Coming through in bonds with yields climbing. Up by six basis points. Weakness coming through in the offshore yuan. We saw it weakening yesterday and we are watching moves coming into the Singapore Dollar that has fallen the most in the month against the u. S. Dollar. Generally broad strength coming through. Market falling to the lowest levels. Rishaad lets have a look at the hong kong executives response to the weekends of violence on the territory streets. Su keenan for the first word news. Hong kong chief executive carrie lam has appealed for an end to apps of vandalism acts of vandalism after some targeted subway stations over the weekend. She said the government is continuing to work on a platform for dialogue with the public in order to resolve tensions in society and said there was no need for interference in hong kongs internal issues. Treasury secretary Steven Mnuchin says the u. S. And china have made a lot of progress ahead of renewed trade talks next month, adding that the administrations objective is to win a good deal. He insists the rumbling trade wars had no effect on the u. S. Economy so far. Mnuchin said the chinese team agreeing to come to washington is a sign of good faith and the pboc governor may part of the group. Will trump hopefully, it all work out. We will see. We will be talking next week. We are talking now. They will be coming to the United States in two weeks or three weeks and we will see what happens. Unless we are going to make a good or fair deal for our country, lets face it. You cannot go back to a situation where we are giving hundreds of billions of dollars , where that become standard fare. Not going to happen. We cannot do it. Su the newspaper of the Chinese Communist party is taking aim at one of washingtons most hawks, saying comments from Peter Navarro are unconstructive lies. The president ial advisor repeated accusations of what he devon sins,s savvy including cyberattacks, forced yuantransfer, and manipulation. They say such comments are preposterous. It may not be as bleak as it seems in singapore. Anecdotal evidence suggests jvp will recover in this third in aer after shrinking previous period. That is the view of economists. It would mean the city state would narrowly avoid a technical recession. However, the singapore government is projecting growth of 0 to 1 for the year. Global news, 24 hours a day, on air and tictoc on twitter, powered by more than 2700 journalists and analysts in more than 120 countries. I am su keenan. This is bloomberg. Government balance the budget. It does include air india. Lets bring in the aviation minister. Thank you very much for joining us. The question is, this is an airline which has been up for sale. How much of it will you sell or can you sell and who is going to earth will buyon it with so much debt in the Balance Sheet . Start by telling you, first of all, thank you for having me on the show. As our national carrier, air india, is concerned, the last part of your question, who would be interested in buying it . Perhaps the context needs to be understood. Thems 120 planes and 60 of are owned by the airline. It has 80 domestic groups. It has 40 International Destination flights. It has an excellent Safety Record and no matter which way you look at it, it is a Viable Airline which even in terms of its operating profits this year, it will do well. The only issue is the government should not be in the business of running airlines because it has an unsustainable debt. The commitment to privatization india is total. I would not worry too much about the previous attempt to disinvest. Maybe we have learned lessons from that. Why would anybody wish to acquire it . Because of the assets it has and 7 sector, with a penetration, is growing at a rate of 17 a year, so i think it is unattractive buy. It is not for me to try and speculate as to who the potential buyers would be. You know, if you are even dealing with information which is in the public domain, you could list any number of them. As to what will happen to the debt, yes, some of it has been retired. Last time, when the attempt was made to privatize it, there was an attempt to retain 26 . Maybe that was a disincentive. All i can tell you is the government has an ultimate mechanism which is the group of hometers headed by the minister of which i am a member. We will meet shortly and we will outline and prepare an approach to the privatization of air india. Minister, would you relax the rules and allow a foreign carrier perhaps to buy the airline here, change things around as well, because you have fdi norms which do not allow a takeover of air india . Would you be open to that . Hardeep i do not think it would be appropriate to share my views just after an alternate mechanism has been set up. I think the expression of interest has to be floated and we have to look at all the suggestions which are on the table, but whether we go for the stipulation or do something, that is for the government with the ultimate mechanism to determine. All i am saying is the commitment to privatize the airline is complete and total and we will go ahead with it. Juliette minister, when you look at some of the other infrastructure problems as well, you have a lot happening at the airports. What about the plans of parking slots, and what about the plans to try and address this massive shortage . Well, if you have a situation where a sector is growing at 17 per annum, you will have problems both at the airports. Traffic isairline handled by two airports. Mumbai and delhi. Fewave taken a decision a months ago to privatize six additional airports, which we are proceeding ahead. All this is a work in progress, but no one that i know of is suggesting there are any hurdles in terms of obstacles. Yes, when you privatize or decide to privatize an airport, there will be suggestions that should remain instate control or there will be suggestions from a particular State Government that they would prefer to do it and many of our airports run by the authority are