More quickly than anticipated and the bank of canada expects inflation to remain near 2 three 2019. The u. S. Tax reform is likely to curb canadian investment growth. Bank of canada raising its overnight Interest Rate to 1. 25 . Eady we are seeing the dollar spike. A. 5 gain in the dollar in reaction to that. There had been a bit of hedging in recent days. The bank of canada might consider nafta and a breakdown in nafta talks as a central risk and might hold off on this raise, but that has not happened. We will hear from the bank of Canada Governor later in the day. He will be interviewed by bn n. It will be interesting to get his perspective on nafta and the other issues facing canada. Here, we are seeing stocks which rose to a record closing level, seeing moderate gains in todays session after the gains yesterday melted away midday. The dow still not about 26,000 above 26,000. We have some push and pull in todays session. On the plus side, big cap text docs seeing strengthening. Ibm higher after it was raised to overweight at barclays. Asml result in europe were stronger than estimated. One analyst calling them ridiculously strong. Those shares rising in the u. S. As well. We have some earnings that are presenting problems for games today. We have banks, Goldman Sachs and bank of america having disappointing aspects of the reports. Goldman sachs, fixedincome trading. Ford coming up with guidance for its quarter and for the year. The cfo saying ahead of the conference that earnings this year could fall to 1. 45. General electric continuing to climb from yesterday. Falling after it announced that big writedown related to its Health Insurance asset. A quick check on bitcoin, which has fallen below 10,000 a piece for the first time in quite a while. Itsas retraced 50 from high in the past month. Mark 90 minutes into the wednesday session. We are down for the third day. Cyclical stocks last year we are talking about euro terms. Extending gains into the year as economiche regions momentum shows little sign of slowing. Trading at a record relative to those seen as less responsive. Keep an eye on cyclical is relative to defensive stocks. Inflation in the eurozone stubbornly low. 9, same as the flash estimate. Looking ahead, Surging Energy prices could feed into Consumer Prices and embolden policymakers. A strengthening euro giving ammunition to officials who say the outlook is still uncertain to justify tying the hand. Salessting First Quarter trailing analyst estimates today, europes biggest some it cannot be maker Semiconductor Maker with a disappointing forecast. It is pushing intel and samsung to adopt these newest machines. Extreme ultraviolet Lithography Systems that connect circuits while increasing capacity and speed. They cost more than 100 million each. Asml up by 5. 3 today. Vonnie moore Bank Earnings rolled in today with bank of america and Goldman Sachs reporting fourthquarter results. Promise on Revenue Growth as trading top estimates that goldmans revenue from fixed income trading tumbling 50 . For some perspective, lets the analyst questioning portion is just beginning. In the nearterm, where is the hit . We expect they had some impact like the other banks. That is the cost of doing business, but we wanted to think about the run rate going into 2018. Fixed income trading was a big disappointment. The biggest disappointment of the year. A lot of that is due to lack of volatility, goldmans client mix, the product mix is less favorable in this kind of environment. Investment banking benefits from the low volatility. We will want to hear a bit more Client Sentiment getting better. They talked about an improvement in pipelines. We will want to hear more about that. They talked about a 24 Percentage Rate for tax reform. Much of that benefit is going to the bottom line and how much will the invest in technology . Vonnie we will get official comments from the bank during the call. Fixedincome trading has been damp is it possible that once more supply comes on next year and the fed starts getting out of the market a little bit that maybe that will pick up again . The key really is volatility for that business. Sometimes it is hard to say what the pickup will come from. In 2016, it was brexit and the u. S. Election. In 2017, we were hitting new lows across all different asset classes. It tends to be a surprise. Their r. G. A Political Risks out there there are geoPolitical Risks out there. It would be more concerning if goldman was passing these numbers in a week revenue and private in a Strong Revenue environment. They did lose money, more than investors had hoped for. We will want to hear a bit more about what they are doing. To make some management changes. How are those aspects going . Mark lets talk costs, lets talk bank of america. They will find cost savings from somewhere to reach its goals for the year. Where exactly . For bank of america and all the u. S. Banks, especially those with a retail presence, its all about digital. They continue to see more of that. They have all been burned by the embattled south african retailer. Is there more to come or is that it . This is a cost of doing business, it is a risk. The banks price these risks overtime. Its more concerning if you see one bank having an outsized risk versus the other banks. Goldman has not specifically said where the impact is in their numbers. Some have pointed to steinhoff, others have not. You do see this type of thing late in the cycle. For