Three basis points. 250 on the 10 year yield. Lets turn to all of our top stories. Germany is recording more than 1000 new cases where a day and spain reporting its highest number of infections since april. Theing meet with more is Bloomberg Intelligence director of research. Put these numbers into perspective for us. Obviously they are going in the wrong direction and germany was the the one that poster child of at least severe numberost thanaths per population other european states. The cases rising are not nice to see. I am not complete surprised in terms of what is going on. We have opened the door and we have allowed people to start moving around. We have allowed people to roam around the street and go to beaches, etc. You can tell people as much as you like that we are social distancing and you cannot enforce it apart from closing areas where you where these clubs,spread, bars and etc. Leader haspanish gotten a lot of flak about being on vacation and not taking the same role he took earlier in the pandemic. Do those countries need that or do we live with this right now . Are going towe just have to live with that. I haveow whether always had a tough time going out leaders of countries were taking holidays. It happens all the time. Countries are never in a situation where there is not something going on that does not need the attention of the leader. They are human beings. I dont want to say that that is the right way to do things. But in the end, you need to lead from the front. That is a way to keep our perspective on. What we needat is to keep our perspective on. Alix where are we in this nationalist vaccine world . Sam i dont think nationalist, but astrazeneca has done deals all over the place. India, everywhere, frankly. That theok at the deal European Commission assigned or buy, it is not just for the European Union. It can also be supplies for countries that may need it but cannot afford it. The European Union is making the right noises on that front. These are all insurance policies. Alix fair enough. Always fun to chat. Bloomberg intelligence director of research. It is among the topics today, covert prices, as Angela Merkel meets with emmanuel macron. Joining us now is richard. What is on the agenda . Richard it really is a bit of all of the most important issues right now. They will be discussing the couption in belarus, the and the possible snap back at the u. S. Is pushing for. The meeting did begin about one hour ago. The german chancellor arrived in expecting are there will be a press conference about one hour from now and they will go on to have a dinner. They have a pretty packed schedule. Alix how do you expect them to address the covert crisis . There are no more lockdowns. Merkel seems to be more attentive in terms of reopening. How do they discuss that . That is the milliondollar question. Has beenmacron exquisite in saying dont want to go back to a lockdown situation like earlier this were they dont want to go back to a lockdown situation like earlier this year. My guess is that there will be a big focus today on how eu members can coordinate better so that they dont see individual Member States take unilateral actions like we sold like we saw the last time around. Alix i am wondering how they discuss iran. President trump said he will call on the Un Security Council to restore sanctions. That is different from the tactic europe is taking. This is a couple of months away from the president ial election. How they think about that right now how do they think about that right now . Richard it is a really interesting topic and german position on this is that the u. S. Does not have standing to trigger snapback sanctions. How the eu is going to approach that in the Security Council remains to be seen. The issue is not on the official agenda, but one would have to assume that it would be broached and it will come up today. Alix richard, thanks very much. The ecb released its account july meeting noting it is looking for signs of recovery. Michael mckee is here with more beer Michael Michael mckee is here with more. Michael we got mixed messages. Song,b is seeing the old to you in september singing the old song. They did not know what was going to happen with the virus. Here is what the minutes said. Thets september meeting, governing council will be in a better position to reassess the Monetary Policy stance and policy tools. This would provide more clarity regarding mediumterm inflation outlook and prospects for economic activity. They have had a sharp initial rebound because they controlled the virus and the economy came back and so some people going into the meeting felt they might not have to spend all of the 1. 3 5 trillion euros they set aside to buy bonds. But some were saying, wait a minute, lets see what happens with the virus and with the economy and from the stories we have just seen, it appears they were right. The prospects for the economy have darkened and it will be interesting to see in september what they do. That is the opposite of the message we got got from the fed last night. July, at thatg in point a lot of people coming out of that thought that the fed was saying we are going to change our Monetary Policy framework in totember and do something tie our rates to inflation and unemployment. The fed made it clear yesterday they really had not discussed that the same way. With regard to the outlook with regard to Monetary Policy beyond this meeting, a number noted that providing greater clarity regarding the likely path of the target range for the federal funds rate would be appropriate at some point. That is different from what they said previously when they said it would be appropriate at an upcoming meeting. Markets are disappointed by that. They thought perhaps that we were going to get more dovish commentary. What they decided was that Interest Rates were so low, and you can see what has happened to the yield curve