Zealand is set for a shallower recession than previous years. The pandemic may have a lingering impact when it comes to government expenses. We bring you the numbers breaking this hour. Lets get you started with our lets get you started with a quick check of our markets trading at this hour. We had a mixed finish. Stocks, in fact, fell, erasing earlier gains after that selloff intensified. Tech fed chair powell not sure if this economic recovery will continue, that really dampening the moon. Tech communications leading declines. Switch of the board and you can see what small and midcaps did with the russell 2000, outperforming, look at that, up 9 of the close. We had the fed really keeping rates low, helping that entire sector. Pressure, andf that paired most of its losses with treasury yields climbing after chair powell also said the current size of the Asset Purchase Program was appropriate, the 10year yield hanging around the highest levels in almost a week. We also have the 530 yield curve steepening to the highest since september 10. We also have to digest retail Sales Numbers that missed forecast today. There was a lot happening, especially with the fed and data as well. Haidi really a sense of disappointment that in particular, fed chair powell did not target some of those longer and maturities when it comes to the reaction on the bond market. Lets take a look at how we are setting up here in asia. We have the fed out of the way, but looking ahead to bank of japan, bank indonesia, some of the bank of england, this rounding out a very busy thursday. Over. 1 . Just we expect gdp numbers to show perhaps a shallower recession but increasingly concerns about the impact on the countrys Fiscal Health as well as taking a look at the kiwi, we are seeing that at negative rates, potentially as soon february. The nikkei trading pretty flat going into the bank of japan decision. The incoming Prime Minister could be feeling pretty comforted by the fact that we are looking at the fact that no modern japanese leader taking over from a long serving premier has seen stocks fall on their watch, but potentially, that rally could continue on equities. Sydney futures higher at the moment. The dollar holding at 73. 05 after what was really just some side words sideways trading ultimately in the dollar index. We are getting three more years of euro rates in the u. S. Lets take a listen to what fed chair powell had to say. We believe that particularly this very strong Forward Guidance, very powerful Forward Guidance we have announced today will provide strong support for the economy. Effectively, we are seeing that rates will remain highly accommodative until the economy is far along in its recovery and that should be a powerful statement in support of economic activity. Haidi lets get more analysis by the feds latest policy direction. Kathleen thank you very much. Of course, Forward Guidance, very powerful is how jay powell characterized it. You heard him say this should help the u. S. Have a strong recovery. What exactly is the new Forward Guidance . At the top of the list, the Federal Reserve will not raise rates until inflation hits 2 . Mind you, inflation has not hit 2 and stayed above it consistently for nearly eight years. Secondly this is a very important addition the fed wants to see the economy reaching maximum employment. A lot of people asking how you will define that, but there it is, another important part of the puzzle. Finally, the third part is that the fed is saying in the Forward Guidance that they will allow they will expect inflation not just to hit 2 , but they will allow for an overshoot. Longer rigid. The target is much more flexible. This is something people were waiting for, but it has big implications for consumers, businesses, investors, for everyone. Chief lets bring in the economist for the aflcio, the largest federation of unions in the United States. Great to have you. Thank you for your time. Give us your insight. What is your reaction from the statement . We had two dissents, with one member clearly wanting more dovish rhetoric and the other, more flexibility. Right. This month, as chairman powell said, very powerful Forward Guidance because it is a clear signal the u. S. Government has the fiscal space to respond to the crisis. So far, we are in a conundrum because the u. S. Senate has toused to take up the charge fill the hole. The house passed the heroes act many weeks ago because we understood that the recovery was not happening as quickly as we thought, and we were running out of the temporary measures that had been put in place back when we passed the cares act. Extending extra money to unemployed workers, filling the gap for the workers who have lost their Health Insurance so they could continue it, making sure state and local governments would have the wherewithal as their new fiscal year started, all those things are necessary, and this Forward Guidance from you have the fiscal space, please act. I dont think it is in a Forward Guidance it has to be the democrat version of the stimulus bill . I guess heres my question would any version between where republicans are and the democrats be a step that is absolutely necessary right now to keep the recovery going . We are in a very deep hole. What senator mcconnell