Bloomberg Morning time Europe: Shut to Liftoff 03/12/2024

Good morning.This is Bloomberg Daybreak Europe. I'm Tom Mackenzie in London.These are the stories that set your agenda.Markets in a holding pattern ahead of US inflation data which could influence theFederal Reserve's next move. Jp morgan CEO Jamie Dimon warns the USeconomy is not out of the woods, saying a recession isn't off the table, addingthat the Fed should wait before cutting interest rates.Plus, the UK's January labour market data will be closely watched by the Bankof England, with regular pay growth likely to show signs of stickiness whenit move the dial for the bank.

We will bring you analysis throughoutthe morning. Let's check in on these markets then.After some modest losses across European and US stocks yesterday, futures lookinga little brighter then today as we lead up to the wage data here in the UK.And then of course the data print arguably of the week when it comes toCPI out of the US and whether indeed it does change the narrative for the Fed.Of course, Jay Powell last week in testimony suggesting that they aregetting closer on the FOMC to a point where they do have that confidence tocut rates. They're not there yet, but will the dataget them a little bit closer when it.

Crosses today, or will it surprise tothe downside? And, of course, some fluctuations acrossthese markets. Again, European futures looking to gainsof 6/10 of a percent after the modest losses yesterday.Footsie 100 futures pointing to 7730, currently up 8/10 of a percent.As we look to that labor data and whether or not it moves the dollar forthe Bank of England currently markets pricing in a rate cut from the BSE inAugust after the ECB and the Fed S&P futures at 5200.So back above that 5200 level gains of 4/10 of a percent again after the modestlosses of yesterday.

Nasdaq futures pointing higher by 6/10,7/10 of a percent at 18,337. Let's split the board and look cross onset then. We are, of course, keeping an eye on thecurrency space. The pound in focus for us today.Of course, as we look ahead to that labor data and the jobs data out of theUK 4.09 on the benchmark US ten years, we count down to the CPI and inflationprint out of the US. Not a little movement so far at the backend of US treasuries, the pound at 128. Of course, year to date one of the bestperforming currencies, the pound. We'll see if that changes that narrativelater day on the labour market data.

Bitcoin had crossed above 72,000yesterday, a fresh record of course, currently at 71,914.As the money flows into those, ETFs just continue for Bitcoin currently down 3/10of a percent in the session. Iron ore.We saw the biggest drop since 2020 to almost a drop of 7% yesterday in thesession on concerns of a lack of fiscal stimulus coming out of China.Also build up a stockpiles as well at Chinese ports going out 108 per tonnefor iron ore, up 8/10 of a percent in the session.Talking of China, let's cross over to Asia now where April Hong is standing byin Hong Kong, in Singapore, I should.

Say.April, what is what is standing out to you, of course, these markets in Asia.Now what's standing out is the Chinese equities recovery.The CSI 300, the Hang Seng both extending gains from yesterday.The Hang Seng Tech, we're seeing the Chinese techs names.They've been gaining ground for three straight days.Even the developers listed in Hong Kong are on the move.And it seems like investors for now shrugging off an underwhelming NPC aswell as woes in the property sector. Worth noting when we talk about the HangSeng tech, it's risen 20% from its.

January lows.We'll see how it finishes the day. But let's flip the board because it'sstill worth talking about what we see in the real estate sector in China.We've been keeping a very close watch on China Bank.It's seen as one of the more resilient developers because of state backing,because of its investment grade credit quality rating, I should say.And we're seeing today Moody's cutting it to junk territory and Chinese lendersreportedly reluctant to lend to it or provide financial assistance becausethey want to see more collateral before they sign off on an offshore loan.So that is one thing that we're keeping.

A close eye on in Chinese markets.Let's put the board, because we also want to zero in on what we're seeing onthe yen today. The BOJ governor talking about how hesees weakness in consumption, that from some sectors of the market to maybe pareback some of their bets that we're going to see imminent move from the BOJ nextweek or next month and the yen weakened versus the greenback.But flip the board because if you take a look at how it's been faring since thestart of the month, we've really seen dollar and pulled down below from the150 level. That's really putting pressure onJapanese equities.

Russell Seeing that JGBs are feeling thepressure from what we're going to get from the BOJ.Of course there's not much risk appetite in the region today as well becausewe're turning our attention to the US CPI top.Okay. April Hong on the change in fortunes forJapanese equities, at least for now, of course, after a very solid run the yearto date. Let's get you some breaking news interms of the earnings story and generally, of course, the Italianinsurance giant coming out with details around the full year and fourth quarterfull year.

Of course, support, this is a bit comingthrough from generally full year net income, €3.75 billion.The estimates had been for 3.56 billion. So it's a beat on the full year netincome for generalI operating profit on the full year basis as well.Also a beat coming in at €6.8 billion. The estimates have been for €6.81billion and the full year dividend per share.The estimates had been for €1.24. They've come out with a full yeardividend per share of 128. Again, a beat across the board it seems,for generalI full year and on the fourth quarter basis as well, there been havebeen some concern that maybe the fourth.

