A lot of the focus has been on what mr. Powell said yesterday and what we heard from the fed. We are seeing a bit of Movement Across the board. If you look at some of the european stocks, they are actually retreating after jay powell highlighted uncertainty about the economic rebound. We sought asian shares falling the most in a week. Treasury yields, that curve steepening slightly on wednesday after mr. Powell stopped short of offering specifics on the feds approach to the monthly bond purchases. Lets get straight to the bloomberg first word news. Here is leighann gerrans. Good morning. President donald trump is not happy with what he has heard about the terms of the oracletiktok deal, but says he briefed on the details on till this morning. Sources have told bloomberg that the Top White House officials have raised concerns about the proposal. They say it falls short of Satisfying National Security concerns. President donald trump says a Coronavirus Vaccine could be widely available as early as october, contradicting his top health officials. They have made estimates ranging from a mark to the end of 2021. Expert Anthony Fauci told bloomberg he is reasonably confident a vaccine will be available by the end of the year , with that widescale adoption but that widescale adoption does indeed take time. Here, Prime MinisterBoris Johnson is making key concessions on his brexit plan to get it through parliament. He has agreed to give the house of commons a veto on whether the government can override parts of the divorce agreement. It comes as one of the governments most senior Legal Officers resigned over the controversial proposal. The European Central bank is giving lenders temporary relief on their leverage ratios. The ecbs new measure allows the bank to include centralbank exposure from the calculations based on data from the end of march. That will raise the average ratio by about 0. 3 . Global news 24 hours a day, onair and at bloomberg quicktake, powered by more than 2700 journalists and analysts in more than 120 countries. I am leighann gerrans. This is bloomberg. Francine bank of england officials are expected to laid the groundwork for more monetary stimulus. That is as optimism over the u. K. s economic rebound officials out. Forecasters widely predict the banks Bond Buying Program will be expanded again before the end of the. The market expects the key base rate to be cut below zero in 2021. Joining us this morning is Deanne Julius, distinguished fellow at Chatham House. Thank you so much for joining us today. If the bank of england, how dovish can the bank of england actually turn today, given all the headwinds we are facing . Deanne i think they will sound uncertain rather than dovish. It does seem to me that there is a huge amount of uncertainty around at the moment. Remember, the strategy that they laid out, that Andrew Bailey laid out early on in the covid crisis was to go fast, go big, as he called it. They did their big rate cut then, increased the amount of qe that they would be doing at that point. It is still the case that that is fueling the economy. We have had some pretty good Economic News relative to their forecast. The bank of england is making its decision based on the strength of the news it has had since the last forecast, since the last meeting in august. I would say the news has been either neutral or positive compared to that forecast. There is not a big urge to change. That wasiece of news perhaps surprising to some was that our inflation rate, the cpi rate that they monitor, went compared month to 0. 2 to the target of 2 . Of course, thats pretty low. You might think that would cause them to think about additional stimulus. It was forecast in their last policy meeting, in the last Monetary Policy report that the inflation rate would go down to Something Like 0. 2, 0. 25. That is not unexpected news. It is due largely to some oneoff features that they will be well aware of. I expect commentators will actually argue about whether it is a debit or hawkish stance dovish or hawkish stance. Francine what exactly is the perfect time to add more stimulus . Do you have to front it and do it air little bit before there is a sharp downturn . We also have that little thing called brexit looming. Deanne when there has been a significant and rather unexpected downturn, compared to forecasts. There are also some tactical considerations here. The bank will be making its next forecast update in november. Thats when the next mpc meeting will be held. The mpc meeting will be two days after the u. S. Election in november. That could put a significant amount of uncertainty into the marketplace. Additionalneed some liquidity support if it really disturbs the natural markets. But also, remember that the previous vote of the mpc was unanimous. So even though there are a couple of dovish sounding people i think it will be quite a while yet before the whole Committee Moves, or a significant majority of that Committee Moves into that state. There are upsides and downsides. Morehaldane is a little optimistic about the state of the economy. But every market has been doing reasonably well. We are getting to the end of phasing off our furlough scheme so they will have to watch that pretty closely. Some of the members watch that. Our broad money supply is up 25 compared to july last year. There is all kinds of Economic News in the market and it is a matter of balancing them out and then taking account of anything major thats hitting them from the side. That could be brexit news, good or bad. It could be the chancellor, who i think is going to be coming up with a budget before the november mpc meeting, although he has not firmly confirmed that. There is lots happening. I think it