he is saying the jay powell has let us down. he says the market wanted lengthy rate cutting cycle and of course that was something that jay powell was saying we wouldn't be getting anytime soon. >> we had a sense this is not going to be trump. what the market wants to see is that jay powell is acting independently. and they are acting based on the data. --he could continue to the in between the two references europe. looking at europe's economy, this trump really want that growth and unemployment? we will have to question. it's time for smart charts. >> joining me to talk about the s&p is walter zimmerman. thank you for joining us. you have a dramatic part that matches up to and s&p chart. perhaps some are calling it less dovish others are calling it slightly hawkish. it may be in impetus for this chart to work. the s&p itself is still confirmed to go slightly higher. that's the s&p 100. on average more precise chart patterns. this one is no exception. each of these turns from here to here, textbook perfect. close tore extremely

aware is jay powell leaning -- where is jay powell leaning? domestic not just the economy, talking about rising tensions. the fed watching that closely. inflation not only failed to meet the 2% target, it moved further away. with theaid, compared june meeting, since then, manufacturing, trade, business investment have all weekend -- weakened. he talked about the labor market. he was asked the question in this context, representative carolyn maloney of new york who asked. >> did the june jobs report change your outlook for whether an appropriate -- a reduction is appropriate? what's the straight answer is no. globalertainties around growth and trade continue to weigh on the outlook. inflation continues to be muted. place.hings are still in >> jay powell says the market looks good. why will that not cause inflation? tightwe have a hot, market? to call something hot, you need to see heat. we hear lots of reports of companies having a hard time finding qualified labor. we don't see wages. i don't see that as a current issue. speaking of the metaph

you don't want to fight jay powell, do you? nejra: it seems like jay powell doesn't want to fight the markets. taking a look at asian equities, we are seeing gains there. aboveci asian index is 3000, seeing the dollar weaker for a second day. pimco talking about rolling over the dollar but it depends on even cycle. the 10 year yield down to basis points. a precipitous drop in the two year yield. of repricing in the bond markets around those cuts. manus: a new record, we've cracked it above 3000. what does it take to maintain that momentum? the by everything rally, is that going to be challenged? is something more ominous on the global horizon, according to jay powell? they are saying the beneficiary could be the yen. you see the powell testimony as being slightly worrying. deutsche bank, it doesn't end, does it? nejra: exactly. more bad news for deutsche bank. we've learned the u.s. debt -- justice department investigating the lender as part of an expanded probe. joining us is sophie cameroon. great to have you with us. -- soph

jay powell noted it has certainly been tamped down. when we get the cpi numbers later, we expect that to be pretty much flat month over month. we do have a deflationary presence, but back to the points you were making a few minutes ago about the phillips curve, i'm not sure if it's dead. it's just been flattened a bit by a lot of long-term secular factors like globalization, demographics, automation. it has been flattened, but if you look out a little bit longer term, we are starting to see signs. average hourly earnings are not at that worrisome for percent level, but if you look at the trendline, it has been going up each of the last three years. there are signs that may be going forward, given that we have unemployment at the lowest it's been in nearly 50 years, we might have that going forward. when investors start to appreciate that, that might be when the fed has to start actually worrying about maybe bit.ng down the plays a alix: burns and lisa will be sticking with us. coming up, and exclusive fed richmondh chairman. inid: chai

we look ahead to jay powell. the two-year back above 190, jumped 22 basis points since the lows in june. a touch of curve steepening. what's that going to look like after powell? futures flat. we saw u.s. markets not move a lot yesterday. the next direction could come from jay powell in his testimony this week. the peso took a beating yesterday. we broke through 19. weakness yesterday pushed the bloomberg dollar index up above the 55 day moving average. the finance minister quit, but was replaced. how much more risk is out there for the peso? manus: to south korea now. this is one of the big issues. warnednt moon jae-in has the country's top businesses and leaders they may be in for an extended trade battle with japan. tokyo ruled out lifting export controls on key tech components. let's get an update now. we have our bloomberg reporter standing by. good to see you this morning. >> the president has invited these company executives to warn them, as you mentioned, that this trade spat with japan will prolong becau

jay powell is not moved by inflation data. business confidence is the biggest concern. >> the first quarter was fine, but the income -- the indicators for the second quarter are less strong. i do not see people cutting back existing plans,, but they are not leaning forward. nejra: president trump claims china has not increased purchases of american products like promised. south korea demands a probe into japan's claim of illegal exports. trump slammed facebook over a cryptocurrency. and expanded alliance today. just past 7:00 a.m.. welcome to "bloomberg daybreak: europe." we have had five days of weakness and european equities, it looks like we can and on a high. dax and cac and u.s. futures higher. s&p 500 hit a record high, above 3000, but it did not stay there. it closes just below it. u.s. equities did take a tiny bit of a hit when we got the line from president trump complaining that china has not been buying u.s. farm products. trade tensions are still weighing on the markets. looking at bonds, we have a reaction to the

