♪ debate, decisions from the fed and boj looming. we look ahead to a huge week for central banks. new york sets up security following saturday's dumpster bombing as the united nations general assembly meets. oil prices climb amid reports opec may call an extraordinary meeting. its members are taking census on strategy later this month. the mayor of london urges reassurance as it begins the process of brexit negotiations. we hear from him later in the program. ♪
>> a warm welcome to "countdown" . i am anna edwards. let's get straight to the markets. shows the relationship between stock markets and oil prices as we get closer to that meeting in algiers on september 27. this is how the two are moving in tandem, stocks rising in tandem with the rising crude prices. up the risk radar. we are starting with oil. investors despite the move 1.8% on the vti, 1.6% on brent. investors are cutting their bets as we get closer to that september 27 meeting.
that will be opec and russia. we hear from certain opec members. the venezuelan president talking about how opec is close to an agreement, so expectations building with a 7.5% increase in oil prices for august. fed and boj meet this week. markets are closed. we have despite the convoluted title, the overnight interbank yuan rate, increasing the most since january. speculation that pboc intervening in the chinese country. that is the second biggest gain on record. let's put the markets to one side. authorities are continuing the hunt for those behind a bombing
in new york city's chelsea neighborhood that injured 29 people on saturday evening. the cityk came as prepares for a united nations general assembly. >> for all new yorkers, the messages be vigilant at this point in time. because we are going into united nations general assembly week, be vigilant because the police need your help. if you see anything that might be pertinent, we need you to call it in. will see aknow you very substantial nypd presents this week. bigger than ever. anna: bloomberg news su keenan joins us now from new york with the latest. reportstand there are that some of arrests have been made. what can you tell us? of reports,r
including abc news, our that five individuals are in custody. there has been no formal arrests or charges filed. to various reports, an fbi official stopped a car of interest that they believed had a person who might be tied to this. the result was five people taken into custody and are believed to have some ties or connection to this bombing incident. the manhunt continues and we are being told that this is in some way a connection. the last bombing in new york in 2010, police were able to arrest a suspect within two days. this.re moving quickly on again, they are looking for various pieces of information, reviewing videos, and looking to the public for information as well. anna: tell us more about what
happened and how the police are responding. >> correct. arrivingntioned, those for the assembly will be met by a sea of police officers and state troopers, a thousand brought in in the last 24 hours because of this situation. the governor andrew cuomo said they do not believe there are any "international ties" to this event. he said any bomb would be terrorism and its nature, but do not believe there is an international link and reason for immediate concern of a threat going forward. devices, thehe first one went off at 8:30 p.m. on saturday. we are told it was a pressure cooker-like device filled with shrapnel. dozens of people were injured, one of them seriously. fortunately, no one was killed,
but there was significant property damage. police found another device that did not detonate. it,e have been pictures of a silver cooking device, put out on social media, with wires apparently connected to a mobile phone. police believe mobile phones were involved with both these devices. you can imagine the unease in another when yet explosion took place in new jersey several hours earlier. that was a pipe bomb, a different device, but the fbi are investigating to see if there is any link. un assembly going ahead as normal. there is a heightened sense of awareness among many new yorkers, but this one definitely
raised the anxiety level in the city. will this affect the stock market when it opens? there is a view that likely it will not have such an impact, event, a heightened police presence and the investigation continuing. the five people being talked to by police have not been arrested or formally charge. anna: thank you so much. let's get to other news, first word news. good morning. >> thank you. oil on the rise after clashes in libya halted the first overseas crude shipment sisterly 14. from algeriaports say opec may call an extraordinary meeting if members reach a consensus on strategy. he iscretary general said optimistic about the upcoming informal talks. non-opec producer russia will be fanningthe discussions,
speculation that a deal to cap output may be agreed. trading in australian equities was suspended for more than an hour because of a technical glitch today that left investors unable to buy and sell stocks. asx delayed the opening of the market due to an issue related to a component that allows it to manage individual stocks. the european unions top competition regulator is standing by her decision to demand more than $14 billion in tax repayments from apple. she tweeted that she may investigate other major u.s. companies. she meets jack lew and washington on monday. angela merkel's party have lost support in regional elections in berlin as the anti-immigration alternative for germany siphoned off voters, extending its challenge to germany's political establishment.
