aboutod in the market is the dollar, the u.s. dollar index now about -- up by 1%. s of the session. the yen and euro getting hammered. yields in the u.k. up white 10 basis points. -- up by 10 basis point spirit u.s. yields up. toid: here is what you need know -- central-bank leverage its weird the bank of england leaves its key rate unchanged while rising inflation and stronger employment leads the fed to raise its benchmark rate 25 basis points. more yellen suggests three rate hikes to hear. fed fallout -- the dollar climbs to ties level since 2003 in response to the fed decision. 10-year treasury yields rise to the highest levels in years. rupert murdoch and an agreement to type up a $14.6 billion deal, the second run as europe's dominant atv company. and the health, up at 22%, and sanderson farms, up by about 4% -- look at aetna health, up by 22 percent. they expect revenue growth in operating income guidance. sanderson farms is doing better a cousin of stronger poultry prices. 21st century fox up by .5%. a per-share basis, it represents a 36% premium over the cl

to reiterate what we heard about the dollar, this is the bloomberg u.s. dollars stop index. what a of focusing on stronger u.s. economy does to a global economy, the preoccupation is on what a strong dollar does to some of the corporate and others in emerging markets and focusing on the negatives there. dropped to its lowest since march of 2015. again it is weaker, down by .3%. yield ine u.s. 10 year there, it's unchanged, but it got up to 2.57 there on that chart. it was up by 10 basis points in yesterday's session and its highest since september 2014. the yield has climbed 45 sessions in a row. let's talk about oil briefly, a big ball on the oil prices cushing is the delivery point for wti with increased -- with inventories increasing it's hard to make up ground despite what opec has been doing. now let's get bloomberg first word news. here is angie lau. and you: technology industry leaders have met with president-elect donald trump. bezos sandberg and jeff sought to persuade him to avoid policies that he thought would hurt their companies. trump insisted that he was an all

cnn's up by .7% against the u.s. dollar result, that reassessment of the relationship although we should say there is context with the strong dollar, the strongest since 2008. manus: as far as the dollar-yen is concerned, it has managed to rally by 10% since the election. the emerging markets story continues to emerge, a resurgent dollar, and down go the emerging-market currencies. the ringgit has had the lowest level since 1998. since donald trump was elected to the white house. this is the single biggest losing asian equity, asian fx trade. despite some attempts by the central bank to get in there and put some control on it. anna: as always, there's a broader international story and the domestic. u.s. futures early in the day, we're expected to see the u.s. equity markets opening up around .2%. the s&p was down on friday, touching the records during the week. a big focus on the dow. manus: checking in on the bond market, it's the positioning in some of these markets. we are incredibly extreme in some positions, whether it

so the hope is that in an environment where the dollar is strong, by lowering the weighting of the dollarn the basket, the basket will actually be able to remain quite steady. anna: and diving into a bit of the detail around this story which was of interest to many people this week, 11 currencies this week are being added as the reliance on the dollar is being reduced. which are they? some of them are a bit surprising. this of them are in fact pegged to the dollar? >> right, exactly. i guess the idea here is to better reflect the diversity of china's trade partners. you've got to feel that people have generally expected -- i guess the one that comes to ind is the south korean yuan and the south africa rand. but there are some more surprising members, you have saudi arabian generally emerging market currencies. anna: there has been a lot of focus on yawn's depreciation against the dollar as you pointed out. will the changes help relief the pressure on the currency? >> well, i guess the problem here is that we are not going to go to the bank and say hey let's trade against this basket of 24

the dollar/yen bouncing off a two-week low. in all, asian shares set for the first annual gain since 2013. up about 2.3% for the year. half of the top performers were in the material space. .6% e stocks slipped about today. gold sparkles again as a safe haven. with that we saw the likes of newcrest evolution mining. they clismed for an eighth straight day. a big story in asia. toshiba rebounding from a three-day plunge that saw it lose 42%, today adding as much as 10%. casino shares helping lift that he could will market. shares like galaxy, m.g.m. china and others on the rise. next week we will be hearing from macau regulators on the gambling generated for december and the whole of 2016. when it comes to this month, revenues are forecast to rise 7%. that is the look in asia today. yousef: thanks. let's get back to some of the turkish data we got out at the top of the hour. the country had a $4.11 billion deficit. the survey of expectations by bloomberg was looking for $4.1 billion as a deaf set. the country's economy is continu

the euro fire against the dollar. overnight trading in asia saw a spike in the euro-dollar. to the huge spike upwards towards the end of the euro. the 10 year yield goes nowhere after a successful seven-your auction. brent with a little bit of steam but it's best year in four years. david: spy versus spy. president obama expels 35 russian diplomat because of the legend spying on the u.s. elections. president putin says he will not respond in kind, overruling his own foreign minister. president-elect trump says it is much to do about nothing. market surprise. closing on a momentous year in markets. the euro surges overnight against the dollar, taking swiss franc and japanese yen with it. then it abruptly reverses. was that it was algorithm? thebull keeps charging. of 79% since the end of 2011. can it keep up the pace in 2017? returning now to the story of the tensions within the u.s. and russia. we will bring in our colleagues, nick from washington and henry meyer, joining us from moscow. henry, you made an interesting point early in the program. the drama played out with the