as the world waits for jay powell take a look at europe. at least right now it's a sea of red except for italy stronger by 3/4 of a point again, also european markets really hinging on what's going to happen today on capitol hill with the fed chairman. that's the big focus he heads to capitol hill today later this morning he's going to be testifying before the house financial services committee this is the first day of two days of testimony so what do investors want to hear joining me now is dan beru, chief investment officer at palisade capital management. dan, it seems like everyone is expecting that we are going to get a quarter of a point drop in interest rates when the federal reserve meets at the end of the month. is there anything that jay powell can say today to sort of change investor sentiment? >> i think that if he -- well, he's got to do a quarter point because it's so, so much expected i actually think he's got a good indication that there's a further quarter of a point drop in rates on a going forward basis as more of an insur

jay powell in the line of fire. president trump keeps up the pressure to cut rates as the market prices out further rate cuts this year. erdogan flexes his muscles. did turkish president fires the head of the central bank -- the turkish president fires the head of the central bank. the lira falls, equity sells off. david: welcome to "bloomberg this monday, july 8. a little something going on in france. it was a great game. aix: their second win in row? david: that's right. alix: even president trump took to twitter to congratulate the team, versus a couple days ago, when one of the women said we are not going to the white house, and he said why don't you win first. now apparently very proud. david: it was a great game. the u.s. was really taking it to the netherland for the first half, but they kept it up in the second half. alix: go team usa. in the markets, you have powell coming out in the next couple of days. drive up market reaction for this week. euro-dollar lower by 1/10 of 1%. the dollar getting a little bit

that's why steve liesman's report is so important of what jay powell is saying in paris today. he's signaling there is external events like the debt ceiling, like trade uncertainty, that have to be factored into the equation good employment, good retail sales, but these external factors could slow the u.s. economy down, and jay powell wants to stay in front of that monetary policy as a cushion for this elevated and escalating trade situation. >> we forget that trump can get thrown out in two years, in 2020. by the american people president xi doesn't have that worry, does he open a few more internment camps. he's got no issues with staying in power, i don't think. >> that's right. so he's constitutionally protected. but serious reformers are really pushing for change here. so if the economy slows considerably, i still think he's come under pressure. and for the president, he clearly wants to use getting tough on china in the presidential election. but he's got to be worried because manufacturing is slowing, construction is slowing. those are key trump voters in key trump states

consensus around jay powell? the richmond fed president speaking to michael reporters, theo fed does not need to step on the gas. however, when he looked at what jay powell said, he did not change the message for the june meeting. let's listen -- said the same thing yesterday he has said for the last month and we said in our last memo. we do not have forward guidance anymore the memo. we are watching carefully what is happening in the data. we are looking very much on upside risk and downside risk. at this point they are tilted to the downside which is why we are looking at it. another: let's bring in fed president. he played down the need for a rate hike as well. he said in fact that -- here it is. from an employment perspective, the economy performs in a positive way and the numbers are not as weak as some suspect. the aggregate numbers look pretty good. remember the consumer price index coming in stronger than the month of june, up 0.3%. that came up before powell even spoke. that is the biggest gain since jan

and the macro setup ahead of fed chair jay powell's speech is pretty interesting only because this is not a major selloff, but there does seem to be ratcheting down ever so slightly of risk with record highs in stocks. >> you're right. and i think that the jobs number on friday or the hiring data on friday basically suggested that now you all eyes are going to be on powell. if powell comes out less dovish than the market would like, he doesn't even have to come out hawkish, i think even less dovish would actually cause the markets to rethink their positioning at the moment. the markets have been on a pretty steep bounce ever since we started to sort of anticipate dovishness by the end of the year so it will be interesting to see what happens >> so gina, let's speak about that positioning because it sure feels as though that more bullish jobs number on friday did shift some positioning, certainly sentiment. there is not as much of an expectation now of a mastiff rate cut later this month. so tell us through whether the market has been reset because of that jobs report >> well, you know

jay powell signaling openness to a rate cut. on incoming data and other developments, it appears uncertainties around trade tensions and concerns about the strength of the global economy continue to weigh on u.s. economic outlook. inflation pressures remain muted. you can see a buying boom in the treasury market. you can see yields down in the treasury. gold shooting higher, equities moving higher. a classic fed cutting move. trade, andll about it is getting worse, not getting better seems to be what he is saying. alix: it is all about trade, if trade gets fixed, what kind of reversal do you see? david: that is a danger. alix: and at what point are you like guys, i cannot fix this? david: the guy in pennsylvania avenue, that is his job? alix: absolutely. it will be a fun couple of hours. coming up, bank of america merrill lynch u.s. equity strategist. this is bloomberg. ♪ hey! i'm bill slowsky jr., i live on my own now! i've got xfinity, because i like to live life in the fast lane. unlike my parents. you rambling about xfinit