theident putin has hailed victory of his united russia party with early results seeing it take more than half the vote in saturday's parliamentary election. high,pularity remains lifted by patriotism falling the annexation of crimea in 2014 despite international sanctions pushing the economy into recession. turnout was 40%, down from 60% five years ago. city mayor has urged theresa may to decide quickly to build a new runway at gatwick airport. he says it would show the city is still open for business in the wake of the brexit vote. he spoke to bloomberg in new york during a trip to promote relations and reassure investors following the june referendum. >> we should announce in the next few weeks the green light to a new runway at gatwick. gatwick has one, heathrow has to bank. airr problems around
pollution, infrastructure. gatwick is ready to go. they own the land, no public subsidy. there will be better competition from heathrow. so what i am saying to the prime minister is let's get on with it. >> global news 24 hours a day powered by more than 2600 journalists and analysts in 120 countries around the world. this is bloomberg news. you can find more stories on the bloomberg at top . anna: thank you. let's move on to the asian trading session. we have details in hong kong. good to see you. the asian equities session looking positive, but we are without japan today. that's right. the timing is impeccable. ironic if in the japanese markets are closed for the aged day. we do know their population is the number one challenge for the
prime minister as they try to fight inflation. without australia at the moment. halt orhis trading delayed to the opening of trade by more than one hour. wheree had another halt everything has been suspended, presumably another technical error has taken place. saying they are working hard to resolve that, but the moment we don't have australia in the afternoon session. around the region, nice gains coming through taiwan, tech names, apple suppliers rallying the, up 2.7% potentially on optimism over the iphone seven, but also the problem samsung has been facing creating upside for apple and its suppliers. elsewhere, hong kong up like listedo 1%, chinese companies in hong kong jumping the most in two weeks. a lot of excitement ahead of
this ipo for china postal savings bank, possibly the biggest of the year. korean stocks up .1%, and shanghai holding steady. we did get property data that suggested that the property market in major cities in china continues to do well. a quick check of dollar-yen. yen, a little bit of strength that that 102 handle there. anna: thank you very much. as we have been saying, a big week for central banks. they are in the spotlight. the boj will kick off its tuesday policy meeting tomorrow. marginally in favor of the central bank to not increase stimulus. the u.s. federal reserve's decision also comes on wednesday. future's are currently pricing in a 20% chance of a hike, while
the december meeting is at 55%. so what more can central banks do? we asked justice stiglitz. -- joseph stiglitz. >> there is only so much they can do. andrtunately, fiscal policy other policies have not been there, so they have been the only game in town. what we are now seeing, particularly in japan, is not enough. they will have to do something else. , great toing us now see you. this is a big week for central banks. the expect tatian muted around what the fed might do. expectations muted around
what the fed might do. some possible to great overarching narrative about monetary policy running out of stimulus? >> there are two overarching narratives. the first one is the one we heard from joseph stiglitz, monetary policy has done as much as they can. that means they need fiscal policy that we have not yet had, a real attempt to bring in fiscal policy to help monetary policy. the other one is there has been a change. that we have pulled back on a hike in the united states until the end of the year because it looks like the u.s. economy may not be as strong as people think. that is affecting china. it looks as if the world is slowing. slow, therefore
interest rates cannot the hike, therefore stimulus cannot probably be increased. we need other tools. anna: in the midst of all that, mark is trying to work out which way the policymakers will go. showing the yen and its relationship to risks. the yen-dollar shown in white versus the volatility index, the vix. the 40-day correlation has broken down. clearple are not entirely whether they are going to ease more or not. way, the way the vix has .een behaving is also very odd there is a lot of uncertainty,
and uncertainty is not good for markets. anna: we saw a lot of people investing in stocks that were bond proxies because bonds were yielding such low levels. how do you see that trend developing? what is your view? of people buying equities because it was the only game in town that could give them some kind of yield. that is not why you should buy equities. you should buy equities because of growth. interest rates are so low for so long. the idea that this might go on for much longer, i don't think it is very safe. if we look at the amount of debt issuance by companies this year, we are just a below what we had in 2007. this is just getting out of
