the boj meets on wednesday. y scandal and mitsubishi motors is in the headlines again. the company used a test of that does not comply with standards on 27 models that would amount to 2 million vehicles. it to be she motors admits data,lating consumption but said it only covers 600,000 cars in japan. the s&p as putting the long-term credit rating on negative watch. powered by over 2400 journalists and 150 bureaus around the world, this is bloomberg news. australiaith asia and and new zealand are closed for anzac. here is haidi. quietert is a little with the absence of australia and new zealand. day forcommemorate the anzac. this is how we closed on friday. indexia-pacific really retreating, still, a third straight weekly gain for the regional index. some late we saw stages surging in the nikkei 225 of why 1.2%. -- up by 1.2%. japanese lenders have been badly hit and will continue going down by the negative rates program. ,nd chinese shares reversing ending in the green. we had the biggest weekly loss in shanghai

funds that the boj buys. and buy the company's share themselves. as we put it together, it turns out the boj is a pretty big shareholder, top 10, 90% of the nikkei companies. for some companies like mitsumi electric, that provides parts for iphones, boj holds about 11%. it is huge. for some companies, the top three shareholders. is twofold.ion it helps prices. it means the boj has to be there buying it all the time. secondly, you have to wonder what exactly this means for come -- corporate governance. if the boj can just print the aum, essentially. will they really care about how well the company is being run, when it can just keep on printing money? i think those are the two implications for shareholders and investors. rishaad: now that the boj has been buying, we've got a lot of economists saying the purchase is going to actually perhaps increase. what happens if they double or triple the amount they are buying? is there a limit? reporter: i guess there is no limit, so to speak. but economists do expect the

the boj story having a big impact in asia right now. european markets not really rough acting -- not really reflecting that at the moment. mispricedn the wei function, fairly flat open for european equities. i urge you to keep an eye on the dax. those german carmakers are going to be in focus. that could be one of the biggest stories of the day alongside the boj. caroline: really. we are getting quite a move on the yen, weaker today. that being filtered in as the boj looking to try to give some relief to the banks, looking to help get credit into the real economy, offering negative loans. percentageis up one point versus the yen. jen, one of the worst performers on the currency market today. euro, pretty much flat. we did see that erasing of most of the euro's gains yesterday. mario draghi is focused on credit, not on the exchange rate. i focus on brent. it is up 1.3%. it has climbed 8% this week alone. and silver, what a week. seen it up we've more than five percentage points. now let's have a look at what is happening in the first word

we have news coming out of the boj. course wehat, have been hearing the critics, talking about the impact negative rates have on financial institutions. now sources telling us the boj maybe throwing a floating device for some of the nations lenders, eyeing possible negative rates on the loan programs. they might adopt negative rates for some of the excess reserves in some of these banks. and financial institutions leaving money idle, that could be interesting to see. because we are heading into that boj meeting next week. and sources saying that this could happen in conjunction with deeper cuts to the negative rate reserve. deep financials up 2.7% on that news. particularly the banks, up 4.4%. all rising now. and the likes of the big leaders on the board, up 5.6%. we also saw some movement in the of, in response to this news the dollar-yen weakening. weakening 4/10 of 1% in just the last half hour to an hour or so. here,tinues to see sources telling us that officials could be adding this into the arsenal. which is again

francine: the boj making policy announcements. rio draghi signaled did ecb will wait to see how measures pan out. could that open the door for janet yellen to raise rates? first i want to bring you my chart of the hour. 7.8 trillion dollars in government bonds have been driven below zero by worries over global growth. money managers are going into debt with maturity for over 100 years. you can see more church by heading to, the story only bloomberg calls it the most dangerous bond market in history. let's welcome with that nice little intro, dangerous trade. very of cookare investment given the incredibly low level of yields. very difficult investment given the incredibly low level of yields. francine: if you look at the 40 year gdp with the white line, the blue line is a 30 year. now we are around 0.4% which is quite credible. do you buy anything in terms of environment echo scott: it is tough because the intervention by the bank is still massive. terms of environment? scott: it is tough because the intervention by the bank is sti

expectation that the boj is running out of ammo. e from the third arrow, the fiscal arrow. anna: we've got a great story on the bloomberg this morning. officials at the boj increasingly want government to expansion.spur this according to people familiar with conversations at the boj. dominic: it is what we would like to see globally. we need to see more reform to boost productivity in these markets. in that environment where growth is slow, germany speaking structural changes. i can take something off of headline growth. -- they can take something off of headline growth. it would be a positive story for the global economy if we saw more reform. whether we get it in the near-term would be more of a challenge. anna: dominic bunning, a busy week ahead with the fed in boj on the radar. equity markets opening. looking a little bit sluggish. futures looking flat at the start of trading today. still a half-hour hour to go until the start of trading in europe. that is it for countdown. i will leave you with guy johnson. ♪ guy: welcome two on