offered was totally inadequate for filling the gap, so it has to be much bigger. If we want to argue about whos package, at the moment, republicans have no package byore us, so i can only go their refusal to act towards the thing that is before them. Kathleen lets look at the fed and where they are now. One of the things the fed is looking at is maximum employment. We know employment got just over 3 . That was great. A lot of people got jobs, blacding flax including ks and latinos. Can the fed really use interestrate policy to guide the economy in such a way that this blunt tool will make sure that black workers, latino workers, everybody gets jobs in this economy . When we let the economy expand to its full capacity, that is what will happen. Everyone will be able to have access to jobs, and that did happen, at least for hispanics, back in the fall of 2019 when we finally got the hispanic male Unemployment Rate to be back with the white male Unemployment Rate. We continued into february until we reached the covid crisis. Nothing bad happened. It is clearly possible we can have the Unemployment Rate at below 4 for prolonged periods and we dont see any inflation. In fact, what we really do is guard ourselves against further inflation because we bring in more workers. They get more experience. They get better in terms of productivity and capacity, and end because wehe go deeper into the bench, so to speak, of workers without worrying about inflation. Everybody wins when we actually run the economy at full capacity. Miss thate when we mark. Could we actually be doing that unwittingly, with people out there saving . Seems to be sitting on the sidelines. Cash at the top of the Income Distribution is sitting at the sidelines. Things people cannot spend on travel and things like that so i dont know that the pentup demand is going to show itself in an inflationary way because we have so much excess capacity in those areas. We have restaurants that are dying to reopen. Emptye hotels that are so and airlines that would big to have people back on board, so the pentup demand is not from things we are already buying. Sherri coale into your point, with the fed saying they will make changes to the Mainstream Lending Program to broaden appeal how much of that has filtered into the broader economy . In some aspects because we have this inability to cure the disease in the United States. You had all that news about new zealands decline in the Second Quarter being less because they got the disease under control. They are the ones who need to worry about a huge spring back. The United States has failed to get the disease under control, in sight. No end we have the president on tape saying he even misled us, which makes it even worse for us to figure out is the path out of this. Kathleen i have to throw in new york citys numbers, which was a big endemic. Numbers way down, continuing to fall. There are definitely parts of the country that have gotten this under control or are moving in the right direction. I want to ask you, though, in terms of how will you know now . What are you going to watch . Maybe the economy gets strong enough, maybe theres a level of unemployment that is so low or something. What are you going to watch as an economist to say, we let the economy run hot you have argued for that for years we did not get inflation, but now we are at a point where i am getting more watchful, and i think that could happen, and people at the bottom get hit as hard or harder by inflation as people at the top of the income spectrum. Right now, we are way behind on wages and earnings. The point of letting the economy go above 2. 5 is to get out of the trap japan found itself in. The two percent becomes internalized by everyone as we cannot raise wages more than 2 no matter what you do, and the result is when wages fall behind, they never catch up, and we are going to need a period of catch up so that the household Balance Sheet can be pulled back into order. We cannot have the labor share continue to decline. We are going to have to move to a position where the labor share starts to increase, and that means that inflation will have to run at a more moderate level to give that space. Much forank you so your insight today. Chief economist for the afl cio policy editor, thanks. We will have more in the next hour with a former Philadelphia Fed president. Karina the World Economic slump will not be as bad as initially. Igured according to the oecd the oecd gave big revisions for the u. S. And eurozone as well as china, which is now expected to grow modestly. It says economies will still need the support of governments and Central Banks to aid in their recovery. One day after President Trump predicted a vaccine for the coronavirus would the ready in three to four weeks, Health Officials in the u. S. Have questioned that call. They had of Disease Control and prevention told a Senate Hearing vaccine will not be available until at least march next year. The nations top Infectious Disease expert dr. Anthony faucher told bloomberg he is reasonably confident of at least one by the end of this year. Dr. Fauci by the end of 2020, namely november or december, i feel reasonably confident there will be one or more vaccines that will be gun being made available to the american