it was an absolute game changer for the dollar. is is the problem now because it feels like a lot is priced in. it feels like we have taken all of the potentially good hits and wee trumpet agenda have sidelined to any talk about detection is the more immigration the. we have to see how that plays out in these first 100 days. comments, we your have to remember there is an opposition. trump is used to getting everything he wants but it may not come quite so easily. how quickly can he deliver on those campaign promises and will the markets have patience for this? david: what are the factors that would affect the u.s. dollar the most? to me its delivery. trump has made a number of promises. the market has chosen to believe which is fine. now he has to deliver relatively quickly. any sign that he can't get his agenda through, they will have to get that repriced. alix: we keep comparing the dollar rally and trump's stimulus with reagan and bush. they are very different dollar reactions. this is a normalized view of what the dollar did und

the euro-dollar interesting. cting parity by the end of the year, and vix, aar, 104.94 lot of research notes of what we expect for 2017, the vix probably the place to be next year. to get yourou need bonus at the end of the year. the bonus round of a bloomberg chart, i could have used it team charts but i picked in the philippines because they went 20,000 in fordow exchange, the crisis of 1997 with weak philippines peso, here is the miracle, a strong philippines peso. this move up and this morning we breached through the 50 level here. 50 pesos, philippine pesos to the dollar and this goes to the knock on effect, what janet yellen and what mark carney do has tangible effects in em. we heard that from mr. gross yesterday afternoon. francine: when you look at the repercussions from what the fed does and will do, we need to look at all markets, especially the emerging markets. showss a simple chart, it where the dots are projecting rates this year compared to last year. pink is the fed funds. projections and this is

rateare raising the base to 1% to represent the dollar peg the hong kong dollar has. we are seeing weakness from southeast asia. the all oil and commodity heavy markets seeing a selloff, given the lapse in the oil price and commodities continuing to get back. a selloff extended. australia is underperforming. the nikkei 225 up 0.25%. we are seeing gains from exporter currency sensitive stock. insurance is one of the top decliners we see over there. in terms of what we are seeing with movers, another picture of a somatic trade we are seeing in today's session. mitsubishi motors, gaining on the topics. -- topix. that is something. a lot of automakers doing well on the back of the weekend yuan -- weakened yen.. we are seeing declines for sunday. rishaad: let's go to first word news. tom mackenzie is there. singapore exports surged in november after elon it shipments to climbs the most in a year -- electronics declined in the more of the year. the estimates of 12 economists we surveyed had been for 8.7% contraction. electronics exports rose 3.5% in the same time, the bigges

-- or the stronger dollar? the stronger dollar is a significant headwind for s&p 500errings 500 earnings. the potential holiday tax is a big impact for firms going into next year. that's a more powerful tailwind than the headwinds we're looking at. >> one factor is valuations. a lot of positivity towards u.s. equities. are there better valuations available elsewhere? europe has had a decent bounce over the last week or two. the valuations remain way more attractive than they are in the u.s. >> sure. u.s. equities from a valuation standpoint, the s&p 500 is trading around 17 times forward earnings. it's not the most attractive valuation in the world. nor is it really expensive either. over in europe, you can find cheaper valuations over here. however that comes with the political risk. we're entering into a busy political calendar. countries representing 42% of eu gdp are holding elections within the next 12 months that doesn't include the activation of article 50 in the uk triggering the brexit negotiations or

a little bit of weakness creeping into the u.s. dollar. i think that's the story we will focus on this morning as we watch and see how this andtionship between china the u.s. is going to change and evolve. it does seem as if donald trump is very keen, very keen, to incite some sort of -- well, let's pick a fight. let's catch up on what we need to know with juliette saly. juliette: guy, thank you. john mccain and three other u.s. senators have called for a congressional inquiry into allegations of russian interference in the presidential election. however an advisor to the president-elect said there is no consensus among the intelligence agencies over moscow's role. thatn also told cnn president barack obama has no strategy for dealing with russia cyber attacks. scotland will hold a new independence referendum unless it can stay in the european union single market. that is the warning from scotland's first minister, adding to the pressure on theresa may as the u.k. prime minister "draw something" land's for leaving the eu. a new sturgeon wil

what is your view on the dollar for the year ahead? >> we're hoping the dollar finds a level here. ht continue to go up a bit in the near-term against europe, especially with some of the political concerns that we have as we go through the first half of next year. the other key call is global industry picks up, global pricing firms, some of the concerns that donald trump would be a very aggressive trade confrontation president start to calm down. the em currencies show more firmness offsetting some broader strength. there was some risk going in about the politics of the fed. yellen traded carefully on this issue of fiscal policy, trump, the rally. the journal cover story, yellen/trump on the same page for now. do you agree with that? >> i would say yellen and most of the fed right now is taking a wait and see approach. they don't know what policy will do. i don't think they can respond to it then if we see big fiscal stimulus next year, that might be okay for the fed. it means they can more easily normalize. i think for now it's a wait and see approach. >> we have to leave it there.

