Transcripts For BLOOMBERG Countdown 20160527

This is countdown. I am anna edwards. Lets talk about what is happening and markets. Stocks extending their rally, up for a third day. Japan getting a boost. Ive got a chart that focuses on u. S. Equities and the problems reaching theas th 2001 level. It seems to be a ceiling for the market. Stocks little changed in the u. S. , resulting in weakness. Talking about what happened in the u. S. , lets get that for you. Dollar index in focus. 95, spots to one today. Yellen test. A 1 15 p. M. East coast time. Speaking. En will be can the dollar secure its best performance in more than a year . The yen is in there as well. Cpi, down 0. 3 . Core inflation down. What pressure is the boj facing . Questions being asked about the future of that sales tax. We will link the dots on that story later. Well, where are we on oil prices . How long is that move going to last . Not long. Supply disruptions, we have talked about those. Sayingrg intelligence there could be a significant ramp up in completions. Lets get the news now. Anchor saying he is expecting a dovish speech. Saying the fed will be refraining from raising Interest Rates. Futures, showing that would be a 28 probability of an increase next month. Theany edged out china as second largest supplier of external credit. First time that happened in a decade. Creditor, since 1991 and it did remain in that position. Donald trump has picked up pick up theng to nomination. Unbound delegates have confirmed they will confirm him. Choice of the Party Convention in july. World leaders have been mulling a potential trump victory. President obama said concern has been expressed about the Presumptive Republican nominee winning. President obama they are paying close attention to this election. I think it is fair to say they are surprised by the republican nominee. They are not sure how seriously to take some of his pronouncements. But they are rattled by it. Mr. Trump many of the countries in our world have in abusing us and taking advantage of us. We are going to have great relationships with these countries but if they are rattled in a friendly way, that is a good thing, not a bad thing. U. K. Consumer confidence has risen for the january readnce but remains below zero. Meanwhile, a measure of the Economic Outlook increased. 2400 journalists, working 24 hours a day. By going more anna lets check in on the live Market Action in asia. Good morning. See thesewe can divergence between china and the rest of the area. After lunch, 0. 4 . That is going to be on track for six weekly losses, the longest streak since 2012. We have industrial profits coming in. 4. 2 in the month of april. We did see that come down from 11. 1 in the prior month. Weakness in hong kong, the hang seng off by 0. 2 . Good session, the nikkei 225 up 0. 4 even though we saw cpi austria having a good session as well. Some of the shocks we are watching in the region. There have been a couple of broker upgrades which have given a boost. Toshiba rising to a twomonth high. Air asia, biggest jump in seven months, up almost 13 . Disappointing in hong kong after its revenue fell by 19 . That was announced after the bell yesterday. Weakness in hong kong and china but a solid week elsewhere. The index on track for its first win for the month of may. Anna thank you very much us from hong kong. Let talk about the g7. The gathering is winding up with an end of summit communique saying economies have strengthen their resilience to avoid falling into another crisis. The group feels Monetary Policy is not enough to spark growth. The Prime Minister of japan, he has failed in his bid to have leaders warn of the risk of a Global Economic crisis. We have live pictures of him speaking now. Whating you up to speed on he is saying as we watch him, he says the biggest risk is the shadow over the Global Economy. It was the biggest game of the summit. Globally. E wavering good morning. Hey issued dire warnings this morning, continuing to talk about the weakness in the Global Economy saying this is the biggest theme of the summer. Yvonne the g7 numbers didnt quite buy it. He mention the lehman crisis, saying the world is on a downward spiral to a 2008 like event. If the appropriate policy measures are not put in place. We didnt see any mention on the policy communique. No mention of these high crisis is. The leaders acknowledged there were risks. Eigh on the global recovery. But the g7 has strengthened their economies to avoid falling into a crisis. As you mentioned, Global Economy. Top of mind. Also, fx. Basically saying, excessive disorderly moves have a bad impact on the economy. That is something the japanese finance minister had refrained expressed. Sawsame kind of views we but still no nod in regard to currency intervention. What response we are hearing, it looks like it is going to be a policy mix. Including monetary, fiscal, and