control. anna: out of control or exactly as designed? economic data,at it's not working. we go back to what joseph stiglitz has said. we have monetary policy doing its bit, but it's not working because other policy tools are not being used in the same way. couple ofhe last weeks, the uplift in bond yields, is that sustainable? think we will have to wait and see. anna: thank you very much. thee have been discussing, week ahead is centered around central banks. today, a monetary policy conference. tomorrow, the fed and boj kickoff their policy meetings. wednesday, we get the results of by newsetings followed
conferences, first the boj, then the fed. speeches by mark carney and mario draghi. then we round off the week with a panel in philadelphia. having a hardna time cooling its housing market. that is next on the program. , a victory for putin, but a setback for merkel. this week's elections. urges the u.k.or government to take an orderly approach to brexit. more from our interview later. this is bloomberg. ♪
anna: welcome back. this is "countdown". the hang seng outperforming the broader asian region. 6:21 a.m. in london. >> thank you. officials say an increase of 1000 new york state police troopers,nd state back-checks at subway stations, and police presence at crossroads are planned in response to saturday's dumpster bombs. 29 people were injured, coming ahead of the start of the united nations general assembly and put terrorism back in the spotlight for the presidential campaign. coulditical turbulence limit orders in 2017. tellsad of siemens bloomberg uncertainty may lead customers to delay spending on
projects. everyone is after efficiency, not so much capital spending. there is a lot of uncertainty in the marketplace. so 2017 will be yet another complicated year. shares rising after the troubled commodities trader says it is seeking an investor and is on track to raise $2 billion. it warned it could be another two years before a return to profit. route, attacks on accounting, and a second-quarter loss have caused shares to slump over the last two years. and is your bloomberg business flash. anna: thanks. attempts to cool china's property market appears to be having a limited impact
with home prices continuing to rise in all but six cities tracked. the value of home sales rose at its fastest pace, 33% up on a year on year basis. curbs introduce on purchases and lending have yet to offset markets. that showschart here china home prices gaining the fastest pace since 2010 the curbs put in place by regulators and china. does that worry you? >> a little bit. , youes com at the have to put this in context. they are worried about the health of the banking system. has come out with a warning saying the debt ratio at 30-to-one is higher than the risk.
it is known there are problems with the banking sector in china. the fact that they keep lending for people to buy houses is a slight worry. you have a slowdown in in imports from the united states. the chinese have to get their act together. anna: this is household loans 2016, loans for households in white, and loans to nonfinancial corporate's decreasing. this reflects the stance of those in china who say the bis and others are worried about debt levels, so we will loan more to households. >> what this shows is that china is a huge economy, and within china, there are attractive opportunities for investment if you are careful.
there is an issue with the banking sector that they have to sort out. there are pockets in which there are clearly overheating. that means you have to approach it with caution. the economic growth continues. it is still growing more than anywhere else in the world. is a day ofay there reckoning coming in china and you have to be prepared for that. >> i think it looks increasingly a can manage ain soft landing. you are meant to slow down after in on this growth. going for specific investments rather than country investments makes a lot more sense. anna: thank you very much. up next, looking for 'sternatives, angela merkel; loss as the anti-migrant party shows gains. readimpact if any can we
she tweeted she may investigate other major u.s. companies. she meets with jack lew and others in the united states later today. is news that opec may call an extraordinary meeting if members reach a consensus on strategy later this month. secretary-general of opec told they country's state news agency he is optimistic about the upcoming informal talks. the venezuelans are talking up the prospect of opec ring on the same page with regards to putting into place some sort of cap. we will continue to talkbig
about it as we head towards wednesday. asian stocks continuing their advance. good morning. index,msci asia-pacific excluding japan, this is gaining 1.3% of the moment after its biggest weekly drop in three months. all eyes are on the fed in the boj this week, but some of these gains in equities are driven by the rebound we are seeing in oil. basically oil rebounding from its lowest close and more than a up 2.1% after clashes halted the first crude shipment from libya since 2014. also, reports that opec may call an extraordinary meeting if ministers reach consensus at an informal gathering next week. at $43.