the jay powell upgrade economic risk assessment. it is getting worse even since what the fed was seeing in mid-june. rising risk, that assessment could be flying the rationale for a rate cut. in their prepared report that is going to be presented officially on wednesday, released this past friday, the fed is looking at weaker global trade, weaker manufacturing, uncertainty, these are the kinds of things that would perhaps justify that kind of insurance rate cut that jim den others have talked about. question, i big don't know how important it is to the outcome but it will have some headlines per you will be asked questions about the constant attacks on jay powell and on the fed. you should be raising rates now, etc. larry kudlow said jay powell's job is safe at the time. the fed should take back to december rate hike. inflation is still low. republicans may take donald trump side area democrats may be looking more things like breaking up big banks and income inequality and trying to get jay powell to say that donald trump is on the

what are you expecting from jay powell and what's priced into the markets? >> well, i'm expecting some really bland testimony, i think that he's really in tough situation, maria, he isn't the first chair that's been under pressure or criticism by president, if you look at history, lbj, if you look at history, he actually physically assaulted his fed, from that perspective trump isn't being that tough on the guy, however, it's a public display and because of that he's going to be extremely cautious, try to straddle both sides of the field as they say. maria: what's your take on the broad backdrop right here and whether or not the economy really warrants a cut in interest rates, europe is not generating much growth, we know that, asia is questionable where china is and the u.s., lindsey just said she's expecting earnings from second quarter to be down 1.8%, third quarter to be down 2 tenths of a percent but the third quarter to show a gain, what's your take. >> i don't think earnings will be that tough, that might be the average earnings growth or decrease, wh

we're getting ready for jay powell's second day of semiannual testimony on capitol hill. now to europe, those comments he made yesterday about the rate cut really sending markets higher, that's helping global markets. european indices are in the greengreen as you can see. now asia, preliminary discussions, u.s.-china trade talks seem to be back on track. all markets in asia also in the green. lauren: feels like christmas in july. louisiana under a state of emergency as severe flooding stuns new orleans. flash flooding turning streets into rivers, forcing some residents to cut across town in kayaks. cheryl: take a look at this, dark clouds and a water spout touched down on a local lake. let's bring in meteorologist adam clots in the fox weather center for all the latest. >> it's going to be a big couple days for the weather for the forecast along the gulf coast. this is what we're looking at, it's a broad low pressure system bringing rain across the gulf coast, likely becoming a tropical storm before today is over. currently it's forecast to get up to a category 1 hurrican

fox business will have live coverage of jay powell's testimony at 10:00 a.m. this. lauren: tech and media giants are heading to sun valley, idaho today for a big conference that will draw everyone from tim cook to bob iger and while they'll be talking up their own streaming services, from apple plus to disney plus, one of the biggest pieces of news to hit streaming is that friends is moving off of netflix. >> here we go. pivot. pivot. pivot. [ laughter ] >> b pivot. [ laughter ] >> pivot. >> shut up, shut up, shut up! cheryl: the office as well will be joining friends as that show moves to warner media's streaming service, hbo marks, semax, setto launch in the spri. it will have content from across warner media's library, including movies, cartoon network and a lot more. content from warner's other streaming service, dc universe, will be featured on hbo max. there doesn't seem to be plans to scuttle that service just yet. no word on how much it will cost to describe for all this. lauren: i'm watching netflix stock today. the office and friends were their top two sho

we begin with jay powell. joel: take something complicated and simple it down. the cover is an expression of that this week. jay powell, fed chair, probably the most important person in the world of finance. he heads the financial institution that is probably the most important anywhere in the world and for a year now, he's been the target of trump's friend are ire, because trump wants lower rates, lower rates, and jay powell has basically been a stoic figure through all of that. carol: we believe this is an independent organization and for the first time, we are wondering is it going to remain independent? >> and can they continue to fend off the executive branch's desire for lower rates? we will see what happens this next week with rate cuts. the market basically thinks there will be a rate cut. the bigger story is one we wanted to ask to dig into, which is for a year now, we've lived through the tension between trump and powell, more from trump than from powell. it is one-sided, for sure. what effect has not had on the fed? what chris got to was, not much of

there has been no bigger critic of jay powell than president trump. the president said today this was not a direct result of caving to the president's desires. >> this action is designed to insure against downside risks overglobal trade tensions, offset the negative effect that those factors are already having, promote faster return of inflation at 2%. that is what we're doing. that is why we're doing. we never take into account political considerations. there is no place in our discussions for that. we don't conduct monetary policy in order to prove our independence. reporter: we didn't get much clarity how a trade deal with china might come b the talks in shanghai wrapped up with the next meeting in december, the china will commit to an to an ago buy. there is no tweet from president keep hitting refresh. kristina: you were too busy refreshing. i would thank him. jackie deangelis at the new york stock exchange. investors were not impressed or didn't hear what they wanted to hear from jay powell? >> kristina, that is right. we were up most of the ses