Quarter been a little softer.Fourth quarter net income though beating solidly €925 million.The estimates had been for €733 million year to date.In fact, over the last 12 months, their stock is up 33%.We're going to be speaking I will be speaking to generali ceo, managingdirector doni next hour. So stay tuned for that conversation.The details, of course, on the reaction to those earnings.We are counting down, of course, to the latest inflation data coming out of theus. The closely watched numbers will giveinvestors further clues.

They will hope on the Fed's policy path.Let's bring in Bloomberg Steel to suspend for the preview.Joe, what are you going to be watching for when it comes to the February CPInumbers later today? Well, Tom, I think a lot to look out forin these February CPI numbers. Of course, as you remember, January washotter than expected. I think we'll be looking for a bit of acooling off and at least the core inflation numbers.Bloomberg Economics is thinking, you know, particularly car prices probablycontributing to that being a little bit lighter.I think that's ultimately what the.

Market would be looking for, because asyou know, you know, we'd like to see continued signs.The market would like to see continued signs of sort of a gradual cooling offin inflation. Not sure whether we're going to get thator not. The other thing that I'm looking out forin these numbers is whether we get any sort of clarity on the stickiness ofhousing inflation in particular. If you remember, there was sort of aweird spike in one of the sub indexes in the January figure that was catching alot of attention, specifically as it related to owners equivalent rents.We later got some information from the.

Labor Labor bureau saying, you know,there were some changes in how we weighted some things and that's whatcontributed. But, you know, obviously, I thinkthere's, you know, a lot of ongoing concern about whether there's sort ofthat continued stickiness and housing inflation.We'll have to see whether that underlying gauge gives us any moreclarity. But of course, as you know, Tom, youknow, even if we're not expecting any kind of interest rate cut next week fromfrom the FOMC, just the fact that we've got a meeting coming so soon after thisprint, I think is why it's all eyes on.

What happens with February's CPI rightnow. Yeah, absolutely.We are, of course, building up to that data point.Meanwhile, Jamie Dimon, Jp morgan's CEO, of course, weighing in with his views onthe US economy, suggesting that he is a little bit more concerned maybe thanothers about the risks of a recession in the US.What's he been saying? Yeah, it was interesting to hear fromJamie Dimon. So essentially saying, look, whileeveryone else is pricing in this idea of a risk of, you know, 70 to 80% chance ofa or rather a 70, 80% chance of a soft.

Landing, he said he actually sees theodds it's going to significantly lower than that, maybe half of that.So, you know, sort of raising the alarm a little bit on the fact that, you know,despite some of the recent data that we've had, it's like, you know, maybe westill are at risk of recession. Jill, I'm going to interrupt you at thispoint because we have a redhead crossing the terminal right now.The Bank of Japan said to mull a march hike with the outcome too close to call.That is the redhead across the terminal right now.Checking in on US Dollar, JPY, the Japanese yen 2147.So paring some of the weakness of the.

Come through in the session currentlyjust down 3/10 of a percent. Looking at Japanese ten year yieldscurrently at 0.77 as well. Marginal move in the yields.Picture the Japanese yen again currently at one 4740 on the back of this red hatcrossing that's happening right now that the Bank of Japan is said to be mullinga march hike with the outcome still too close to call.We've been hearing in form, of course, the BOJ governor away there talkingabout the economy recovering generally, even as they are pockets of weakness inconsumption. A couple of the lines crossed as he gavetestimony earlier today.

But again, reporting from Bloomberg thenthat the BOJ then is looking potentially at that March hike, ending negativerates. As soon as next week.We'll bring you more details, of course, as we get it on this unfolding story andkeep across the Japanese assets as well. Joe, let's get back to you then on thedetails from JPMorgan's Jamie Diamond. Of course, I was interrupting you tobreak that red hat, but the importance, of course, in terms of how he's thinkingabout this economy, but also his views on the interest rate view and what theFed should be doing. Yeah.I think that, you know, it's certainly.

He's saying that they need more data toultimately make some of these decisions. I agree there.I think that, you know, that's where the February CPI statistics ultimately comeinto play, because as you know, Tom, when we were looking through some ofthat labor data from Friday, some, you know, interesting, you know, signals inthere, we saw, you know, overall that headline non-farm payroll report figurewas still pretty strong, but we did see that slight uptick in the unemploymentrate. We did see some underlying wage datathat was maybe more favorable to this idea of a gradual cooling off in themarket.

I think ultimately, you know, the casethat Jamie Diamond is making is is certainly that, you know, that idea thatthat data needs to be a significant calculation here as the Fed goesforward. Do they have enough information yet tomake a call on rates? Not yet, But we'll ultimately see wherethis next CPI print leaves us. And then I think all eyes are thenobviously pivoting toward what's going to be happening with that next FOMCmeeting next week. Where are we going to hear from Powellon the Fed's calculus for when they might start cutting interest rates?Traders obviously think that's going to.