public. Karina global news 24 hours a day on air and on bloombergquinttake powered by more than 27 hundred journalists and analysts in more than 120 countries. Shery still ahead, oracle could get full access to tiktoks source code to make sure there are no backdoors. We will be discussing that next. Late this hour, we get the zealandsth amc new chief economist. This is bloomberg. Oracles tiktok bid still hangs in the balance President Trump saying he is not happy with what he has learned so far about the terms of the deal. Be getting access to tiktoks source code, but that has not alleviated the adminss concerns. This is a pretty big deal if it turns out the source code would. E included these are basically two details people have been scratching their heads over the what is days, which is oracles role in all of this . Finally, we got some details as to what all of that means, at its basically saying that bytedance continues to have majority ownership over tiktok, but its partnership with oracle allows them to have access to the code and changes and updates to basically see all the data going back and forth around tiktok. Trump says hent does not conceptually like the idea of bytedance having in its oh of bytedance having a majority stake. What are some of the changes could be made and what are some of the details that perhaps the administration does not like . The Administration Last month came out and said, we want a full out sale of tiktok. We wanted to be owned by an american company, not in the arms of a chinese company, and unless they do that, we are going to ban it. The proposal presented to the u. S. Administration over the weekend was not that. It was a deal for bytedance to maintain majority ownership and just have oracle and a number of other american investors have a stake, so theres a real difference between what trump said he wanted and what he actually got on the table. With that said, and a lot of people are falling into line. Steve mnuchin, Jared Kushner he saw marco rubio come out today, initially saying, i dont like this, but putting out a tweet in the afternoon saying the only thing that matters is that data is kept safe, and apparent kind of reference to this oracle detail, so its very unclear as to what trump will end up deciding in the end. Endi is it clear that an to these discussions will be imminent, or is there a sense that maybe this is just the start of negotiations . We know that for bytedance, there is probably knowledge in the back of their minds that november is not that far away and we could get potentially a whole new ballgame politically after that . Absolutely. Some would say this is just a stalling tactic, but if you are bytedance, you are thinking this might just work because you can really spin this in whatever way you want. Bytedance a way that gets to keep tiktok and the u. S. Gets security concerns addressed and a big company like oracle, whose founders has close ties or whose term and has close ties to donald trump, gets to say we are watching out and making sure everything is secure. Ride pass andout trump could sign off on it as early as this weekend, but also, he could decide that he does not want to. Shery so much hangs in the balance when it comes to this deal. Of course, we have been hearing from the president in his White House Press conference earlier talking a little bit about where we are at in terms of the that deal, saying deal between tiktok and oracle, but when it comes to the stimulus deal, saying there are questions that remain, that they are getting closer to endorsing a stimulus proposal and he would be supporting something that 2 trillion bill unveiled by that Bipartisan Group of about 50 house members to try and push this through. They are known as the problem solvers caucus. We also heard President Trump saying he also still had confidence in the cdc director after some confusion arose overnight over the timing of a vaccine deadline. Redfield saying the second or Third Quarter of next year would be more likely, with others saying potentially by april next year americans could be inoculated. President trump also saying he thinks vaccines are much more effective than wearing masks. Much more coming up including snowflakes soaring. An ipo for company more valuable than uber, gm, and dell. We hear from the ceo next. This is bloomberg. Softwaree cloud data maker snowflake sword done its debut transforming the company into a business now valuable more than uber, dell, and general motors. Its ipos the biggest in the u. S. This year and set the record for software deals. The chairman and ceo spoke with the chairman ceo spoke with Bloomberg Technology about the debut. We are thrilled with the reception. We started transferring ownership over a year ago, so this is really not something over the last couple of weeks. We had people buy into an offer we did earlier, january, february timeframe. Snowflake is really a handful of companies, so by the time we got to the ipo, there was really High Conviction buying into the offering, so we are thrilled with the way things have gone this week. Talk about conviction, shares more than doubling. You left a lot of money on the table. You have me concerned that you have given the bankers a little too much here . Thate assumption is always we