation down the pike, but they are very well aware of what other central banks are doing around the world. it is one of those things that goes down to the last minute. yen -- david: thank you, mark. off highs of the day on the hang seng index. john lee talking about the economy returning to growth. that hong kong will be looking to attract overseas companies to re-domicile in the city. companies that may have left, looking to attract them back into the city. the government will fo

the aussie gained after the hawkish rba minutes yesterday.nues to be pressured after inflation in the third order slowed to a two-year low. questions about where the rbnz goes from here. that is it for daybreak australia. daybreak: asia is next. this is bloomberg. ♪ (sfx: stone wheel crafting) ♪ the biggest ideas inspire new ones. 30 years ago, state street created an etf that inspired the world to invest differently. with spy? ♪

of more to come in terms of rate hikes from the rba if the inflation warrants it.g be foreign any kind of upwards momentum for the aussie dollar. annabelle: that's right. really the reaction is still that story of dollar strength coming through and that's playing out across a lot of different asset classes because when you take a look at what we see in the bond space, it's a story of yields moving high-end what has really been that flight to safety. as you said in the currencies base. the focus on the malaysian ringgit this morning. that currency is at a multiyear low and it's all about these rate differentials that are in focus. particularly for a lot of asian economies. the korean won. that one slipping in with a wrist sensitive currency. it just tells you that the aussie dollar is down three tense of a percent. a lot of commodities likewise are moving low. tracking the moves and oil throughout the session as well. equities wise, half an hour to the session for tokyo and seoul at 90 minutes into trading for australia. and you can see here, the losses are really c

kent, suggesting the rba might reassess rate hikes that impact on the economy.ead towards new zealand's elections as well over the weekend. >> that's right -- paul: that's right, the election to be held this saturday. polls indicate there's probably going to be a change of government and new zealand. there could be a change of fiscal policy as well. let's take a look at the bottom space -- the bond space. we are seeing yields declining. we are seeing a bit of a dip on the aussie tenure as well -- aussie 10-year as well. a bit of a pop for the u.s. 2-here. on this part of the world, we definitely have an environment of falling yields. the aussie dollar, holding steady at 624 sense u.s. -- holding steady at $.64 u.s. that is it for "daybreak: australia." stick around for "bloomberg daybreak: asia" in a moment. ♪ thanks to avalara, we can calculate sales tax automatically. avalarahhhhhh what if tax rates change? ahhhhhh filing sales tax returns? ahhhhhh business license guidance? ahhhhhh -cross-border sales? -ahhhhhh -item classification? -ahhhhhh does it connect w

i think that is an option the rba has bought. it is not a given that they. the auction. but the market has taken that negatively. if you look at some rough liquidity forecast, in october we don't see liquidity turning into a surplus. it could probably be after the second half of november. the liquidity could turn into a surplus. even then a surplus would be somewhere between one trillion rupees 1.5 trillion rupees. there are a lot of moving parts. during the festival season october, november, we see currency demand go up in the system so that gives liquidity tighten. we have a number of state elections in november, and we will be entering into the general elections. elections tend to have an impact on currency demand. if something of that sort plays out, supposing we support the rupee because of -- liquidity could remain relatively tight. they say they could potentially do more sales. . i don't think that is a given at that point. rishaad: are they more interested in defending what has been a weak or strong dollar or week rupee. is that the major plan? >> i

rba says further tightening may be needed. at the six-month low. >>> check out the russian ruble pushing to the $100 against the dollar. coming closer to the all-time low. it has been weakening since last month when russia central bank had to step in to stabilize the currency and hiking the key interest rate to 12%. >>> sticking with the global picture. we continue to watch the price of oil. the benchmark brent falling from the recent highs s and coming o the recent highs with the fear of energy demand. let's get to dan murphy in abu dhabi who has been speaking with people who know a thing or two about oil. dan, we spoke about the possibility of $100 brent crude a couple months ago. >> reporter: good morning, frank, and good afternoon from the middle east. this conference brings together executives from the oil and energy value chain. the focus of the conversation is not just about oil and gas, but the focus is on decarbonization. that is because we are here in the uae which is hosting cop-28 in november. that climate event wi