the boj withholds more stimulus. s to gokuroda to effective negative rates, but is he really affecting damage? the fed remains reserved. and deutsche bank me to the net income line of just 240 million euros. we expecting a negative start. we just may be soften up a little bit more down by around half a percent. we worked our way into the open. as we get to that open, let's find out what is going on. nejra is you tell us what is going to happen. stockswe saw that asia were initially rising, we then saw them reverse those it gains in japan. as you say, futures were pointing lower. now, it looks at the are seeing a weaker open. , euro stoxx 50 is down as well. toll waiting for the dax open. it looks at the moment like we are seeing a majority of red across european equity markets. let's take a look at the stoxx 600. ,t is red across the board every industry group has a low on the stoxx 600 today. the worst performers are financials down 1.2%. the -- let's take a look at dollar yen come with broken through 109, the yen ac

watching theely yen ahead of the boj decision day. l holding above the 111, certainly doing better than the 107. here in asia. the yen rebounding off of a three-week low, and it dropped the most in 17 months after bloomberg reported that the bank of japan is considering sending relief to its banks affected by the subzero rates. we are taking a look into this. the yen took a tumble on this report. it has since strengthened. what happened there? on friday, the boj has thistrying to stop strength, but we are some 7% up the year to date, but yes, a significant pullback on the yen last week, but some may have been an overreaction to what is speculation as we head into this boj meeting, but, yes, they are saying the boj maybe trying to spur some lending. basically, it is a relief measure here for the boj for the banks in japan, and some interpret that, hey, this may be a relief measure for what can happen on thursday, which could mean a bigger negative rate cut on reserves already, so those are in conjunction. for the short-term, some say do

has not moved the needle as much as the boj wanted. table, six months this time next year, so towards the third quarter of next calendar year. now, have a look at this. can we get this graphic up that shows you where it has worked and where it has not? when you look at profits of japanese corporate scum a function of that week japanese up 9%,iving stock prices profits on companies in the topix index, but real wages have fallen 1.5%. the figures released last week show that japanese companies cut their forecasts for inflation for the next five years. what is that mean? that's the outlook for pricing. why would you raise wages if you cannot see pricing ahead? that is the inflation read. let's look at gdp growth. power, theo abe took japanese economy is essentially 6%, larger than what it was back then. aina by comparison is about quarter bigger, the u.s. is about 11% to 12% bigger. 9% over the same timeframe. when you look at 5% or 6% and the growth in debt, you grow yourself out of the debt situation ideally when central-bank start to bu

>> we expected the boj to stay on hold. t the yen strength and so much on so little shows there is a degree of instability in the markets. it tells us the market is completely driven from central banks, and pay very little attention to what the boj has done in the past. there have been massive impulse coming from the boj and the ecb. but the market is not paying attention. vonnie: we are, however, sticking and some kind of range. 108.re between 113 and 107, we dropped to. francine had an interview. the economic instability is the case. what you are seeing in the case of the dollar-yen. you have two effects. the dollar is weakening paid you have to yen undershoot, which is steadily correcting. the commendation of the two means that -- the combination of the two means the dollar-yen is still heading for instability. francine: i might be the only one who thinks this is significant. this is governor kuroda telling markets to leave him alone. this is something we have not seen at the fed or ecb. >> so, what we are finding out her

some said the boj may provide relief to lenders by offering negative rates on some loans. the interesting factor in all of this is that after today, japan is going to be shut down for ten days this what's known as golden weak holidays here. that could invite a bit of volatility as well and not to mention the reaction in overseas market while tokyo is closed for business. amidst all of this, let's not forget crude oil futures settled at five months high. helping to boost the fed stance as tone down global concerns following the policy meetings. looking at the dollar. that's a bit of a focus there after australian dollar fell over 2% following inflation data. some of the index is trading in the positive. china markets open in an hour and a half. >> sounds like it will be a busy day for you. talk to you in a few hours. >>> there are big changes under way at japanese firms that are serious about employing and retaining more women. in the final installment of our series, nhk visits two companies that are leading the way. >> reporter: the color of the car is unusual and so the dr

mark: disappointing about the boj today. f of them expected some sort of policy from the japanese central bank. the boj deciding to sit on his hands after implementing negative interest rates. consequently we are seeing stocks fall. this resources the only industry group that is rising on the stoxx 600 which is down. it is 1.25% lower. it is a day dominated by earnings. first i want to talk about the yen. this is how the yen is faring after the boj disappointment. we have data from japan for the boj which shows inflation sank in march by the most in three years. the boj is no closer to achieving its inflation mandate. it pushed back its inflation goal for the fourth time in the last year. all of these major currencies are falling against the japanese yen. the best performer is the new zealand dollar. it is down by 1.4%. busy week for bank earnings continue. deutsche bank hosted a surprise drop it in the first quarter. legal expenses dropped its trading possesses. -- trading businesses. restoreder pressure to investor confiden

