they let the rnb fall a little further. the weaker rnb, the more aggressive monetary easing gets the economy righted. gets the property market going again. drives up infrastructure construction and benefits the consumer a bit and you start to see the stable rnb and inflows again. it can only go down but of course -- >> now i was just going to say oliver the question is when does that turnaround come to fruition. an economist says china's economy will see a u shaped recovery now delaying that to the fourth quarter. is that when you see the rebound coming as well? >> well, we have been tracking the property market as an indication for overall economic health and we have been seeing that home sales and transactions have been picking up since april and historically once that cycle starts you see a pick up in investment 6 to 9 months later so you'd expect to see new construction starts hitting around the 4th quarter and real estate investment rising and providing more demand for materials as well. i would say we're looking at a

rnb is overvalued.ty: if you're looking at the chinese government response, what are you to make of this? >> i think hold your seat. there's not much you can do in the interim. it is coming to america at the end of the month, -- president is coming to america at the end of the month, and then to your. katty: how much credibility does he come coming at of the crash. >> he is nervous. he is not making many statements. he feels there is pressure. the signals are confusing. he is trying to construct a get himself back together again. katty: thank you very much for coming in. >> you are welcome. katty: french authorities have opened a terrorist investigation of board the boarded attack on the french train last friday. el-khazzani watched a jihadi video just before taking out his gun. he is in court on tuesday. he was barefoot, blindfolded, and his hands were bound behind his back. he told police he was only planning a robbery. this video was taken by one of the americans who overpowered him. it shows the mor

with, i guess, the volatility you often see in other major currencies you still have to have that the rnb volatility is relatively low but this is another step and not quite a fully flowing currency. >> john, we'll leave it there. thank you for your perspective. >> thank you. >> i want to pick up on one thing there as well, seema, china keeping it's exchange rate artificially low. it's allowing it to weaken and still keeping it artificially high just to a lesser extent than before. that's the bigger point here. finally allowing market forces to come into play and would be getting much, much weaker if it was allowing forces to come in to a full extent. >> but intervening is keeping it low. it's not just allowing the market to dictate the price of the currency. >> it's relaxing it's intervention. it's fixed it's currency traditionally and now allowing it to go lower. this is a move toward financial liberalization and allowing it to weaken. it's still keeping it artificially high but to a lesser way than before. >> agree to disagree. >> is it fair to question the pboc's credibility with the

reporting a q-2 net profit of 7.31 billion versus a rnb of 5.84 billion in the previous quarter. you can see the stock down about 4.2% in today's trade. >> suffering along side the rest of the chinese market. big day of course for chinese internet names and more focus on alibaba throughout the show. still to come, trump not stumped. can the donald continue his surge in the polls. we bring you the latest from washington after this short break. bhap >>> china devals the yuan for the second straight day. continuing to royal european markets with heavily exposed stocks leading the declines. alibaba with fiscal q-1 earnings before the bell with internet giant's profit expected to fall and ge selling it's health care finance business and loan portfolio to capital one for about 9 billion. >> u.s. secretary of state john kerry says that under the terms of the recent nuclear deal a violation of the arms embargo by iran would not force an automatic reinstatement of u.n. sanctions. also that the u.s. dollar could seize to be the reserve currency if america walks away from the iran deal and

rnb, there's talk of going to 3 trillion. i think that would help ease the pressure on financial vehicles existing year to date. so clearly, that would be something to solve. i think when we step back and look at the bigger picture, we're at a very high level. even today mortgage rates are 5.5%. corporate rates are at a6%. when you think of that bpi number, that's almost double rates on the corporate sector. we do think it's something that happens over the next couple of quarters and hopefully adds relief to the private sector. >> josh, one of the most persistent means has been the weak economic data coupled with the measures taken by the central bank. when does the story change? when do the reforms put in place by the pboc actual go through the economy? >> that's a good point. we've seen monetary policies like the psl, sof with borrowing rates of 3.5%. ultimately, this is towards a more transparent rate in the market. one of the policies you've had with china, there's a bit of ambiguity. that may have been a strength with be

what are your thoughts on rnb? >> interesting company.'t see a catalyst for a sleep deprived problem. let me say this has always been a company people think will get a takeover bid and i am not a buyer of a companilike that. nancy in massachusetts. nancy? >> caller: hi, jim, thanks for taking my call. my dad and i, my father was a big fan of you and your show and i'll calling about illumina. >> i see you that and raise you with tmo which we've had on the show. illumina is a good company, too. but thermo fisher, i think they deliver. that's what i want to be in. jerry in tennessee. jerry? >> caller: hey, jim. watch your show, appreciate what you do. >> thank you. >> caller: my stock i'm interested in, have some shares in is cyprus semiconduct zblor it's just a total house of pain. we had t.j. rogers on, they had a good quarter, it's got a yield of 4.5%. i don't know what to say other than this stock market a little bit irrational when it comes to semiconductor, witnessvti which had a blowout but then last night onanalog guys goes crazy. to

looking at here is the aussie dollar, off 0.8%, off the back of the decision by the chinese to allow the rnb to devaluate by around 2%. of course, relative to moves we've seen in the euro and the yen, it's a very small move, 2%. so, they have deserted their usually strong starts of not letting it devalue just to allow a small move. will that be enough to allow exports to recover? of course, the fallen exports we saw over the weekend, the catalyst to see them dessert their traditional stance on keeping the currency steady. let's look at bond rates. what are they doing today? the ten-year in the u.s. just below 2.2% and the ten-year in germany below 2.7. those have been steady the last couple days, those two safe havens. looking at italy, 1.8%. so, again, not much of a move in the peripheral yield spreads, despite the deal we've seen out of greece. joining us down the line is anthony o'brien, co-head of european rate strategy at morgan stanley. he joins us now. gom you. thanks very much for joining us. let's get straight to this greek deal and explore whether that changes your preference betwe

even more so now with the devaluation of the rnb.y, is that they're simply opening up the yuan to market forces that this is just a correction because the rnb has appreciated so quickly. it's up 10% since 2014 and perhaps they're loosening their grip on the currency exchange rate but the analysts are a lot more skeptical. >> the world is watching this story closely, as are we. anna coren thanks to you. >>> images posted online appear to show the beheading of a croatian hostage held by the egyptian branch of isis. the images cannot be verified we the croatian prime minister who says the situation looks bleak. ian lee has the details. >> reporter: croatian -- was a topographer for a french company. he was kidnapped by isis and it appears they have executed him. the croatian government while not able to confirm, fears the worst. this is the road where isis reportedly kidnapped the man. there is not much out here but desert. it is an area known as the western desert famous for oil seekers and it is unpredictable and dangerous. a year ago

now we have the rnb depreciating. 36 has been negative for months. gdp growth of only about 4%.hina is not falling apart. if anything, imports are picking up again. high-frequency china is starting to improve. particularly the expectations of fiscal stimulus. on the whole, markets are structurally oversupplied. equities are not pulling their weight either. where do you expect the commodity markets to head. do you think the most -- that what we have seen has been overdone? china is not falling apart. what is it, 16-year lows western -- 16-year lows? >> pricing like it is 1999. anna: the chinese economy is not back to where we were in 1999. does it make sense? >> neither is demand. as the growth starts to wane, china's ability to push out across all commodities is this inflation rate. we have moved into reporting season, where we have not seen supply cuts announced. the commodity market still needs aggressive supply cuts from producers in order to bring back into balance. we still have oversupplied. -- oversupply. nothing changes the fundamental week driver around the commodity sp