structural reform. Some of theseh of nations has to go accordingly to each nations condition. Not one prescription on growth. They did reaffirm Monetary Policy is not the only game in town and alone cannot need to sustainable growth. What happens at the International Stage could be different when it comes to japans domestic story. Lehman, it is interesting to see shinzo abe raised this language. We have heard he would delay the sales tax hike if there was another major earthquake or event. We are expecting and hearing from some of these local media reporting the sales tax announcement could come as early as next week and this delay could go on as much as two years. Abe continuing to push that lehman argument. Parallels once again between the Global Economy and the lehman crisis. With us this morning is simon, chief currency strategist. I want to pick up on one of the things they were talking about. We will come back to that because we have cpi. Growth policy options. Stimulus, some fiscal structural reform. Where does that leave us . Saw stuff we had heard before. The policy problem is the assignment, they would like to see it earlier this year. People not doing competitive devaluations. Since then, it has been reiterated, the same story. The extremities we have seen in japan, unless you are going to go for something truly radical, you got to go to fiscal stimulus. For them to come over with the smorgasbord, is it surprising, really . Anna china was the subject of conversation. They are going to host that shortly. That was a topic of conversation. The extend with which we were seeing slowness. Steel price. Where did you see china in these debates. Simon it was fascinating about century for china over dumping steel, potential censure. That has to do with the money that float in over the previous 1015 years. We see the aftermath of that not just in china but into the Global Economy. The fact that youve got the Steel Industry in such trouble. All parts of these connections that feedthrough. I do think china is central this year. We know exactly how concerned markets were when we had the crisis with the currency. Like abe says . Simon if you want to look at a vaguely objective measure of this. Not when lehman collapsed in 2008, very different. Could you see something similar, yes you could. We have an event on the calendar, 6 15. Janet yellen will be speaking in harvard. P memorial day trading is easy. Longis the start of a weekend. Trading, typical before holidays. What are you gearing up for around janet yellen . Simon doing it right at the end of the trading week, it is a smart thing to do because it gives the market relatively little time to react. Three days to take it into account before it reopens. It could end up denting any negative sentiment. Fed has a fine balancing act. In march, when we went from thinking there were going to be for rate hikes to two rate hikes, we considered that dovish. It is a cautious pace of a rate hike. The fed has a problem. Right now, the market doesnt really believe they are going to go through with a rate hike. To get themselves any type of chance, they could do that. She has to sound hawkish. That leads to a strong dollar. Feeds through to international markets. The same problems we had in august of last year. Sends says a 20 chance, down just a little bit. Simon if you want to have a rate hike, they are going to do a lot of talking. That is the point jeffrey was making as well. Some banks saying she wont talk Monetary Policy. The currency stratus strategist stays with us. We will see if the ongoing strikes in france have had an impact on consumer confidence. And then the big number of the of firstsecond reading quarter gdp in the u. S. Rating updates for several countries, most notably the u. K. Scrutinizing comments from janet yellen. Inflationapanese core falls again. We have the latest from tokyo, next. Anna 6 19 in london. The wealthws from management industry, particularly the industry in france and the u. K. They are going to sell those two phoenix. Things. Generate of 400 million euros. It may emphasize digital technology. More details. We are getting comments from shinzo of a. They will make a decision on the sales tax hike. Many have linked that to a delay in the sales tax hike. Cpi fell 0. 