could have sold the entire offering up the number we closed at, and obviously, theres such a thing as a demand curve. Theres always investors that are willing to buy some number of shares at higher prices, but as you know, the ipo is a price discovery process, and we were after a very specific set of institutional investors, people that can hold multibilliondollar positions, are willing to hold them for five to 10 years, and also people that dont chase momentum either up or down. Its not unusual for a price to get chased up by momentum players, retail and so on. Theres a lot of noise to it. The idea that we could have sold the whole thing at the price that we closed at i dont think is reasonable. Emily that said, is there a lesson for other Companies Looking to go out of the gate . We have huge openings expected for some other companies in Silicon Valley airbnb, ballantine. The question is how fast it will grow into its valuation rate, so you need to really do a lot of work with investors because they have to make longterm bets, right . Its not a 12month deal. People are buying you for 3, 5, seven years, and they need to. Nderstand the story to do that shery snowflake chairman and ceo speaking to Bloomberg Technology anchor emily chang. Regulators issued new online funding curbs. The regulations save loans should not exceed the firms net assets. Largest player in Online Consumer loans is preparing what could be the largest ipo ever. Breathing 9 billion in the industrys largest deal while trying to survive a cash burn of 27 million a day. Secure by deltas frequent flyer program, the bond may yield a most 5 . Coming up, we look at how asian markets fare as there are signals from Global Market banks. This is bloomberg. Karina the Federal Reserve has less Interest Rates near zero, they hold through at least 2023 to help the economy recover from the coronavirus pandemic. The fomc said the fed will maintain Monetary Policy until the u. S. Gets back to maximum employment and 2 inflation. Chairman powell called it powerful and determined guidance. We believe that particularly this very strong Forward Guidance, powerful Forward Guidance we have announced today will provide strong support for the economy. Effectively, we are saying rates will remain highly accommodative until the economy is far along in its recovery, and that should be a powerful statement in supporting economic activity. Shery the bank of japan meets the new Prime Minister was elected. The doj is expected to keep stimulus untouched later as the recover. Ooks to suga has pledged to maintain abes economic policies. We understand oracle will get full access to tiktoks source code and updates to make sure there are no backdoors to access data. The agreement remains on the table ahead of a september 20 deadline. President trump says he expects a briefing thursday morning our time. Has kongs government formally protested the trump administrations move to label imports from the city has made in china instead of may in hong kong. The government called the move irresponsible. They have made a complaint to robert lighthizer. On air and on quicktake. Im karina mitchell. This is bloomberg. Shery investors across asia waking up to a busy day as they digest not only the latest from the Federal Reserve but also three different Central Bank Decisions in the region. Sophie with centralbank updates from indonesia, japan, and taiwan, which may not have the bond space watching for steepening moves, this after the long as lead u. S. Yields higher, after we see jgb futures higher, and in the stock space, futures pointing to a cautious start. In the forex corner, the yen as we saw a july high u. S. Retail sales missing estimates. The offshore yuan holding below 6. 75 after a fourday advance. Pulling up a chart on the terminal, i give you more insight into what is going on with the yuan, which has risen to a may 2019 high. That has pushed the onshore rate to the most overbought level against the greenback since early 2018. This is not the right chart. Thats ok because i just want to keep talking about what is going on with the chinese yuan as well potentiallyause more fixing from the pboc and more anticipation ahead of the potential inclusion of chinese debt into the ftse russell flagship index, which should come next week and Bloomberg Intelligence thinks global interest in chinese debt will be sparked by the feds lower for and yet chinas yield advantage over treasuries also draw their with that gap at a record 240 basis points, so that yuan likely to stay big and that may put pressure on the greenback as well. Lets get more on what to ask for just trading gets under way in the asiapacific. We also have a slew of other decisions rounding out the bank of japan, the boe as well. Lets get to our chief equity strategist, gina gina martin adams. Movedially, the fed just the needle. Yesterday, we pondered the potency of Central Banks to keep delivering upside surprises to support this market. Is that essentially what we saw . It was not a watershed moment, and therefore we saw the reaction or lack of reaction in markets . Gina i think that is certainly part of the story. We did see some intrigue and reaction at the sector level. We did see really strong rotation into value plays and particularly, financials