i think that is true with the boj and the ecb. we know the raise in interest rates, it suggests they might again given certain market conditions. i would agree the boj meeting to night is important. it has gone off the deep end in terms of quantitative easing. we will see tonight whether or not the extent that. the balance sheet to about four joined dollars over the past year or two. they have negative interest rates now, and they are buying corporate bonds and stocks. this, thatnated by the large kept japanese stocks of the 10 largest holders of these, the boj is a holder of 90% of these large-cap stocks, one of the 10 largest holders. it indicates to me that the boj is really in this to win it. i am not sure they're winning it at the moment. >> is there a trade you can put on at the head of the bank of japan? >> yen dollar related. even more in terms of more significant corporate and an extensive end to the stock market, that it would affect the yen dollar relationship. as you know over the past month or two, what they have been

jon:, i know you're all over the boj. lling the federal reserve non-decision, a weak dollar. apple down on my premarket screen by seven percentage points. 41 straight quarters of growth over, and it will not resume if their guidance is anything to go by in the next quarter. you guys are all over this -- crude, 45 bucks a barrel for wti, for the first time since november. michael: jon ferro, thank you very much. we will talk about the same thing, what is going on in central banks in particular with the bank of japan. that is the subject of our single best chart. can the boj manage its own currency with its monetary policy? we have seen the bank of japan and the yen be affected by what goes on around the world. the yen is always a haven. you can see how the yen has reacted over the last couple of months. the circle is where they went to negative interest rates. but the yen kept getting weaker. one reason, everybody buys in when things go bad. yen volatility is starting to come down, and that has the yen getting stronger into

the door open. rbnz said more easing may be necessary. bojlight turns to the an inflation target way out of reach. policy doesn't's seem to be working. the japanese economy is backtracking to the time before abenomics. felley gauge of prices 3/10 of 1% from a year earlier. the most since april 2013. that compares with forecasts of .2%. energy,, which excludes did grow by 7/10 of 1%, but did ms. estimates and is a slowdown from the previous month. the labor market does remain on solid ground with the jobless rate at 3.2% in march, and also 130 job positions for every 100 jobseekers. the problem now is that the labor market is failing to an uptick in spending. retail sales fell 1.1% in march. household spending plunging 5.3%. both numbers reversing course from gains the previous month. is not surprising given that the preliminary results of the spring wage talks have shown the pace of increases to be slower than last year, so households may be reluctant to open their wallets. production did grow 3.6% in march from a month earlier, beating estim

mark: will we see the boj go in the opposite direction?economists we surveyed say they probably will be some further loosening of fed policy. a slight majority are probably favoring the boj doing something. what do something mean? it is considered quite unlikely they would cut the interest rate further into negative territory. that has not worked out too well for them. coupling that with more asset purchases or qe, or maybe just or say we need more time to see how it plays out. thatore of an expectation something will come from the boj this evening. talked aboutfink the boj earlier this morning. larry: the whole process of what japan is trend to do was restimulated economy through aggressive monetary policy, but the second phase -- erik: what option do you have right now? to thehe has to talk prime minister and say i ran out of runway. betty: are we there? a desperate situation. abe ironically, the administration has been the one most inclined to pursue a reflation or strategy. kuroda has found himself the only one at back. abe increased t

surged, at the boj maintain records that was. re than half of the economists in a bloomberg story said they will predict more from the boj. on the wrong side of the trade, but the japanese occur t economd are jodi schneider joins us. seeming to surprise some in the markets, survey looking at the currency market and the equity market reaction. jodi: yeah, a big surprise. though not everyone can we only of a slight majority analysts who resurvey, bloomberg survey, thinking there was good the action at this meeting. we will hear more from governor fewda soon, in the next hours. we will know more details them. but this really does appear to be keeping with some of his past stands, as he has been doing this for three years now with the expansion of the monetary stimulus. and he seems to really be saying, wait for the actions to take affect. let us see what effect they have on the markets. and if they have an effect in terms of moving japan closer to the inflation target. and the negative interest rate policy, less than three months ago

the ugly is the boj.nk the boj is divided where they're going to move are not -- whether they are going to move are not. shery: how much is enough stimulus at this point? it is difficult for the boj at the moment. how do they satisfy the market. this is the key question that not only everyone is asking themselves, but also the boj. as you and your viewers know, when they move for qe3, january 29, dollar-yen was 118 before they moved. we had that quick spike up, and we are obviously a lot lower. we were won 12 this morning, so significantly lower, and i think it is a sign of qe fatigue that we have been talking about for a while that is showing its phase come so the boj is thinking two things. the first is that qe is the next financial gain. every time you have to come back to the table, it has to be higher and harder. another is what level do we have to come in. i think it is the 100-105 level. the next question is how hard and what else can they do. a have to do something epic to be a real game changer.