haidi: i am also watching the minutes from this month's rba meeting. a couple things but ultimately the central bank considered raising rates but decided to stay pat was the stronger choice and that suggest they are joining with cautious policy stance being adopted under the new government michelle bullock fair [indiscernible] code to see more of an economic slowdown they also mentioned the moves in the aussie dollar in recent months i've eased monetary conditions and today we are looking at the prospect of the low being set by the aussie alongside the kiwi as well at home prices might mean policy is less restricted and they talked about more broadly more further tightening might be required but in this month's meeting they decided pausing was the best thing to do so they will have before the november meeting other data to work with saying the low tolerance but delay forecasting cpi returning to target and that really any further tightening really depends on the date of the in practice and the risks these concerns are up 4.1% they obviously do not want

by 1.1% over the quarter which is in line with the forecast but if we get a 1.3 or above that, the rbahave to hike rates in november because it will mean that the inflation forecast would be pushed out in terms of meeting the two to 3% target they told us from the minutes that they have a low tolerance for inflation remaining a sustained high. paul: concerns -- it seems that the last meeting the data was mixed. a slow up in the participation rate, have them not happen we would have higher employment so it is a fine balance. >> i don't think the rba should raise rates but when i look at the communication from the past few weeks i would say it has been hawkish read we had commentary from the new governor last week. she sounded i thought she sounded in concern. we had agreements running up as well. that would concern the central bank so if we see surprise i would say 50 or 60% chance. shery: despite the global risk that we saw the australian dollar being supported by the fact that we got stronger than expected numbers out of china. what are you expecting in industrial profits or the broad

this is the first meeting with the rba governor michelle bullock who came into the role in the middlee will look at india were committee will decide on its interest rates on friday and the consensus is that the rbi will keep the rates on hold. as we do, the first friday of the month will get the jobs market update from the world's biggest economy also for the month of september. that's it on this edition of asia business report. stay on with bbc news and thanks for watching. voice-over: bbc, bringing you different stories _ voice-over: bbc, bringing you different stories from _ voice-over: bbc, bringing you different stories from across - different stories from across the uk. �* ., ., , different stories from across the uk. �* ., g ., the uk. and what has changed since rod _ the uk. and what has changed since rod leary _ the uk. and what has changed since rod leary started - the uk. and what has changed since rod leary started his - since rod leary started his apprenticeship. 1963. harold was the prime minister and the beatles had only released left debut album.— debut album. getting

as we look ahead to the rba ing which is on tuesday. bit of an odd day here in australia at we are weakened by a third of 1% but a check of the country is out on a public holiday. things are a little quieter than usual the aussie dollar holding steady at $.64. crude prices, pretty strong. brent at the moment 92.49. a very strong oil price causing a few concerns for inflation and growth. shery: let's bring in our next guest who is looking to add to global equity exposure on the current weakness, we have seen already two months of losses for global stocks. with us now is head of asian equity research at ubp. always great to have you with us. where are you looking for opportunities in the global markets? >> we are looking to add to equities into the year and. we think the current weakness is an opportunity to do that. we have made a couple changes to our global sector preferences, both related to where we are in the cycle, we are about 18 months after lift off of interest rates. first we think it is going to get a little tougher for consum

we did see the rba in the last meeting and the first policy meeting with the rba governor staying ones unchanged at that 4.1% for the fourth straight meeting there with continuity as usual. we have seen that weakness in the aussie dollar as one of the per aiming themes when it comes to policy assets. let's look at how we are trading in these other parts of the trading session. >> the focus today is really going to be down to what we know from fed officials on monday. this is setting a tone for quite dovish commentary coming through and assets have been reacting to that. just recapping big headlines i came out, we saw and heard from the fed fights chair philip jefferson and he has been watching those moves higher that we have been seeing with bond yields as traders come to terms with the idea that the fed will need to say hi for longer. he says he is cognizant of that, and as a result fed officials can proceed carefully from where they go from here. and also at that same event, because it was in dallas, we heard from the fed president lori logan, who reiterated those views from philip