3 in april from a year earlier. Joining us is that bloomberg editor. Good to have you. What implications might this have for Monetary Policy . What about Monetary Policy . Reporter this is expected to intensify pressure on the central bank to act. This is a set of Consumer Price data, the last before the june 15 meeting. It is expected to have an effect in terms of that pressure. Action can wether expect . They talked many times about the policies that are open to them. Lower andout increasingly negative rates . Reporter there are several different actions they could take. There will be a lot of discussion about what that might he in the few weeks leading up to the meeting. The central Bank Last Month when ahead at that meeting and for the fourth time in a few years, moved forward the inflation target. Pushing it further out. We will not see that at the meeting but they are saying we want to make the target. To do so, the thinking is they will have to ease further. Anna thank you. Chief currency stills just strategist with us. We have seen pictures of shinzo abe talking and saying he will make a decision on the sales ax hike. We assumed there would be a decision in the next few weeks. That has been a lot of the chatter. It dragged on too long. If you generally believe there is an issue. The reality is, this has dragged on and on. Is it going to have a major impact . The move was going to be next year. One Rating Agency said, the rating will be at risk if they dont do this. If they dont fill the gap with something else. Simon that it will be the case. Right now, the fact of the matter is, the japanese economy is clearly losing momentum. I think that is the major issue they have. They have gone a long way with Monetary Policy. Yes, it is going to have to be fiscal policy. They have an issue with the rating, that is fine. The japanesethough public anyway, the bank of japan has done a good job. Anna lets talk about the inflation problem at the boj. Heres another chart, showing this which goes back to 2006. Core cpi in the orange and yellow. Both have been coming down. It is the white one the boj likes to look at. Simon that is the problem may have. Yen strength has been an issue. Maybe some of the commodity price moves have played against them. The fact of the matter is, the bank of japan is struggling to get to its inflation target. There has been the criticism negative went for the rate, they were trying to manipulate the currency. That inflation is starting to slow here gives them a greater space to argue further are not necessarily a weakening of the and even though we know it is. The question is, what do they do . Anna one of the things i want fed will do. At the is that what we are waiting to find out, whether the fed really does move in june . And may be dollar changes in japan . remember, you would probably have more activities if there was a correlation between the yen and the nikkei. Something like 90 on a weekly basis. The fact of the matter is, the fed does not want to have two strong a dollar. If you see the bank move on the back of the fed move, no criticism. Anna thank you very much. Up next, a stern warning on sterling. Will speak to the author of that report coming next. London, 6 29. Lets get the news. Here is rishaad. Rishaad g7 gathering in japan, end of summith an communique saying economies have strengthened their resilience to avoid falling into another crisis. The group says it feels the Monetary Policy alone is not enough to spark growth. This is the Prime Minister, shinzo abe, talking. Warning of a risk of a Global Economic crisis. This after presenting documents saying there was a danger of the world careening into a crisis. Dovish speech expected from janet yellen. Fromsay they will refrain raising rates in june. Investors seeing a 28 probability of an increase month. China says there is room to increase borrowing in support of the economy. Thatsaid they can increase gradually. The local Government Debt is more than double the figure. More than 100 cities have debt bigger than their local economy. Ald trump has run corded reported picking up enough support to clinch the nomination. That its him over the top for the delicate count. He can expect to be named the choice at the Party Convention in july. Consumerf u. K. Confidence has risen since january but does remain below zero. This is of course a measure of the Economic Outlook. It also increased from the weakest reading and almost three years. 318 passengers and crew have been evacuated from a flight. No injuries reported. Triple seven had been scheduled to fly soul. Global new rules, 24 hours a day powered by journalists around the world. Top stories can be found thank you. Anna thank you. Asian stocks have arisen, heading towards their first weekly gain in five weeks. Mormoarkets. At the reporter asian stocks heading for a gain. We have seen a bit of weakness in china. Gains in japan. The topic climbs to a onemonth high. We also got the week inflation data from japan, fueling speculation of more stimulus. Although we are seeing this Risk Appetite in asia, equities are flat as we look at the world index. The all caps free world index. I want to look at the u. S. As well. The rally soften yesterday. The s p 500 feeling toward the end of the chart to get past that key 2100 level. Previous rallies have stalled. The big question is, how far have Global Markets come to terms with the prospect of further fed tightening . We have heard an expectation for Janet Yellens speech to be dovish. This is the dollar