jay powell, fed chair, probably the most important person in the world of finance. he heads the financial institution that is probably the most important anywhere in the world and for a year now, he's been the target of trump's twitter ire, because trump wants lower rates, lower rates, and jay powell has basically been a stoic figure through all of that. carol: we believe this is an independent organization and for the first time, we are wondering is it going to remain independent? >> and can they continue to fend off the executive branch's desire for lower rates? we will see what happens this next week with rate cuts. the market basically thinks there will be a rate cut. the bigger story is one we wanted to ask to dig into, which is for a year now, we've lived through the tension between trump and powell, more from trump than from powell. it is one-sided, for sure. what effect has not had on the fed? what chris got to was, not much of an effect on a policy standpoint, but there is a certain nomination in progress right now. it will take a few months to evolve. this

i'm saying i don't think they're targeting the dollar. >> you really think jay powell, when he closes his eyes tonight is thinking wow, that quarter point or maybe a couple more will really address the spongy global -- global, not domestic deflationary cycles we're going through? >> he thinking we're providing insurance if we get more -- >> insurance against what? the spillover is coming through bad policies that aren't addressing the growing ills in europe you're right, the outcome is what you've just sen they're slowing. now we are doing the same thing they are what do you think our outcome will be? does that highlight how little effect this has on me. >> i think there is some of it to what extent will it actually -- i think that's been the whole challenge. and what actually it's going to do >> it's really a skimming off the top. the market is overaggressive about what was going to come behind that? i do think it leaves investors, traders in a familiar, am bigius and contingent state i think it's also significant that chairmans that the fed has been undergoing all year, which is to

fed chairman jay powell. joel: jay powell is probably the most important person in the world of finance. he has the financial institution that is probably the most important whenever institution anywhere in the world. for a year now, he has been the target of trump's twitter either. trump just once lower rates, lower rates, lower rates. wants lower rates, lower rates, lower rates. carol: they have been an agency for so long. we are wondering if they will remain that way. >> the market thinks they will be a rate cut. the bigger story is one that we wanted to ask chris to dig into. for a year now, we have been living through this tension between trump and how. more trump than powell. it is one-sided. chris got to is that there is not much of an effect on policy standpoint for the fed. this will take a few months to evolve. this could be radical. shelton is nominated for the fed. we don't know how that will go nor what you might do if she gets into that seat. >> a good list -- it could last the rest of the year.

we begin with jay powell. joel: take something complicated and simple it down. the cover is an expression of that this week. jay powell, fed chair, probably the most important person in the world of finance. the financial institution that is probably the most important anywhere in the world and for a year now, he's been the target of trump's friend are ire, because trump wants lower rates, lower rates, and jay powell has basically been a stoic figure through all of that. anol: we believe this is independent organization and for the first time, we are wondering is it going to remain independent? and can they continue to fend off the executive branch's desire for lower rates? we will see what happens this next week with rate cuts. the market basically thinks there will be a rate cut. the bigger story is one we wanted to ask to dig into, which is for a year now, we've lived through the tension between trump and powell, more from trump than from powell. it is one-sided, for sure. what effect has not had on the fed? what chris got to was, not much of an effect on a p

the president says jay powell has let the country down. the move sent wall street in months.e most and trade talks go back on hold until september. no progress in shanghai, but washington says the brief meeting was constructive. break downr, we will qualcomm earnings and the challenges it is facing with bloomberg intelligence. first, let's get you started marketsheck of how closed this wednesday session. it was a down day across the board. every sector in the red. we had that 25 basis point cut from the federal reserve, but it was taken more as a hawkish cut with chair powell's comments. we saw significant pressure there. we have seen a roller coaster ride throughout the session. the s&p 500 did rebound a little bit when fed chair powell did not completely rule out further cuts. the nasdaq was down more than 1% and we continue to seek u.s. futures under pressure. 10-year yields were pressured for a fourth consecutive session, although two-year yields jumped. not really yielding significant progress causal -- not really yielding significant

we are counting down to jay powell's testimony in d.c. are we going to get a clear signal on what easing path is going to look like for the fed? not really a clear story to tell you, but it seems things have stabilized a bit. from the liquidity we saw in china, plenty of ipo's in the pipeline, also when it comes to japan and korea, there's reports that the two sides are going to be talking. at least that is eliminating some of the risk that things could be ratcheting up. watching out of china snapped out of that slump. take a look at another chart when it comes to u.s. 10 year yields. we are watching that u.s. 10 year. we are still back above that 2% for the 10 year yield at the moment, but we have a cautious stance ahead of jay powell's speech. dollar-yen is interesting. we are seeing dollar strength coming back after that solid jobs report. closer to 109, which is not what a lot of traders were forecasting. and we are watching the ringgit as well. largely expected to keep things on hold, but there is a stronger case now given what we've

