Welcome to countdown. Im anna edwards. Just on 6 00 in london, bright and early, lets get to some of the latest market moves. The fed commentary driving that. Ive got a chart that shows where the dollar has been. In the red boxes, can see the effects from the hawkish commentary weve been getting from the fed. Ill draw your attention to the comments we had over the weekend from the fed vice chairman Stanley Fischer saying that economic goals are close to being met and the market readjusting once again. Little more chance of a fed rate hike perhaps being factored into the dollar. Lets bring up the risk radar and show you currency markets. 94. 89, ar index at lift of 0. 4 . The work function on bloomberg suggesting a 22 chance of a rate hike in september. Not much change versus friday. Weve got dollaryen in there as well. The yen under pressure. Further chance of easing being flagged by governor kuroda. He talks about a sufficient chance of more policy easing. He talked about not doing helicopter money. Down 1. 3 . 87, we had seen the longest run of games in four years. Iraq seeking to increase their exports. That putting downward a lot of focus on the changing of the guard over at the reserve bank of india. The r. B. I. Will be handing over the baton to urgent hotel. Lets get the bloomberg first word news. Heres shery ahn. Shery oil is falling after it longest run of gains in four years. The country says it will boost crude shipments by about 5 in the next few days. Oil entered a bull market on thursday amid speculation of normal opec talks to stabilize the market. Bank of japan governor kuroda says there is sufficient chance the central bank will add to its unprecedented easing at next months policy meeting. Kuroda said that the boj wont hesitate to act based on discussions of the results of a comprehensive review at a september board meeting. Pfizer is said to be nearing a deal to buy medivation for 14 billion. People familiar with the situation say an agreement could be announced as early as today. Pfizer is expected to pay about a 26 premium. A pfizer spokeswoman declined to comment. Medivation representatives didnt immediately respond to phone calls and emails. India has swapped a financial a list or for a technocrat. Deputy governor patel is to succeed rajan. Hotel has spent the last three drive theing raja biggest reforms in r. B. I. History, including setting a target for inflation. Rajan steps down on september 4. Hundreds of flights have been canceled in japan thanks to a typhoon. The Weather Agency has issued heavy rain and Flood Warnings. The Prime Ministers Office warned of possible landslides and damage from strong waves. The u. K. Should avoid any drastic steps Corporate Taxes or similar measures as it prepares to start talks on leaving the European Union, so says the swedish Prime Minister. He told bloomberg that such moves would make discussions more difficult. U. K. Chancellor Philip Hammond has expressed readiness to reset fiscal policy through Corporate Tax cuts to support the economy. Dayal news 24 hours a covered by more than 2600 journalists and analysts in more than 120 countries. You can find more stories on the bloomberg at top. Im shery ahn. This is bloomberg. Thing anna thank you very much. Juliette saly is standing by in hong kong. Good morning to you. Nintendo has been getting a boost. Shinzo abe dressed up as super mario at the closing ceremony for real. Back on earth, what is happening this morning . Juliette super mario to the rescue perhaps because japan is such a different picture to what we are seeing today. Asian investors taking those hawkish comments and Stanley Fischer over the weekend and we are seeing Dollar Strength, which means yen weakness. Japanese export stocks go higher. The nikkei is outperforming the rest of the region today. Nintendo not showing on that screen but it has been having a good run today. The stocks are looking good. Toyota also leading the way in japan. Kuroda also saying there is sufficient chance of further easing in september. You can see these big policy divergence between the boj and [indiscernible] we are seeing quite a lot of weakness. Crude is falling. A lot of Energy Players are being sold off. You can see those in hong kong. That is a similar story over in australia. Have a look at this company, apn outdoor down 35 after it cut its forecast. Santos also weaker on that weaker oil price, earnings down about 7 today. A little weakness in the markets. The yuan also being sold off. It is at a twoweek low. Aboutllar story, down by 0. 2 . Anna thank you very much, Juliette Saly in hong kong. Back to the u. S. And Federal Reserve vice chairman Stanley Fischer has signaled that a 2016 rate hike is still under consideration. He says the u. S. Economy is closed to meeting the feds goals and that growth will gain momentum. The comments come ahead of janet yellen speech in jackson hole later this week. Lets bring into the conversation geoffrey yu. Good to see you this Morning Bright and early. Lets talk about, as we head towards jackson hole, i was reminded about the consensus that was much talked about back in 2003, faith in the markets, monetary favored over fiscal stimulus, Central Banks rigidly independent. Are we going to progress that conversation . Geoffrey i think using the phrase consensus is a bit dangerous in this day and age. Economics andl consensus weve had over recent years, that is starting to break down. If we look at policy divergence is within the g7, carney attacking negative rates, the boe is probably not going to go negative. Very dangerous to talk about consensus. But if theres one thing central bankers would agree on, independence is still sacrosanct. Whether they can claim that when they are putting so much in terms of government bonds on their balance sheet, that is a different story altogether. In practice, they wield some power, but they have to react to government concerns as well. Anna independence is sacrosanct, but coordination and cooperation, are they the same things as undermining independence . Geoffrey i dont think so. Ultimately, they all want to achieve their inflation targets. If achieving their mandate will require some degree of coordination between governments and Central Banks as well, i think we will be happy to do that. Once we actually get past that threshold, maybe it is a different story. 