over the past five days. It has already come down from the two month high it hit earlier this week. We are looking at the bloomberg dollar index. Could a hint of dovishness cause a reverse . I have tracked gold heading for its against loss since november. We saw gold hit a 15 month high. Finally, taking a look at crude oil. Posting some losses. Brent back down before the 50 barrel level. This is even though crude production is at its lowest level since september. We are seeing canadian producers moving to resume operations. Are seeing losses in crude, it is heading for a weekly gain, the third. Anna lets move on. A brexit just weaken the pound, it would jeopardize its status as a reserve currency. That was the warning this week from s p global rating. Thesays a vote to leave European Union made dethrone the pound. Great to have you on the program. One of the assumptions you make is a brexit will the term Foreign Direct Investment into the u. K. We have heard that from politicians take the view we should stay in. Others say, they think that will not happen. To various clues that suggest businesses will continue to invest. What makes you so sure we will see a drop . Guest japan, access savings, the u. K. Is the opposite. You have a large deficit. The second in dollar terms. Year that has to be funded. One of the key sources has been in the financial services, the key strength of the u. K. , another has been central bank purchasing. It is quite substantial. Since 2008, it has been almost 5 of gdp. One years worth of external financing. You can also look at it as one years deficit. Anna the pound has defined many predictions it will not be a reserve currency. Why will this make the difference . Guest in our view, it does put at a risk a lot of the fdi into some of the key sectors such as financial services. Europe remains the largest customer, one of their key customers. Anna fdi into the Banking Sector is the key concern. Guest we think that could put some pressure on it. It could put at risk the reserve status, yes. Right does the pound have to have reserve currency status . Beuld the chinese currency more prominent . Why is it maintaining its presence . Think frank made a great point. We went from a position where the holdings of the emerging 800t nations were about billion. 2002. O 8 trillion that money has to go somewhere. One of the issues was there was a concern, particularly in china. They were overly exposed to the u. S. That was a big driver for diversification. The question was, what you diversify into . Gone y holdings have 19 of emerging market holdings. The yen has been one of the key alternatives. 4 and 5 of known holdings. The problem is, beyond that, what else is there . That is one of the major issues. That is why gold has been coming up as a reserve unit. The issue is, what else is there . Are you going to put more money into japan . Into the euro . It is a tough call. The yuan muscle in here . Yuan is going to be reserve currency. It is probably going to displace more minor currencies including sterling career that is a longterm concern. Years, yen has lost, holdings are around they used to be six back in the 1990s. Aussie dollar and Canadian Dollar have increased in holdings. Banks looking for alternative currencies. What about the cost of capital it we saw a brexit . How do you measure that . How does it reduce the cost of capital . Frank that is a good question. We took two approaches. Indexked at the average after Sterling Holdings in 2004 towards 4. 5d percent versus before when sterling was having a rough touch. Seemedd over time, this to reduce the real Interest Rates. You can also take another approach and try to map of the u. K. Against another economy like australia and look at the real funding costs. Almost 90 basis points. Has external debt. You conclude the cost of capital goes up . Currentou have a large deficit. Is the rest of the world going to be happy to funded that for ever if they feel the u. K. Is walking away from its number one trading partner to mark or resetting its relationship . Anna do these things come home to roost . Frank it will happen fast. The market will not wait for negotiations which will take time. Which will ultimately lead to to retainof agreement trade access. Anna thank you very much. Frank stays with us. Simon also with us on the program. They are both staying with us. We will talk europe in the next conversation. Up next, a bright spot for the dutch market. That ipo ishow going. See you in a couple of minutes. Anna welcome back. 1 45 in the morning if you are watching in new york. This is where futures are expected to open a little later today when janet yellen speaks. Comments from toshiba in japan. The g7 taking place there. Saying greece has work to do. An agreement from various parties, more money would be going to greece. Conversations seem to be a path pass the debt. Bloombergs miss flash. Flash. Mberg business casead google winning a over the android operating system. Jurors rejected that argument and concluded it was used in law. Under fair use experts say overturning it will be difficult. Trade, and offer from earlier this year. The wall street journal said it turned on a bid from decayed. The drug taker has been under scrutiny. Companies currently in talks. Air asia having a wicked time of it. A sixfold jump. To 16 million. The budget carrier plans to expand its fleet. Air are tapping growing travel in china by increasing the number of destinations served there. And indeed, the frequency of flights. The company has failed to agree on terms. , giving it ag 3. 