Giving equities a nearterm jolt. Seeing declines across the board. Hang seng off 1. 2 percent and the msci lurching to the downside as you can see from the getgo. A quick look at china benchmarks to see how they are doing. That tells you everything. I guests we had a bit of a gut check for those developers. Not out of the woods. Investors coming to grips that may be the authorities theyve been sort of taking a piecemeal approach. Perhaps they are getting it right. We dont know yet. Theres a feeling perhaps it is working to some extent given the long queues people had looking for properties in shanghai and beijing. Yvonne its amazing. The mortgage down payments, people just start lining up and they saw transactions that weekend was equivalent to what they saw in a month according to some local reports. What did that translate to consumption is another key factor as well. Its interesting to see with Country Garden. Today is the day, or tomorrow, the grace period of the dollar bond ends and whether they can avoid default is the key thing. I think thats what is worrying the market. They bought time with extending the renminbi and paying the ringgit bond but the dollar funds are. The subject. Rishaad they have to go to developers and bondholders to get extensions. Great story about the housing crisis on the bloomberg terminal, top 50 private Sector Developers by dollar bond issuance. 34 suffered delinquencies. 16 are left including Country Garden facing 1. 5 billion of offshore public bond payments this month alone. Yvonne most of the downgrades theyve been doing are mostly in the property sector, but then there are some green shoots. You cant put it all in the same thread because consumption and utilities, people are enjoying their time on some services. If you look at the pmi data, it shows you how big of a factor the Property Market is weighing on the consumption story now. Rishaad exactly. Consumption elsewhere, we have to look at that. Out of the philippines, korea as well today, they told us something else. Yvonne massive surprise to the upside when it comes to inflation. Yvonne rishaad we rishaad got rice here. Rice futures. That rallied in the middle of last month. We came down off that but we are approaching those levels once again. This is a hugely important bit of food right across this part of the world and africa as well. Absolutely a staple. Then you look above that, new york crude, another inflation number. Options market reflecting solid conviction in the market. We have market tightness and its becoming brent crude trading at the moment, lets see. Yvonne near 90. Rishaad and we are looking at 90, a lot of crowded technical stuff and options. Yvonne just when people thought asia dynamics and inflation are different from the u. S. And europe, you are seeing prints like this. Food and energy really playing a big part when it comes to Central Banks. Can they resist not hiking or hiking . That is the question. When it comes to gold movers, a sea of red across the screen. Different than what we saw on the back of the hong kong reopening, Housing Properties lifting the Property Market. Its basically the opposite now. You are seeing commodities that have had a decent run now deep in the red. Rishaad 4. 12 , the australian 10 year yield. Philip lowes last cash Rate Decision later on today. Thats get to the market action, Mark Cranfield joins us now. One day we see big engagement, but ultimately it is skittish. Give us a sense of what your overall take is. If you look at the china markets in particular, theres 20 to still worry about, so it is not surprising that you get one piece of data thats a little disappointing, it gives people a reason to pull back from the market. After the past seven to 10 days or so, a pretty good run with china equities so some people have made decent money already. Its a good excuse for them to push to the sidelines here. If you look at services pmi from cashing numbers, its a reasonable number but just a bit lower than the estimate. In the background, you have this Country Garden issue. People really need to know what will happen. Are they going to be allowed to have an extension on dollar bonds, are people going to push for a default or do they have the money to make the payments hold for now . Of course it will be an issue because it will drag on but people would like more clarity because Country Garden is such an important developer and the overall picture of whats happening with chinese property. That one needs to be resolved, and the quicker the better. If its resolved positively and they get agreement to extend and can repackage other dollar bonds as well, it will be a sigh of relief to investors generally. If we get more of the property Sales Numbers like last weekend in major cities, that would be a great sign as well. But theres so much hanging over the property sector in china that people are pretty worried. Yvonne watching dollar china closely, the fix is a new norm given how massive the fixes are versus consensus. Dollar year end is capped here. Why so . Theres a big bunch of options coming this week at 7. 3 that helps the pboc messaging. They are trying very hard. The reason why they are fixing it as far away from estimates as they are, they dont want it to go too far above 730. The threshold is 7. 32 at the moment. Seven point 35 is probably a line in the sand so they dont want it to go much higher. Think they will get help for option positions but that is only for this week. They will need to continue aggressive fixing until confidence comes back that they are doing the right things. Yvonne thank you, Mark Cranfield, telling us the latest when it comes to china. Still ahead, chevrons australia workers threatened to strike this week. I speak with petrochinas global lng had about the potential Market Impact of that. Rishaad next as governor philip lowe prepares to give his last policy meeting for the reserve bank of australia. We look at his leadership for the last seven years. This is bloomberg. Is it possible to fall in love with your home. Before you even step inside . Discover the Magnolia Home james hardie collection. Available now in siding colors, styles and textures. Curated by joanna gaines. 