since june meeting, there was no need to do that at this point. They could just let it ride. At some point, change policy when they needed to push down on rates. They dont need to do it right now. Alix i thought some of the rhetoric yesterday was that they are rethinking how they are thinking about their Balance Sheet. It is not justified the virus, it is also to accelerate the recovery just to fight the virus. And also with how quickly the market reacted. Michael according to who i spoke with, it is because they overextended themselves and the markets bought too much into the story that the fed will be changing the policy regime and the indications for what it might buy in the market and how much that might put into the markets, they had to back off of that. Of course, they jumped right back in today with jobless alix true. Bloombergs michael mckee, thank you very much. Coming up later, we will be schoolg with nyu stern of business professor and his insight on politics in the pandemic and what it means for the economy. This is bloomberg. Live from new york, im alix steel. This is numbered markets the turkish bank is Holding Key Rate flat in line with forecasts while the headline rate is unchanged and increasing the amount of cash lenders must hold. For more we are joined by former chief economist of central bank of turkey. Hakan, it is good to chat with you today. There is a difference between hiking the rate and using the rate for backdoor channels. How long can that be sustained . Hakan i think they have some room because the central bank of turkey does not use the rate it couldve yielded at. It is a gradual shift to a different channel. What the central bank is trying to do is they are suspending the cheaper channel and using the more expensive channel. For example, they have stopped funding the banks. Cap on the Central Banks activity. They have not used liquidity yet. They have used it in thousand 17. That is another option that Central Banks can use. Instead the central bank is trying to tighten the Monetary Policy for different windows. Today they decided to raise also helpt which will slow down their credit code. Outlook, inflation there is an adverse shock in the upcoming weeks which shifts the Inflation Expectations alix it looks like we are having a little bit of a connection issue. Are you there . Hakan i am here. Can you hear me . Alix i can hear you now. I understand what you are saying. Where do we need to be here in turkey on voluntary on Monetary Policy . Question. T is a good i think the main problem is controlling the Inflation Expectation as i mentioned. , [indiscernible] given that the inflation will continue to be double digits, that means it should provide some protection from inflation and that brings us to much higher levels than the current policy rates. It is difficult to tell where the exact rate is, but i think the central bank should at least provide some positive interest that it isnvestors serious about inflation. Nominalns bringing the 12 rate up to 11 , alix it looks like we are having a pretty dicey connection with hakan kara. Im going to leave that there. Talking about turkey central bank, you have a followup in the lira and inflation shooting higher. You have to wonder how the growth aspect plays out. We will get you back later. Economist of the central bank of turkey. This is bloomberg. Ritika it is time for look at the biggest business stories in the news right now. Growth atsales alibaba have bounced back. The Company Reported quarterly revenue grew better than expected at 34 . The ecommerce giant is benefiting from a pickup in consumer spending. Ups and fedex show they can handle record demand during a pandemic. Now they want to prove they can boost profits during the holidays. Aggressives have set peak season fees. They are expecting an unprecedented year in deliveries. It will compete with amazon to delivers with amazon to hire workers. Freeing up billions of dollars for loans. Twoquet transferred bank woulder the transfer loans. At specs 2021 to be a bad year for travel. We caught up with the ceo earlier today. We havenk given that any facts in the next two months, it will take some time to roll out to be an effective way. I have to say qantas is in a better position than airlines around the globe because we have parts of the business that have gone well. , our resortbusiness business, and we are optimistic about domestic business. We are working with the states and government to open up state borders up more. The suppression of covid19 in around the globe and we are hopeful we can have the majority of domestic is by the end of the year. We are still cash positive that we can get them up and running. Million has nearly 800 in depreciation each year which we wont be able to cover if we are not flying international. I think the last time you joined us was in may. At that point, lots of moving points. You told us, worst Case Scenario, the cash you had would have lasted you the end of next year. We obviously know things have changed. You are laying off workers. The reason i bring those things that what makes you say the conditions that you now expect to persist will be the worst Case Scenario . For investors, what confidence can they attached to the scenario you just put out if you had just changed very recently those assumptions that you made . One of the things we are going to have to work with is this is weird and you have to be flexible. What we do is adjust our plan to cope with the environment we are seeing. We did say in june there would be at least 6000 redundancies and we are going to announce in the next few weeks more changes in restructuring the business for the future. What we are aiming for is to take advantage of the opportunities we have. We have a number of strong decisions domestically with the two brands that produce the majority of our profits even before covid19. And are coming out smaller we think