tom mackenzie.eair said to a deal for virgin america. negotiations are at an advanced stage,, but could be derailed by jetblue. irgin would allow them to expand routes. indian tobacco company idc has closed its factories in protest of new packaging rules. asia's second-biggest tobacco it did noto because have time to implement new health warnings. and government are fighting over regulations which say health warnings must cover 85% of pack service. the central bank of singapore wants to give financial firms more room to expand -- experiment with new technology. it hopes to create an environment for experiment to fail "safely and cheaply without major consequences." the authority said it will be up to management to assess risks in the new adoption of new technology. traders are pricing in a rate cut in australia, even as growth outperforms most developed economies. is falling u.s. dollar giving the aussie dollar a lift, clouding growth prospects. the aussie dollar has surged 13% since january, when i

china, story came out of china's consumer prices were up last month while factory deflation used, tom mackenzieore. tom: inflation in china rose again in march with the consumer price index up 2.3% year on year. that was marginally below forecast for a 2.4% increase. the rising cost of food, particularly pork and vegetables had an outside impact with prices up 7.6% in march, the highest since the start of 2012. they may have more to do with supply shops then demand it, according to bloomberg intelligence. nonfood inflation edged up just 4.3% fromion used to 4.9% in february. that was thanks to stronger commodity prices and improvement in the real estate sector. trade it out on wednesday, first-quarter gdp on friday. from bloomberg news, i'm tom mackenzie in beijing. ofk: after four weeks decline, european stocks arising on this monday session. it's a china led rally in place. the big news was producer prices. on a month on month basis rose for the first time since 2013. have a look at the best-performing industry groups today. if the china led basic resources that are leading the advance as an

tom mackenzie from the auto show.alk about the global bond market. 0%, now 7.8s than trillion u.s. dollars, despite the fact that the bond market grows. what are the risks? theolas: we will set from -- we will see from the fed this week that they will likely keep rates on hold. negative deposit rates around the rest of the world. as the percentage of negative yield bonds grows and grows, the question is, where is the value? anna: what is that ballooning in the negative rates environment telling you? nicholas: it is telling you really that the animus of a global bond investor aren't there. growth and inflation. you look at levels of growth around the world and inflation, they are really at pinnacle -- at pitiful levels. anna: i have a chart with inflation expectations into the medium term for the u.s.. do you see any move higher that is meaningful in inflation expectation? when you look from february, a very impressive increase. 's 1.6%. we're talking about the u.s. economy. that is the five-year inflation rate. 1.6%.

tom mackenzie is having a look at this.isiting and numbers they were, but certainly are investing like never before. they are snapping up shares over concerns that will be further depreciation's down the line. also, valuations in hong kong -- rishaad: it is trading six times and the hang seng is 9.8, phenomenal. dual listed shares around 40% more expensive on the mainland than over here. those are some of the motivating factors. chinese investors have been net , splashinge october out $6.8 billion on hong kong equities. yuan depreciation a big analyst,g factor for predicting a 3.3% decline by the end of the year. rishaad: are they pouring into the stocks that trade because there is a 40% discount compared to the mainland? there are a lot of dual listed companies, hsbc the most popular stock according to jeffries. the rest are chinese companies, icbc, alibaba. a shares our editor when he 5% premium to their hong kong equivalent, so there is a motivation to get in on the act over here rather than in shanghai. a lot of analyst

angie: all right, tom mackenzie life in beijing.the first time in years, hedge funds turning bearish on the dollar. find out why in your fx headlines after this very short break. ♪ it is monday, the 25th of april, and these are your fx headlines. hedge funds betting on dollar exceedingpositions those of strength by 21,000 contracts last week. we haven't seen long positions for the dollar versus eight other major currencies. dollar bullishness has been up a winning trade the last few years. ledpean and central banks those easing efforts, driving the dollar up 20%. that divergence trade has fizzled out as the fed cut back inflationand for cash forecast. falling against the basket of currencies under pressure that the pboc is guiding the currency lower. an index dropped last week since the basket was unveiled in december. the chinese central bank raising its reference rate against the dollar, but lowering against other currencies. singapore for one saying chinese authorities are going to face a weaker yuan against trading currencies. a