prices have been fluctuating sense stabilization talks started in august. i wanted to show you the commodity currencies leading the gains, the aussie dollar and the mexican peso among them. weaker dollar after gains on friday after weaker than expected cpi data. this shows the yen trading out of line with the vix index. correlation has broken down for the first time since june 2015. a lot of that because of uncertainty at ahead of the boj meeting. past threeer the days, seeing it rebound a little today. it lost some ground on friday after bloomberg news reported that philip hammond is ready to accept britain giving up access
to the single market in that brexit scenario. anna: thank you very much. charts this monday morning. sticking to the oil story, 's president says opec members are close to reaching an agreement. , great to see you. lots to talk about as we head into next week. where do you want to take it. ? >> all of these opec members and the secretary general of opec are having this meeting and doing their prep work, but we are watching what is happening in the u.s., in particular with the rig count. we are seeing expansion resuming. i've color-coded this for you to highlight that this is the 11th
increase in 12 weeks. now 460.ine, producers are comfortable to ,ring their rigs back online although the scale of the expansion has stabilized, but it adds to anxiety about the potential oversupply that could be fed into the market and ties into the commons -- the comments that we got last week that the oversupply is larger than we .hought your it we also had da a we are seeing investors had to the sidelines. in both cases, total lawns and shorts are at the lowest levels are ats and shorts the lowest level since july. investors deciding to wait this one out in many cases. anna: thank you so much.
a lot to talk about with regard to commodities. to as just referring there piece of analysis about shorts oil prices and illustrate how investors are fleeing to the sidelines ahead of this algeria meeting. we have opec and russia meeting at the end of this month. we high expectations should have that any cap on production can be agreed? it is difficult. this is why investors are on the sidelines. there are two conflicting signals. the increase in oil rig count says producers are coming back into the market. pressure on larger producers to do something about oil prices. saudi arabia has cash flow issues. it is in their own interest to do something about capping
production. they are worried that if they do opecroduction from outside is a worry. in, islow 40's, the end not stable for these countries. they are laying chicken with the market. -- playing chicken with the market. not comingan were back into the market, the conversations might be different. >> absolutely right. the complication is twofold. one is iran coming back online. the second one is there is a geopolitical fault line between saudi arabia and iran increasing. so it's not just about economics. it is about politics. we will have to wait and see.
fundamental point of view, the world economic growth is not strong. back, andally on its therefore the oil price should be in the 40's. the question is who produces more to get more boy them even more to getts -- more volume even at lower cost? anna: interesting moves ahead of that meeting. let's get to breaking news. the asx has halted trading for the rest of monday. the market will not reopen for trading on september 19. there will be no closing single price auction. all of this coming in an e-mail statement from the exchange. they have been suffering from ongoing problems through the trading day. this is the latest update from the australian market.
let's talk about european partycs, angela merkel's and its coalition partner have lost support. meanwhile, president putin has hailed the victory of his united russia party with early results seeing it take more than half the vote in yesterday's parliamentary election. his personal popularity remains high, lifted by a surgeon patriotism following the annexation of crimea in 2014. you are always keen to talk about the political atmosphere. we had some interesting comments from the siemens boss. geopolitical problems could mean businesses
are less keen to invest. >> politics is a very major part of the investment story. it is whirring when the far right rises and when nationalists are doing so well in russia. there is a return to protectionism. if you analyze the differences between mr. trump and mrs. clinton, they are both espousing quasi-protectionist policies. look at what europe might do in the wake of brexit and the rise of the right, more internalized policies. in russia, you have a protectionist economic structure. , in addition,and people are worried about what this means about political stability. you have parties beginning to dismantle the stability of countries such as germany, it
would mean that investors would find it more difficult to work out how they can infest. investors -- how they can infest. -- how they can invest. anna: how do you stay away from the volatility and invest with geopolitical tension? add anobvious one is to analysis of politics into your investment. i mentioned the united states. in both cases, donald trump and hillary clinton, you will have a more protectionist policy. if you invest in europe, take on board that there will be more inward looking politics. as we heard from the ceo of siemens, take on board the fact that the outlook for globalized demand will be lower than you think.
within that, there are always opportunities. anna: is there a way of staying away or reducing exposure to , going towards domestic plays, medium-sized businesses? >> i think so. this is true certainly in the united states, increasingly in europe. there is very much a case for that. the bigen we look at events taking place this week, we talk about how central banks are running out of ammunition and whether the battle now switches to fiscal. how does that fiscal stimulus in europe rub up against populist parties? >> there is a link. we talked about the eu demanding .ack taxes -- by then element
trump and clinton want to increase taxes. the second one is they somehow have to pass the money through through fiscal policies. the rise of populist politics will mean governments have to be more populist. that means some kind of fiscal stimulus. that is how one can read it. you will probably get into see it in mainland europe as well. you think the response will be more fiscal spending and changing its stance on migration? >> spending is easy. we are seeing noises about that , the united states from both candidates, and europe. immigration is a more difficult topic. there is a real worry about refugee migration.