2 this point, to get to that magic number, whether that should remain consensus also, is a different debate. Anna how do you receive fischer s comments over the weekend, a rate increase still be impossible, considering the u. S. Economy close to its goals . Geoffrey i think they are trying to gently guide market toward the view that we are very close to full employment in the u. S. It is probably time to think about a rate hike. Dont leave just because theres Political Uncertainty, because we have a very uncertain election. When the fed believes that Market Pricing of their policy trajectory has moved a bit to the dovish side, you tend to see them dragging back a bit. They start to talk up the probability of rate hikes and then they get cold feet. I think the fed will be as careful as possible in guiding markets. Anna should we view fed guidance on guidance where they think Interest Rates are going to go, or is it more about tweaking how strong the dollar has become, or how low bond yields have become . Geoffrey i think it is always relative. If markets have gone too far to the dovish side, they want to pull markets back a bit. This translates into where the dollar is going to be. Manifestow markets expectations of pricing. Theou look at eurodollar, dollar against some other currencies, it hasnt exactly surged. In terms of dollar transmission, i dont worry too much. I think that divergence is still in play and something that we need to be careful about. If the Dollar Strengthens from here against g7 currencies, i think Central Banks would welcome that. Against emergingmarket currencies, that is one thing of interest, where theres a lot of external liabilities to worry about. That is not necessarily a good thing. Anna we will talk more about emerging markets in the euro growth story. Sticking with the u. S. For a moment, this is a chart showing cheap borrowing costs help propel home sales to the highest since 2007. The home sales story would be one sign of strength in the u. S. Economy. Cher talks about being close to gold, what is he talking about . Geoffrey using the word gold is very interesting because that is different from mandate or target. Is he talking about getting full unemployment . How do you define full employment in the u. S. . I think we have to look at it holistically. Gold right now, the u. S. Is close to achieving potential growth, but right now potential close growth is slightly lower compared to historic levels. It doesnt mean they are going to be super hawkish either. You have to think of it in the right context. Overall, theres a good sign of demand in the u. S. That is one thing seriously lacking in europe. You can keep Credit Funding rates at zero as much as you want, but theres no end demand on the back of it, then the economy is still going to struggle. Anna thank you very much, geoffrey yu from ubs. Here are some highlights of your week ahead. 5 00 p. M. U. K. Time today, we get a joint News Conference from angela merkel, francoise along, and matteo renzi. Economic growth and migration will be speaking to the media. On wednesday, john kerry visits turkey to strengthen ties between the two countries following the failed military coup. On thursday, vw is due to provide an update on how it will fix 8. 5 million diesel engines in the wake of its emissions cheating scandal. We will round of the week with janet yellen speaking at jackson hole. We mentioned it when we were speaking with geoffrey. Coming up, the ceo of an italian oil firm speaks to bloomberg. That interview is next. Then, could british holidaymakers be in store for some sterling suffering . We discussed the possibility of heritage. Replacement. We have all you need to know about the reserve bank. Stay with bloomberg. Later today, we will ask the lead singer of iron maiden and wellknown aviation entrepreneur Bruce Dickinson why hes launching an airline in one of africas smallest countries. That is an interview on the pulse at 9 30 u. K. Time. Anna welcome back. This is countdown. Kong, a fairly beautiful afternoon. The hang seng down by 0. 3 . Lets get the Bloomberg Business flash in hong kong with shery ahn. Shery good to see you. Pfizer is said to be nearing a deal to buy medivation for 14 billion. People familiar with the situation say an agreement could be announced as early as today. Pfizer is expected to pay a premium of 26 on the companys friday close. A pfizer spokeswoman declined to comment. Medivation representatives didnt respond to phone calls and emails. Japans biggest brokerage lands to hire bankers in the u. S. , resuming a push to boost Investment Banking business. The ceo has been eliminating jobs in europe and the americas to save about 700 million and stem six years of losses abroad. The shift comes as nomura anticipates rising volumes and Stock Options in the u. S. Taiwan is to investigate a bank whose Compliance Program was described by a regulator as hollow shell. Mega International Commercial was fined 180 million by the department of Financial Services for violating Money Laundering laws. It says the suspicious transactions flowed the tween the banks branches and a substantial number of customers [indiscernible] uber has told investors it wont pay more than 2 billion for lyft according to people familiar with the matter. It has been reported that lyft sought a sale at 9 billion while gm valued it at 5. 