actually profitable entities, so governments are in the business of getting the best possible deal. Publicprivate partnership or privatization. At the end of the day, it is only the commercial operation which is being privatized. You have the airport authority, the ministry of Civil Aviation. It is a strong area of Economic Growth and we have every intention of ensuring that this process proceed ahead, whatever, you know, what may be perceived you know,l, hindrances or obstacles coming through the course. I think it is well on the way of progressing. Rishaad you have spoken about the local manufacturing of aircraft. How do you plan to do that . Are you talking about speaking to some of the big names and having factories in india . Hardeep well, for the moment, all i am telling you is that two areas of priority are we must have the maintenance and repair operations done in india. These were the two points. The finance minister put the budget speed in. Make muches not sense. If you have 690 planes in the and to send the engines servicing and repairs to neighboring countries. 690 planes in at the air. We should have engine manufacturers, repair facilities, maintenance facilities. That would make much more economic sense and we would have the airlines of other countries coming. That is an approach we are actively considering and i am very hopeful we will go down that railroad and engine thefacturers will look at commercial advantages of location in india. Rishaad minister, many people, contributed toey redtape. It is difficult to fly there in india. How are you dealing with cutting that redtape . It is a nationwide problem. I am sure you would agree with me, minister, and that is one of the objectives of the government. What can you do to make life easier for airlines and the Aviation Industry has been calling for turbine fuel to be the gst. In where are you on all of this . Hardeep there are many issues you have raised. One is redtape. Insofar as redtape is concerned, i will be the first to tell you that the government, which has now got a massive mandate for a second term, mr. Modis government, it has not only reduced redtape considerably during the first term, but whatever is remaining as well on its way out. That the cessation of operations was due to redtape. I would take serious issue with that. We are in a very interesting situation. The people who make aircraft, they make money. The people who run airports make money. The tourist industry makes money. I could give you any number of examples of airlines in the United States, europe, not being able to succeed. Maybe it has something to do with the business model. I am not going to speculate as to why they ran into trouble. After jet airways ceased operations in april of this year, we had 590 planes in the air. I think every few months. I would like to encourage airlines all over the world to look at their Business Models in terms of seeing where the stress comes in, why problems take place. I am very, very optimistic. I mean, if the sector was not growing at 17 domestically, we had a blip in between. To do withing redtape. I think there are more airlines wanting to fly in india. I am constantly being approached by airlines both located in singapore, airlines in the middle east, the gulf countries. Singapore has 500 flights a week to 18 destinations in india. They want more. We have several, you know, demands for increasing the capacity. Indian airlines, if they were to acquire widebody aircraft, which i know they have plans to do that, many of these rectifications will take place through market mechanisms. These are all private carriers. We are determined to ensure that they get the best possible. You mentioned aviation turbine fuel. I approached the finance minister. I am hopeful that the issue of withne fuel can be dealing patrol and diesel. Most use petrol and diesel to raise revenue. Many states individually reducing taxes on it to encourage airlines to fly there. Juliette minister, i wanted to ask you about the impact of the grounded 737 max 8 and whether or not you are continuing to follow what the fda is saying or is india taking its own stance and looking into terms of how or whether or not that airline is going to come back into operation . Well, there are grounded planes of the max which are there. Absolutely clear. The aircraft manufacturer in this case, boeing, has to rectify those. I am encouraged by reports i received that rectification is well on its way. The International Regulators will have to certify that those planes are on. I do not think india or any other regulator is going to jump and do the clearance of certification until those who are designated have the prime responsibility to do that. If it can be done quickly, i am sure we will take a call on that. Rishaad thank you very much indeed. That is indian Civil Aviation minister Hardeep Singh puri joining us from singapore. Still to come, apples most important day of the year. What to expect from the launch of new iphones. Next, chinasup factory deflation deepens. Where jp morgan is placing its bets. Stay with us. This is bloomberg. Juliette chinas Producer Price index fell further into contraction in august, signaling a worsening economic slowdown that threatens to have deflationary pressures to the global economy. Lets get more. We saw factory prices Falling Point 8 from august the year from august the year earlier. The Consumer Price index rose faster than year, the median estimate of 2. 