the rba governor saying more rate increases might be needed to tame inflation.rs that we just received, looking like a distinct possibility for november. chief rates correspondent for asia and m live contributor garfield reynolds joins us here in sydney. a beat there on cpi. what are the implications for the central bank now? garfield: the implications are that it's going to be a very tight call, do they go or do they not go? rates markets on the currency are responding very much as though i think it's a better than 50% chance that they will move. they were pricing about a 40% chance, so they were saying what could happen now, that's probably going to build towards the base case, even though it's a tough task to immediately say do they hike or don't they. it all depends on how these numbers work with the other things that are going on in the economy, where the rba's own economist put together their forecast. if they come out and say, ok, this means if rates stay where they are, we won't get inflation back to target within the timeframe that has been outlined by

unlikely to really move the needle when it comes to with the rba's doing given we saw the central bank keeping the key re unchanged with the tightening bias last tuesday really gauging the impact of already what we've seen as four percentage points of hikes. shery: take a look at how futures are coming online. a little bit of a mixed picture. not a lot of movement after we saw the s&p 500 today struggle and fall almost every sector was in the red. there was a lot of volatility. we had the treasury wrote -- route deepening with multiyear highs, the vix, at one point climbing above the 20 level to the highest in 16 months and settling a fraction below that. it was really about not only more hawkish commentary coming out of fed officials today but really the data that sent yields, the 10 year yield to the highest level since 2007, the 30 year yield also at the highest level since 2007. that narrative, that we are going to see the fed higher for longer, given the data, take a look at u.s. job openings, it toped all -- topped all four for the month of august. 9.6 one million -- 9.61 one mil

household utility bills continue to be pressure points in australia's inflation basket that will keep the rbaedge. other economic data, gdp figures from south korea and the u.s., japan's pmi data, dpi numbers from south korea, and industrial profits from china. and of course a career in the thick of earnings season. we have major tech results coming from the u.s.. investors could hear more about the cost of ai when alphabet and microsoft report earnings on tuesday. that is your week ahead. paul: let's get a preview now of the trading week ahead. our chief rates correspondent for asia and mliv contributor garfield reynolds joins us. bones are traditionally safe, but we have seen them swinging through the u.s. 10-year, 40-basis-point in the last month. how long do we expect this to carry on for? garfield: probably for much of this year the way things stand, unless you get a stunning downturn in the economic data which would say, ok, good fed is definitely done and now it will have to start thinking about when it code-3 because a recession is coming into view. unless you get that, it's hard to s

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it comes in expectations for the rba.ies we are tracking in this hour. fidelity investments is seeking clearance that would allow some of its mutual funds to exchange funds. the company is seeking to have exchange funds after the paycheck expired in may. it gives mutual funds access to the tax advantages of etf's, boosting after-tax returns. western digital shares plunged after jill negotiations. sources telling bloomberg the discussions between both companies have ended for now. after sk hynix that it wanted support the merger. the chipmaker is a shareholder and felt the transaction would be undervaluing at stake. expectations are a day after winning labor peace with a tentative contract with the united auto workers. ford also put the operating results guiding -- guidance citing the six-week strike of the pending ratification of that deal. the ceo said the firm was negatively impacted by the strike, which was estimated to cost a total of $1.3 billion so far. sources have told bloomberg that the uaw has offered a new cont

we saw a pop and linked to the rba minutes and hawkishness there compared to what we are seeing elsewhereoxies are under pressure, there is no growth story coming out of asia driven by commodity prices. the australian dollar continues to linger. there is a huge buying opportunity for the aussie in the coming six months once the story bottoms out. for now, i am not inspired to buy the aussie except maybe a relative play versus the new zealand dollar where there is divergence in the central bank outlook. rishaad: is the u.s. -- they can't afford the dollar where does and with yields where they are. if they see the dollar perhaps devalued, they can then find themselves in a position where that creates inflation and we remember what happened in the late 70's and how that was the genesis of what happened in the early 1980's and then skyrocketing price rises that we saw that paul volcker had to correct. john: it is a difficult situation in the u.s. with the economy cratering. we have the fantastic q3 gdp number coming out but these long and lagging effects of higher rates eventually had to. the