and energy and out of Technology Stocks and this is something we have seen a little rotation beginning in the equity market in the u. S. And globally over the course of the last month, into more inflation plays. Financials, energy, industrials, materials. These are all sectors that tend to do a little better in an inflationary environment, in an environment in which you see a cyclical recovery start to emerge, and out of some of the more defensive covid19 sort of winning sectors Like Technology and health care, but especially technology. That trade really took off in the afternoon today, right after the fed meeting, and i think the reason for that is partly what you said, that the fed really did not surprised. The fed would have needed a surprise with significantly more policy infusion or maybe an expansion in qe, and expansion in the Balance Sheet or something to keep multiples inflating for some of these sectors that have really driven market gains over the last three months, but also the fed committed and continues to push this notion that they are going to keep rates extremely low right through to 2023. They see prospects for economic recovery to emerge. They are willing to let inflation run hot, and that is starting to impact Sector Performance in the u. S. Equity market in particular. Something similar we expect from the boj, right . Not huge enough to move the needle, but yet you expect them to stay low for the longest time ever. How will this Impact Global stocks and countrylevel performance . Gina Central Banks are absolutely essential to driving performance, mostly through currency. You do see certain areas of the world are incredibly sensitive. There equity markets are incredibly sensitive to what happens with currencies. Japan is one of those markets that has very high correlations with what happens to the yen. I say one of the things you want to watch more carefully with respect to the boe meeting today is how does the yen react . The yen has been stable the past several months. Range bound, very stable, not moving a lot, consistent with a central bank that has been on the case and persistently very, very easy. Does something happen today with the bank of japan that potentially disrupts that relative stability in the yen . That could be incredibly important for performance, not only in japan but for developed markets versus emerging markets, at a general risk measure for global stocks at large. We have more market views. Guggenheims global cio told bloomberg tv that the feds pledge to keep rates lower for longer will make it virtually impossible to haidi he says markets are price for rates remaining on hold for at least five more years. The chairman is going to have a lot of pressure on him to define what and overshoot means, what will actually treat for a rate increase. Coming into this the way the market was priced, we are basically priced for virtually no increase for the next five years. I was a little bit surprised because im probably a little bit more on the bearish side of this. They would be strong in their commitment to go through 2023, but you know, the market is clearly placed for that. They dont want to disappoint the market because the last thing they want to see right now is for Interest Rates to begin to rise, especially, you know, 10s, which are an important benchmark to place corporate debt off of. Record issuance at the moment. Im interested in your perspective for whether we will ever see and overshoot on the 2 level. The 10 year breakeven. Its reallyine, interesting. I think that the market may ultimately be surprised to find that inflation could come back faster and harder than anyone is expecting and i think one of the important things about how that would happen is that the number of Zombie Companies it was pointed out in a Research Piece by a Research Piece by deutsche bank, has now reached 20 of the market. I mean, these are companies that really should be allowed to go out of business, but you know, one of the things about companies that should fail or be restructured that do not fail is that they began to become very companies,e so, if if we suddenly see it takes more takesinput or it additional demands on resources, we could start to see pressure there. That is the speculation. I think the first order effect is that this will drive asset prices higher. We might have to set back here in stocks over the course of the next month or so, we should generally expect to see risk assets go up in price and Treasury Bonds to even go down in yields. Here. Me jump in we had a chance to go through all these documents yet. There was this question about whether anybody in the wouldould predict fed predict 2 in the long run. There are several people it appears to have forecast pce inflation above 2 , starting in 2021. Its the first time we have seen anybody do that, but the range now runs from 1. 3 up to 2. 4 percent for 2021. In 2022, the range goes up to 2. 3 and 2. 1 again in 2023, which in a interesting way either suggests inflation dynamics are going to change over those years or it does not square with the idea that you are not going to raise rates because how you get inflation down from 2. 42. 