that is where the tension is. separately, there is more tension about migration. this rhetoric is consistent. you hear it in the united states. you now hear it from the alternative right party in germany. you heard it from the united kingdom. putting up walls because the global economy is not looking so good. anna: would it make investors nervous if angela merkel does not win another term? ofthere is a good chance that. she has been there for quite a while. like everything, it is a matter of uncertainty. there is no right or wrong outcome. if she goes away, it is less certain. anna: thank you for spending time with us this morning. we appreciate it. coming up on the program, calling for calm, sadiq khan
injured 29 people. more on that in a moment. 6:48 a.m. in london. this is the bloomberg business flash. thank you. officials say an increase of 1000 new york state police officers and state troopers, more back-checks at subway stations, and police presence at major crossroads are planned in response to saturday's dumpster bombs. injured in the attack. it comes ahead of the united nations general assembly and puts terrorism back in the spotlight for the presidential campaign. siemens ceo says political turbulence could crimp orders in 2017. he told bloomberg that uncertainty may lead customers to delay spending on projects. >> it is a tough environment because everyone is after efficiency, not so much capital spending. there is a lot of
uncertainty in the marketplace because of the geopolitical tightness in the world. 2017 will be yet another complicated year. noble group shares rising in singapore after the troubled commodities traders said it is seeking an investor and is on track to raise $2 billion. at also warned it could be another two years before a return to profit. route, attacks on its accounting, and a second-quarter loss have caused shares to slump over the last two years. shippingea's hanjin returns vessels to owners as it struggles to survival. it plans to remove 13 more container carriers. korea will decide whether the company can be revived or
needs to be liquidated. that is your bloomberg business flash. anna: the london mayor, sadiq has urged the british government for calm as it from thes its exit european union. is to have a sense of comb. let's ensure the advanced teams know what we need. let's merck sure we negotiate -- let's make sure we negotiate the best terms. years toore than two get the right deal with the eu. at the same time, let's reassure, reassure, reassure. business confidence in the u.k. has hit a four year low. small and of 1500 medium-size companies found the eu referendum vote has introduced a level of uncertainty.
on this survey from andrew connors from lloyds banking group. andrew, give us the headlines from this latest survey of businesses. how much more nervous are they now compared to before the brexit vote? >> good morning to you. insightas been offering for over two decades. a measure of take companies performance and confidence, essentially companies that are positive in future expectations against those that are negative. this survey shows a four-year low and company expectations. confidencear, the index takes an average of expectations over sales
orders, future orders, and sales profitability. 12%.s declined to anna: what does this tell us about the possibility of recession. that is a live debate ahead of the vote. it is what you are seeing suggest the recession move or a slowdown? >> what the survey is telling us that company's major concerns are around that uncertainty, but also around weaker u.k. demand. what we don't see is a deep contraction. we do see this as a slowdown. context, theis in survey is nowhere near the level we saw during the 2007-2008 financial crisis. anna: stay with us, andrew. good morning to you. thoughts on the
u.k. economy? >> frankly, that data is not quite good enough to judge how deep the slowdown is. the confidence aspects are hardly unsurprising because business need some assurance about things like migration flows, whether they can keep eu workers, so that thing is up in the air. it doesn't mean the economy falls away like i stone, but it does mean there is a really big headwind for the economy. anna: so reassurance needed. andrew, quickly then, i noticed one of the components is exports. prospects have profi faded since january.
in the face of the weaker pound, which should have been bolstering expectations. >> that is a very good point. it tells us that overall companies are expecting export growth over the next six months. their expectations over that level of growth have declined. we are expecting exporting to the u.s. to hold up reasonably well. there is real concern about export markets around europe, the middle east, and asia. anna: some of the latest reporting on friday really moving the pound, suggesting philip hammond and his team are preparing to step away from a full access to the single market strategy and move more towards preserving access to the financial services sector. how would that be received? >> that is probably critical at
this point. we now see a lot of the noise that the move is towards something that resembles a hard brexit. that is sterling negative. the other issue is the global ofture is not great in terms how the u.k. manages to export its way out of difficulties. all of that combines suggests more weakness for sterling going ahead. anna: thank you very much for joining us. 6:56 a.m. in london. up next, and give japan a break. that is the view from joseph stiglitz. which way what the boj head?
anna: the rate debate. with decisions from the boj and the fed looming, we look ahead to a huge week. the united nations general assembly prepares to meet. oil on the boil. opec might call an extraordinary meeting if a consensus is reached on strategy later this month. and angela merkel builds for support in regional elections.