the last two big dollar values -- the reagan dollar value, the clinton dollar value -- the clinton dollarintervention in support of the euro, which was a fallen card at the time. i think this time the weakness of the euro is a good thing for europe and the general strength of the dollar helps rekindle the average demand in the world. the key will be the place. the federal reserve slowed its rate hike it anticipated last year partly because of the strength of the dollar. that will be the story of the first quarter of next year with the fed out of the picture. francine: what is priced in? it feels that 2017 feels different. we go into it for the first time and what the fed expects the market to do are aligned. there is an expectation about monetary policy. are we mispricing things? marc: there are two parts of it. maybe we are getting ahead of the story in the u.s. part of it is may be an exaggeration about how much fiscal stimulus can be delivered by the new administration. at the same time, there are problems in europe. the german two-year yield is at record lows. that is destructive for

the dollar rising against the turkish lira.will bring you more on this developing story as soon as we get it. you are watching bloomberg television. this is bloomberg. it looks like we are going to close higher. ♪ live from london and new york this is the european close. stocks finishing up the session in london finishing down down by a 10th of a percent. below the daily average of the last 100 days as we approach the holiday season. performance with oil and gas the worst performers the worst decline after a second weekly gain on friday. don't forget the stoxx 600 finished at its highest level since december 31 last year. todayys is the big story back to tell 7000 clients to find another lender. the global investment bank coming under pressure to cut ties with some clients. moreare struggling to get management from your leap fund managers. that makes them rethink the traditional focus. love this chart, european companies with high sales to emerging markets have an inatively unhurt by the rout those countries financial markets.

you are worried about the strengthening dollar. ad the likes of citigroup him out and say that there will be an extension of this rally, might even surprise the dollar. you're in for a surprise when you thought the dollar value was anywhere near an end, is that something you can subscribe to? i probably do not subscribe to that necessarily. a continuation of the dollar strength and the continuation of the oil price rally in perpetuity is unlikely. primarily because volatility will not allow it to happen. there are too many hurdles in the way. global political risk. you look at europe and the amount of events you have in 2017. the ability for the fed to raise than three times or more the market is suggesting is a bit of a stretch considering the amount of political hurdles we have to get over between now and then. i would be looking at any major further rally in dollar strength and subsequent pain for emerging markets as an opportunity to add further to the emerging markets. anna: back to the u.s. story. i have a stock chart and i wa

i'm looking at the euro-dollar and dollar-yen. we said this is about 1.05. .he yen on the flipside at 1.17 is this just about the dollar strength powering through every currency, or is there an ability for some of these economies to push back due to their own economic growth? >> you are right, i did think .he dollar-yen at1.15 a lot of these were broken on the fed announcement. the fed was a bit more aggressive than we expected. i think most people expected that it would push interest rates a little higher before year-end and that has taken the dollar with it. in the same environment, if yields continue to come back a little bit here, we will come back and see those levels. joe: i just want to go back to your point about surprise indices. ones, what is striking is everyone of them is above zero right now. see this in we can rare situation, they are all above that redline. that almost never happens. they are not objective versus how people think. as they inevitably swing the other way, which they will, you would expect that would br

fundamental relationship between the dollar and the oil. the oil is priced in dollar. if the dollar appreciates, oil needs to decline slightly to keep the price in other currencies constant. like everything was constant in the world which was never. but then there's also other things. you've had also periods where, well, in recent period what you're having is that the u.s. is starting to be a much more, a much smaller net importer of oil. oil production in the u.s. has been increasing rapidly over the last few years. increase the length where stronger oil prices needed stronger imports and a weaker dollar. so, you kind of rejuiced a bit that correlation over the past few years. something that will probably need to be monitoring in the coming years to see if that relationship continued to hold and that the correlation between oil and the dollar may have faded a bit. >> if you were a betting man, where would your money be? heading into q1 in 2017? >> i would say continue to be long of the dollar. still some room there and i think also lo

the dollar, deflationary. y and inflation is practically nonexistent. and inflection point where monetary policy is going to shift to fiscal policy. top trade for 2017? top trade, japanese equities. japan,e the bank of committed to a green the 10 year bond yield. that isest rates go up, positive for equities but negative for the end. joining us live on the set. up, the u.s. busts a legend chinese hackers. more on that story, this is bloomberg. ♪ you are watching bloomberg. lau in honga angie kong. as we count down to the new 7 is on the minds of guest. especially, creates, if you well, a qe infinity type of thing. instead of turning the amount a are going to buy, they are saying we are going to buy as much as it takes. that is an important decision for the boj and you have seen the yen drop significantly and 's mojock market get back. >> we think the focus of policymaking will shift in 2017. away from long-term requirements . the authorities have been very good at engineering a recovery in 2016, alex we have se

the dollar having a surge. bonds getting sold off across the curve, people trying to work out where it's safe to hold a bond. building up to inauguration on january 20th and then waiting to see what happens. i can't help but think a lot of tensions are built into the system. >> the comment presupposed is there has to be an impetus to the upside or downside as opposed to the general melt-up that we've been seeing. i think we're all intrigued where that interest could come from if it emerges before year-end. any thoughts? >> it's unlikely we'll get impetus before year end. if anything i think we'll going to see some acceleration in momentum of the existing moves amid thinner liquidity than usual. i think the next big thing is to wait for trump's fiscal plans in general, policies on trade, immigration, so we can choose which way on the way down the road he's going, and then filter through the noise and decide whether this dollar rally indeed is very much justified. >> i think we're on the same page. i think if one