5 market fell you wish and. A market valuation. Rishaad in shot in hong kong. The director of sovereign ratings. Lets talk about europe. The comments coming off the g7. Christine lagarde saying greece has worked to do. Thoughts on the work still to do around greece. the last couple of weeks, the language coming from the imf seems to be a walk back from the original surplus target. I think this is not bad news. Greece remains a patient on the table, losing blood. The economy has collapsed. Will go towards paying which will put liquidity into the economy. Anna how do you explain the way these parties, they came together seemingly quite painlessly in brussels. It is as if the conversations were not as tense as they had been. The potential for flareups reduced. Frank this is the neverending story, the third program. Greece has been in recession since 2008. The Banking Sector looking healthy but that is not saying much. Simon absolutely. Crisis taking up 20 of my entire career. It is not that big a part of the economy. Simon it is not. The capital controls, for those that believe there was the possibility of a next it, the fact that capital controls were brought in, it was a fascinating one. It showed we could go a long way. Conversation in the middle of july last year. We certainly know the possibility of somebody leaving is there. But of course they didnt. Thing that canne realistically happen. There has to be haircuts of sums kind. A more reasonable approach to be surplus. To a sturdy. That is probably what is going to happen although in fairness, there is an element of kicking the can down the road. Is, as soon as you relent, you are going to get calls from elsewhere for that to happen. And then northern europe, particularly the populist politicians are going to jump on this. You get the action and reaction. It will be adjusting how this plays with german elections and in 2017. , you mentioned, simon mentioned kicking the can. Whats is the can look like . The amount of Debt Reduction that can be talked about . Airing in mind the political constraints . Case think it is the frank i think it is the case that you can turn out this debt indefinitely. Delay the final resolution which perhaps would be some sort of haircut. You can term it out to 100 years. 10 . An introduce they are talking about a limit of 15 per year. They are talking about this. I think it is enough to provide some oxygen. Many optionsre too on the table . Frank it includes the stability mechanism. Possibly buying back the imf debt which is more expensive. Anna what are the benchmarks you want the greek story to reach . Is there a level of reduction necessary in your mind that they need to achieve . Can they go too far . Frank what dominates that is gdp. We are much more focused when we are looking at fiscal metrics. How on earth are they going to gdp covering. We have seen wages coming down. The internal devaluation isnt working. The Tourism Sector is doing well but greece is not actually a very open economy. It is a Small Services economy. Anna is the implication other countries will say, we would like relief from debt pressure . Simon eu skepticism is on the rise. Both, you are likely to see these pressures. Within italy over the course of the last five years, the rise of the five stars, of this world who are looking at what is happening, and seeing whether it is an opportunity. I think it is in northern europe. We already got a hint of that. When they were talking about what is considered to be a haircut. Coming at a time when there is immense dislike for with the ecb is doing with Monetary Policy, the idea that you could have a further rising skepticism and euro skepticism as well within northern europe, it has been the key story. Look at the comments about alternative for deutschland. The far right in austria. It seems to me that is the big issue. That populism. Anna we have seen conversation about spanish debt. They are talking about how they want something, their debt situation to look better. Is that going to have any implication on the overall spanish story . About they were talking doing a socalled audit. They have walked will back from that original position. Onhink there focuses more trying to introduce policy