Europe, up by 2. 5 . Todays number from barclays, very strong. We are going to hear from jes staley a little later in the program, our interview from early round. The pound bouncing around all over the place. We were into 1. 31. I think this is broad Dollar Strength rather than anything else. Take a look at the bloomberg dollar index. Alix rising covid cases impacting the economic data. Composite pmi for the euro area dropping below the 50 mark, which shows contraction. Meeting. O ecbs next joining us is john hardy, Saxo Bank Head of fx strategy. Does 1. 18 make sense for when you consider the rising uncertainty . John of course, the pressure should be on the downside given the covid resurgence. I think the general take on the could be that if we are seeing this democrat sweep scenario, we are positioning for a weaker dollar for some time in the future. Anything looks fair between 1. 17, and to me, this is the upper area of where we should be. We shouldnt be doing anything and eurodollar until we get a good look at how this election turns out, and whether it is a smooth transition, and whether we get a smooth result fairly quickly not next week, but the week after that. So it is a fair price. Guy the pmi data not particularly good, though certainly could have been worse. The industrial data looking a little better than anticipated. Nevertheless, what we have seen over the last few weeks has been sick for can spread widening across the atlantic. We have seen u. S. Yields on the 10 year rising, the exact opposite to a certain extent here in europe when it comes to the bund. How has the euro appreciated, and why do people fall for more appreciation as we see the spread widening . John ellis a it is all about the u. S. Real rates. It should theoretically be compressing the real rate disadvantage from the u. S. , but rates are rising in the u. S. Because we are fearing deficits of a very large size once inflation starts to spike out of control. Then u. S. Rates are taking a very different interpretation of what is going on. I think there could also be some portfolio things, while u. S. Rates are rising, the facts that bonds are not performing when stocks are performing poorly. There could be an issue around that as well. It is very interesting, though, that we are seeing this rise in yields not supporting the u. S. Dollar. It is certainly something we should set up and take note of. If it persists beyond this 1 area on the 10 year, a bit higher on the 30 year, that starts to impact a lot of things. The price for global money out the curve, it is crucial stuff. Alix that brings up the question, is there actually yield curve control, even if it is not official . John there will bully if it spikes significantly further there will be if it spikes significant further. Clearly, the feds focus does not continue to improve very sharply from here. That would only add to the negative sentiment towards the , ifar, for very good reason these Inflation Numbers actually start to pick up significantly, and doing so within the next couple to three months. Also depending on what the policy signals are from whatever the adventist ration looks like after election day on tuesday, november 3 the administration looks like after election day on tuesday, november 3. It is much more finely balanced now. I think it wouldve wanted to wait until december because we had the latest forecast by then, but eurodollar creeping higher could be one thing. Spiking above one dollar 20 since aggressively might pull the trigger. But the covid situation makes it really tricky. I would say maybe something in between that they might signal quite clearly that they are moving in december. They might signal that they are upping the pace of purchases a bit. That just sort of signals we all know we are going to move in december, but i am not sure it is a huge catalyst for the euro either way. Alix talk to me about positioning. If we are expecting that in december, there seems to be consensus around what is going to happen in the u. S. Election. Where are we on positioning, trying to get a bigger read on positioning in the fx market . Inn it seems positioning eurodollar long is quite heavy. Yen arear and the ,ormally positively correlated not something worth noting, but it has been quite long in eurodollar. It suggests to me that the upside might be more limited and grinding in eurodollar. If we get some jolts to sentiment, it could just be some more sideways activity in the market expects. For example, on a disruptive u. S. Election scenario. But it certainly is quite a headwind for eurodollar upside, at least in the near term. Guy the market doesnt seem to expect, judging by positioning, much of a move around a brexit deal. What do you think we could get if we got such a deal, even a skinny deal . John i think, for good reason, theres a lot of fatigue around these cycles. Alix that is so surprising. [laughter] john to put it mildly. We are just absolutely sick of it. The market is as well. Which could actually mean that once we finally get some news that the market might have to rush to position something. I think theres upside, but youve just got those dark shadows of covid hanging over everything. It is particularly bad in the u. K. , so it could go higher a little bit, 2 to 3 towards 1. 