will be events that drive eventual stimulus, if indeed that does happen. Francine do we need an extension of the furlough programs . And a lot of concern about risk to the downside is indeed about the labor market. Around,there is support particularly on the u. S. Side union side, for extending the furlough scheme. Sunak has been pretty clear that it is a temporary scheme. He has been phasing it out for the last few months. It is due to end at the end of october. It is still around. At the same time, people have come off the furlough scheme and gone back to work in the last two months. Data is notrket that negative. I would say it is not positive, but no one expected that. It seems to me what is more likely than extending the furlough scheme is probably to extend the Additional Support that comes through jobseekers allowance and whats called the universal credit, which is then targeted at those people who really need it. Than being an across the board, very expensive extension to the furlough scheme. Francine how much pressure will the bank of england actually get from markets to talk a bit more about negative rates . What will it take for the bank of england, if anything, to go into negative territory . Deanne i think it will take a significantly worsening economic situation. It seems to me there is quite a bit of reluctance on the part of certainly Andrew Bailey and some others on the committee to cross that rubicon. There is not a lot of economic evidence that it does much good. The swedish experiment, which is the longest running one that we have had, in europe anyway, has moved back from negative rates. It does create some strain to the banking system, and the financial policy committee, which Andrew Bailey also chairs, is looking at those sorts of issues around negative rates. They havent ruled it out. They certainly are keeping it on the table as an option, but i think it is an option that would be not quite last resort, but it would come after additional qe in this case. It certainly has negative consequences on the banking sector. Anna thank you so much francine thank you so much. Deanne julius from Chatham House stays with us. Three more years. Jay powell says u. S. Rates could stay near zero until at least 2023. We will focus on the fed next. This is bloomberg. Francine economics, finance, politics. This is bloomberg surveillance lets get straight to the Bloomberg Business flash. Here is leighann gerrans. Itsnowflake soared in stockmarket debut. Its share price was up as much as 160 6 , giving it a market value of more than uber, dell, and general motors. Snowflakes 3. 4 billion dollar ipo is a record for a Software Company and the biggest in the u. S. So far this year. The ipos price discovery process is a price discovery process. We were after people that can hold multibilliondollar positions. They are willing to hold them for five or 10 years. Most were people that dont or down. Entum, up the latest version of sonys gaming console, the playstation 5, will go on sale november 12 in the u. S. For 500. That matches the price of microsofts upcoming xbox series x as the two Companies Battle for market share. Pricing is often an important factor of success. Historically, the less expensive systems sell more, driving an increase in revenue from games. And a citigroup employee has been placed on paid leave pending an investigation after revelations he operated a prominent qanon Conspiracy Theory website. A Fact Checking service identified him as running the site, which has since been shut down. No comment from the employee or citigroup, but the bank says employees need approval for any outside business activities. That is your Bloomberg Business flash. Francine three more years that the fed predicts rates will stay near zero to help the economy rebound. Chair jay powell says while the recovery has been faster than expected, activity remains well below prepandemic levels. We believe particularly this very strong Forward Guidance, very powerful Forward Guidance will provide strong support for the economy. Rates will remain highly accommodative until the economy is far along in its recovery. That should be a powerful statement in supporting economic activity. We will aim to achieve inflation moderately above 2 for some time so that inflation averages 2 over time and longerterm Inflation Expectations remain while anchored at 2 . The labor market has improved, but its a long, long way from maximum employment. My sense is that more physical support is likely to be needed. Of course, the details are for congress, not for the fed. We believe the strong policy guidance we are providing today will serve the economy well by promoting our goals through the many possible paths the recovery may take. Francine still with us is Deanne Julius from Chatham House. How did you take what we heard from the fed chair yesterday . It is setting out somewhat of a new policy, but actually it had mixed reviews. I dont know if everyone interpreted it in the same way. Deanne i thought it was very clever, actually. The fed has been saying for a long time that they were in the process of reviewing their framework for Monetary Policy and we were all speculating if they would go to Something Like gdp targeting, nominal gdp targeting, something else. Socalled new framework of average inflation targeting provides them with a lot of flexibility, and a lot of wiggle room, if you want to put it that way. They can to be tied down with t be tiedt they can down with additional calls for stimulus month after month. Particularly with the election coming up, i think to have a wider canvas on which the fed can frame its policy is a good idea. Extent,lso, to some takes off the table the idea of negative Interest Rates in the u. S. He talked about additional stimulus to keep the economy growing at a more sustainable rate, but that can easily be changes inancial financial parameters around banks or even in more qe. I did have a look to see what average inflation actually might mean if one looked backwards. Rather strangeat metric of the personal Consumption Expenditure deflator without food and energy. If you just take that data, if you went back to 1980, the beenge core pce would have 2. 