9%. so, it looks as if we are building on what we have seen in asia. friday's session was driven by a boj report about the banking sector. we also saw that u.s. cpi data, the u.s. dollar surging, and a reassessment of what the fed will be with interest rates. all of that was weighing on the markets on friday. let's look at the risk radar. 4380.e m nymex at oilprice of a barrel of is up by 1.8% overnight. we have an opec leader talking about how they might meet leaders, the opec might meet formally after the september 27 meeting. the venezuelan president says this as well. we have the dollar-yen for you, and movement thereby 0.25% as the move toward the boj and fed meetings. the japanese markets are closed today, and on friday. the yuan rate has increased the most since january in hong kong.
on cnh hong kong has increased by 15.73 points. let's bring up the bond markets. there are many questions being asked, is it really a reversal in bond markets, or just services around central banks -- or just nervousness around central banks? or, is it simply both? bond isear german positive by 0.01%. let's get to the bloomberg first word news. reporter: oil is on the rise this morning after clashes in libya haulted what would have been the first overseas cruise ship since 2014. meanwhile, reports from algeria an opec could call extraordinary meeting of members reach a consensus on strategy. the secretary-general told the
state news agency he is optimistic about the upcoming and formal talks. non opec producer russia will also be at the discussion. a deal to cap output might be agreed upon. australia's stock market was hit by a series of glitches. trading started by more than one hour late because of the problem. that was followed by two further averages. this year's markets are raised for central bank trading this week. e decision to demand more than $14 billion from apple. she tweeted that she might investigate other major u.s. companies. in meets with jack lew washington later today. angela merkel's party and the coalition partner has lost support in berlin. anti-immigration
alternative has surged. well, president putin has hailed the victory of his united russia party, after receiving more than half of the votes. his personal popularity remains high, following the annexation of crimea in 2014, despite sanctions pushing the economy into a recession. 60%out was 40%, down from five years ago. the london mayor has urged theresa may to decide quickly to build a new way that gallic airport. he says it will show the city is still open for business. he spoke to bloomberg in new york on a trip to reassure investors following the june referendum. >> we should announce in the green lightks the for a new runway at gatwick
airport. airr alseathner also has pollution. gatwick, they are ready to go. they own the land. to thet i am saying prime minister is, let's get on with it. reporter: global news 24 hours a day, powered by 2600 journalists and analysts in more than 120 countries around the world. more stories on the bloomberg at top . anna: thank you very much, christine, there with the latest news update. let's get the latest on the market action now. australia, a big red mark on your map. reporter: yes. it has been a tough start to the trading week for australia. it is not the most orderly market in the world. it has not been a very
good day. as christine would say, we started off the day about an hour or so late. delayedre session was as a result of technical glitches that were supposedly fixed. a little while ago, it went into suspension again. the asx will be closed for the rest of the session. we ended up pretty much but, although the asx stock actually was declining to the tune of about 2.3%, unsurprisingly. also around the region though, it is surprising given we are setting up for a big week of event risk. it is not just the bank of japan or the fed, though they are the big ones. we are also getting the asian central banks all coming out with their monetary policy decisions. given all of that, we can see surprising gains across the region. having said that, japan is on holiday today. momentum,'t have that i guess, coming through from tokyo. around the region, closing out
the day, up by .9%. these apple suppliers are rallying hard on the back of the optimism over the iphone 7, closing up by 2.8%. here in hong kong, pointed percen .8% higher. and we are just noticing, though, the equities are doing quite well, but quite a lot the volatility in the currency markets in hong kong. we of the cost of offshore yuang borrowing jumping. some concerns are tweaking, i guess you could say, in the boj. anna: thank you very much. central banks are in the spotlight this week. the bank of japan will kick off its highly anticipated two day policy meeting tomorrow. chances are marginally in favor of the central bank not increasing stimulus, according to bloomberg intelligence. the u.s. federal reserve's