35 in cable if the dollar runs back towards 88, something odd that. I think we just need to get to the other side of this covid shadow, and to me it looks like we are heading into a bit of a great winter. I dont want to sent a grim winter. I dont want to sound too pessimistic, but i dont see any way out of this for the next two months. We need to see some news on that front for me to get at her visibility. To get better visibility. Guy we will leave it there. Coming up, ecommerce has been the huge story for loreal. My interview with the companys ceo is coming up next. This is bloomberg. Guy we are ramping up the european corporate reporting season. Reporting a surprising increase in sales. I spoke to the ceo about the rebound in consumption and the economic recovery. We are worried about this rebound of the pandemic in western europe and the u. S. , and at the same time, some other parts of the world are apparently doing a bit better. China, some countries in asia, even in america it is a bit better. Navigateying to through this crisis, and we are still confident that we should be able to deliver a positive secondhalf this year, and we are preparing also for positive and dynamic next year. Guy does china compensate for the rest of the world . If you see solid growth in asia, doesnt mean gross for the rest of the United States . Interestingly in the last quarter, almost all regions were positive, and even most of if you take out travel retail. Travel retail is the most difficult because theres no one in the planes around the world. , we with europe last year were at plus 3 , which is pretty good, and plus 3 in north america. So in fact, the consumption in the countries on the continent has been really recovering. It is a positive sign. Guy ecommerce clearly has been a huge story for you in the last quarter, and the previous quarter for that matter. I think i saw a piece indicating that you were plus 23 . Does that number sound about right . We are plus 61 . [laughter] the 23 is the percentage of sales during the quarter. Total, the growth in ecommerce is extreme a strong, and is going to keep growing. It will really be the alternative in the market. Unsurprisingly, ecommerce doing very well at the moment, and they are going to be withdrawing from a number of malls in america, cutting back on their retail exposure. The thing i really learned today anything that is really driving skincare,is active which i didnt even know existed until this morning. Alix he is setting me up because i went on a whole rampage about cuticles and how they are really helpful when you wear your mask, and a skin cuticle product and the difference between them was someer between moisturizer. That is a definite driver. I do want to point out that stanford bird seen Stanford Bernstein said that they were already outperforming, and the pandemic seems to be putting the outperformance on steroids. Maybe you need some active skin products, guy. Guy i learned a lot today. [laughter] and you certainly improved my knowledge, as did john paul a little earlier. They cant make enough of this stuff at the moment. The demand is so big they cant make enough of it, which is a good problem to have. Alix im a woman on tv. I need all the help i can get. Coming up, barclays beats, posting strong revenues. The founder of opimas joins us next. This is bloomberg. Alix barclays shares surging today, reporting another Strong Quarter amid pandemic driven volatility. Ceo jes staley spoke to anna edwards about the risks in the market. Jes the challenge for all banks, particularly in the u. K. , is the zero or close to zero Interest Rate environment is tough for a bank that relies on large Balance Sheet assets and liabilities. A lot of our services in the u. K. Are for free. Getting money out of your atm machine, your checking account, etc. Sure we gesture to make are helping our customers in this time of need, in the First Six Months or the last six months of this year, we have waived over 100 Million Pounds of overdraft charges and banking fees. Inwe are being conservative terms of trying to make sure that our customers dont get into financial distress given what is going on in the market. On the others of that is the Mortgage Market, which is surprisingly robust. Our market share has grown a lot in the Third Quarter. Interest lending in mortgages has gone up. You see it in our net interest margins. It is one of the real encouraging signs in the u. K. , how robust his Mortgage Market is. We want to make sure we extend credit to customers, refinance their home or buy a new home. It is one of the surprising markets i think of the Third Quarter. Anna youve talked about negative Interest Rates this morning. You said the bank is ready. I heard you reference the free nature of a lot of banking products in the u. K. Are you thinking about passing on any of the costs of negative Interest Rates should they come to pass to customers . Are you know, there negative Interest Rates in certain markets in europe, and there indeed with some large corporate clients, we have passed on those negative Interest Rates in the deposit pool for large corporates in certain markets in europe. We are prepared operationally for the bank to run with negative Interest Rates. There are some negative parts of negative Interest Rates. Consumers will go to cash. I dont think that is necessarily a good outcome. But we are ready to manage negative Interest Rates. We would rather not charge our clients those negative Interest Rates, but we also have to manage the financial integrity of the bank. I think it is important that the Central Banks keep in there while it the ability to use in their wallet the ability to use negative Interest Rates, but i think here it is not likely. Anna youve talked about how youre going to give guidance on the dividend for the full year 2020 mark. Are you having conversations with regulators . Are things moving on that front . Jes as the bank of england has said, we will have discussions with the pra in the Fourth Quarter of this year. As i mentioned, this is the strongest the banks Balance Sheet has been. Our capital risk assets is now 14. 