76 of 23andme Health Customers surveyed reported taking healthier actions. Styles and textures. Because they know health isnt just a future state. Health happens now. Start your dnapowered Health Journey today with personalized insights from 23andme. Yvonne we are checking aussie assets this morning. Mostly a down story when it comes to stocks as well as bonds. We look at the asx 200, down by half of 1 . The aussie is also weaker as we count down to about an hour away from the rba decision. Phil lowes last final meeting before he steps down and Michelle Bullock comes on as the head of the rba. The australia bond market also selling off this morning. Of course as you talk about phil lowe set to chair the last meeting in a few hours, its a pretty tumultuous sevenyear term that is now drawing to a close. Paul allen looks back at his leadership through some extraordinary economic events. Phil lowes seven years as reserve bank of australia governor could perhaps be characterized by one word inflation. When he got the job in 2016, inflation in australia was barely above 1 , and his first appearance in front of a parliamentary committee, he had to defend the banks apparent obsession with how to stir it. We might be what some would call inflation notaries. Weve had a more balanced perspective recognizing degree in variability and inflation yeartoyear is both inevitable and appropriate. Paul cpr did not vary that much in the years that followed, barely touching the lower bound of the target band until the covid19 outbreak, when inflation briefly dipped below zero. The Global Pandemic was a black swan event, none of his predecessors had to deal with. After slashing the cash rate to a record low. 1 , he came to utter the words that would contribute to him losing his job. We are likely to be at the current level of Interest Rates for an extended period of time. Paul in march 2021, he even put a date on it saying the condition for an increase in the cash rate is unlikely to be met for 2024. Many australians took matters word taking out ultracheap market mortgages as the Property Market roared back to life. So much for 2024. By may 2020 two, inflation was running red hot and to contain it, the rba embarked on the fastest rate increases in australias history, 400 basis points in 14 months leading to awkward questions. Do you accept that you did in fact induce australians to take out mortgages on the basis that Interest Rates wouldnt rise until 2024 and do you think you oh those people an apology . Well, im certainly sorry if people listened to what we said and acted on what we said and regret what they had done. That is regrettable and im sorry that happened. Paul his hopes of leading a threeyear extension of governor were effectively dashed. Now it passes to incoming governor Michelle Bullock, the first woman to lead australias central bank. Paul allen, bloomberg, sydney. Rishaad there we go. Heres the last meeting and thats what we get a decision, Interest Rates expected to be unchanged. Lets go to the chief economist for barrenjoey markets, joanne masters. Of course, the last year or two quite tumultuous in particular, there have been missteps, but overall i guess we cant give him any marks until the dust settles as it were. I think thats right. We are still in the postpandemic challenge period. Inflation is still too high. Structural changes from the pandemic like work from home are still in place. As always, it will take time for history to settle and for us to look back on this period with real perspective. Yvonne im just wondering overall, what do you think is going to be his legacy . We talk about the pitfalls in the package but what do you think people mostly remembered . How will you remember him the most by . I think its a good question and i guess it will be different for different people. Clearly a lot of australians for a long period will remember the misstep around communication. But as an economist i guess i would reflect that over the time of his governorship, inflation has averaged exactly 2. 5 , which was also true of governors before him. But in his case, he has achieved that through some of the most tumultuous and unprecedented economic events of our time. Hes the first governor who has looked after the economy through a recession, the first in 30 years. The first in the inflation target period. A Global Pandemic unlike anything weve seen before. Mistakes were made, the bank itself has reviewed those. Course the rba in australia are not the only place we saw those mistakes. I think its encouraging the bank is reviewing those decisions and learning from those. Personally i look back on his tone term and he was calm and confident and capable through a really difficult period. Rishaad absolutely. Recession, pandemic as well, the perfect storm. Now we have Michelle Bullock, shes coming to take his job. She faces inflation. What does she bring to the party and though she as a woman also enthuse you . Perhaps if i could take the last part of that question first. As a female economist, im incredibly excited to see such an Important Institution being led by a very talented, very experienced female economist. We know from the research weve done in australia that one of the big impediments to young, female australians studying economics and joining the community is that they dont have a lot of positive role models, and i think it is incredibly exciting that governor bullock when she takes over will be front at press conferences and in the nightly news, and i hope inspire a whole generation of young females to study economics. We know that we need diversity. That