credit costs, weve been at unsustainably low levels. How far and how fast it we get get normalization do we to a normalization . Vonnie allison williams, thank you. Lets check the first word news. Hill, housel republicans leaders are trying to come up with a stopgap spending plan that would prevent a Government Shutdown on friday. Lawmakers and say the measure would also delay some obamacare taxes and provide money for childrens Health Insurance. And new plan cannot pass unless it has democratic votes in the senate. Is small sign of cooperation between north and south korea. The two korean delegations will march under one flag next month at the Opening Ceremony of the winter olympics. Ae two countries will form joint womens hockey team. A former cia officer suspected of helping china identify u. S. Buys has been arrested u. S. Spies has been arrested. Hes a suspect in a longrunning investigation. Lee has been living in hong kong. The commanders of two u. S. Navy destroyers involved in deadly collisions will be facing courtmartial charges both accidents took place in the western pacific. Several other officers space charges face charges. Global news 24 hours a day, powered by more than 2700 journalists and analysts in more than 120 countries. Leinz. Ley vonnie thank you. Breaking news. Jerome powell has been approved for the role of fed chair by the Senate Banking committee. Now, it goes to the full senate next for a vote, after which he will be the fed chair. Jerome powell has been approved by the Senate Banking committee. Youtube and twitter executives testifying before the Senate Commerce committee. The hearing is about terrorism and social media. We will bring you any headlines as they come in. This is bloomberg. Vonnie this is bloomberg markets. Again on capitol hill as House Republicans leaders are racing to come up with a stopgap spending plan that would prevent a Government Shutdown friday. The measure crafted by paul ryan and his Leadership Team would also delay some obamacare taxes and provide money for childrens Health Insurance program. But, they will need bipartisan support in the senate to close any potential deal. Kevin cirilli joins us with the latest. Lets go back to the drawing board and get this done is a tweet just tweeted out by john cornyn. Does it get done before friday . Kevin all indicators suggest that lawmakers will pass a shortterm budget deal that would keep the government funded through february 16. Several divisive issues, most notably immigration, have divided not just the Republican Caucus but also democrats want to keep in place obama era policies that protect socalled dreamers and keep this daca legislation intact. Donald trump signaled he was potentially willing to bargain on that particular issue, but it would seem that democrats are united in their opposition about k caving on any of these immigration policies. Vonnie we heard from Mitch Mcconnell earlier saying Congress Must pass a shortterm spending bill this week. Longterm, he is not so sure. What would be the sticking points for a longerterm one . There will be defense spending and other sticky issues. Kevin republicans are also divided on the issue of defense spending. Several republicans want to see that significantly increased, as does the president. In terms of where this could pose a significant Political Risk for this administration, the issue of infrastructure, this administration has ambitious plans on the issue of infrastructure. It comes at a time when we are several weeks from President Trump giving his second state of the union address. Next week, he will be traveling abroad to the World Economic forum in davos. s advisers feel he gained Political Capital as a result of passing tax reform. On the flipside, President Trump will be on capitol hill later today with Vice President mike pence to honor bob dole, a prominent Republican Senate leader for the Republican Party during the end of the 1980s. He was also the Vice President ial nominee at one point. And a prominent backer of then candidate Donald Trumps campaign. Mark the president is set to announce the fake news awards today. Is anybody care . Does anybody care . Kevin i dont care. The president has criticized the media to rally his base. His former chief political strategist, steve bannon, is set to be back on capitol hill tomorrow to testify behind closed doors at a hearing. The Mueller Investigation is also going to make some attempt to meet privately with steve bannon as well. Vonnie we are awaiting developments from that. Our thanks to kevin cirilli. Mark time for the Bloomberg Business flash. Holiday sales rebounded this year at jcpenney. Samestore sales rose 3 in the final two months of the year. Tiffany was helped by its new home and accessory collection. Holiday sales came up short at burberry. Retail revenue of 2 for the quarter. That is half of the growth produced that you executive announced plans to boost the brands image with flashier stores and a focus on handbags. A deal that would shake up the global event market business. And former is in talks to buy ubm for 4. 