Be June at this point.Does that still hold? Do they move something up a little bitearlier? It's all about timing, Tom.Okay, Bloomberg Commodities Edge, Thank you very much indeed.When we think about the relative resilience, of course, of the USeconomy, you think about fiscal stimulus and talking about fiscal stimulus, wehave to think about the budget, of course, and budget plans.US President Joe Biden unveiling a $7.3 trillion fiscal 2025 budget proposalthat would deliver more services, middle class tax breaks and price controls.It would be funded through higher taxes.

On the wealthy and corporations.Let's get the details then from Bloomberg anchor Kristie Gupta, who'sbeen watching this for us. Kristie, what is standing out to you?What is in this package of proposal 7.2 trillion?Yeah, Tom, this is really coming down to one question, one question only.How do you get that deficit, the ballooning deficit over the next decadeunder control? A forecast, by the way, that the Bidenadministration is something like $1.6 trillion per year.Now, this plan is a proposal supposed to address about $3 trillion of thatdeficit over an entire decade.

But do the math there, 1.6 trillion peryear over the next decade, 3 trillion is only a small drop in the bucket in termsof the way to go. But I didn't see that kind of approachto this is to tax the wealthiest a tax corporations and to do so in a way thatdoes it on multiple levels. You've got the billionaires tax, you'vegot anyone making above 400,000. You've also gotten mentionedcorporations, anyone who's getting a lot more revenue from abroad, including, bythe way, European corporations that then get a lot of their revenue from theUnited States. All of that is getting taxed and feedingthat or trying to at least stem the.

Blood and stem the hemorrhaging that youwere seeing out of the Biden budget. That being said, you are seeing a lot ofpushback from the GOP on this. And this is where Biden's budget is morecrucial because although the really only big major change between now and thelast budget he had was the kind of a 1% increase on defense spending, a muchsmaller increase than some of his peers around the world are posting.When it comes to that GDP, the GOP is saying even that is too much spending,the kind of support that he wants to give the middle class lower income taxbreaks aren't actually going to be helpful for the long term.The GOP instead saying, what about that.

Consumer resilience?What about that consumer growth? But, Tom, at the end of the day, you'llremember better than anyone back in the fall of 2023.Remember that big sell off? We had the long end of the curve.A lot of that was centered around concerns around the fiscal deficit.This is why it matters for the European audience, because if you can't get thatdeficit under control, the entire world. Okay.Well, I'm going to ask you to kind of sideline my cynicism because I look atthis and then I think about how this is actually going to be implemented if ifthat's what parts of this budget will.

Actually end up being implemented.It seems very limited pass. We've run out of time.I want to get your reaction to that. But you are pointing out that this isalso a bit of a bit of an election ploy, of course, as we build up to November.So a little bit of architecture going in in terms of the views of the Bidenadministration, in terms of what their priorities are when it comes to thiseconomy. Chris, you got to thank you very muchindeed. Of course, Bloomberg anchor with thedetails of that proposed budget coming through from the Biden administration.Let's check in on what else is on the.

Docket then for you today.Of course, we have in the UK the jobs data.7 a.m. so 45 minutes time.You've been watching that. If you have a view and the bank ofEngland currently markets and traders pricing in a cut not until August forthe BSE but will the data today in terms of wages change that view?Average weekly earnings growth seen slowing from 5.8% to 5.7%.The unemployment rate seeing coming in at 3.8%.8 a.m.. Bond.The lion of the European Union, of.

Course, will be speaking in the EuropeanParliament 8 a.m. UK.Time to discuss the upcoming leaders summit.There's a lot, of course, on the agenda. Ukraine and support Ukraine will be partof that mix, of course, as they consider of course the budget challenges ofBrussels. And at 1:30 p.m.US UK time we're going to get that US CPI print then expectations that COREwill come in at around 3.7%. Of course, following on from Japan'scomments and testimony last week where he signaled and suggested they weregetting slightly closer, they need more.

Confidence on the data front.They are getting closer to being able to cut interest rates.Will the data today give Jay Powell and team on the FOMC that confidence to geta clearer view on when that first cut comes?Now, coming up, Ukraine scrambles to build war fortifications as the CIAwarns momentum on the battlefield is shifting in Russia's favor.We get the details on that story. This is Bloomberg. Welcome back to Bloomberg Daybreakeurope. Now a bloomberg scoop around thethinking of the boj.

They are getting closer to decidingwhether or not to hike rates for the first time since 2007.Next week it does sound like it is on the wire for the boj.They are waiting for wage data coming through on friday to make the finaldecision. Currently it is too close to call.If they do hold next week, currency. Bloomberg reporting they are consideringa hawkish hold, signaling that a hike will be coming even if they do hold nextweek. Again, they are edging closer to raisinginterest rates. That is the top line whether they do itin March or April.