is what drives good economics and good policymaking for the future. For me, that is personally incredibly exciting. In terms of what does she bring, shes been in the Deputy Governor role a bit shorter time than most governors, but brings deep experience, a long career at the bank, and deep expertise in payments and Financial Stability which dont often get as much focus as policymaking, but those will be incredibly important as we think of the challenges the economy faces over the next decade, if we think about climate change, decarbonization, digitization and the cybersecurity issues that come with that, that skill set will be a really important part of her role. Yvonne i guess its hard to say if she is a dove or a hawk, but given what weve seen of late in the data, it has been a slew of soft data, whether the inflation print we saw, jobs data has shown weakness. Is this september decision pretty much a done deal that they are going to pause . I think its pretty much a done deal today. The run of data weve had has been soft. For me, the decision to pause in august was surprising. I think the window was wide open to hike if thats what the board wanted to do and they chose to pause at that time. I think the bar is very high for additional rate hikes here in australia and we certainly havent met that high bar in the last month. In terms of is she a dove or hawk, i think thats an interesting question. Shes been in the Deputy Governor role for not very long so we are still learning a lot about her. Some people would argue her Financial Stability background might make her more hawkish. Of course she gave the speech around the need for the Unemployment Rate to rise to bring inflation down. Economists understood that but shes already been under some pressure around employment and australians losing jobs. Perhaps a slightly hawkish tilt, but she is a career rbaer. I dont think her reaction function is materially different from for lowes. Shes been in the boardroom over this massive rate hike period. Being part of those decisions. Yvonne thank you, jo masters, chief economist at Financial Services firm barrenjoey markets. Go to tliv to get more commentary and analysis from our bloomberg expert editors. Lets stick to australia. Its not just that they got one, mr. Phil lowe leaving. Mr. Alan joyce as well. Interesting news about starting his retirement a little earlier than expected. Rishaad thats right. I look at how hes been a thinker since 2008. During his time, hes seen qantas share prices go up by just 55 . I thought, let me have a look at the other indices. Guess how much the World Airline index has gone up in that timeframe. 53 . [laughter] yvonne so at least he has been kind of on trend. But what a 15 year reign for someone that turned around this airline. Rishaad huge. Yvonne and its almost a bit sad. Rishaad exactly. The whole investigation into the airline selling seats on canceled flights. I mean, there you go. Yvonne i think the pandemic may be made qantas of victim, managing the twists and turns of the pandemic and how to really manage it during that tumultuous time we have talked about as well. Rishaad weve got a lot more on the way here. This is bloomberg. Its easy to get lost in investment research. Introducing j. P. Morgan personal advisors. Hey david. Connect with an advisor to create your personalized plan. Lets find the right investments for your goals okay, great. J. P. Morgan Wealth Management. Let Innovation Refunds help with your erc tax refund so you can improve your business however you see fit. Rosie used part of her refund to build an outdoor patio. Stop waiting. Go to innovationrefunds. Com clink yvonne watching some chip stocks in focus today. We have learned that while way, chinas top chipmaker, has built an advanced processor took power its latest smartphone. Its a sign china is making progress in domestic chipmaking in the face of u. S. Led tech sanctions. Lets go to debbie. How big is this breakthrough that you are learning . Reporter so it is indeed quite the big deal, a big event. What we have here thanks to the tech insight tear down is that they are offering the most advanced technology for a whiles new 5g phone. Although the technology is still five years behind the most cutting edge, it is still a breakthrough in the sense that this is the first time they are able to offer the most advanced technology to be used to power a 5g smartphone. At the same time, what is probably even a bigger deal here is smic. Its unclear how they licensed for the department of commerce for the chip. Both have been blacklisted by the department of commerce and based on u. S. Rules, any company that has plans to supply while way with u. S. Technology would need approval from the u. S. Government. Whether the u. S. Has violated trade sanctions is also something that is at play here although we dont have clear indications as the department of commerce has not responded to repeated queries on whether the chinese chipmaker has taken measures. Rishaad what does it therefore mean overall for those sanctions . Do you think it means they will be largely redundant, or is this just a oneoff . I think it depends on what we are going to see. If the u. S. Government does not see the measures as ineffective, we might be in a situation that we could see more bridges. But at the same time, if the u. S. Government decides to move and not penalize companies that violate trade sanctions, probably we can expect higher restrictions on certain firms that violate sanctions. Its very unclear because we dont have any clear indication from the u. S. Government at the moment, and given it was labor day and the u. S. Yesterday, its only natural. We will see whats coming from washington, d. C. Today. Rishaad thank you so much, our north Asia Tech Team leader. Just looking at smic here and the share prices, up 9 10 of 1 in the declining market. The billionaire chair