the boj really has a mandate from the large japanese corporate's to do all that it can.s been intervening ever tince the yen was a lo stronger a few years ago. the last thing it wants to see is those trade gains eroded by a currency that appreciates again. the fed is the wildcard, because the fed is buying as much time as it can, delaying, pushing out, using the same tactics we saw in 2015 to buy more time to move, but to do it at their own pace and delay as much as possible. rishaad: well, indeed, and the minutes do suggest that they will be moving. as you suggest, they are in no big hurry. how much will the earnings season in the united states prey on the minds of those members of the federal open market committee? >> i think they are definitely cautious, because u.s. earnings have now been beating and the moment has been strong for a long time. , when look at bullishness the markets surveyed as to how bullish traders are, we are around the same levels we were at since 2008, so there is a lot of optimism there, perhaps too much optimism, and perhaps this earnings seaso

especially for a big player like the boj. ays going to be on the lookout for a rain check and for them to take a long dollar-yen position, they want that proper follow-up. guy: is this a lead indicator -- the eurogroup stop >> i believe that policy was somewhat synchronized the right now i think what they have done was how they view the banking and driveld help credit growth. the strategy has leverage somewhat but if you look at 15, we arer, 114, 1 slightly comfortable with the levels. i think that anchor a relatively good inflation forecast. they have to be aware of each other. you have to go back to carney's speech in february, telling the ecb and the boj that the central banks going negative -- it starts to generate demand and that should be a conference of -- guy: the third arrow has finally delivered. always a pleasure. thank you. he'll be staying with us. don't miss our conversation sakibara. he says the boj will only intervene at 100. the people of the market are talking about 105. the uk's prime minister gets ready to

with the boj buying, gives more power to etf. question is, prime minister abe wants corporate efficiency to be a big thing in japan, but essentially the bank of japan continues to buy. it detracts from the. -- from that. hans: we are looking at what we have received on the negative interest rates and quantitive easing. how much for guidance are they giving? how long are they going to play the etf? reporter: the quota has been asked many times. he said it is too early to talk about an exit. he avoids that question because he knows as soon as he says something, the market will sell off. dents. have prece in the u.s. and hong kong, the government but large stakes, but over time they have gotten rid of them. it has never been on this scale or impacted as many companies. it is the first time in history that we have had something like this. i guess we will see what the exit looks like when it becomes time to do that. hans: hopefully, we can come back to you at that point. thank you for your time. i want to bring you breaking news. there

aware of the fact that maybe we could get intervention from the boj? yet. think the problem with the boj in justifying intervention would be the yen is still undervalued at current levels. there may concern will be the pace at which it is moving rather than the outright level. if we wait for days just wait four days, the risk rises materially. -- wait four days, the risk rises materially. that't think we are at point yet. the cloud i am looking at now for euro yen, the potential for a downside move is it there. -- is there. you look at the actions of the boj versus the ecb, is it draghi versus kuroda guy: -- kuroda? not been a major factor in the declining dr. -- declining dollar. it is been a commendation of that's aeing risk-off combination of markets being risk-off. -- a combination of markets being risk off. the central bank policy outside of the u.s. has played a miner roland that. some -- forward you get if risk appetite stabilizes, dollar yen can build up more momentum. it needs those conditions to be met. probably the most important factor will be th

in the income of the boj is going to do more because there's not much choice left. ve to move negative rates, pay people to borrow, i think the problem with the strategy and the reason that i say that we may be at the end of what the central banks can do is that paradoxically you are forcing people to save more as they realize it at have enough money for retirement and that has been the problem not only in japan but the developed world as you reduce rates, you are forcing more saving in less spending. it is a tough road for japan. the boj is going to be moving for more action, more qe, they will pay you to borrow -- the question is whether it is going to be effective in the long run? the markets have their doubts. rishaad: what would you do? i think it is a fiscal policy story for much of the world including japan where rather than printing money and buying assets which will help the rich, you have to put more people to work and japan has a low unemployment rate so it is not a big problem there as it is the rest of the world that you have to start investing in infras

guy: was it a mistake for the boj to do nothing? i think it is quite right .hat they stayed back unfortunately for them, the yen is a risk of this currency when it goes up. right thing tohe hold onto. but to see what happens with fixed interest rate. guy: they get in the no impact on lending at the moment. people described this as pushing on a string. it wille questions, have to come from other areas. guy: was negative interest rates a mistake? that would seem to be the impression we get from mario draghi that they are very different economies, but draghi has made up his mind that it is not a good idea. extent of negative interest rate policy has come to an end. if you ask a bankers and will europe and japan they would say it was a mistake. guy: the fed actually did what it did is the real story this week. not a lot, but we continue to see the dollar moving down. the impact that is having is a larger effect. of the the dollar is one most important market levels. the fact that brent is higher, that signifies and quality prices that i

why isn't the boj moving this global event that causes people to sell everything? guest: i think they got to focused. i also think about waiting to see the full impact. >> we saw futures the other night that when the boj didn't move anything, why is it we live in this world where people sell you futures because the bank of japan didn't go further into negative freights? -- negative rates? , there isn't a lot of growth, so i think we need to be sensitive to that. -- guest: there is a lot of we needo i think to be sensitive to that. japanese earnings have more than doubled over the last year. people have been sensitive to that. >> you talked to a lot of people in the equity market. what you think in terms of the idea of people hedging their portfolios against the market falling? we have seen a lot of talk about fix related products -- about relatedted -- about vix products. guest: we think that is a sensible thing to do. test global equity strategist and head of -- thank you. >> will improve conditions from financials ever arrive? we will discuss credit market decisio