this yuan,cing breaching the seven per dollar level. the pboc same reports the one broke the seven per dollar level were inaccurate. as far as we know right now. >> we saw certainly trade volumes spike up. a suggestion we could see capital outflows ramping up. shery: we are seeing the pboc is trying to balance liquidity, providing liquidity. also at the same time, trying to avoid fueling asset bubbles. we have this top official coming out and saying, it is time to ease. we are talking about the china banking regulatory official saying china's requirement for the reserves the bank must hold theyuote very high, and should be reduced at an appropriate time. to 17% but hasut not moved since february. that is after four cuts last year. economists saying it will get not untilto 16.5%, the fourth quarter of next year. check of theget a first word news. president elect donald trump has accused the obama administration of putting obstacles in the way of his transition. he tweeted the run-up is being hobbled by unspecified inflammatory statements

and look at the u.s. dollar. the currency of the u.s. llar has strengthened to the strongest point. and the stronger u.s. dollar is going to wage on growth in the u.s. i would expect the fed would stay with a gradual and prudent approach in normalizing monetary policy. >> and that seems to be, you know, the desire by the markets, the bond markets in particular. but do you believe that these yields which have really spiked up here in the u.s., do you think you'll gradually come down as we get into next year? we expect u.s. yields would inch down again after the first quarter especially after the honeymoon period for the trump administration is past. i think the market would start to digest the policy implications, the effect of the fiscal stimulus proposed by the strum please administration -- by the trump administration is likely to impact economic growth only in the second half of 2017. so this actually constrains the federal reserve from shifting a more aggressive, monetary policy. given the uld cap it negative impact of higher yield on

on the dollar. s to be the story for the fx market with the dollar in mind. >> it is the old by dollars, where diamonds story. wear diamonds, story. you would tend to see some repositioning and rebalancing of long dollar positions that will happened and is going on through the end of the year. by and large, the large dollar trade is not as large as people think it is, otherwise we would not come this side. >> it is remarkable and it is the only interesting question right now. we can talk about stocks being at record highs. jonathan: in round numbers. >> 20,000, whatever. this is the only interesting question. it feels like a lot of strategists are starting to gravitate around this 3% level as the safe place to save, where they can make a call that is interesting, but not to out of consensus. with the 10-year and long-term rates do from here is probably the only interesting question. jonathan: positioning is one thing. you look at the positioning and say it is not stretched, so the can of the oxygen i

the dollar is stronger against the yen and the pound is stronger against the dollar. ain, relatively flat compared to what we saw yesterday after the ecb move. look at oil prices up again today. crude above $51. brent is above $54. there's some hope that non-opec members maybe looking at production cuts. there's a meeting over the weekend. let's head over to wilfred. >>> the latest on the are trump cabinet. president-elect trump tapping andy puzder to be labor secondary. puzder, the ceo of carls juniors and hardee's. to get reaction on potential possible presidential announ announceme announcements, let's join tracie potts. >> democrat joe manchin is scheduled to meet with president-elect trump today to possibly talk about being energy secretary. he is from a coal state. that plus the pushback on puzder has him on defense. president-elect trump talked about his cabinet choices and china last night. >> they haven't played by the rules. and i know it's time that they're going to start. they're going to start. >> reporter: president-elect trump on china at an evening rall

in the fx market, the dollar index the reclaims a 14 year high, the dollar-yen the gets back to a 118andle. the euro the gets down to 103. higher by three basis points at 257 on the u.s. tenured. its first agenda got minister, addressing the next step for the country and theresa may will be questioned by the house of commons liaison committee at 9:00 a.m. eastern time. what does that mean for the fx market? it means considerable divergence in terms of what the view is for where euro sterling ends next year. in terms of estimates down toward 17 -- 70, potentially 73. joining us now is vasileios gkionakis, it's great to have you with us. for euro real market sterling in 2017. where do you sit on the spread for next year? mr. momma: i'm some --mr. gkionakis: i'm somewhere in the middle. politics is in the driver seat right now. areway i see it, politics the biggest concern for the u.k. relative to the eurozone right now. largely because of what's already in the price of the euro relative to that of sterling. sense, it can be a bit of a binary. if the markets starts sniffing early on the

since july, is weakening versus the u.s. dollar. a little further, a decade or so, and suddenly it looks a little bit different. wondering, does this show you that the chinese currency right now is still more overvalued? >> chinese currency is more overvalued at this time. sensitive generally to what the chinese might do in terms of trying to put on capital controls, to make it difficult to trade. although it looks to me as if the yuan is the more overvalued currency that could weaken most, i would rather sell the korean won because i think it will react more smoothly. they put capital controls on in china, they will find it difficult if they do it aggressively, but the korean won would fall on that. confident of what they will do. joe: let's talk about again. there's an argument to be made that the yen has a lot more to all, thanks to the bank of japan and its efforts to tap the long end of the jgb curve. rates are rising everywhere and that's not happening in japan, then you could see significant weakness due to the yield app. wha