decision will also come on wednesday. futures are pricing in a a 20% chance of a hike, while december's probability is that 50%. bloomberg asked what else they could do to promote this? >> they are trying hard and fact is, there is a limit to what monetary policy can do. they have said that from the very beginning. this policy, and other policies, have not been there. they have been the only game in town. what we are now seeing, particularly in japan, is not enough. they are going to have to do something else. anna: joseph stiglitz there. saying,ph stiglitz is monetary policy is not enough and they will have to do something else. we've had many conversations around this desk about how monetary policy is going to, or
should, and over fiscal policy to do much more. >> given the recent insurrections in market, you can understand what central banks do, or an escape, perhaps, don't do. the sense they should be taking away from these meetings is that we are kind of reaching the end of the road. theyeally, for both banks, don't want to persist with this ulta easy money. they would much rather move away. they have not been allowed that scope to move away. that fed is desperate to get rates away from 0%. they don't know how they will fight the next downturn otherwise. there have been other factors beyond their control that they are fighting. much the same with the bank of japan. anna: he will come to the fed in a moment, but this chart illustrates the challenge that the boj has, the challenge the
japanese government has, and the big ask. this shows the aging on a day when japanese banks are closed. japan has been aging faster than the world for decades. the blue is the global average, in terms of the average of the population above 65 years old. this is a massive structural countrye the japanese faces. we cannot expect the boj to deal with that. >> the interesting thing is, if you put europe on top, you will see they are a little bit behind, in many ways. there is this big demographic transition going on in developed economies. .k. are also u.s ar behind. that tells you there is this big slowdown around in the economy. it tells you have to adjust our expectations lower.
re,s big headwind is out the making it difficult to realize the economic growth and the rise in living standards that is needed, particularly with productivity growth. as he know, the last few years have been sluggish. that explains the rise of populism in many parts of the world. some of the tensions in markets are really explain of that chart, actually. anna: what do you expect that boj to do this week, then? what will the policymakers do? >> waiting and watching and hoping for better. they have got some reserve ammunition left, but really, that needs a proper, big downt urn. -- big down turn. the economy is dust hanging on. we would need an onset of a recession to do more. the money stock has doubled in a
couple of years. so, the stretching of that monetary bandwidth to the maximum already. anna: and if the boj does not do much, how would markets react? just thinking about how things turned out after that ecb meeting, and markets started to ask themselves big questions areut, to what extent d the central banks changing their mind? >> the bond market has a repriced in that limitation to what the bank of japan and what the ecb can do. i do not expect, at this stage, to have a major tantrum on any lack of boj action. anna: this is the other big central-bank meeting of the week. now, this 20% here, you know, thank you inclined to disregard this in the sense that it is not
really expected. i was reading a great copy on the bloomberg this morning suggesting that, in some people's views, the fed needs to stop wearing about whether it is moving in line with -- needs to stop worrying about whether it will move in line with market expectations. >> there are several data points that suggest the economy has lost growth in the last quarter. the data is not strong enough for them to be moving around. but the urgency is still there. so, we need a couple of stronger data points to get that green light up. we have to wait and see for that. by december, it might well be they are ready to go. the other thing is, we should stop focusing on whether it is september or november. what really matters is how much they raise rates over the next two or three years. the is the big debate, whether they will be able to get off of that near 0% mark. anna: something very similar was
anna: a very warm welcome back to "countdown." 7:18 here in what is a very gloomy london. we have a little bit stronger start for the equity trading data. be futures will higher at the start of trade. let's talk politics now. angela merkel's party has lost support and the regional elections in berlin. that is as the anti-immigration party in germany siphoned off the voters, extending the
challenge to the political extender establishment. we are joined by caroline hyde and a guest. caroline: we are joined by david mcallister. he indeed, is a member of the cdu. give us a sense of the afd. stay?ey here to herepefully, they are not to stay. it is a single issue party, in my view. they are giving very simple answers to complex questions. a lot of voters are not expect them to deliver any results. i just want to show protests. i hope they are not here to stay, once again. caroline: when we hear and see keyprotest vote, the issue consuming investors is the battle of immigration, which is why the afd is doing well.