correspondent tom mackenzie joins us from beijing. good morning. what can we expect here? rning. the figure, the forecast, is 2.4% for the cpi and march and china, up from 2.3% in february, the fifth month of rises in inflation here in china, if those forecasts do come true. it would also be the highest print since july 2014, 2.4%. in this expected rise in inflation, food prices are a big part, and bloomberg intelligence tracks food prices. they say those food prices could 7.7% in march, big jump up from february, 4.6%. up 60% in the first quarter. that will also have an impact on food inflation. then the prices in real estate, prices rising in tier one cities in china. taken stepsnt has to curb some of those price ares, but those steps unlikely to feed into the march number. angie: does this mean an end to easing for the pboc? tom: that really is the crucial question. the pboc has had an easing buys ias. rateve seen six interest cuts since november 2014, also cutting the reserve requirement ratio's china's banks as they tried to get credit into the system in china, but ana

francine: tom mackenzie in beijing. up next, the obama effect. the u.s.dent weighs in on the brexit debate. thiel.back with scott ♪ show me movies with explosions. show me more like this. show me "previously watched." what's recommended for me. x1 makes it easy to find what blows you away. call or go online and switch to x1. only with xfinity. e.t. phone home. when you find something you love, you can never get enough of it. change the way you experience tv with xfinity x1. francine: welcome to the polls, life from bloomberg european headquarters. let's get straight to the bloomberg first word news. nejra: the bank of japan has become a top 10 shareholder and about 90% of nikkei companies according to estimates compiled by bloomberg. it is now a major owner of more chinese blue chips than black hawk and vanguard. isics say the boj distorting valuation. an increasing number of bank of japan officials think the government should do more to spare the country's stagnant economy. while most of the officials are said to be concerned that the administration need

tom mackenzie is here. what did the data tell us? ber came in at three point -- 2.3% in the march index. that was in line with the 2.3% from february. analystsy low, below estimates at 2.4%. rising food costs, food prices, when you break it down on the component by component basis, up 7.6% in march. that is the highest reading we have had on food prices since .arly 2012 so that has been a very big part of this. we know that pork prices alone are up 60% this quarter. we also got the producer price index, those declines in producers have eased off 4.3% in march from -4.9% in february. that was largely due to stronger commodity prices, pick up in the real estate market may have had some play as well. we have seen rises in the first tier city. it is a food price component of this marsh consumer price index that really is the focus today. and the question of whether or is 2.3% versus 2.4% gives the pboc more for the economic indicators. they are looking more and more healthy. rishaad: thank you for that. tom mackenzie. we have more on this

tom mackenzie is our china correspondent.chprise rise in the purchasing managers index for china, 50.2. the survey had been 49.4. that is what the forecast had been. it follows seven months of contraction for china's manufacturing sector. it will be a positive for the government as well and the pboc. we heard there was going to be a fiscal stimulus. of thates on the back increase in the services pmi and follows the positive run and chinese stocks. it is not just investors. where seeing impact in the manufacturing sector. -- we are seeing impact in the manufacturing sector. government expecting 1.8 million people may have to be laid off from state owned enterprises. we have seen falling demand as well. that has eased off for the first time in seven months, an increase in the purchasing managers index of chinese manufacturers. rishaad: thank you. we get reaction to all this out of china and hong kong markets as they get set for the trading day. we get the open proper and half an hour. the opens in singapore, taiwan pay -- taipe

tom mackenzie with the latest on the follow out of the yuan depreciation in august taking a toll on corporatena. now, a look at wisconsin. thers casting ballots in republican and democratic presidential primaries today. donald trump facing a test of whether his latest self-inflicted wounds could harm's chance of winning the nomination. megan murphy joins us from our new york studio. here,sconsin possibly could it be the turning point for donald trump or ted cruz? ted cruz is trying to make this a big turning point, and there's no question it is a significant race for him. that the stop donald trump movement has momentum. can anyone steal enough delegates away from him to impede him from winning the nomination outright. att people will be looking in wisconsin, night even who wins, but by what margin and what that means for the possibility of going to a contested convention in cleveland for the republicans in july. how doesthe thing is donald trump minimize the damage if he does lose? looking like he will lose in wisconsin from the eggs of falls. xit polls. manager was charged with battery, mad

tom mackenzie is there for us. let's start off with these testing scandals. what is the mood there?nd saying? it is certainly on the top of the agenda in beijing. largely because the industry leaders just don't know how far this all goes. they don't know what the implications are for regulations going forward. the suspicion is we will get greater oversight by the , andrities, or probes tighter restrictions, but how all that feeds through into the industry is what everyone is talking about here. we heard japanese newspaper that theying mitts is he sh mitsubishi test could affect up to 2 million vehicles. daimler asked to investigate operations in the u.s., peugeot as well, as to look at their operations in france. we've heard from the ceo of daimler, who says there needs to be more transparency from automakers. we also spoke to the ceo of ford and volvo. i asked them both whether they were confident that their going by thee letter and the spirit of the law. very confident we are complying with the law, and we have no cheating devices. thatnk it is also good starting next year, we wil