for fiscal stimulus for the basics. There is demand for that and it has been our view lot of the austerity has been selfdefeating because there is no demand in europe as a whole. Anna do you expect them to do more or have they done their bit . Has gone tocb enormous links to support an adjustment. Now it is over to the government and especially governments that have the capacity to spend more. Thank you for joining us. The chief currency strategist. Up next, at risk of a crisis. Abe warns of a global crisis. With the g7 wraps up leaders saying they strengthen their economies. Awaits a speech from chair janet yellen later today. And a gauge of u. K. Consumer confidence rises for the First Time Since january but remains below zero. A very warm welcome, this is countdown. I am anna edwards. Over in japan, a little later than that. That is where we find David Cameron speaking at the g7 meeting. We will bring you the latest headlines. The mention of brexit risk it did get a mention. Weme minister cameron shared ideas with each other. On russia, the g7 has agreed on the importance of sanctions rollover in june. Ukraine is the victim of russian aggression. The g7 is clear sanctions must in place. On the migration crisis, the lessons of the recent past are clear. We must help refugees. We must support jobs and livelihoods in unstable african countries. The United Kingdom does more of this work than anyone else. Strong borders. It sillypeople fragile agreement but returning people works. We are working closely with our colleagues to boost the capability of the libyan coast guard. The u. K. Will send a u. K. Training team to assist in its implementation. Resolution is in place, we will the ploy naval warships. That is prima this cameron speaking at the g7 meeting. Also speaking about the migrant crisis. We got breaking news. Lets get back to the markets anglolk about what american are talking about. They are naming a new ceo, Bruce Cleaver the ceo. Say following the decision to step down after five years. Of the base metals lets get add to the markets. Asian markets have actually been firmer overnight. Up by 0. 6 . The big item on the agenda is janet yellen speaking. We will see whether that moves markets. Lets bring up the risk radar. The dollar index, facing a test. 6 15, u. K. Time. She is interviewed. Be dovish inr to her speech. The yen is in there. Cpi out of japan, disappointing. More pressure on the boj. We have seen comments from shinzo abe about what he sees as the dire straits of the Global Economy. Belowl prices, dropping the 50 a barrel mark. Disruptions in china and in nigeria. A rampup in shale. We have the yields on the u. S. 10 year. See the latest yields in europe and japan. To bloomberg news. Anchor he expects a dovish speech from janet yellen. The fed will refrain from raising Interest Rates in june. Unless traders assigned odds of 50 for the move. Contracts show investors seeing a 20 of ability of an increase next month. Etched out china. Heavily last year to support a weakening yen. Japan, the top creditor since 1991, remained in top position. Haved trump is reported to picked up enough backing to have clinched the nomination. A small number of unbound theyates have confirmed will support trout. He can expect to be formally named the republican choice at the Republican Convention in july. Meanwhile, World Leaders have trumpulling a potential victory. President obama said concern had been expressed about the presumptive romany winning in november. President obama they are playing close attention. I think it is fair to say they are surprised by the republican nominee. They are not sure how seriously to take some of his pronouncements. They are rattled by it. Of the countries in the world, have been abusing us and taking in his vantage of us. If they are rattled, in a friendly way, if they are rattled in a friendly way, that is a good thing. A gauge of u. K. Risener confidence has since january. From a to minus one minus three in april. Is one of the few italian Business Leaders to sign a letter calling for britain to stay in the eu. Speaking exclusively to bloomberg, he explained why. Without britain, europe, i confirm i am against the brexit. Haslinda global news, 24 hours a day. Powered by global journalists. Anna thank you. Talking David Cameron about brexit. He said he is not a closet brexiter. Cameron i am passionate about eating the right results, getting the reform. It is in Britains National interest. You have been predicting with some success if you look at some of the polls, economic armageddon if we let the European Union left the European Union. And yet Angela Merkel said it was not a subject. Leaders to not get involved or have you over exaggerated the impact of us leaving . We didnt hear from you yesterday on migration. Talk about these figures . Why were you silent on an issue that is so important . Mr. Cameron i tend to have a