8 billion. Former runs 200 trade and consumer shows annually. Vonnie up next, china challenge. Why economists are expecting the latest data to reveal a slowdown in asias biggest economy. This is bloomberg. Mark this is bloomberg markets. Tomorrow is an important day for china watchers with gdp, retail sales data leaked overnight. Will we learn anything that might surprise, frighten, concern, worry us about the gdp data . All of the above. It is certainly a big day tomorrow. We get the ultimate health check on the economy with gdp numbers. Be brought story expected to the World Economy had a pretty good year last year. Say the stable backdrop seems to be the story right now. The backstory is credit is slowing in the economy. The big debate is just how much so far itflow out seems to be managing that pretty ok. Vonnie a lot of chatter about that we have seen offshore at 6. 4328. Against a basket of currencies, it has been a lot more stable. There isnt a lot of transparency around the exchange. Broadly speaking, it has been stable against the basket, which is important. And has been strong against the dollar. Vonnie does that mean imports and exports will change dramatically . Into something of a headwind for exporters it is something of a headwind for exporters. Global growth slowed dramatically the yuan state strong and the dollar stayed week. China hasnt been playing that game for a couple of years now. If we looking for stability in the exchange rate, sure. The idea that they have been pushing it weaker for Competitive Edge has diminished somewhat. An crosse dollaryu means it will be difficult to label china a currency minute or instigate a trade war. The immigration of the currency side of things has been taken out of the base somewhat because of the weak dollar and the yuan stronger. The trade tensions havent gone away. Next week, President Trump is going to davos. Year ago, president xi jinping went there. Trump continues to make threats against china, accusing them of unfair trade. You have an ip investigation going on. Theres talk of maybe more tariffs and fees. The trade war is a pretty extreme thing. The idea that we are heading for a heightened trade tension is something we are watching in the global economy. Mark will they be singing the same hymn this year, rejecting what else is china aiming to get out of davos this year . The message from china, they believe trade disputes should be resolved. It mr. Trump wants to go down that route, they can respond. They have reminded the u. S. That theres plenty of Chinese Investment in the u. S. , hiring u. S. Workers. Theres plenty of u. S. Companies depending on contracts and business in china. The message remains clear that they are willing to come to the table and willing to make some give some advantages to the u. S. , but they can retaliate if need be. Enda and the current curran, thank you. Mark still ahead, the bid to and germanys political gridlock faces a crucial vote this weekend. We will be speaking to dennis snower, president of the Kiel Institute of World Economy. This is bloomberg. Vonnie breaking news. House Speaker Paul Ryan is taking questions at a News Conference now. Yan when you see a situation where more men and women in our military are dying in training accidents than they are in combat, it is a serious situation. To block funding for our military with a friday deadline over unrelated issues makes no sense to me. Its wrong. I will leave it at that. Vonnie youve been listening to the last question there in a News Conference given by house Speaker Paul Ryan after to enter an a bid shutdown lets check the first word news. Oneor Jerome Powell is step closer toward being chairman of the central bank. The Senate Banking committee has approved powells nomination. Is nomination now goes to the full senate. Subpoenason faces two in the rush investigation. Russia investigation. Investigation. The House Intelligence Committee has issued its own subpoena. Bannon appeared before the panel yesterday. He was barred from answering many of the committees questions. The traders have faced biggest loser when venezuela was hit by turmoil. So far in 2018, they have returned 12 , four times what investors have gotten from has advised the queen to provide President Trump with a state visit. Hes been unhappy at reports he will not be invited to prince harrys wedding. Global news 24 hours a day, powered by more than 2700 journalists and analysts in more than 120 countries. Im taylor riggs. Germanys deeply divided social democrats face a crucial vote this weekend. They will decide on sunday whether to end a formal coalition talk. A formal Coalition Government poses less than the threat of we are joined by dennis snower, president of the Kiel Institute of World Economy. He joins us from berlin. Is at the lesser than two evils, voting to End Coalition talks . They could do even worse than they did in the last vote. Dennis i think you are absolutely right. They could do worse. Areefore, all sides optimistic that these negotiations will succeed. What sort of coalition are we looking at, then . Will it be similar to the last one or will it have a different feel to it . Dennis it will have a dramatically different feel because both sides have learned from the possibility of getting on with their own program. It hasnt worked terribly well for the fdb. Both sides will renegotiate. The most important thing will be there combined vision for the future of europe. Mark. Has set the now, the big question is whether germany will support or delay. A lot hinges on that. Mark what do you expect as merkel and macron meet on friday to further discuss integration of the eurozone . How close to macrons vision is merkel likely to go . Ftp sdpl, the wants to go a considerable distance toward macrons vision. Macron left a lot of things open. Therefore, this vision need