the hong kong dollar is pegged to the u.s. dollar. bank of korea holding rates steady for the sixty month in a row. the bank wants to take that wait and see approach to see how the fed rate hike impacts the economy. back to you. >> the government should fight for the city of london in brexit negotiations and should not be ashamed to stand up for britain's banks expertise. that's according to the house of lords eu financial affairs subcommittee. the committee is believed to have been warned that big banks will start making decisions next year as to their long-term future in the uk. the report went on to say the danger is that in the absence of clarity firm also restructure or relocate on the basis of a worst case scenario. >>> elsewhere, eurozone lenders put a short term debt relief deal for greece on hold. greek prime minister alexis s cyprus announced the program. the esm already criticized the speech on monday, but a parliamentary vote will be held today in an effort to rally domestic support. >>> and let's bring you the latest in it

headwind is the stronger dollar, the bloomberg dollar index sitting at a record high. gold is still headed for the best year since 2011. the company story of the day has to be toshiba. take a look at the today chart. -- the two day chart. cap is off by $5 billion in the last two days. it has to do with the breakdown of the u.s. nuclear assets and they may be forced to sell assets to make up that kind of cost. we will delve into that story later in the hour. and wrapping appear, qualcomm find light antitrust regulator. .4 percent.s off this involved a patent licensing mobile phone makers. samsung and lg may be able to lower their payments to qualcomm . so that is weighing on the stock today. david: coming up, the election of donald trump gave consumers new confidence. the underlying structural factors support that rally? and how do they get productivity rising again? this is bloomberg. ♪ alix: the ftse surpassing its record closing high on extraordinary light volume. up by .5%. volume is 37% lower than the 10 day average. quiet across the board. david: it is still on hol

the u.s. dollarndex. the u.s. dollar is of critical importance to the rest of the world, particularly emerging markets and some countries close to home here in dubai. how much pressure does this put? >> it puts some pressure. em varies. it differs from country to country. the bottom line is tighter financial conditions. it is not exhaustive because they can offset that through other means. but it is something to pay attention to. >> a lot of analysts have been commentsing yellen's as a more hawkish fed. her comments on the idea she does not want to run a hawk economy as an experiment quite interesting, what is your take? >> if i was to summarize it in one phrase, it would be beyond the data. the fed took a strong step toward being data dependent. markets moved to during a press conference. part of that is exactly what she said. she walked back this notion of high pressure. are we not just seeing a higher expectation for rate hike? but in addition, a could be tighter than we saw otherwise. it was not

anna: the dollar keeps strengthening, then? at is one thing that has been doing some of the work for the fed. bob: absolutely. one has to quantify the extent of the dollar move and realize we have come a long way. 30 dollar on most purchasing analysis is already overbought. it is expensive. yes, the euro could test one. we have come all the way -- yousef: hold that thought. bob parker stays with us on the program. still to come, more signs of stability in china. beijing forive to the details. stay tuned. this is bloomberg. ♪ anna: welcome back, everybody. tokyo there for you. the dollar against the yen at 113.9. 6:30 if you are here in london. a new edition of daybreak available on your bloomberg and mobile. let us look at the stories that have made it into today's edition. yousef: an official gauge matching a post-2012 hike. you can see the pictures emblematic of something chugging along. that is a credit field recovery of heavy industries gaining momentum as the pick up in inflation expectations. anna: the next this story is r

fed, -- thes the dollar against the yen, upward move in the dollar as the end is down 2/10 of a percentollar rally faltering a little bit. thedollar was down on bloomberg dollar spot, down by 0.6% in yesterday's session. perhaps a notable move. crude, 15.82 is where we trade. moves we saw in the oil price inflation. that is why we have been focusing on what is happening to the 10 year u.s. yield as well. 2.476 eight is where2.476 eight. the yield is below that 2.5% level. touching the highest since september 2014 but retreated low it during the session yesterday. let's get the first word news. china's stabilization held in november with industrial production climbing 6.6% from a year earlier. retail sales advanced 10.8% last month while investment increased 8.3%. it gives policy makers more room to switch from stimulus towards curbing financial threats. president-elect donald trump will announce today that he plans to nominate exxon mobil hisrex tillerson as secretary of state, according to a person familiar with the decision. if he is confirmed by the senate, it would have the job -- h

a lot of this is the u.s. dollartory, the fed story expectations around where central-bank policy goes in the united states. there's also the contrast with what were hearing from the ecb at the moment. what is driving a lot of divergence between 10 year yields is also the contrast in terms of the policy mix between the two countries. you have tighter monetary policy in the u.s., still lose monetary policy in europe, but you also have a contract and fiscal policy. you have more expectations of big fiscal stimulus in the u.s. with donald trump coming into power in january. and the contrast in europe, there's no talk of fiscal policy. anna: expectation seems to be muted for most of the economist. >> there's no big change in terms of structural deficit, no one seems to be pushing for more new money going into the economy. the only country with saw doing that is germany but it's more on the migrant issues. anna: thank you very much. coming up on the program, japanese industry gets a boost and export volumes rebound sharpl