1 over those two years is not clear. We dont know how many people are making these forecasts, but that is the range of forecasts now. Mike, i think there are two things. One is just the arithmetic of inflation after we had such a deflationary shock with covid and the lockdowns, now, you know, we are kind of getting a bounceback, and you know, people are retailers have had to liquidate big inventories. They were very cautious for the christmas season. I think we are going to see further up pressure on inflation over the course of the year. That does not necessarily mean to secularize but its a shortterm increase. Minerdthat was scott speaking to Caroline Hyde and mike mckee. We have breaking news. An update when it comes to tiffanys response to lvmh, attempting to pull out of what would have been the biggest merger. This year. This year. Id they are trying to force her to go through with the acquisition deal lvmh had previously decided it would sue tiffany to get out of that deal. We know the french government is involved in this as well. Tiffany now saying that it is urging the court in delaware to hold a trial for the decision before november 24, making comments about the nature of the acrimony between the two parties at this point. Tiffanys saying lvmh has been grasping at any opportunity to delay this deal but they have shifting expectations but there shifting clinicians indicate bad faith. Tiffany says no interior adverse effect has occurred during the pandemic and they remain committed to completing the transaction so we know this relationship has deteriorated after lvmh tried to back out of the purchase of the american jeweler. Bloomberg news had also reported arnaud, chief, bernard had asked for assistance from the french government to try and get out of that transaction as well. We know that at least eight major places including cases are pending in the court. The coronavirus pandemic had really presented an interesting issue in terms of whether it can be used as an excuse to exit a deal. We will get more on that as the details come to us. Moments away from new zealand, gdp data are likely to confirm the nations first recession in a decade. We will be getting some analysis from the anz bank. This is bloomberg. Haidi breaking news when it comes to Economic Growth numbers out of new zealand. Lack of growth actually. , contraction of 12. 12 12. 2 seasonally adjusted quarter long quarter quarter. That year on year gdp number, contraction of 12. 4 , also slightly better than expected contraction of 12. 8 percent. The First Quarter gdp number also revised to a decline of 1. 4 quarter on quarter. Lets get direct reaction from the Anz New Zealand chief economist. We were expecting members of this magnitude. It is slightly better at the margins. What are the implications of a bounceback of new zealand from this . I am quite astonished that the number came in so close to market expectations. There was plausible range really for the gdp number. It was always going to be wild given gdp methodology was never designed with lockdowns in mind. I certainly think the. 3 difference between the markets meeting expectations and the actual was neither here nor there. In a bigger macro sense, the fall in gdp in q2 is more noise than light. Thatuestion is how much of is sustainable given it was really underpinned by an incredibly expansionary fiscal policy, really frontloaded like in many countries around the world . We think the industrial settled by the end of the year and the questionhere are real marks about how things will be looking at that point. Questions about Fiscal Health after an intraday amount of fiscal measures being required. Do the numbers today does it move the needle when it comes to the rbnz . Theres a lot of expectation we could go into negative rates by february next year. The reserve bank has committed to not changing the ocr until march. We dont think they will want to undermine their Forward Guidance. Given how important it will be in the years ahead. Fromng through this noise the lockdown, by the end of the year, the fiscal stimulus will be winding back very significantly, and the hit to tourism will really be being felt. This is really a summer story are tourist arrivals it was not that much of a cash flow. Come summer, it will be very noticeable. So thats why we think that the economy will be showing renewed weakness by the end of the year. Why we are expecting to take further action. You have downgraded your thirdquarter gdp forecast. How big of a hit will the new zealand economy get, especially with these renewed restrictions. The renewed lockdown is very much lockdown like compared to the last time. Shortterm or severe. Change theing to fact that q3 gdp will probably be the biggest increase in gdp with everything following the largest decrease we have ever seen. It really is just a lot of noise i would say but what we have seen is that the impact on Business Confidence in our survey was neutered and in fact, we saw those measures increase in early september, many of them to the highest since february. Just about that in context, they are still at recessionary levels. Something that haidi mentioned slightly, the burden on new zealands finance has given all of the fiscal stimulus they have already had to implement. Sharon we have a really good starting point or had a really good starting point. We tend to report our numbers in a very