5 billion. That is your Bloomberg Business flash. Anna thank you. Lets talk about the oil market. Last weeks bull market increment has slowed as iraq seeks to boost exports. Yousef gamal eldin is here with the chart of the hour. Good to see you. Oil prices down 1. 3 this morning. Yousef it ends the longest streak of games in four years. A lot of that has to do with the changing supply picture. We spoke about how opec members are starting to muscle up ahead of the informal talks in algiers. The latest culprit on this chart is iraq. They are increasing their exports by 5 . We are talking in the vicinity of 150,000 Barrels Per Day after they came to an agreement as to how to export oil from three oilfields. These three oilfields, they go through the kurdish controlled area, so the new oil minister was able to get some traction and come to a consensus. What weve drawn up to you is where iraq stands in terms of Oil Production. 3. 46 milliong Barrels Per Day last month. The supplyloud in side of this equation is news out of nigeria that the militants appeared to commit to a ceasefire, or at least committing not to attack in Multinational Oil company or the facilities of these companies, to try to support talks with the government. Bearing in mind that a lot of the supply disruption has come from nigeria in the last year or so, we will see what kind of traction comes off the back of that. Anna thank you. Yousef gamal eldin joining us from dubai. The ceo of the italian oil firm eni hopes the informal opec meeting in out area will lead to an Oil Production freeze. Claudio told bloomberg why he things a middle ground will be reached by the end of 2016. We are going through a possible stabilization of the imbalance. Equilibrium of the imbalance between demand and supply. It is clear that we have still a huge [indiscernible] i hope really that they can find a decision to have a stabilization in production. Anna lets talk more about oil and commodities. Geoffrey yu still with us in the studio. Any chance of what is happening to oil prices over the last few weeks, risks under playing the amount of volatility weve seen in the very short term . We went from a bull to a bear market in less than three weeks in oil prices. On a longerterm chart, that doesnt necessarily show up as such a big event, but that is quite phenomenal. Geoffrey i think the news from iraq shows how oil is sensitive to even the smallest changes in supply dynamics. We talk about rig counts. Now i see it in our chats, when are the rig count numbers coming be, whether that is going to demand or supply side. It is a transmission. Oil price directly feeds back to the inflation outlook. It is headline inflation and most central bankers trying to dismiss it, but if you look at how the Unemployment Rate has fallen, and normally this should tighten labor markets and generate inflation ingles, it hasnt really happened. U. S. Is the best option. It is really depressing prices. There probably is some structural change in the commodity impulse feeding back into weaker inflation. This is why all this matters. Going back to the smallest amounts of news with regard to supply, it shows you how central bankers are at the mercy of this. Anna u. S. Oil and Gas Producers increased drilling activity for the eighth week. Everyone obsessed by rig counts. Oil rigs up by 10. Talk about the structural change that is pulling down pvi. What are we looking for . Does that have to come out of china . Geoffrey china and asia in general. South korea, japan, taiwan, theyve been negative for the longest time. There are tentative signs of stabilization, but not enough to call the end to this downward drift in producer prices. If the dollar starts to strengthen against these emergingmarket currencies, against asia currencies, where the biggest source of disinflation is, this could turn the cycles south again. Anna just to underline the headache this causes Central Banks, commodities underscoring attended outlook for price gains. In yellow, or is it orange, weve got the bloomberg commodities index. Weve got expectations overlaid on white. Really showing how expectations in the u. S. Have been tracking the commodities spectrum lower. Geoffrey if you look at the ecb, draghi mentioned inflation expectations, metrics, and markets. That seems to be persistently below 2 . If that is a sign of entrenched disinflation expectations, that is really hard to pull away from. Sometimes you see central bankers desperately trying harsha to move away, desperately trying to move away, trying to shift expectations. We have to see if this can actually happen. Anna were going to get some japan inflation data this week. Are you expecting more easing . Geoffrey it is probably necessary. I wonder if shinzo abe was trying to send a message dressed as super mario because the last super mario was mario draghi in 2012. Hes sending a message. Anna we will see. Geoffrey yu from ubs stays with us. Up next, pfizer is said to be in talks to acquire the maker of a blockbuster Prostate Cancer drug. The full details next. This is bloomberg. Anna welcome back. This is countdown, at 6 30 in london. A new edition of daybreak is available in your bloomberg and on your mobile. Lets look at the top stories making this mornings edition. This is the front cover picture, illustrating our top stories. Bloomberg daybreak, with this nice graphic illustrating what perhaps fed officials are trying to do. We had recent comments from Federal Reserve vice chairman Stanley Fischer, indicating a 2016 rate hike is still under con