there are further opportunities and we see huge demand. We have our Loyalty Program which is performing exceptionally well. Our freight business has record profits. The interest will be international and that will be dependent on a vaccine. We think international could open bubble by bubble. Gets therezealand second wave under control, there is no reason why it should not be open. That is work markets and out of australia and new zealand. That is for markets. We will try to position ourselves to take 1 billion of cost out on an annual basis so that when covid is behind us, we are the strongest airline in the region and the strongest airline with the best Balance Sheet and we think there would be opportunities. Alix the ceo of qantas talking about their quarter. Joining us is Bloomberg Intelligence. George, what is your biggest take away . George i know that a big portion of their launch was the writedown of their assets. I thought it was very interesting that he could come back into use at some point. That it would come back into use. Has a lot of longhaul flights and International Business that is really being hurt by the pandemic given all of the restrictions and quarantine and such. Alix how much cash burn are they going through verses there appears . George we have not had a chance to count their tax burden cash burn. A lot of this is the larger you are, the more dependent you are on business travel. But we have not cut it down yet. Alix all on the same lines, airlines have been trying to cut costs and trim everything as they can, etc. How many more letters does qantas have to pull levers . George all of these airlines have had to find a way to resize their business for what the longterm demand in travel is going to be in the region. That is a challenge. If wel go tomorrow woke up tomorrow and we had a vaccine, you want to be able to pull the letter and get your pull the lever and get your pilots back in the cockpit. The ceos are trying to figure out where the recovery comes. I know qantas is talking mid 2021. That is kind of what we are talking as well. It is dependent on where we are with the virus at that point. The point i am making is, the l ever they have to pull is the one all of them have to pull. That is cutting fleet size and staff and the challenge is to find where and what demand will be and when that happens. Alix we have to leave it there, but we appreciate it. George ferguson of Bloomberg Intelligence. This is bloomberg. Alix lets take a look at where european markets are trading as we had to the close. Modestly above the lows of the session but significantly losses in europe. 1 loss whether you are in germany or spain, where there is a lot of heat where the leader is getting an auto where the leader is getting a lot of heat for not coming off his vacation. Bank yields moving lower. Banks down 2 . Switch up the board. A quick check on other asset classes. Eurodollar, it has been a huge move for the currency, Deutsche Bank taking off some of its long positions. We could see more downside. That currency pair trading flat. Biding about the safe haven , obviously want to check on the swissie as well as the yen. Euro swissie down. 5 . The bond market getting a nice bid. Gold going nowhere. I want to dig deeper into the movers in your. Heres abigail doolittle. Abigail todays movers had a sector theme. That is the worst sector for the stoxx 600 today and the worst stock for the stoxx 600 is also a bank, an investment firm, eq tp rate they put up a big report. 31 earnings report. They plan to load up on esg or sustainable debt using a 2. 7 billion subscription. Apparently investors do not like that. Those shares plunging 14. 5 . M g advisory shares cut to a whole. Standard life is down. The yield situation not helping that sector. As for another down sector, materials being weighed on by some of the miners. Copper down for a second day in a row. That is weighing on the biggest European Mining companies, and in particular, i hope i do ok antofagasta down to a sell by Deutsche Bank. Saying shares trading at an unjustifiable premium. In the stoxx 600, one sector is up, real estate by 2. 2 , being the commercial Residential Real Estate company shares. Results much stronger than estimated. They also announced they are operating theyre offering a convertible operator for holders of certain bonds. You have that is a bright spot. That is the best stock in the stoxx 600. Thanks so much. Talk about the fallout from wirecard. The big demise in june. The delivery euro will replace wirecard on germanys prestigious dax benchmark. The Delivery Company will take its place on the index this coming monday. Another company benefiting from wirecards demise is a dutch payment company. A 27 mpany had a jump of rise in revenue for the first half of this year. Joining me is the cfo ingo jeroen uytdehaage. To start with the wirecard phenomenon, can you give me some perspective on how many clients you got from wirecard and how much more juice you can get from that . Ingo the wirecard situation is not good for the industry. The big difference for our company is we saly we see some impact where merchants are switching. What isost impacted by happening around us as a result of debt level and the Macro Economic circumstances. Alix which will get in one second. One more thought on wirecard. There is a narrative that due to wirecard and the criticism that german regulatory agencies fell asleep on the job, they might see more regulation in the payment sector. What are your conversations around that right now . Ingo the regulatory landscape is changing quickly. Anything we can do to have trust is important, so if there are changing regulations we will comply with that. It is good to make sure Companies Like wirecard do not exist. Alix does that mean you would welcome regulation . Ingo if you look at how we are regulated, we already have quite a bit of regulations. Im not saying w