6 . It has never been at that level. We are very liquid. We will have conversations with the bank of england in the latter part of this year, and we will address our policy around returning capital to shareholders at our Year End Results coming up shortly at the beginning of 2021. Guy Barclays Jes Staley speaking to anna edwards a little earlier on. For more on the european banking space, lets bring in a cavium a renzi bring in octavio marenzi, the founder of opimas and the ceo there. Lets talk about barclays and extrapolate into the rest of the sector. Barclays delivered some really strong numbers, yet i am looking at a backdrop that looks increasingly difficult right now. How representative do you think barclays is of the wider european banking space . Octavio i think they are fairly presented if of the wider european, perhaps the wider Global Banking space. We have seen various stimulus dynamics in those markets over the past few quarters. I am not sure i agree that they have very strong numbers. They certainly beat expectations by a fair margin. I think it was a fair amount of ,repidation about barclays especially because they have a fairly large credit card portfolio in the u. K. On the u. S. I think there was fear that that kind of unsecured lending would start to rack up big losses with covid and unemployment numbers being high, and that did not occur. But if you look at other banks like ubs that did much better in the u. S. , jp morgan did better, certainly the big investment banks like Morgan Stanley and Goldman Sachs did really well, so barclays is not one of the stellar performances, but certainly the outperformed expectations. What we are really seeing here is a bifurcation between the ks major to activities major two activities. You have markets and Investment Banking. What has been weaker is the breadandbutter retail and Corporate Banking, particularly in the u. K. We saw the same passion in the u. S. With u. S. Banks more exposed to invest in banking trading that did phenomenally well, and the breadandbutter Corporate Banking had the worst, so that is basically the underlying trend, and that is Going Forward in the coming couple of days and weeks. We saw a lotu. S. , of loanloss reserve builds, not as bad as everyone expected. I guess my question is does it actually get worse, or do we see the trough in the Second Quarter . Octavio we have seen the loan losses decrease at barclays and most of the u. S. Banks at well banks as well in this quarter. Theyve taken very large loss reserves that theyve built up in the Second Quarter and Third Quarter, so what these banks basically did it say we are doing incredibly well on the market side. Lets take a loss on the retail and Corporate Banking side and build up those loss books so we can draw that down on a rainy day. I think they basically over reserved, almost consciously saying lets set aside some money. We will be able to draw on that and improve what our return on equity looks like in those quarters. I think that is what we are seeing now. A sickly, we did really over reserved basically, we did really over reserved quite substantially. Things did not turn out as bad with people defaulting on uninsured lending, so things are actually ok. Guy nevertheless, lending standards are continuing to tighten. Even in the Mortgage Market, which jes talked about being slightly more robust than he anticipated. Central banks are become frustrated that the liquidity they are providing is getting locked up within the financial sector. Do you think lending standards will continue to tighten as covid continues on the track it currently is . Actual i think the lending standards themselves have not tightened. Most banks have the same lending standards and standards in place. It is just that most do not live up to them. It is deterioration in the not as much theres lending going on, but it hasnt been a particularly dramatic effect. If you look at the overall level of lending, it looks pretty decent. I wouldnt say there is a huge credit crunch going on right now. That is not where we are at this stage. I think answer quite right to be cautious in this environment. They should be looking at their borrowers quite carefully, making sure they can repay loans. That is to be expected. I guess the Central Banks are frustrated that more of this money they have printed and generated has gone into the smallream markets, help businesses, medium to small enterprises. It seems much of the money they have generated has gotten stuck in the equity markets and fixed income markets, and hasnt moved much beyond that. That has caused frustration for them. Things dont always work the way that central bankers have in their math medical models. Sometimes they have a nasty awakening their mathematical models. Sometimes they have a nasty awakening. Alix that transmission mechanism not really working there. Lets get to catalysts for the actual share price. Dividends, buybacks, when is that going to restart . What bank has the most potential upside from that when it does happen . Octavio i dont get makes that much difference whether they are paying it out as dividends or keeping it has retained earnings on the books. I dont think it is going to make that much difference. I think that is going to remain where it is. What we are seeing in the coming quarters is Investment Banking and trading activity slowing down further. We will have phenomenal first and Second Quarters. The Third Quarter was still strong, but not as strong. I think that trend will continue, and we will basically see the trading side of the house stopped defying the laws of gravity and basically fall down to where they were at precovid levels. We will probably see that over the next quarter or two. Barring some unseen event, may be a huge amount of volatility through the u. S. Election might drive things up there as well. Perhaps the markets will take off again as well on that front. I think what