day full of meetings. On the second, i have a press conference. That is what we have done this time. On the economic impact, there was a discussion about the issue. Clearmmunique is very about the economic dangers and risks. I dont want to overemphasize anything. I have always said britain is a great country. The fifth largest economy in the world. Weve got a lot of strength. The question for me is how are we going to best succeed in the future . I have no doubt eating part of the Single Market is important to our economic future. Aree who want us to leave not being clear. They want us to leave the Single Market. You are putting out risks, putting at risk growth and jobs. Those arent simply my views. That has been set out by the governor of the bank of england. The organization of advanced countries in the world. The day before yesterday, the institute for fiscal studies which has been held as a Gold Standard for impartiality. Can remember lots of occasions when that has been the case. They were clear that would be a bad impact on jobs and the economy. Risk. Re is real economic that is a written grill shared by that is a view shared by those countries that are here. They said it is a matter for when you are faced with a difficult decision, it is often good to do what your friends think. It is undoubtedly the case if you choose to leave the Single Market, there is an Economic Cost involved. It stands to common sense and reason, we are a great trading nation. 44 of what we sell goes to the european Single Market. If we gave ourselves worse terms then we have now, that would have a negative impact. Particularly the case when we think of the british economy. 80 of our economy is services industry. Importanticularly when you have a servicebased economy to have good trade access and market access. Argument abouts the economy, the jobs, is so important and im going to continue to make it for the next 30 days. I want to make it in a positive way. Single market is not just a status quo that we put up with. Benefit toassive britain to read we are the digital and tech leader in europe. It is a massive boost to britain because we are the number one of business and professional services in europe. Britain is a big player in energy with some of the best energy businesses. It is a positive argument about the economy we are making about the future. It is also absolutely right to warn people of the risks and dangers. Risks set out by the g20 and other organizations. Who have an interest in wanting britain to do well. I have been watching you on bbc world. Question from you. Im glad you are watching bbc world. A British Naval warship, taking on arms smugglers reports British Special forces on the ground. What do you say to people who fear britain is being sucked into the libyan conflict . Cameron talking at the summit. He wants to talk about the dangers of a brexit. He also wants to talk about the positives. The g7,guing to read gathering in japan, is winding up. That is why we are seeing these statements from World Leaders. Of summiten an end communique, saying Major Economies have strengthened their economies. They also feel Monetary Policy alone is not enough to start growth. Shinzo abe failed in his bid to have leaders warned of a Global Economic crisis. Yvonne man is there. He keeps talking about the parallels between now and the lehman crisis. He didnt win all the other leaders. Christine lagarde says she does not see a similar situation. Youve on that is right. Leaders are not convinced. They are not buying this statement of a lehman crisis. He spoke about Global Markets wavering. His it could turn s big cast a are nations that shadow. He said the Global Economy was the biggest thing this weekend. We are seeing and hearing a different side of the Prime Minister. Two years ago, he delivered such abenomicsof optimism, are going to work. Now you are hearing the Prime Minister paid a dire picture of the Global Economy, saying we could be in a downward spiral if we dont have the proper policy measures in place. If you look at the policy committee k, there was no mention of this. No mention of a high risk crisis. The leaders claimed their economies had enough resilience to avoid a crisis although they knowledge did there were risks which were growing. When it came to a response, they an agreement the responses will be all of the above. There was also a brief mention, reiterating what we heard last week. Saying excessive disorderly moves are going to have a bad impact on the economy. Anna thank you very much. Joins us now. In key topic. Be differing views about how much it was discussed. What are your thoughts on where guest we have taken a view and produced of you we will state in. Having said that, we are not a political house. Therek it is fair to say are so many elements to this discussion that cannot be quantified. People say they are waiting for the fax. Even if they