The consensus seems to be building thata hike is coming, a move out of negative rates then for the BOJ currentlychecking on the yen currently at one 4752.Still softer in the session against the US dollar by 4/10 of a percent.We will keep across this story for you. Of course, the governor of the Bank ofJapan speaking earlier saying he is seeing relative resilience in terms ofthe economy of Japan. The economy is recovering even as hesees pockets of weakness in consumption. Let's switch focus now to thegeopolitics of Ukraine. President Volodymyr Zelensky saysUkraine is racing to complete 2000.

Kilometers of defensive fortificationsas Kiev runs low on ammunition and Russian forces go on the offensive.This as US intelligence agencies warn senators that the deadlock in Ukraine isshifting the momentum in Moscow's favor. Let's get more then from Bloomberg'sBill Faries who has the details for us. Bill, what has President Zelensky beensaying about Ukraine's effort then to bolster their defenses?Well, that's right. You mentioned the 2000 kilometres ofdefensive fortifications. President Zelensky says that hisgovernment and military is working to complete that in a timely manner.It looks like they've had to accelerate.

Some of that work.The goal really, really here is to is to slow down any additional Russianadvances they've already. Ukraine has already lost some territorythis year. They want to keep that to a minimum andtrying to build this out while they can. But they have also warned about the thethreat that the shortages of ammunition posed to them as this war is now fullyinto its third year. And what has the US intelligence beensaying about their views as they weigh up the data, they weigh up the linescoming through the way at the intelligence in terms of where thestanding is in this conflict.

Well, you had the top U.S.intelligence chiefs on Capitol Hill talking to senators about the worldwidethreats. A lot of that was focused on Ukraine.They have said that the CIA director, Bill Burns, for instance, said thatwithout this improvement or additional Western military help, that Russia willlikely make significant gains this year on the battlefield.You remember a year ago we were talking about a promised Ukrainian offensive.Russia was on the defense, the defensive then.We're now in a reverse situation. They said that Russia appears to havethe momentum in this battle and that.

Will continue unless Western allies,particularly the U.S., step up. Okay, bloomberg's bill faries with thedetails there in terms of what the intelligence agencies would be sayingabout the fate of Ukraine and the prospects, of course.Thank you very much indeed for the details, Bill.Now to Haiti, where the unelected prime minister, Ariel Henry, has resigned asviolence escalates across the Caribbean country.According to the presidents of Guyana, the Transitional Council in Haiti willappoint an interim leader as they prepare for elections following weeks ofviolence.

The US has committed a further $100million for peacekeepers in Haiti. Former Credit Suisse chief executiveTidjane Thiam has signaled his intention to run for president in Ivory Coast.The 61 year old former banker convincingly won the leadership of thecountry's Democratic Party at a Congress last year and told Le Monde newspaperthat he will seek the party's nomination to run for president.Elections are set for October of next year.There is plenty more coming up. Stay with us.This is Bloomberg. Welcome back to Bloomberg DaybreakEurope.

Let's bring you up to date with thelines crossing in the BMJ. Then Bloomberg reporting, according tosources, they are getting closer to making a decision as to whether or notto hike for the first time since 2007. Either next week, of course, in themonth of March or in April. Either way, it's too close to call.Right now. They're going to be looking at the wagenegotiation detail that comes out on Friday.That's going to be really, really consequential in terms of thinking atthe Bank of Japan. And they may send a hike signal if theydo hold in March, they may send a hike,.

A signal.So it's likely to be a hawkish hold if a hole comes through again.They are split, it seems they are on the line on the wire when it comes to thedecision as to whether to hike in March or in April.And again, the wage data will be consequential.They're going to judge if pay figures will be enough for the march, move thosedata and that detail expected to come through on Friday.They are currently split on March or April.It is too close to call. The Japanese yen currently trading atone 4744, down 3/10 of a percent against.

The US dollar after the strength thathas come through, of course, would be the first hike for this Bank of Japansince 2007, moving out to negative territory.Now on to some of the other top stories we are following this Tuesday onto thetech space. And Oracle shares have surged in latetrade after reported a spike in bookings attributed to its cloud computingbusiness. Revenue from the cloud division jumped25% in the last quarter, slightly ahead of estimates.Oracle is focused on expanding its cloud infrastructure business to compete withthe likes of Amazon, Microsoft and.

Alphabet.Some of those names are, of course, within the Magnificent Seven groupingand talking of one of the key members of that group now is NVIDIA and the demandfor exposure to that company. We have an in video ETF chart showswhat's been going on. If you want to be able to double yourgains or losses with exposure to in video and this ETF.This is an example of Granite shares ETF and you've seen the inflows netpurchases of over half 1,000,000,000 USD worth of this ETF again as investorstrying to get exposure to the upside coming through from an VEDERE of coursewith the context that in the last two.