tough kind of way. We dont take assets into account. That ourappreciate starting point was really low. Of course, its going to deteriorate massively and quickly. There is some debate emerging about how we are going to pay it back, but actually very little debate about whether the government was doing the right thing getting into this debt. This really is one for the history books. We have saved money for a rainy day and that rainy day is here. Theres no question tough choices lie down the track. For now, we are looking the other way. When it comes to the tough choices, we are getting into the general election. What does the new government or the continuity government need to do in terms of policy priorities . Its pretty clear we need to pivot away from life support for things that will promote growth. If we can grow our way out of it to some extent. New zealands growth comes much more from population growth than it has from productivity growth and that model is of course extremely challenged now. We are seeing with the closed border, net migration has gone to practically zero. That is of course not going to be the longterm scenario, but its certainly true that governments need to focus on things like infrastructure, labor market reform, education, these things that can help us grow. The current infrastructure plan theres a lot of political noise. They really are a drop in the ofket seen in the context the likely fall in business investment, so they cannot really say its gdp on their own and they also take a long time to get underway. At the moment, we are looking at a pretty uncomfortable period. Great having you on. Sharon zollner, anz chief economist reacting to Second Quarter numbers. We have a big interview tomorrow you do not want to miss. We will be speaking with new zealand finance minister graham sydney, at 8 30 a. M. In 6 30 p. M. In new york, right here on daybreak australia. Australias jobless numbers likely trending higher in august as the extended lockdown in the state of victoria always on the economy. The economy. We will have more analysis. This is bloomberg. Haidi australias and employment numbers are specter to show a loss of another 35,000 jobs. Paul allen joins us now with the preview. Are there any expectations we have not seen the worst of the job losses in australia just yet . Paul thats definitely the expectation. The reserve banks central scenario is unemployment reaching 10 by the end of the year. One of the key things to watch will be the Participation Rate for people either in or looking for unemployment. Byis still very weak historical standards, about 64. 6 . In the course of the true employment picture, its skewed by job keep repayments. About a quarter of the workforce is receiving government wage subsidies through employers right now. That program has been extended once. Have an extended lockdown in victoria of gorsuch might be pushing at that again. We will learn more about that on october 6, when the budget gets handed down, and thats coming five months later than usual. Numbers are expected to reinforce this trend of a growing jobless queue in australia, another 35,000 jobs in the month of august. The rba releases its quarterly bulletin today. Can you expect any more clues on future policy settings here . Paul its possible its worth a look. Its a little unlikely, but the bulletin tends to be more of a collection of thoughts on broader domestic macro themes. The last one drew some pretty interesting comparisons between policy responses to the covid pandemic and the spanish flu over 100 years ago. That report was encouraging by the way it showed a sharp rebound there. So we might see something in that bulletin. We may also hear something from the head of domestic markets at the rba. Shes giving a speech today on in these of sound data troubled times. The rba ministers tweet does not give any clear signals on any future change in policy although they did say they will continue to consider how further monetary measures could support the recovery. The westpac chief economist, bill evans, took that as a sign there might be a discussion around a further rate cut sometime in 2021, especially of unemployment keep if on a plumbing keeps rising. Shery paul allen with the latest from australia. U. S. Futures slightly higher at the moment. This of course after stocks fell with the fed decision. We are seeing key restocks gaining. 3 at the moment, this after Second Quarter gdp numbers came in slightly better than expected, still a plunge of 12. 2 quarter on quarter. We are seeing nikkei futures unchanged at the moment. Coming up on daybreak asia, a full slate of voices on key stories today including the former Philadelphia Fed president and ceo, charles foster, on the latest out of the fomc. Plenty more ahead on daybreak asia. This is bloomberg. Shery i am shery ahn in new york. We are counting down to asias major market open. Haidi i am haidi stroudwatts in sydney. Welcome to daybreak asia. Our top stories this hour. Asian stocks headed for a cautious start after Jerome Powells warning of uncertain economic rebound without further fiscal stimulus. Oracle to get full access to tiktoks source code under their proposed deal, but President Trump says he does no w
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