tom mackenzie is with me now. how is this working?etting some insight into the steps the government may take, and what they're looking at is taking those bad loans from state owned enterprises and converting that into equity. what were concerns around that might mean for the balance sheets of the banks. the process is likely to spend three years, and it is our first inside into what the government is thinking about the economy after the national people's congress. rishaad: you are talking about bad debt becoming bad equity? tom: we've heard voices from the chinese bank itself. concern thating this is going to shift one problem to another. they want to make sure there is a cap on these bad loans to equity swaps. economists say you could take these bad loans, give it to the banks, cleaning up the balance sheets for state owned enterprises and makes accessing credit easier, and they go back to the banks to get credit at a better rate with some of those bad loans shifted off their balance sheets, creating a cycle of debt that so many are

we are joined by tom mackenzie. a very good day to you. ion data, a little bit more sustained stability economic story in china. tom: i think sustained is crucial in the question. we have had more positive data out of china. lower.a smidgen on the back of more positive manufacturing data and services data. ofve seen a strengthening the dollar. it is feeding into a more positive story on the surface at least. if you drill deeper, there are some questions. some economists have thought that if the bigger had been significantly above two before the -- 2.4%, the pboc would've put the brakes on. the pboc is still in play even though we do not know when. if you're chilling for the numbers -- drilling for the numbers, they spike up 7.6%. that is the highest food price hike on a year on year basis since early point in 12. early 2012. vegetable prices as well. you got the production prices, the factory gate prices. as julia mentioned, they have eased up -- as juliet mentioned, they have eased up. that could feed into better corporate profits. analyst

guy: tom mackenzie, great interview. thank you very much indeed.e is assuming apple is working on a car. say --rl's going had to with carlos goes and had to say about that. let's go to caroline hyde. caroline: keep an eye on phillips because it could fall. earnings beat analyst expectations, this is the stock price over the course of 12 months. we are focusing on the news out today that they could push forward with an initial share sales. whether or not they sell the assets to a buyer, they could be looking at a night you -- looking at an ipo. at the same time, the share prices, we could see a sale of its unit. phillips earnings did seem to beat -- some earnings analyst saying maybe it was a little bit lackluster. maybe ca shares give way about 1% -- maybe see the shares give way about 1%. novartis is looking to sell its stake in roche. that is what is being reported at the moment. this is novartis and the white. white.he it has been another 4 -- another performer. novartis could gain. the chairman is looking. novartis to a not just to neutral. --

that's go to beijing where tom mackenzie is standing by.ased pork prices coincide with your arrival in china. we will ask you to come clean on that. give us the implications for pboc policy. great timing, wasn't it? part of thessential chinese food basket here. that rises the highest we've seen since 2012. vegetable prices also going up. this feeding into the rise in ,nflation we saw in march slightly below the forecast of 2.4% inflation, but it is now, focus is now on the pboc. the consensus amongst economists is that easing is on the table. we've seen strong data, this inflation target still below the central-bank target of 3%. commerzbank saying they still expect a cut in interest rates from the pboc this year and three reserve ratio cuts as well. guy: let me pick up, tom. to my mind, what is really interesting is what is happening at the factory gate level. the first rise since 2013. tom: absolutely. they've been on a deflationary cycle for some months. those prices have started to marchow, down 4.3% in from 4.9% in february. that has b

welcome tom mackenzie. it is his first talk exchange. so you guys, behave.ay in hong kong. this is the stock i am watching. japanese stock out of also the. if you are -- out of osaka. if you are familiar with rice zojirushi. first-quarter profit, up 21%. they have jacked up the full-year forecast by 26%. it has done a lot over the past year, 3% call it flat. it is not covered by a lot of analysts. angie: is it more domestic sales or do they export? david: it is a mixed. there are bright cookers made in japan, made in china, and they are cheap. i can't complain about the quality. rosalind: my turn now. hyundai motors, in. first-quarter operating profits expected to fall 19 percent -- 19%, according to kgb security. it is not the only analyst to predict the weaker outlook. first-quarter earnings are expected to drop, according to another financial market data provider. that's a lot of upside there. tom? tom: they operate tokyo disney resort. they have 30.1 million visitors last year. restaurants the around the resort. but the visitor numbers were down from the