. >> the nikkei drops after the boj has no policy change. governor corrokuroda saying he'e maximum force if necessary. >> and we speak sclusfully to the cfo later on cnbc. >> and margin pressure drives a 20% decline if first quarter profits. >> electrolux beating expectations across europe and north america. ♪ >>> so we've been waiting for volkswagen ceo to have a press conference at the first annual result meeting since the announcement of the diesel scandal. i can see the press conference has begun so let's listen in. >> translator: it is close to my heart for you to read -- under the motto moving people. you will find a host of information with many stories and impressions from the word of the volkswagen group and its brands. our navigator should be familiar to you. you will find the most important key financials data facts on the group, the fact sheet now available as a small app. so that you are always abreast of developments. may i ask mr. moda for his contribution now. >> translator: good morning, ladies and gentlemen, a warm welcome.

and the boj yen index since 2011 when the the oj last intervened.en the yen rise the dollar since june last year. we've seen the yen index rise as well. these indices are working inversely. one of our big writers at bloomberg, he says, keep an eye on the yen index, don't keep an eye on the dollar-yen. he says that is a distraction. he says the level of the yen index, that is what we should be looking at. we are 35% below. in theot a 35% upside saysndex before our man the boj intervenes. ignore the dollar-yen and keep an eye on the boj yen index. francine: mark, thank you so much. that is almost it for "the pulse " today. stay with bloomberg. plenty coming up throughout the day, including a historic gathering of the fed chairs. janet yellen and her three predecessors up here together on stage in conversation for the first time ever. definitely don't want to miss that. stay with us. "surveillance" is next. i will be joined by tom keene from new york. ♪ ♪ francine: the yen hits a high as fed minutes show caution over an early rate rise. jp morgan relea

then it b comes at what point does the boj intervene. those are the questions kicking around the market. let's get our guest in on this, the chief strategist for morgan stanley. good morning. >> it's a big story. it's a market where you have a lot of crosscurrents between the pmi and other data picking up, but at the same time, indicators of risk like the yen and commodity prices have been headed down. i think those are hitting critical levels for the yen, where you are reaching levels where the market will expect some greater form of either central-bank action or policy action or both. guy: which do you think is more likely? >> we think it will be a mix of the two. we will get increased central bank action at the policy meeting, an increase in etf purchases, but importantly, and the spoke to your previous guest, we will see fiscal policy step up in may. i think that will be an important element to complement anything the boj might do in april. hans: andrew, i want to take you off again story, although i agree it is dominating, and take y

it is also being bought up by the boj. the net stock is falling.us: that leaves you with another potential market that is so contaminated. you at -- i will not give great big go by. guy: you can do that lead-in anytime. manus: guy, thank you very much. let us talk about iceland and the newly installed prime minister who faces a no-confidence debate in parliament today, it barely a week in the seat after the former prime minister stepped down earlier in the week when leaks from a panamanian law firm revealed offshore investments in his name. plans to lift capital controls are still on track. >> it has had no impact on that. a counterparty in the current government. we plan on proceeding. i am hoping that we will be able to take that action. i think it is likely before the summer recess. manus: for more on this story, let us bring in our nordic managing editor. there he good day to you. -- very good dates you. the no-confidence motion is what we are waiting for today. it was a forward yesterday led by the pirate party leading in the polls. that will

at the 18 month high, and worrying exporters and the boj. tures in chicago pointing to a higher open as oil climbs as well. yen, searching last week to the highest level since 2014. this is a rally that has confounded most currency strategist. were taking a look into this. there's one to you that says we should be looking at the yen through the prism of the bond market. , traders,estors everyone scrambling to explain this meteor ascent for the japanese currency. through at make sense lot of metrics. there's no indications that abenomics is taking hold. theory put at this forward. even though japanese government have gone into negative yields, if you compare real at as, they're looking increasingly attractive competitor. this is the metric were looking ,t, the narrowing of the u.s. and that explains why we could continue to see further attraction to the yen. morgan stanley cohead of fx strategies saying if yields remain high, that discourages the export of capital and could result in further gains for the yen, weakness in the dollar against th