Trading sessions video is actually down11% in the last two trading sessions. Again, this is an ETF that's designed todouble the gain or losses of the stock's daily move.And Greenwich has pulled in $252 million in fresh capital just last week, $252billion in fresh capital last week. So it's another way the investors arelooking to get exposure to, of course, that a chipmaker in video lost twosessions down around 11%. But of course, upside of over well over100% year to date for in video. Let's move from video then to bitcoinbecause they have also we're also talk about records with bitcoin 72,000 above72,000 was the line that it crossed.

Yesterday.And talking of ETFs, this is also partly an ETF story.Of course, the ETF to the likes of Fidelity and others approved by the FCC,the Securities Exchange Commission in January, pulling in the inflows then andthe upside just continues for this cryptocurrency.72,881 was the level it notched yesterday, a little lower than thattoday. But again, the split as well will becoming in April. That is expected to put further momentuminto this crypto currency, up 48% just in the last 30 days come in inflation infocus as investors count down so that.

Key US CPI prints.Stay with us this is Bloomberg. Good morning.This is Bloomberg Daybreak Europe. I'm Tom Mackenzie in London.These are the stories that set your agenda.BOJ officials edged closer to raising interest rates.Bloomberg has been told the decision hinges on friday's initial numbers fromspring wage talks. Markets in a holding pattern.The head of US inflation data which could influence the federal reserve'snext move. And JPMorgan CEO Jamie Dimon warns theUS economy is not out of the woods.

Saying a recession isn't off the table.He adds, So the Fed should wait before cutting interest rates.Let's check in on these markets then. A modest downside coming through for usand European stocks yesterday. Today, the picture is a little brighteras we build up to the wage data out of the UK.And of course that CPI print 1:30 p.m. UK time out of the United States.European futures pointing to gains of 6/10 of a percent at 4961 UK futures,then 21 other futures at 7727 looking to add 57 points, up 7/10 of a percent.So set for a pretty decent session here in the UK.The Footsie 100 of course, and the wage.

Data out late today.What that does in terms of the thinking around the Bank of England marketsexpecting to be a way to cut not until August after the ECB in the Fed does thedata out today change that view? S&P futures about 5200 looking to add4/10 of a percent. NASDAQ futures at 18,326 again after thedownside that we saw yesterday pointing higher today, 6/10 of a percent.Let's put the ball across asset. We'd be talking, of course, about thelines crossing on the Bank of Japan. It is on a knife edge.The decision around whether or not to hike for the first time since 2007, inMarch or April, they're going to do it.

It's a question as to whether it comesin March or April. And the wage data on Friday, as we saidin the headlines, is going to be really consequential to that thinking.The Japanese yen softer in the session versus the US dollar down 3/10 of apercent at one 4746. Let's have a little look on the US tenyear then 409 on the benchmark as we lead up to that inflation print, theexpectation is that core inflation in the US will moderate from 3.9% to 3.7%in the print later today, year on year. The pound 128 one of the best performingcurrencies year to date. Again, the labour data could move thatcurrency later today and iron ore after.

A drop of almost 7% yesterday, thebiggest drop since 2022. You are looking at iron ore 128 pertonne, up 9/10 of 2% so far in the session and the squeeze came throughyesterday on concerns about the lack of fiscal stimulus out of China.Let's get you like to said in terms of what is happening with the BOJ.Again, Bloomberg reporting, according to sources close to the BOJ that they aregoing to make this decision it seems at the meeting next week and it is finelybalanced in terms of whether they raise interest rates in March at next week'smeeting or indeed hold off until April. And there is an expectation that if theydo hold off until April, then it will be.

A hawkish hold.That is one potential scenario for this Bank of Japan.Let's bring in Bloomberg's Paul Jackson then for the reaction and the details.Paul, what have we been hearing? Where does this leave the thinking onthe BOJ? Well, I think we have a finely poiseddecision coming up next week. There are some officials favoring amarch move thinking they've already seen enough.The wage data has been coming in strong so far.We saw those demands from Ringo. That's Japan's biggest union federationlast week, saying that the average.

Demands was 5.85%, compared with aboutfour and a half percent a year ago. So much more pressure from the unionside for higher wages. Amid all the talk of the need to raisewages above inflation and really drive this inflation cycle that the BOJ islooking for. Meanwhile, we're hearing that someofficials favor waiting till April. I think that's kind of been the baselinescenario that makes a lot of sense. Gives the Bank of Japan time to look atmore wage data that includes smaller firms, smaller companies.That is a concern amongst officials that, hey, look, you know, the big boysthat the the big companies, the big.