we begin with jay powell. joel: take something complicated and this still it down to its most simple form. istill it down to its most simple form. the cover is an expression of that this week. jay powell, fed chair, probably the most important person in the world of finance. he heads the financial institution that is probably the most important anywhere in the world and for a year now, he's been the target of trump's friend are ire, because trump wants lower rates, lower rates, and jay powell has basically been a stoic figure through all of that. carol: we believe this is an independent organization, and for the first time we are wondering is it going to remain independent? >> and can they continue to fend off the executive branch's desire for lower rates? right? we will see what happens this next week with rate cuts. the market basically thinks there will be a rate cut. the bigger story is one we wanted to ask to dig into, which is for a year now we have been living through this tension between trump and powe

jay powell says he has serious concerns. plus you will hear from the global chief diversity officer. how they plan to double the number of female employees globally in the next five years. all, it is going to take thousands of satellites to do it. it will the price of global broadband be a polluted night sky? we will take a look at a looming debris problem. facebook plans to create its own crypto currency is not getting love from u.s. lawmakers area you can now add jay powell to that list. project -- libra raises many serious concerns regarding privacy, money laundering, consumer protection and financial stability. these are concerns that should be thoroughly and publicly addressed. facebook has a few billion users. you are looking at the possibility of a very broad adoption and if there were problems, they are associated and any oflaundering the things we were focused on including the company they would arise to systemically important levels because of the size of the facebook network. i think it cannot go forward without t

i'm sure that is what jay powell is watching. charles: i hope we don't continue to follow in the cycle. thank you, ladies very much. >>> senator chuck schumer signaling to use plan to use the world cup soccer champions for his agenda and push mitch mcconnell into a corner. i will explain. >>> baseball gets the best to show off their talents in tonight's much anticipated all-star game. we'll have a preview for you next. ♪ i customize everything, like my bike, and my calves. liberty mutual customizes your car insurance, so you only pay for what you need. ♪ liberty. liberty. liberty. liberty. ♪ can't see what it is yet.re? what is that? that's a blazer? that's a chevy blazer? aww, this is dope. this thing is beautiful. i love the lights. oh man, it's got a mean face on it. it looks like a piece of candy. look at the interior. this is nice. this is my sexy mom car. i would feel like a cool dad. it's just really chic. i love this thing. it's gorgeous. i would pull up in this in a heartbeat. i want one of these. that is sharp. th

. >> the big new s the market is waiting for comes tomorrow when jay powell talks to congress but before that, we heard from larry kudlow today weighing in on powell's job security and central bank independence among other things steve liesman is here with those details. >> melissa, the firing of tur y turkey's central bank chief and president trump's consistent throats to fire or demote the chairman of the fed sparked a controversy over whether the central bank is and should remain independent larry kudlow weighed in, saying he believes the fed should be independent. >> that word independent, i mean, it doesn't mean they operate from another planet. the fed reports to congress. and that's in the constitution and the fed is appointed or the governors are appointed by the president. so i think that in a day-to-day sense certainly they're independent, but that doesn't mean that they shouldn't listen to advice from their elders. >> that advice from their elders, from the president, also from kudlow, was for the fed to cut interest rates to accelerate growth, with both going further than the

certainly making taylor -- jay powell's job easier. we will take a look at the individual sector and where we are within the s&p 500. we've been talking a lot about bond rates. financials are the best performer of them all. they are benefiting. you get a lift up of the rates. these are more profitable and we will be heading into earnings season. take a look at that equity trading. it is all about the industrials. earlier it was real estate and utilities and the bond sensitive sectors. it is now about the industrials. they continue to lead the decline. if we've look up the board, we can take a look at individual movers. it is ge, honeywell, 3m, john deere. we were talking about siemens in germany because of the poor german factory orders. some concern about the economy, which does not square up given the good jobs number. i guess that is what makes markets. all over the place today. david: thanks so much to taylor riggs. coming up, is good jobs news bad news for democrats trying to unseat president trump? we talk with a senior economic

markets pricing for key testimony this week from jay powell. banister-- in very barry banister joining us from baltimore. where do you stand now on rate cuts? >> i do believe the fed will cut rates july 30 one, taking back that december rate hike in 2018 which was clearly overdone. the question before the market is whether they do another 25 basis points in september, taking back one year later the september 2018 rate hike which the market really did begin to peek out after that if you 2920 ande peaked at2 they raised rates soon after. the question is what happens to the data in august to convince the fed to move in september again. if you look at today's numbers, friday's nonfarm payrolls, you may ask yourself why the fed needs to put in insurance cut in place at all. barry: you have five reasons. very low inflation. we have a low forecast into next year. second, full employment. underserved, disenfranchised people are finally being included and are seeing wage gains. that is something the fed knows they have to continue. third, we have an 80