the korean won is heading for its fifth weekly gain thanks to the fed and the boj. philippines. i want to show you the peso because it is probably one of the only asian currencies that is we can sing -- that is weakening because of the election coming. francine: coming up shortly, it is "bloomberg " with david westin and jonathan ferro. jon, you have a lot going on. you're talking about banks and currencies. to 107llar yen dropped for the first time in 18 months. we will talk about yen strength and dollar weakness. crude is popping. the bti, $46 a barrel. -- wti, $46 a barrel. we will look at linkedin, up over 8% premarket. we will wrap all of that together. francine, the s&p 500, second-longest ever bull market. we will debate that and some of the nuances around it as well. high can ago? when it stops going higher, what happens? mario draghi's challenge was all about consumer prices. in the last hour, we learned that inflation is falling. is still here. when you look at the conundrum that is the european union or the eurozone, gdp a little bit better than expect

and all eyes on the boj next week now. >> all right sri. see here too after the ecb meeting. but stay with us because i remember that you are a music fan. it is a tough day for music fans. tough year so far when it comes to the passing of many of the greats and today the tributes continue to pour in for prince and fans around the world which have taken to party like it's 1999. i understand sri is getting into the spirit as well. >> we're going to do our own tribute. we are going to boogy in honor of prince. so come on, hit me. ♪ purple rain ♪ purple rain >> very impressed with that one sri. would have liked you to sing "little red corvette." >> there were so many classics. he's going live on in fond o memory in my mind and heart. he reinvented the p funk era. >> and apparently so many unreleased songs as well. there is a vast collection of those. perhaps we'll get to hear what hasn't released yet. thank you so much for joining us and have a great weekend. >>> getting back to the big story this week around the ecb, mario draghi has now rejec

some japan watchers see the boj as running out of ways, but governor kuroda says there are many ways further actions. inflation is not a choice between monetary policy or growth strategy, both are necessary. in this context, the government initiative to enhance japan's is of vitalwth importance. addressnor kuroda also negative interest rates and the impact on banks. cutaid negative rates don't profitsofits -- bank excessively. he says it is not aimed at the currency markets and is not the cause of the yen's gains. thanks indeed for that. we will have a detailed look at that story later in the program. tweet us your thoughts at @rishaadtv, include #trendingbusiness. the u.s. banks earning season, let's have a look at that, as well as some other stories. good day for j.p. morgan, shares jumping more than 4% in new york, the best performer on the dow after reported earnings that beat estimates. $5.5 billion, while revenue was $24 billion. first-quarter profits got a boost from trading in march, lower compensation and legal costs, and strengthen retail banking. trading revenue declined le

the boj would need to, again, somebody prepared to go an extra mile. air question, but i'm going to ask it, anyway. is there an appropriate abenomics level for the yen? is there a level at 120 where we are happy, or 110? or is it 150? abenomics has been weakening yen. with that, the economy should have profited, companies should have profited. this should have created room for true reforms. we thought when we ask for reforms in japan, they will should lead to stronger currencies. profitability is rising and so on. this would help the currency. when the yen had been sufficiently week, when inflation have an higher, profit seven higher, it has to deliver on the real economy side and not on the yen. the financial market is questioning if this is possible, tom: david cole with a good briefing from frankfurt. seeing, mystery we are the yen move, a massive yen strength, and a brutal move. david kohl. coming up in the next hour, it is extraordinary how the weekend as been. i don't know if we can talk about. we will find out if robert can talk about yahoo!? yah

it is a relief for the boj to see a weakening. maybe the beginning of longer-term development which could see weakening further from here. anna: will depend on what -- will it depend on what they do? if they see further week -- if we see further weakening in japan -- many in washington won't want them to do that. valentin: what we are seeing at the moment in terms of yen depreciation was a response. the boj has run out of options to ease further. part of that was clearly the response we saw in shanghai again, further aggressive easing. interesting comments last night minister, butance also kuroda suggesting commitment to further easing that could receive endorsement by their main trading partners. the boj is not necessarily out of options to ease further did we expect -- further. we expect aggressive easing in the form of stock market purchases. the key reason there, it is going to restore boj's credibility when they say we want to boost money and expand our balance sheets for the quarter. there is only one asset left if it is liq

that is the boj, are not sure there is much they can do. ly weekend at the currency much. scarlet: you can see that there with japan introducing negative interest rates, and going from strength to strength. >> and does not appear to be an interest rate story. you could understand yen strength for the end of their fiscal year, they often repatriate some of their assets. that is no longer the explanation. there is something else going on in the markets. theres not look like -- could be some big reserve ships going on around the world, and those are things we don't know about. alix: i thought it was a really fascinating take. china doing its own fx rebalancing that could be leading the yen higher. strength is something that everyone is talking about but nobody really has a coherent going on,t what is especially in light of the boj going to negative right. he was not particularly sure himself, but it's possible that china is reallocating some of yen.x pile into scarlet: i find it fascinating on whether it is the result of something happening, or