Exporters, yes, sure, they can give bigwage raises. But what about smaller firms that employthe majority of people in Japan? So I guess we've got these figurescoming on Friday from Ranga, which is the actual results of those annual wagetalks. And if they come in hot, then I thinkexpectations for a march move are really going to get to get a fire litunderneath them. Okay.So the way the wage negotiations data out of Japan on Friday could be the mostthe most important wage data without out of Japan for a very long time then howoverweight the wages comments today he's.

Been giving testimony again in terms ofhis views on the economy. What have what have we been hearing fromthe Bank of Japan, Governor? How has that informed our views on theeconomy and the prospects for a rate hike?Hey, look, I think the governor does a job when he's appearing in parliament isnot to give any signaling about what's about to happen.It usually plays it fairly cautiously and reiterates what he's said before.So you'll see that he said that he thought the economy was recoveringmoderately. So there are pockets of weakness inconsumption.

Hey, you said this before, but you know,we're the market like like very hyped up about what's going to happen.I think there's a bit of overreaction to that comment on the wheat consumption.I think it's all part of what the BOJ saying.And hey, it's realistic. I mean, the consumption hasn't beengreat in Japan. You know, the economy across the boardis not going gangbusters, but there is enough evidence there to suggest thetime has come to move away from the negative interest rate.And that's the turning point that we are approaching.It's different.

Yeah, deeply consequential.Paul Jackson, really appreciate that on that Bloomberg scoop, joining us, ofcourse, from Japan on the latest and the consideration of course the BOJ whetherthey go in March or April finding the balance.But it seems they are now preparing finally for the first hike since 2007.We appreciate it. We are counting down, of course, to thelatest inflation data coming out of the US as well.The closely watched numbers will give investors we hope they will hope furtherclues on the Fed's policy path. Let's bring in Bloomberg's Dan Morse.Dan, does it significantly change the.

View on the Fed?Is it likely to significantly change the view?The expectation is that core inflation year on year will come in at around3.7%. How are you thinking about the impact ofthis inflation data when it lands potentially with a thump at 130 UK time?Well, it would have to be quite a significant sum for this to change theFederal Reserve's perspective. You know, the central message from JayPowell last week is what he's really been saying for a couple of months now,which is at some point this year, they expect inflation to slow to an extentthat they can comfortably reduce.

Interest rates.That message really hasn't changed. It would have to take a spectacularconfluence of circumstances to knock them off that.I might add that picky the inflation gauge that the Fed's 2% target is basedaround is significantly lower than that and is headed toward 2%.Yeah. Really worth reminding viewers of thekey gauge that the Fed focuses on in terms of personal consumptionexpenditures and how that data is shaping up.Dan, your views and what we've been hearing from JPMorgan CEO Jamie Dimon,he seems to be out of consensus when he.

Says a recession is not off the tablewhen it comes to the US. Is this just a cautionary call from fromJamie Dimon or is there more to read into this?Well, it's certainly cautionary. As you say, a lot of the consensus hasmoved away from that and did move away from that in the final months of lastyear. But he's right on one thing.You can have a recession in the US and not necessarily know it until monthsafter it has ended. Recessions in America are decided by anacademic panel that is quite disdainful of the 2% GDP rule that's employed inthe UK, Euroland and places like.

Australia, New Zealand.In that sense, he's not wildly off the money.Okay. Bring back Diane Moss with a preview ofthe inflation data coming out of the US. And I view that and what we've beenhearing from JPMorgan CEO Jamie Dimon cautioning that a recession is not offthe table, of course, for the US. Thank you very much indeed, Dan.Right. To the U.K.now, where general jobs data is out in about 30 minutes.So I'm in London, 30 minutes, about 20 minutes time.In fact, the numbers will be closely.

Watched by the Bank of England as itmulls when to cut rates. For a preview on that data set, thenlet's bring in Bloomberg's Andra Day. Anna, what can we expect from the datatoday? What are you going to be watching for?Hi. Good morning.So the data coming out today will be a little bit of an awkward one for thebody. On the one hand, we still have all theseissues going on with the labor force survey that's being distorted by lowresponse rates. And that means that we cannot take aclear signal from the unemployment rate,.

Which has been falling beds to be a weare unlikely to place a lot of weight into that.We are certainly not. And then the second thing, and probablymost important is that after wage growth has been on a sort of fast decline inrecent months, especially in the latter part of 2023.It's the data today is likely to show that decline coming to a halt.And so on the whole economy, wage growth, wage gains are likely to stayunchanged at 6.2%, and the private sector measure is even likely to tick upslightly to 6.3%. Now, the less bad news is that this sortof increase is largely anticipated.

Because it will be driven by baseeffects and not the acceleration in the month, the growth of wage growth.So overall, the U.S. will sort of be able to look throughthat as well. Okay, So wastewater, that's going tolook relatively sticky, but ultimately priced in at least some of it.How does it how is it likely to feed into the thinking of the Bank of Englandthen? The last time I checked, the marketswere pricing in a cut, not until not until August for the year.So after the ECB, after the Fed, how were you thinking about the reactionfunctioning the body to this data?.