rishaad: if you are a greenback ull, it is a big ho ller for the dollar. ng a lot of pressure on currencies because of the strength of the dollar. we will be discussing that in just over an hour or thereabouts. let's look at what else is going on. 10:40 hong kong and singapore time. united airlines in the united airlines'\ boss for china and korea joining us. undercut,anaging to in providing you go through china, you can get to the rest of the world for a lower price. thailand university in accepting rice instead of cash. discussing that as well. a flavor of what we have on the way. holler for the dollar, thank you. nod authorities gave the for the merger of amc entertainment. timehas become a long issue. reporter: it was first announced back in march. all cash. blessing of u.s. after agreeing to a few conditions. this according to a court filing. the sale of 15-20 theaters. giving up control of a cinema advertising company, and transferring theaters. evestitures are two preserve competition. they say they can close the deal by the end of the year. carmike

mentioned of the dollar falling the most in two weeks. what has become a volatile year. ingles.o to david and david: i thought it was going to be quiet. things are getting fun. i have a dollar-yen chart. still digging deeper. because this could be japan is just opening. why do we have this up? it fell beneath that level briefly. 116.36. in other words, we have recovered that average. at the moment, as we get to the open in japan, we saw a dip in dollar-yen. on dollar-yen. the other one is the euro. we see the spike that right here. 1.5% over two days. above 106. our high happened 20 minutes back. 106.53. one centnt higher -- higher than current levels. you where trading has really taken place. that is when sort of japan takes the baton, if you well. that color coming out? light blue. it is only light blue, and a dark blue for me. 7:30. let's see where this takes us. there we go. not really anything there. thel below what seems to be 50 day moving average. we will be fleshing out all these moves a bit later. watching at the open. a massive amount of trade going on despite

the white line is the dollar under reagan. the blue line is the dollar under bush. er trump. do you think that a trump dollar echoing a reagan dollar is just that? and i knowre spot on you have been discussing this, that's a great chart. , ifcommon thread with them trump does what he seems to be saying he's going to do, is you have a very large fiscal stimulus when the economy doesn't really needed and that the stimulus is heavy on tax cuts so that the growth multiplier as well is low. put those two together and, going back to your previous question, david, that usually results in a lag in federal reserve types. that is a pattern that leads to an unsustainable boom bust. you get a sort of short-term recovery, you get employment rising beyond what sustainable, you start getting inflation pressures, the dollar goes up, the fed goes up, and then the economy starts to turn around in the wrong direction. david: as you say, you call it a mug to game for central banks to try to anticipate what's going on. we looked back to what the fed did in december aced on projections fr

all of the discussion is about dollar dynamics. euro the question is who is driving the euro buzz, america-trump -america-china-america. year,if we look at this we really see the bank of japan and the bank of new zealand as well. if you go back to earlier this year we have the bank of japan easing. we have had the rba easing. september, when we had was the dollar weakening cominge u.s. yield curve down. and that was overwhelming the impact. this is a disproportionately dominating effect. usually. it also depends on the positioning. , it ise the dollar goes likely to be dominant, irrespective will of what you see the bank of japan do. francine: how much do we trump and -- donald janet yellen. there are a few members seeing their -- few members living there. jane: right now, we going with the assumption that the fed will carry on looking at it. , there is a huge amount of fiscal stimulus. it can be expected that they would have to tighten more and the dollar would go up. however, what we haven't talked about is the impact and that co

this is the dollar index, the blue line. has not moved as much as the two-year and the tenured nominal yield. does this signal to you that the rally is overdone? >> is possible is overdone if you look at dollar positioning. they are at the highest since february. after the election everyone has piled into this long dollar trade. there is a stunning rally the dollar has had against the yen. 9% last month. we are seeing a lot of people piling into this trade income december in the fed rate is a lock, they will be selling thereafter. david: the question also is what to the telegraph about 2017? if they have a dovish hike, and some people have been predicting that, what does that do? >> it's an open question right now. a lot of people are trying to figure out what everything means in terms of fed policy and the new administration's policy. a little bit of wishful thinking and happy speculation now that the election is over. chopped andot of volatility to come as people try to read the tea leaves. >> one thing people are interest

and the u.s. dollar. going up, we have seen upcross-border bonds going 25-40 basis points. the impact has been much more muted. because of two things. the banks are still the largest provider of capital to borrowers. and second, there is a home buyers in terms of local investors investing in names that they know. debt fully seen transmitted into local markets cap. betty: hang on one second. we are getting some headlines out of new zealand. the prime minister saying he will be standing down as prime minister. the national party can win the 2017 election. he says it is a good time to go. new zealand's prime minister key saying he will stand down but believes the national party can win the 2017 election. pretty apropos, talking about political uncertainty and the risk to the world economy. it seems every day we are seeing some more turmoil in different countries. we will have to leave it there. thank you for joining us. talking about the global risks. much more ahead. president obama blocks a chinese acquisit