further down the line, we have obviously the boj meeting at the end of the month, presumably further fx appreciation will increase chances of more aggressive policy action. >> and it's interesting you note that investors are perceiving the bank of japan is running out of tools because we also heard from kuroda this week saying we still have the tools. so where is the disconnect? is this simply their way of talking to the markets? >> two things. one is negative rates were seen as a central bank tool to cheapen the currency. one reason the euro is so strong is actually the assumption that investors make that the ecb has hit the target of the negative rates. a big chunk of, say, the household wealth in japan represents deposits. so further cuts in the deposit rate may trigger a negative wealth effect, which could derail the recovery. they assume that qe, in terms of boj's ability to expand their balance sheet, is certainly not available anymore. we disagree with that. we think the boj will result in direct purchases of stocks. really, nikkei stocks. that will give them the opportunity t

the boj meets next week to decide the next policy move. bank of japan governor kuroda was waiting for? mentioned 1.7%ou move in the again, it is dramatic. let's a how to involved markets are with policymakers. the river is self caused -- the room itself did not cause this dreaded move. he rumor itself did not cause this dramatic move. apt to move most dramatically and the most short period of time is the boj. they are up against tremendous demographic in induced inflation, deflation. they made a significant error trying to introduce sales tax, which sent them into recession. and now qe and buying bonds, how much stock can we buy? so the market is handicapping some of that. if they fail, they do expect a dramatic selloff of stocks that have rallied in anticipation. back fromalternately financial wealth back into the real economy? these are questions for all of the central banks. david: we talked about macro risks. what is the upside? we are talking about the state of decline, the graphic problems -- demographic problems. what is the possibl

are penciling in more stimulus from the boj. the big corporate stories today is from car four. shares are up 3.9%. france's biggest retailer reporting higher first-quarter revenue. growth compensated for a decline in china. happy anniversary or not for the stoxx 600. a year to the day, the stoxx 600 hit a record high. 600 hasen, the stoxx fallen by 17%. let's look back at the past two peaks for the stoxx 600. look what happened thereafter. 50% in thell of over ensuing years. 50%housing bubble, we saw a decline. if history repeats itself, francine, the stoxx 600 could, i say could, fall another 50%. happy birthday, stoxx 600. francine: i don't like that so much. usually happy birthday is a bit of up news. mark barton with a great asset check. there is a chance but you k12 vote to leave the eu. he is menacing. singh, one of the few people to correctly predict the outcome of the election. thank you so much for joining us. he's the referendum not different? can you be certain that you are predicting the right numbers like you did wi

what does that mean for the boj? that is a question we are all asking right now. ensus a couple of weeks ago was that the boj needs more time to assess the impact from this unprecedented policy which is negative interest rates. given today's reading and the bad data from the last week, there is more of a sense of urgency for the boj to do something right now instead of waiting for the summer. much werenk you so taking us through the data. mohammed is still with us here in london. the report is at a three low. there seems to be a dissipation abenomics and a mutual distrust that governor kuroda can pummel the yen. mohammed: there was much excitement when a abenomics came along. the hugehat led to surge in the japanese equity market a couple of years ago. now, we are a few years on and we are looking at the basic economic situation. it is still basically uncompetitive. in anrld around japan is easing phase. it is difficult for japan to act in isolation when other players are also easing and putting in stimulus in place. hans: when you look at where the dollar-yen is,

in fact, currency traders have already reacted sharply to a media report last year about the boj that it could help banks by offering negative rate loans, and that itself caused one of the biggest one-day dips for the yen since october 31st, 2014. so we've already seen some volatility in the currency markets. >> apart from the fed and boj meetings, we also have some key data that could swing the dollar/yen pair. >> the key data out of the use will be very important due out on thursday. the dollar slipped a little. look at it now, 111 flat. now first quarter gdp on thursday will be a key guide for the u.s. and for investors. for all intents and purposes, there's no expectation of a rate hike by the fed at a meeting this week. in fact, the gdp data may have more of a bearing on what the fed may do at its june meeting. mitsubishi motors will be announcing earnings on wednesday, and that's following the fuel efficiency scandal that broke last week. and we've seen the market value of mitsubishi motor plummet since that point in time. but that will be a big focus. sony also due out on frida

what should the boj do? should they just get the fiscal side in order?hink what were seeing here due tonishing returns incremental changes in policy. if you said we would see more negative interest rates or more quantitative easing, i think the impact of that is likely to be fairly limited. the big bazooka is if the central bank starts directly financing and writing off potentially government debt that it downs. that obvious he is a game changer. i think we are a long way from that, but it's too simple to say they have imaging returns from monetary policy, but you had increased returns much more dramatic action is required to really change the balance sheets of the government, and obviously we don't seem to be approaching the point at this time, but if we see a severe slowdown in growth and moved back into deflation, then the risk of that ultimately will increase. rishaad: great talking to you as ever. stories making headlines around the world. an investigation under way into of fire at a temple in southern india that killed more than 100 people. the com