fed chair jay powell might say about a potential rate cut in july the two-year now 1.925%. quite a steep rise considering that the recent low is 1.696%. >> 195 on a close. >> amazing yields. >> obviously stretched lower >>> in trade news, top u.s. officials, talks back on the hill the first high level talks with the chinese counterparts yesterday. they continue to try to work out a trade deal people close to the conversation say both sides are going to continue talking but that existing tariffs could be, in their words, the new normal. >>> netflix is losing another high profile tv property next year "friends" is moving to warner streaming service hbo max. this is a second big blow to netflix. cnbc parent company comcast announced "the office" is moving the fresh prince of bel air, joe's favorite and pretty liars. they didn't announce a subscription price for hbo max i think the question here is is netflix really facing finally that competition that everybody had been projecting but in the next couple of years we have disney plus, hbo max, you have a comcast streaming. >> di

we've just been listening to the second day of testimony from jay powell. he says the consumer part of the economy is strong but there are issues with the business park. the economy is being weighed upon by certain uncertainties. he stays had on his commitment to a 2% inflation goal and says there are longer physical challenges ahead. we want to bring in somebody who has presided over these hearings until recently. he served for 16 years in congress representing his district in texas and for the last 16 years resided -- presided over the house banking committee. thank you for staying with us and being patient. we do not control them. >> i do know a little bit about it. david: let me cut right to the chase. days, the markets are saying we hear from jay powell there will be more cuts coming down the pipe. i will put up a chart that shows we are talking about a cut in july and the markets are anticipating a total of three this year. is that the right answer? after two days of it is clear the fomc will be in a more accommodative stance. i would be surprised if

jay powell will be speaking later today. he will also be testifying tomorrow and thursday in front of congress. markets were down yesterday for a second straight day on hopes of -- as hopes of a rate cut began to fade after the strong jobs report on friday. that's what the markets are waiting for. what will jay powell say about the potential for an interest rate cut later this year? europe pine meaeuropean indicesy lower. cac is down 17 and the dax in germany lower by 116 points, 1% lower in germany this morning. asian markets mostly lower. only japan able to squeak out a gain as you see. it was fractional. the other majors down, about three-quarters of 1% or lower. growing tensions with iran, tehran is warning it will restart deactivated centrifuges and ramp up enrichment of uranium. mike pence says america will never allow iran to obtain a nuclear weapon. virgin galactic has liftoff, making moves to become the first space tourism country to be publicly traded. we'll tell you about the company's plans to go public. stranger

>> jay powell will likely disappoint the market. it is quite frankly amazing to us how three months ago he our call for two rate cuts was looked at with extreme skepticism and now the market is look for almost three by the end of the year and four by the middle of next year. that is too far in our opinion this is not about an economy that is going to go into recession. this is about taking insurance to make sure that the growth path is maintained >> phil, you have two concerns for the markets. china trade deal, that that didn't happen, and the fed screws up monetary policy. so what does that mean screwing up monetary policy, not cutting or cutting too much? what is the risk >> i think julian hit the nail on the proverbial head the core pc number a week or so ago was better than expected results of the g-20 better than expected nonfa nonfarm payroll numbers better than expected. if i'm jay powell, i'd let the market down easy and let them know that it is not a slam dunk that i'm going to cut 50 basis points on july 1 i may not cut at

jay powell builds the case for cuts. markets saying he is sounding like central banker to the world. again. the outlook the fourth profit warning in just over a year. contenders to become the next prime minister. we get the take of the chancellor of the exchequer. ♪ good morning. good afternoon from asia. this is "bloomberg surveillance," i'm francine lacqua in london. lift to the stoxx 600, data from around whattivity jay powell is doing. dollar weakening for third day. crude oil 60.60. makesort saying surplus return despite opec cuts, whether that means they will come further is something we will watch for. as operators in the gulf of mexico are bracing for tropical storm barry, giving pressure on crude oil prices. u.s. 10 year yield at 2.12. coming up on "bloomberg surveillance," the all-star lineup today. we will talk about deals in the banking outlook. we will speak with philip hammond. this afternoon, we sit down with the ford chief executive. breaking news. arkey says it has received missile defense system from

more on jay powell's testimony. from new york, this is bloomberg. ♪ from bloomberg world headquarters to new york. taylor: i'mbostick taylor riggs. romaine: stocks are up, treasuries are down. joe: the question is, "what'd you miss?" gearse: the fed chairman up to face lawmakers on capitol hill. shares of dialysis providers sink today as president trump takes aim at prices in the kidney-care market. and we will speak to one of the candidates running for president, representative tim o'ryan of ohio. taylor: fed chair powell is set to appear before the house banking committee tomorrow and onto the senate on thursday. powell will likely mirror language from the fomc minutes last month, saying it will act as appropriate. i want to welcome our senior reporter for economics. what is the one key piece of information you would like to hear from powell tomorrow? >> everybody will be focused on the timing of the potential rate cuts. it seems it is not whether they win do it -- whether they will do it, but when and how much.