is this something angela merkel and the cdu will shift on? >> if you look at the polls from yesterday in berlin, you can see they were attracting voters from other political parties, especially those who did not vote last time over two main issues, security and the immigration crisis. ae immigration crisis is huge crisis for germany. angela merkel will continue to have policy to bring the numbers of migrants down. you got to decide those who are entitled should stay and must stay and we must integrate the better, but those who are not entitled to stay must leave germany. do youe: so, david, think this result has an impact on the question as to whether angela merkel will run for another term next year. the think she will run for another term? >> angela merkel is a great tensor and party leader. angela merkel will decide if she wants to run again.
she will decide when she wants to announce this. she certainly has my full support. caroline: we will look out for news on that. sitting as i am in london, i wanted to ask you about the brexit conversation, as you see it from berlin. on friday, some of our reporters said the treasury in the u.s. is putting aside questions about blanket access to the single market and instead, aiming for some good access for financial services for banks. if that was the approach that the u.k. government took, would it find favor in berlin? >> well, the ball is now in the british court. as long as the u.k. government has not triggered article 50, there will be no negotiations on our side, neither on the formal or informal side. we will have to wait and see what the u.k. government wants. wants fstand the u.k. onc
ull access to the single market, but you can only have access if you accept the rules, which includes the free movement of people. all these ideas, which are popping up now in london, as long as article 50 has not been triggered, will not find another national leader commenting on these. caroline: if the u.k. backs away from full access on the single market, and just wants to preserve access to financial services, will that change the conversation? now, i have been understanding that the brexit supporters have been saying, you can limit the numbers of migrants coming from the other eu member states. obviously, that is not possible and they knew that before the referendum. now, they are trying to square the circle. why should we, at this stage, comment on internal debate within the u.k government.. i would like i article 50 to be
triggered. once again, it is up to the u.k. government to decide, but as long as they happened, we will not be going into the details. caroline: what is the sense in brussels at the moment? dispair orne of this bear o dis-unity? >> we regretted what happened on june 23, but of course, we respect this them a craddick majority of the british people. -- this democratic majority of the british people. now we have an excitation that we will see the article 50 procedure. i think this would be fair for both sides. apart from the u.k. leaving the european union -- and by the way, if there is any possibility of the remaining, i would before that -- apart from them leaving the european union, but many other issues we have to look at,
including the migration process, and how we can keep the euro stable, and many other questions. anbratislava, that was important single. the other 27 member states want to continue the european project. caroline: certainly, angela merkel has been deemed a linchpin within the rest of the eu, the 27 members that remain. what would be the uncertainty if indeed, she did not run next year, because certainly, there would be a financial impact, but there would be a political impact as well within the rest of the eu? >> germany is one of the 27 member states, but of course, we are the biggest nation with a strong economy. germany knows how important it is to have a unified europe. that is why we need a stable federal government in germany. i believe that chancellor merkel is a great leader and she guarantees this political stability in germany. capital,ee now in our
probably the new alternative to the existing government in the city of berlin will be a coalition between several democrats forming under east german communists. just imagine this kind of constellation as a federal government of berlin. i think the general debate in germany will be, with regard to the upcoming elections in autumn, a government of stability, a government of the political center, angela merkel, or uv times with a different coalition. caroline: and one yes or no question, in terms of a deutschland next year? >> hopefully, no, but we have got to be realistic. caroline: it is wonderful that you have stopped by, david mcallister. hopefully, we can lure you on once again. anna, back to you. anna: thank you very much, caroline and thanks to our guest
over there in berlin as well. now, tapan datta is to with us in the studio. there is not much time left on the program, but the existential crisis triggered by the brexit vote will be tested in italy, germany, and france. >> these things are only tangentially about europe. they are ultimately, about living standards and jobs. and the eu becomes a convenient vocal point. they are scapegoating for the ills of the eu economy. a lot of it is not really about that eu. you forpan, thank giving us your thoughts this morning. that is it for "countdown." "on the move" is up next. a quick look at the futures will tell you we are looking to open up a little bit stronger across the european equity market. you can see we are looking to ia,k up in france and in as
guy: welcome to on the move. 8:30 a.m. in berlin. we are counting you down to the european open. imo alongside caroline hyde over in berlin. this is what we are watching. central banks take central stage. big week as both the fed and the bank of japan announced decisions on wednesday. how are you positioned? place your bets.