>> asian stocks fall for the third year as the fed and boj await decisions this week. calls for more action from the japanese central bank. majoromes the first oil to later and may post its first loss since the disastster. bundesbank talks brexit. a move to leave the eu would hurt the pound and the eu -- and the u.k. economy. anna: the very warm welcome to "countdown" everyone. let us start with some breaking news. let us go to scandinavia. we have first-quarter numbers coming through from the scandinavian lender. they are talking about their net krone.numbers at 4.31 that looks to be ahead of estimates. around the broader operating conditions they see week stock market producing lower commission in comfort that is a backward kind of statement about the previous quarter. they talk about q1 net interest coming in at 5.2 one billion krone. they talk about increased lending volume and a lower market interest rate weighing on their net interest income. that is interesting because we had diverted views regarding these numbers. divergent numbers regarding these numbers. throu

david: i notice the vote of the boj was 7-2. the dissenter said they would go back for positive numbers. are they saying they made a mistake? jim: i think they are saying they made a mistake. i do not know very many people outside of the academic and central-bank world that think that negative interest rate is a good idea. i think negative interest rates tell savers they need to save more and spend less. i think it is a big mistake. central bankers are realizing that but they have to hand the baton off to somebody else. i think it is true that maybe it goes to abe. what about fiscal policy and fiscal stimulus? the u.s. can learn a lot about that, too. carol: here they go, they swing the other way. matt: i wanted to show you how surprised the investment community was by this. it was a major shock, jon ferro. carol: he's going to fight with you. matt: this is global investors buying into the japanese stock market. we had the biggest inflows from foreign money in the year because they expected the bank of japan to move. the currency

the boj's introduction of negative rates has helped trigger a property boom in tokyo. e investors to warn that the market is overheating, and that a mini bubble is forming. let's bring in the bloomberg tokyo area keep. what is happening at the moment? reporter: the boj's negative rates policy has pushed down returns for investors across assets. find hes do need to returns, so they are flocking to the japanese property market. they are bringing a lot of cash. that is pushing up prices. angie: is it a bubble? peopler: well, i think say bubble and mean different things. the investor that our reporter spoke to called it a mini bubble. he says there's a 10%-20% chance of a crash.that is a pretty small possibility. the baseline scenario is for price gains, as well. angie: what does this mean for boj policy? were the if i governor, i would be thrilled that i could successfully used the property market. you have to remember, the negative rates policy is unprecedented in japan. no one was quite sure how it could work. so when the governor went into the boj -- boj board and discu

many say, could the boj intervene?ot a brilliant bloomberg strategist who says, don't look at dollar yen. yen index, boj's that's far more interesting. it suggests japan will tolerate another 35% appreciation before authorities intervene. this is the boj index. 2011, itsee back in was about 130. today we are at 100. the average over the last 10 years is 104. we have not been at that average since june 2013. listen to what our bloomberg man is saying. the bloomberg yen index could rise another 35% before the boj intervene straight when it comes to intervention, who better to listen to than shinzo abe, who reportedly on tuesday told "the thatstreet journal" countries must avoid devaluation of their currencies. if you want to find this of duty on the bloomberg, #btv832. betty: you don't know this, but i did not hear part of it because my earpiece went out. i'm going to give you the win. it would be unfair to go against mark if i didn't hear everything. that does it for "the european close." you're up, mark. there you go.

investors indeed positioning ahead of the boj meeting and also analysis from the fomc. the nikkei 225 now, the market sitting down half a percent at the close of trade. and the worst performer on the market today was mitsubishi motors. it fullum 10% as fell almost 10%. the market previously thought it was 2002 as a result the scandal worsened and we saw shares tanking. also shares in toshiba as well. after much refusal they also booked an impairment charge. shanghai comp up. hang seng up as well. losses for some other stuff. and indeed -- we're also tracking losses on the asx 200. and in australia we've also had a major defense announcement as well. japan losing out to france in the race to win the billion u.s. contract to build australia's next fleet of 12 submarines. we saw shares in japan's major defense contractors. mitsubishi heavies and kawasaki heavy industries both down. >> and tisson group shares driving. the the project was awarded to the french firm. australia's prime minister called the decision a momentous national endeavor. >>> elsewhere bp shares catching

anything the fed will do will impact the boj and governor kuroda. kinghave about is out of all the central seemsin the world it governor kuroda is probably the strongest at doing everything independently. the ecb has a lot of members it has to please. governor kuroda seems to want to try the limits of central bank monetary policy. jonathan: and he has done that. when it went to negative rates it was very slim margin. when they boosted stimulus in late 2014 it was the same. me about all of this is when politicians get that immensee saw japanese yen strength couple weeks back. today the prime minister's economic advisor is saying this week's meeting is the perfect time to do more because they can be preemptive and surprised the market. do you think politicians should be getting this involved? francine: we have the same debate here in europe with the german politicians always giving a lot of flak to the ecb. german politicians say, we respect the independence of a central bank but as politicians we also need to tell people what we think. what's interest