7 and it was driven by a big surge coming through in pork prices. Lets bring in Laura Fitzsimmons from j. P. Morgan australia. Great to have you with us. I have a chart on my terminal showing that big increase you saw in prices as a result of the swine flu which really implanted or game that lifted to overall inflation. As we mentioned, it is contrasting with the deflation on the factory floor. How does this away into what china needs to do in terms of stimulus when we already have the rrr cut announced on friday . Laura it makes it very difficult when we consider you have clearly got Consumer Prices arriving faster than expected. On the producer side, much weaker again. That spread continues to move to the wider side. Clearly something i think represents, for us, the difficulties in trying to rebalance the chinese economy amid the trade war and in addition of course, to issues around the pork industry as well as. They are certainly not about to go away anytime soon. There is a plethora of issues. Shorttermm are more in nature but many are reflective of that deeper transition that needs to occur as we move away from the industrial section in china and more towards stimulating the consumer. Right now, we are facing difficult headwinds for that. Juliette in that sense, what can this targeted stimulus look like . Is not going to go back into the property sector which is part of the problem anyway that increase in property sector . And then driving that divergence between the upper class and the struggling middle class . Laura thats right. That is certainly one implication. Cpirally, if we look at the number, it probably does limit, to an extent, the amount of easing that can continue from here. And that is where it can get quite complicated for the chinese authorities going forward. Also, it represents that you cannot continue to support the industrial sector. Maybe the way it has been in the past. Right now, we have continued to see a lot of Regional Support and generally, in terms of infrastructure, bonds, or packages along those lines, so a lot of the stimulus has limits, to an extent and it is really not heading in the direction that may be the chinese authorities would have liked to have been heading into at this stage. Unfortunately, the trade war has occurred, and even though we have some promise of talks in october, i think we all know we are far from out of the woods just yet. What are the key drivers at the moment with global bonds and looking at this retracement taking place with bond yields after this rally we have seen right now . What is your take on it, laura . Laura yes, we have seen around 20 basis points i guess when we look at u. S. 10 year yields or years out ofe 10 the last week, which is a significant retracement. We think a lot of it was to deal with positioning. The market was driven to very low yields throughout the month of august. Headlines, stair and helped to trigger that reversal. The extent of the move signified that there was putting large positioning from real money accounts and certainly evaluations had looked a bit stretched and people got a little bit complacent with yields expected to stay suppressed for some time. Clearly, that can reverse outkly and i think the risk turn for the Central Banks over the next month, where we have clearly the ecb, the fed, and of course the boj as well, in addition to what we have said from the rba. Rishaad larry kirkley, Mario Draghis last one, last ecb meeting. He is likely to go out with a bit of a bang rather than a whimper. How would that manifest itself . Laura our case is that quantitative easing will be relaunched. Purchases from the next month which is more than the market is expecting. We only expected a 10 basis point cut for the deposit rate with no tearing which might be less than the market might be expecting. Overall, we expect the ecb to extend Forward Guidance to take us through the transition period away from draghis. Always draghis presidency. Rishaad Laura Fitzsimmons joining us in sydney. A lot more coming up right here on bloomberg including a look at some of those equities on the move as we head towards the china lunch break. This is bloomberg. Juliette a quick check of the on the and nissan is verge of losing a second later in less than a year. Asked to stepen down by monday amid the fallout that he and other Senior Executives received more pay than they were entitled to. Nissan continues to struggle after the arrest of carlos ghosn last year and is facing increasing scrutiny over its corporate governance. Its largest investor are said to be discussing the possibility of shelving its anticipated share sales. Softbank is pressing them to hone the ipo amid investor concern about losses, its business model, and its corporate governance. They had been expecting to hold a roadshow to promote the offering this week. Rishaad lets have a look at what is going on now with these Chinese Markets as we head towards the 90 minute lunch break. Has been a what story lately. Some of it attributable to this ppi read which came in slightly better than expected. We were looking for a decline in Consumer Prices. Is show adoes move to the downside for nominal gdp growth and also for industrial profits as well as. That on top of an inventory write down here as well and a lack of the monitor pricing power, too, for chinese economy. Comp,. 4 lower. This is bloomberg. Here, it all starts with a simple. Hello hi how can i help . A data plan for everyone. Everyone . Everyone. Lets send to everyone [ camera clicking ] wifi up there . Ahhh. Sure, why not . Howd he get out . a camera might figure it out. That was easy glad i could help. At xfinity, were here to make life simple. Easy. Awesome. So come ask, shop, discover at your xfinity store today. Upiette it is almost 11 5. 3 . Of course, little bit of su the yen is rejecting the call for an early general election. Lawmakers voted 29346, a landslide against the idea. Parliament will be suspended until october 14 while johnson continues exit negotiations with brussels. He has repeated his determination to leave the e. U. With or without a deal on october 31. Devicestter how many this parliament uses to tie my hand, i will strive to get an agreement in the national interest. , here. This government will not delay brexit any further. Avoid anyin order to questioning of what he is doing or not doing, simply to avoid discussion about yellow hammer, particularly to avoid any discussion about the proposals he has or has not or do or do not exist that have been put to the european union. Su hong kong now. C