Yeah, So I think I mean, as long asthere's no nasty upside surprise in the data, as long as private sector wagegrowth only ticks up to 6.3% from 6.2%, I think that's still okay.Wage growth is running a little bit higher than to be as we had expected inFebruary, but marginally. And we still think that the mostimportant indicator right now is headline inflation, because the beautyhas sort of hinted that as long as headline inflation moves and settles at2%, inflation expectations will adjust and that will feed through overpaidfreedom. And so that's sort of the framework thatthey're using.

And headline inflation is still on trackto fall below 2% in the spring. So we think a window to cut rates willopen in May. Whether the year we will take it or notis a different question, actually. Remarks from the chief economist whorecently have suggested that it might prefer to wait and not take that Maymeeting as the first one to cut. And we think that June is probablylooking more likely for the easing cycle to start.Okay. Really interesting.Bloomberg's an android with the analysis there.As we look ahead to the wage data out of.

The UK in a little under 20 minutes timeand expectation that it could be June when the Bank of England goes with itsfirst cuts in a long time. Of course, there's plenty more comingup. European futures pointed to gains of6/10 of a percent. US futures S&P is up 4/10 of a percent.Stay with us. This is bring that. Welcome back.Happy Tuesday. Bloomberg Daybreak.Europe just getting up to speed on what's been happening.Of course.

The Bank of Japan lines crossing abloomberg scoop. We have been speaking to sources closeto the bank of Japan and they are getting that much closer to a decisionin terms of whether or not to hike interest rates or move out a negativepolicy for the first time since 2007. It remains on a knife edge as to whetheror not they do that in March next week or in April.If they do hold it next week, then it could be a hawkish hold.That is one option that officials are weighing up.But crucially, it is the wage negotiation data that will come throughthis Friday that could move the needle.

And be consequential to that decision.So we know it is too close to call right now.But there's a consensus they do need to hike interest rates.The question is, do they do it next week or they do it in April?And again, the wage dates and the negotiation dates are coming through onFriday could be very, very meaningful to that decision.Okay. Let's switch focus now as we look at theJapanese yen at one 4739, by the way, a little bit softer in the session.Let's go to what's happening at one of the big corporates, of course, that hasdominated the agenda for at least the.

Last 12 months or so in the US.Novo Nordisk, a blockbuster weight loss drug Wegovy may soon be covered byMedicare for heart disease patients with obesity.That's after regulators expanded approval to include reducing the riskfor heart attacks and strokes. The FDA says it's the first time aweight loss therapy has also been approved to help prevent lifethreatening cardiovascular events. Soaring sales of Novo Nordisk obesitydrugs helped boost income and investment returns tenfold last year.For the owner. Novo Holdings Total income and returnscame in at four and a half billion.

Dollars.Let's get more then from Bloomberg's Naomi Kresge now.What do we know about the approval from the FDA?How much of an uplift is this likely to give Novo in the months and quartersahead? And what do they do with all this moneythat they are generating now? So the importance of the FDA approval isreally that it gives novo an additional argument to payers that this is not justa medicine piece, it's also a tax on other diseases and cardiovasculardisease. It'sextremely important, the biggest killer.

And so this is just really key to theireffort to get this medicine used more widely.Turning to Novo Holdings, I mean, this is the holding company that controls 77%of Novo Nordisk. And their fortunes have risen, ofcourse, along with the drug maker. What is the competitive threat right nowfor Novo Nordisk? We know Eli Lilly is ramping up itsefforts around its own weight loss drugs.Is there a challenge that comes through, a consequential challenge that comesthrough for novo this year? Oh, absolutely.They have the weight loss market really.

To themselves for a couple of years thatnow for the first time this year, they're facing competition from EliLilly. And these two companies have known eachother for decades. They competitors in the diabetes space.And, you know, Lilly is a formidable competitor.We will see these two companies duking it out in the next year.Okay. Bloomberg's Naomi Christie, thank youvery much indeed. With the analysis coming through for theimplications. Novo Holdings, of course, Novo Nordiskas they continue to build out their.

Expansion and the market for Wegovy andother weight loss drugs within their portfolio.And I'll be speaking with Novo Holdings CEO Carsten Coté at 9:30 a.m.London Time. So do tune in for that interview.To France now where June's European elections are being seen by some as adry run for 2027 presidential race. Marine Le Pen is ahead in the polls withher far right national rally. Party building momentum.But is there anything Emmanuel Macron can do to hold back the prospect of a LePen presidency? Let's get more then from Bloomberg'sAnya nous bomb in Paris.

Anya, why is it crunch time then forMacron? These elections, the general electionsfor France are not until 2027, but we're looking ahead to June already.Indeed. So as you said, this EU elections areseen as a dry run for Michael. And the polls are showing that Michael,again, has been steadily building her popularity.And that's despite Michael always picturing himself as the insider thenantidotes. So, no, we're going to get a sense ofwhether or not nine of them can make it in 20, 27 after years of building up herreputation.