there is the dollar against the peso. trengthening and the peso weakening and you today, the mexican peso is one of the worst performing emerging-market currencies against the dollar, down 17%. extending its decline on that news that the central bank governor is resigning. also breaking news on brent crude, rising to its highest, this year. we saw a post opec rally, 9.5%, yesterday. we are up 3%, today. coming up, we will have more on that, and other markets. i will also have our interview with the deputy central bank governor of the central bank of mexico. this is bloomberg. ♪ vonnie: you are watching bloomberg. nejra: this is your global business report. oil rising on opec steel to cut production. we spoke to venezuela's oil minister after the agreement was reached. vonnie: apple is taking aim at google, a look at how the text -- the tech giant is trying to rise above the search engine's map services. nejra: a look at the evolution of 3-d printing and how it is predicted to up -- disrupt everything from medicine to milit

if we move to currencies, there has been a move in the dollar in the last hour. weaker after just days and days of dollar strength. there is a report that china has seized an unmanned, unmanned vehicle in international waters and that the u.s. has demanded it back. there is speculation this may be impacting the market when it comes to risk. dollar-yen that big drop happening there for the dollar getting weaker. look at the mexican peso. it. 't checked in on lelele mexico did make efforts to change that. we'll talk about that with richard jones in london. still trading at 2043. that is weaker mexican peso today. look at this for the ue juan. we'll see 7 before the year is out. the two-year yields 1.24%. check in on the bloomberg first. >> more on those reports that we were talking to you you just mentioned. china has seized a u.s. unmanned underwater vehicle in the south china sea. report comes from reuters which sites the u.s. official. the incident reportedly took place in international waters. the u.s. has demanded that china return the vehicle. in the last cou

let us talk about the dollar. talked about it a lot this week, certainly yesterday in the aftermath of the federal reserve interest rate hike. we are once again talking about the dollar. go long or go home is the title of this fantastic chart i have for you here. circle, november, marks the victory of donald trump. what we have on the white line is net dollar long. their highest level since january. are we done with the dollar rally? perhaps not. a 10 year high against the yen. let us put up the risk radar to show you where we are compared to other currencies and asset classes. the euro is a focus. some big moves in the euro this week. 104.37. the euro hit 103.67 in yesterday's session. for the dollar against the euro since 2003. asia-pacific, up by 0.3%. brutal in the wake of the hawkish fed about 2017. when of conversation about it will get to 20,000. uncharted territory for the dow jones industrial. not for -- not so for the nikkei. it has been there before, back in 1987. a history lesson from the bloomberg thi

the dollar index coming down under 2.5 in tens. a closing basis since the day before the tightening. which makes it 13th of december. also hasn't happened since the session before the fed's december tightening. bund yields are hovering around 18 basis points. seems there's a reversal. maybe there's a bit of a rebalancing going on. if you continue to monitor all the markets, i would think that the weaker dollar and drop in rates may make it a bit more difficult to ascertain the 20k market. melissa lee, back to you. >> all right. thank you, rick santelli. not too much movement there on the futures front with the dow and is s&p looking to add small this morning. john riding is a chief economist, michael farr. they join us to decipher this economic data. i would think the claims numbers, it's a strange week to analyze. >> well, it is. but claims numbers generally have been very low. and 265, 275, 250, honestly it's all about the same number. what it tells is american companies are still reluctant to lay off labor. that's one of the the

the long dollar trade is long in the tooth.ighth year of the bull market, potentially indicating that, yes, we are long in the tooth here. rishaad: i like one comment you made in the research. of, is the u.s. equity market a mirror image of summer 2015 in china? michael: sentiment looks like it. most expertsthat tend to agree on something, then it tends to be working out the other way. china last year in the middle of the summer, everyone was bullish but the market looked overvalued and overstretched, but there was euphoria in the chinese markets before it went into serious correction. the u.s. equity market looks similar to me, the euphoria stage. the real question for investors to think about next year is whether that transition from a -driven market to a fiscal driven market is without execution risk. governing by twitter could lead to execution risks not fully appreciated. tohaad: i'm going to come that concept, governing by twitter, but scott morrison talking at the moment, michael. thisould you characterize state-of-the-a

the question for the dollar might be whether we see that we get to the hike, given the run that the dollar has had since the election. >>> we'll move on to politics. president-elect trump is expected to nominate exxonmobil's ceo rex tillerson as the secretary of state. the oil exec has no government experience. tillerson is the former chairman of the committee of the american petroleum institute. he has brokered deals with russia. his ties to russian president vladimir putin could lead to bipartisan resistance in congress. trump acknowledged the relationship on fox news yesterday. >> in his case, he's much more than a business executive. he's a world class player. he's in charge of, i guess the largest company in the world. it's been a company that's been unbelievably managed. and to me, a great advantage is he knows many of the players. and he knows them well. he does massive deals in russia. he does massive deals for the company, not for himself. >> arizona senator john mccain weighed in on the potential nomination himself yesterday. >> i believe that vladimir putin is a thug and a bully

the dollar has set the tone, the dollar and the treasury move. strong dollar, higher yield. so far that has not managed to derail stocks at all as they hold near record highs. and the question is going to be, does that get in the way? does geopolitical tensions and trade tensions get in the way? more back and forth in china which we'll hit, but clearly it is a reminder about the sensitive nature to the relationship. and everybody is bracing for it to get more tense next year when donald trump becomes president. >> it has not derailed equity markets in terms of a full pull back. certainly that is true. but the s&p and nasdaq were slightly negative for the week as a whole. and we saw rotation as a well. financials were on a tear upwards, but only on thursday. the financials underperformed. the worst sector was industrials. so two of the high sectors that have done well since the election didn't do so well last week. the best sector last week was telco, so one of the more defensive sectors. so yes, last week it was encouraging markets didn't fall much off the back of the fed rat