testimony from jay powell, moved to the dial for bond and equity markets, seeing big rallies. that in saw some of bonds adding a little bit -- ebbing a little bit. you saw the softer jobs report and the series of months, the u.s. jobs market clearly is calling. the testimony this week from jay powell will be very crucial, especially to a bond market that is leaning towards slightly more aggressive cut profile from the fed, a few of those bets as you can see here in the library, they got wound back late friday, given the softness of the jobs report. clearly july is very live if not a done deal on 25 basis points. expectations from the market waivers over three to six months as to how aggressive the fed is, but they are watching the data, inflationary problem is the big hiccup for the fed. anything from the fed wednesday and thursday over how the inflationary outlook is developing, but also on the growth upside, especially the global growth story and whether he makes any more comments that lead to what is happening in china and the trade tensions, that is what will set the bar f

that is what happened to jay powell today. the president did tweet, not as emphatically as in the past, the fed let us down. economyhikes more, the is growing, helping with the trade war. ago, a richmond fed bank economist, someone who has been watching the fed said the action wasn't warranted and paul had a tough time defending it. we did see stocks plummeting. is not clearlyon warranted. powell struggled to provide a defense of the action and is clearly suffering anxiety of downside risk. the press conference provided a compelling case that the rate cuts will cut these issues in a significant fashion. he said it will not help the economy and will just help markets and the white house. one more thing i would like to throw in, we just had the bank of japan meeting saying they could ease more if they had to. everyone worried about the fed. maybe governor caretta got it right. the fed made its rate cut, but did not signal in aggressive move to more cuts. this will have more input asian's to other central banks around the world.

we heard what jay powell said. why the skepticism? think the skepticism gets to the general skepticism about crypto. you heard jay powell's content on that, was the fact that facebook has so much power. that is something we have all been reckoning with over the last couple of years were they have a huge user base. they are able to push people into new products. you could imagine if they aggressively try to push people into the cryptocurrency, it could create issues. , powell was talking about libra posing a real threat to the global financial system. at the scale of sais -- facebook's size, any problems would be magnified. is he right to be concerned? joe: listening to chairman powell, i was really struck by what i think is clear -- this is something that is on his mind a lot. as you mentioned a lot of the , lawmakers were asking him about it. i think in the past when it comes to cryptocurrency or blockchain or other endeavors like this, you got the impression that they are like, this is something we are watching. this is more than th

jay powell signals a cut is coming as concerns. rising tensions. .he british navy intervenes deutsche bank in the crosshairs. u.s. investigators probe and involvement with malaysia. welcome to "bloomberg surveillance." good morning. good afternoon if you are watching in asia. i am francine lacqua. these are your markets. a cheer across the market for a dovish tilt for central banks. we heard from jay powell. we will hear from him again today. the euro-dollar, 1.1278. there is a lot going on, not only about trade. official taxes that france will vote on. there is a mood on what happened to euro depending on what we get from the ecb minutes that will be released after midday. we will watch for that and any movement on currency. coming up, we speak with the sao paulo governor, he is joao doria . plus we will speak to sheriff brown about u.s. politics. let's get to the work first word news. >> deutsche bank is now being probed u.s. justice department as an expanded investigation. the u.s. is reportedly taking a closer look at a former

jay powell did tell him to take a hike. he said fire me and i will not leave. >> well ab, i acan assure you are the president is not going to do what the jay powell tells him to do. >> thank you very much. >> i appreciate it peter good to have you with you. >> my pleasure. >> thank you. >>> next democrats needing tofg over their game plan for questioning bob mueller. the congressman in the meeting next. plus traveling to mexico where thousands of migrant wait to asylum. they have been told they have to wait a long time what are they doing? well, we found out. this is nice. yeah...yeah, this is nice. hmm. how did you make the dip so rich and creamy? oh it's a philadelphia-- family recipe. can i see it? no. philadelphia dips. so good, you'll take all the credit. you don't need to go anywhere dad, this is your home. the best home to be in is your own. home instead offers personalized in-home services for your loved ones. home instead senior care. to us, it's personal. not ecan match the power of energizer.tery home instead sen