Hmm.What is the strategy then? What is the mix, the macro strategyto kind of curtail the pain? And what is the what is the pen strategyto win? How would you build out this success, atleast so far? If you read our long, long story, thisbig take until the very end, you'll see that we've done a lot of reporting fromNormandy, which is unremarkable in many ways, but remarkable in the sense thatit's really average and representative of what could be happening in France.Michael, I used to be very strong. There used to be this strong macrostronghold.

Before that, it was a stronghold of thetraditional less than the traditional rights.And essentially my party won almost all the seats in this constituency.And now she's trying to build a reputation as a respectable party, youknow, with lawmakers that are trying to be, as they say themselves, not at allscary and trying to normalize the party that has a history of anti-Semitism andxenophobia. And at the same time, they're trying tostick to the economic issues that a lot of people are complaining about.And that means caring and talking about the lack of doctors or the fact that alot of people don't feel that they're.

Reaping the benefits of Macron'spro-business economic reforms. And Macron's response to us is that he'sbeing very aggressive these days and picturing the elections of June as anexistential fight against the far right and a fight for the EU against Russiaand to support Ukraine against Russia. And that is because he's picturing LePen as essentially an ally of Vladimir Putin who could change the war in favorof the Russian president's. While all of that may sound familiar tothose who tuned in for the State of the Union address from from President Bidenwhen he was referring, of course, to his challenger in President Trump.So that's interesting in terms of the.

Reach across from the US to France andsome of these similar challenges. If is Macron guaranteed to run again in2027? Is that is that locked in?That's actually the crux of the matter. Michael cannot run for a thirdconsecutive mandate in 2027. So this means that he has to appoint asuccessor and likewise know not to be a great manager.He has failed so far to groom anyone. Very few people were emerging.His prime minister, 35 year old Gabriel et al, ISE former prime ministeral-Asiri. But none of them so far really hasimposed himself or herself as the next.

Possible successor of Mark.Okay. Bloomberg's Anya Nussbaum on thatBloomberg Quicktake around Le Pen and Macron, well worth a read.Thank you very much indeed. There's plenty more coming up.Stay with us. This is Bloomberg. Welcome back to Bloomberg DaybreakEurope. Happy Tuesday.The Bloomberg scoop of the moment is around the Bank of Japan and thedecision as to when to hike the first time since 2007.And it does remain on a knife edge too.

Close to call.They are coming around to the view that they do need to hike.That's going to happen is the question as to whether it happens next week atthe March meeting or if they hold off until April and the wage negotiationdetail that comes through on Friday out of Japan going to be really, reallyconsequential in terms of where they land on this decision.And if they hold next week, they are looking at the option of coming throughwith a hawkish hold, flagging a hike at the next meeting.So, again, the debate is very, very finely balanced and there will be greatscrutiny on that wage negotiation detail.

That comes through on Friday.The Japanese yen on the pressure on the session so far today, just down 3/10 ofa percent. But after the strength that we've seen,of course, in the last few weeks, one 4743 on the Japanese yen intraday.Now let's have a quick look in terms of how things are shaping up, the previewof the inflation data out of the US dropping at 1:30 p.m.UK time. Of course, before we get to the overheadlines, we've got have a quick look before I move on to the CPI out of theUS, we're looking at this chart in terms of where the BOJ rates are of course innegative territory so that they moving.

Out of the negative territory that willhappen. The question is do they go in March orin April? And that's the context historically interms of where rates are negative rates in Japan, and that's likely to end inthe next couple of months. Again, let's move on to the US inflationstory now, because I do want to touch on what's going on there and theexpectations coming through from this Fed survey, the New York Fed survey, andthis is interesting, potentially concerning for the Fed because consumerexpectations actually ticked up in terms of inflation in February.They dropped in January quite.

Significantly.But you can see the tick up there with the yellow line, and that potentially isa fly in the ointment as overall inflation has been grinding lower in theUS. But consumer price expectations tickingup in February will be a concern for this Federal Reserve.Let's flip board and have a look at the expectations broadly in terms of whereinflation's likely to land on a segment by segment basis.And you can see it's move in durable goods, a lot of work being done in termsof goods prices and inflation there. And that is essentially not a problemanymore.

It is all about services, as you can seein the white bars. That is a services part of the inflationbasket, and that's where the work needs to be done.Again, on the core basis, year on year, inflation is expected to come in at3.7%, down from 3.9%. But look for the services component.So essential. Still ahead, I'll be speaking to thegenerali ceo, managing director phillip tonight on earnings next hour.Plus novo holdings ceo carsten cuts. I join the pulse 9:30 a.m.a london time. Stay with us.Markets today is next.

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