matt: why do you think we see the dollar down today? s getting ready to move up and has a statement to the press conference afterward, do you expect them to remain extremely dovish? to remainpect them pretty balanced. they realize they have a lot of work to do in the first half of next year. they have got to react to the new news that it will come out of the new administration. at this point in time, they don't have enough information to make those predictions. now, the fed in my mind has not had a great year. down the stocks continuously. expectations for the u.s. economy has revised lower throughout the course of the year. this moment in time, they are not going to move or react. they are going to wait and try and get all the information they can get that the new administration is set to do and make their decisions off the back of that. matt: if you look at the last year, are they in the right position considering the data we have seen? mark: i think the data now, you know, is very backward looking. it is out of date. not only do we ha

the u.s. dollar been moving ever stronger which has caused theyou want to fall despite efforts of the chinese central bank to question the fall. -- do you agree with the yuan there's -- bears? 720 yearwe do expect in terms of dollar-cmy. we think it is an interesting way to be long dollars with some hedge against geopolitical risk. we have not seen any repercussions of some of those international tensions that perhaps have been rising recently. to be long dollars in the risk environment, -- if we have especially some trade tensions and tariff barriers against china, that is a scenario where the dollar will go higher. heid: donald trump has said is really concerned about the yuan being so low. if it goes further lower dozen that up the chances he will take some sort of action? vassili: i think that is absolutely the case. we have talked about this yuan has measured against the baskets and china is trying to not appreciate the trade weight of the want. the dollar is strengthening everywhere else. i thi

the dollar is stronger against the yen..22 this morning. >>> i am psyched for this segment. we are trying a new unorthodox stock picking strategy this morning. we're bringing in oz pearlman. he is the mentalist for the 2017 stock picks. you've come here before. >> let's do it. >> joe gets very -- >> joe gets angry. >> because he wants to know how the trick is done. >> no, i don't. >> three investment strategies. i'm spilling the beans the way a mentalist invests. look through these. i put every dow jones 30. i want you soo to see all these companies. these are all different companies. make sure, make sure. coca-cola, intel, travelers, dow jones, general electric. all to have them. >> you think this is going to be a better strategy than the analysts. >> we'll see. hold onto this. make sure these are all different. are they all different? i want you to see these cards. we have merck. general electric. >> they're the same as these cards. >> all the same. put those in your left hand. you are going to be my passive investor. >>

this is really about the dollar.llar was operating under very low interest rates for a very long time since 2009. so i think we need to see this not as a crisis in asia, but more about the normalisation of interest rates in the us. how will this impact asian economies next year?” the us. how will this impact asian economies next year? i think we will see probably quite significant appreciation of the dollar still to come against many asian currencies. so on the currency side, we will see somewhat more weakness for many asian countries, and that may help their exports. but it also brings with it concerns about capital outflows because the strong dollar and stronger us growth will attract capital into the us assets and out of asian currencies and asian assets. so that is a risk that if there is significant capital outflows, it could create some pressures on some of the currencies in asia. so it is one of the downside risks for 2017. over now to china where currency weakness is driving up demand for us dollars. the chin

overall, we actually think that the u.s. dollarl find bye weakness in 2017, driven three or four factors. that can be the next leg up for commodity prices, in our view. is simply a function of so much being priced and so much optimism being priced in, perhaps as many as three rate hikes. yeah, i think the u.s. dollar story is a couple of gotors, which i will through. first, we expect real rates in the u.s. to drift into more negative territory over the coming six months or so, and that will be at the detriment of the u.s. dollar. we also think that the tax cuts, etc. that are being proposed by president-elect trump will lead to higher fiscal deficit, and that will be negative for the u.s. dollar. and yes, we have seen a spike in yields in the u.s. treasury, for example, which has also dragged up a lot of other things as well, pushed down gold, as it would turn out, so precious metals have suffered under that. nonetheless, we still see quite good growth across emerging markets. as we go into growth of next be broadlyshould positive

they're often hurt by the rising value of the dollar. hone in on the big etf that tracks it, emerging markets fund, ticker eem. since hitting a 52-week high on september 22nd, shares have dropped since then. it's been a negative trade for four of the last five days. and certain individual country funds are working on negative trends as well. take a look at the i-shares' larger cap fund, seven straight down days for that etf. it's been down nine of the last ten. he wi melissa, traders will be watching these in 2017. will there be bottom pickers around or is the worst yet to come? guys, back to you. >> dom, thank you. carl icahn joined "the halftime report" earlier today to address trade issues with china under president-elect trump. >> obviously if you get into a trade war with china, sooner eo later, we'll have to come to grips with that. maybe it's better to do it sooner. but that's not my decision at all. >> maybe it's better to do it sooner, tim, what do you think? >> if china is doing poorly, you're doing particularly poorly if you'r