had the facts, they would not be able to decide what the best result was. Interestingly, scotland wants to state in the eu. We areecause of the smp having this referendum. Cameron had already said he wanted, he would pledge to have a referendum. The majority. This is partially with the why the comments are so extreme. Was expecting this to be the case. Couldsaying a brexit trigger a scottish referendum. Is that where the conversation goes next . Guest possibly. It means alex probably has to die. It was supposed to be once in a lifetime. At one point. Other themes coming out of the bid tonzo abe making a draw parallels between 2008, the lehman crisis, and where we are now. Leaders not buying it. He needs that for domestic reasons. Tuc parallels . Taking the issue around brexit, you have to make assumptions. With the way the g7 makes assumptions sees the world, they have to make assumptions. Christine lagarde is french. There are issues of their which could prompt another selloff. The fed is controlling the situation quite well through Interest Rates. We cannot afford to be complacent. Anna we saw the french president talking about volatility. That was something of a discussion point. Do you think the volatility is abnormal . With it is usually hindsight that you see it has been volatile. The line. Cts down there are issues that need to be considered. Anna he stays with us on the program to read what you can expect from janet yellen. Banks in saudi arabia have come over fresh pressure products that allow speculators against the currency pay. Interesting story coming out of saudi arabia. Their awareness over the stance people are taking and what investors can do. Now, pruning a. Thank you for coming with us. Tell us about what you found out about what Saudi Arabian banks are doing. Guest the Monetary Agency has reached out, asking them to explain why they are offering products to customers. This is happening after the regulator banned contracts. Funds made by its thats. Made bets. This is happening while the government is saying, it will maintain the exchange rate. Nothing will change. Them reaching the highest points in february. The regulator wants to have more information about such products. And also why they offer these. It is also warning in the future such projects will have to be submitted to the regulator for review and approval. Anna what has the Saudi Arabian Monetary Authority said . Guest they came out and said there will be no change. There is enough resources to support the current situation. Anna thank you very much. Joining us on that story. The chief investment strategist still with us. It comes down to the oil price and where we are. Coming back above the 50 a barrel. Didnt hold up very long. 49 22 is where we are. 49. 22 is where we are. Guest we could see marginal shale field which could account barrels a day. We have seen shoes with nigeria and other supplies being choked off. I would expect the price to come back a little bit. Anna if this puts more upward pressure, does that change the conversation or hasten the conversation . Guest it could. It depends how could we it moves. You will need strong underlying economic growth. If you consider over the last few months, manufacturing output numbers, indications are the fed will not go for an increase in june. Probably july. That might will be the case. Probabilitye a 28 of a rate hike in june. Saying the fed cannot move unless they have a more than 50 chance. That makes it sound simplistic. You think that is true . Guest i think where the fed has to be careful, they have expressed this. They dont want to do something that may disrupt sentiment just before the election. Fed toifficult for the act. I could see a situation where they may hold off. You are getting data coming through which is quite photo. The overall trend does look to be softer. The fed has to take that into account. They are datadriven. Think july is a possibility . Guest i would be inclined toward january july. It depends on the underlying activities. If they raise rates too soon or too aggressively, they risk choking off what theyve got. The other side of the coin is they leave too late. Then they got to do with that in hindsight. Anna janet yellen, what do we watch for . Europe, 6 15. Y in i think she will be saying very little actually. Anna some banks saying she wont talk about Monetary Policy. Thank you very much for joining us. The future suggesting we will be weaker at the start of the european trading day. It looks as if the euro stocks could be down. No great margin. May be stronger on the ftse 100. Janet yellen speaks later on today. 6 15 later today. Course, full coverage here. Welcome to on the move. We are counting down for the european open. Im guy johnson. This is what we are watching today. Delaying trading trade weekend by giving what could be a crucial speech. She could be dovish. Seven ends with a whimper