78. The average from 1990 was 1. 9. If you take the average from 2000, 1999 actually, it was 1. 7 . 2 , ifnot too far below you take that kind of fairly long run period to calculate the average. In a way, it might be more significant that powell did not firmly place his new framework on the pce. The fed does talk about monitoring different types of inflation indices. The pce, this old favorite, or at least the one that alan 0. 3 inn stuck to, was july, compared to the cpi, which was 1. 6 . There may be an additional debate to be had here around, what is it that they are averaging and aiming for . Francine does the more specific guidance actually help in reaching those targets just because they are more specific . Or does it mean that they will have to deploy more aggressive tools to try to get to those targets . I think it will depend a lot on which direction, not just the level of the inflation rate, but which direction its going. I think at the moment, there is so much volatility in the data itself with the lockdowns in different places and different states having different issues that it is a little hard to place much faith in any of the data. Policy tohange in average targeting as opposed to point targeting on balance does indeed give them more flexibility and perhaps less pressure to move in the direction until they are ready to move. I mean, it is also interesting that powell has made the case, at least at jackson hole, that the fed should place equal weight on the unemployment part of its mandate as the inflation part. That seemed to come true yesterday in his statement as well. In addition to watching inflation and different measures of inflation, they will be really pulling apart the data on the labor market, i suspect, in deciding to put additional stimulus into the economy. Francine thank you so much for joining us today. Deanne julius, distinguished fellow at Chatham House. Job losses are on course to be the deepest and half a decade. We have all the details next. This is bloomberg. Francine this is bloomberg surveillance. Im Francine Lacqua in london. Job cuts are back at the worlds biggest lenders. They have begun to slash their workforce. Here with the details as dani burger. Dani about 60,000 job cuts so far have been announced for the year. Youell on pace, as say, to beat last years levels. That means we will have the steepest reductions in lender workforce since 2015. This is just the job cuts that we know about. Lenders do not always announced to the market how many jobs they are cutting. Part of the reason we are seeing it so steep is the desire to cut costs when we have these piling loan losses, we have regulations that banks need to spend to keep up with and some of the digitalization these banks are doing. Here is a place where they can save costs. When we dive into that number, you can see that the majority of cuts are coming from european lenders. This is about 78 coming from the region, much smaller than north america. Within this nearly 50,000 job cuts coming from europe, 35,000 of them are from hsbc. Thats where the bulk of it comes from after an announcement in february. We cannot forget the human cost of this. It is a tough year for bankers to find new jobs. Jobs posted in london last month sunk by about 40 . There are definitely less listings for new jobs for bankers. Francine thank you so much. Dani burger with the latest. Dr. Anthony fauci says it is unlikely a covid19 vaccine will be available to the public by the date of the president ial election. We will have plenty more from the top. Markets. Jay powell upending some of the things that we saw in terms of asset classes. U. S. Futures down after jay powell highlighted uncertainty about the economic rebound. Looking at treasuries, they are actually ticking up. I am looking over at some of the industries in europe that are under pressure. We sawers slumping after data showing european car sales plunged by nearly 1 5 in august. This is bloomberg. Francine economics, finance, politics. This is bloomberg surveillance. Im Francine Lacqua, here in london. Lets get to the bloomberg first word news with leighann gerrans. Leighann the Federal Reserve sees rates staying near 04 near three years. Staying near zero for at least three years. At its last meeting before the president ial election, the central bank vowed to delay any hiking until the u. S. Gets to maximum employment and 2 inflation. Particularly the strong Forward Guidance, this powerful Forward Guidance we ,ave announced today effectively we are saying that rates will remain accommodative until the economy as far along in its recovery, and that should be a powerful statement and supporting economic activity. Leighann joe biden is warning about the impasse of the latest plan on a potential trade deal. He says an agreement depends on the continued respect for the Northern Ireland peace protest and the good friday agreement. The governments plan may make other deals more tricky. Deutsche bank has told its new york city staff they can continue to work from home until mid2021. That is in contrast to rival to theeeking to return office. In a memo, Deutsche Bank says workers only had to return when the bank moves into its new offices, which is happening in july. Global news 24