michael: jay powell right now because his job is easier. mario draghi has to come up with a plan to stimulate from a menu of choices, none of which are good. if they cut rates, they have real problems with the bank, deutsche bank being one of those. again, they can only buy so many sovereigns. if they start buying corporate, they continue to distort the economy there. they don't have a lot of good choices. the problem for both of them is they are going to try to stimulate demand by lowering the cost of borrowing and demand is not the problem at this point. lisa: isn't the definition of insanity trying the same thing again and again and expecting different results? we have junk bonds in europe that have negative yields. borrowing costs are low. is that going to stimulate anything? michael: that's the problem the world faces right now. alix: they will spend some cash. they are slashing their 2019 forecasts. time -- overall uncertainty around trade remains high. fallis the last issue to or sort of in the middle? lisa: i think you will hear mor

fed chair jay powell testimony pointing to a rate cut as soon as july. treasuriry yields are lower in response, so is the dollar small caps and transports are weak in the session. joining us is josh brown welcome back. >> good to be here >> are you also in celebration mode after jay powell? >> i'm also in celebration mode. >> we got all but a promise of a rate cut i think in july. >> they're going to do it. i said earlier, he foamed the runway for what ithink the market knew he was going to do the thing is, i don't think it's necessary, but i also don't think it's harmful a 25 basis point rate cut most likely, the best example of something like this, that i can think of from recent history is 1995 you had a new all-time high in the stock market the day they did the cut, but it was a single cut. and a lot of the reason for that, they had done a surprise rate hike in 1994, which kind of crushed the bond market, people were shocked i think what the 1995 single cut was about was taking some of the pressure off from that, maybe also like a mea culpa, we didn'

we heard a little jay powell, the fed, the minutes there. what was your reaction ? >> it was a huge week. i think the last two weeks were pretty big. he think about after the trade agreement, after that then you had powell, the ecd and the christine the gardners is a very big piece of news. atticus would be more aggressive going forward and markets have started to react to that. by the way the cpi report, we don't think inflation is moving a higher but it's nice to see that now there is a bit of pricing power that companies for the equity market have a bit more inflation. the fed is going to keep moving because they're worried about global growth. companies have pricing power in nursing used cars are bit better, apparel is a bit better. it is pretty good news. if you take the last two weeks, pretty good develop for the market. >> it really has been. let me take one by one. the christine news, coming from the ims, the presence of the ecb, how is she going to differ from very you groggy. christine has been very clear about the ecb and it needs to be aggressive of maki

as i said, what does jay powell signal? how does he handle this point where the fomc itself may not have its mind fully made up ahead of the meeting and this is on july 31? paul: kathleen hays, thanks for joining us. still to come, urgent and desperate. how the trade war is threatening the existence of many chinese factories. our exclusive interview with the head of the world's largest supplier of goods. shery: wells fargo offers us arguments to shifts to riskier assets. stay with us. this is bloomberg. ♪ paul: we are counting down to the sydney open. a cool and clear morning. futures pointing higher by half of 1% right now, following mixed positive day in u.s. equities. i'm paul allen. shery: i'm shery ahn. let's have a closer look at the u.s. market action. late&p 500 eeked out a session gain. a rally in the faang stocks helped offset losses in material and consumer staples. su keenan has more. who can blame investors for being more cautious given where we are headed into this week? su: everyone seems to believe there w

global markets will be watching jay powell's testimony very closely. the founder and president of the ankor research joins us now from chicago. jim, we just heard kathleen lay out the argument for and against the fed moving. where do you see them heading? jim: i see them moving 25 basis points. i think the risk is that they move 50 basis points, not move at all. this is typical of the way the fed rate cycle begins. the market runs ahead, prices it in. andeconomists screaming kicking, believing they won't do it, saying the market is too dovish. this is the way all the rate cycle start but ultimately, it will not be in insurance cut but a campaign towards lower yields. maybe they go 50 in the first move but if they don't, they follow-up with another 25 basis points in september. paul: we are seeing some research from citigroup today. saying the july rate cut is not a done deal. the markets are priced in at least 25 basis points. what sort of reaction can we see if they get nothing at all? jim: i respectfully disagree with citibank. it is a done deal, it

federal reserve chairman jay powell driving global markets this morning. futures pointing to another gain at the start of trading after powell signaled a rate cut could be on the way as early as july. dow up 91, s&p up 7, the nasdaq up 20. the next fed meeting is at the end of the month. all the major indices hit new intraday highs yesterday. the s&p crossed 3,000. only the nasdaq ended up at a new record high when all was said done at 4:00 on wall street. european markets this morning look like this. as you can see, it's a mixed story, fq100 down 9 points, cac up 7 and the dax index lower by 17. asian markets overnight were higher across the board. fractional moves for the most part but, well, kospi was up 1%, hang seng was up almost 1%. president trump just putting out a few tweets. >>.here's what the president sa. a big subject today at the social media summit will be tremendous dishonesty, bias, discrimination and suppression practiced by certain companies. the fake news media will be there for a limited period, writes the president. the fake news is n