More. You get crude getting hammered over 1 percent. Bac back toess get be fourth of july recess. Senate republicans promise to get their bill out before the recess. But they only have three weeks done. That European Central bank gets together with officials with the of European Finance greece. S with well getting new York Fed Survey on u. S. Expectations. Healthcare fight will greet lawmakers again as they trickle this week. Capitol Senate Majority leader mitch to find enoughg votes to miser the measure. Trumporning president tweeted, i can be the imagine that congress would leave a beautifulithout new healthcare bill for me to approve and ready to go. Met last year met with a russian woman to provide informationdamaging on hillary clinton. The meeting took place in june 2016 after his father had secured the republican president ial nomination. The fbi and congressional investigating russian interference in the election and whether theres an members of theen Trump Campaign and moscow. Moving across the pond, u. K. Prime Minster Theresa may will on opposition lawmakers to out the eu. Ritain andwill tackle injustice vested interest. She said social and economic reform is needed. Weakness,ign of her shell call for Cross Party Cooperation to deliver it. For commuters who take to train to and from New York Penn station today twins what has called the summer of hell. Signalck will start repairs. They have told riders to expect hour. Trains during rush this 650,000 people who use penn use an every weekday will patch work system, bus and subways. This is bloomberg. David thank you so much. Theirleaders wrapped up two day summit in hamburg and differencesper over on trade not so much on Climate Change. Joined now from london by colleague caroline hyde. Tony lets start with you. Score card here. Who came out of this being able to clear themselves having gained something . Of summer is everybody gets something. You had 20 nations here which quite a challenge for any german chancellor merkel. Her main goal was to avoid avoid major proportions. Trump got along on trade and trade and steel. Exportsand on steel which has been a sore point. He got something. President putin of russia got a meeting with donald trump. Electiony talked about to sayg and trump seem that this issue was being put to for now. David what about theresa may . Come back glowing. A stride forward trade made. She came back saying, she was the strongrised by desire of many countries she noted china, india and the states. Of wanting strong bilateral trade agreement. Wasarticular, donald trump out there really blazing for the theial relationship between u. S. And u. K. He said no country could the u. S. Be closer than and the u. K. At the moment. He said in particular, that any trade deal will be done very quickly. I might add, this is down to the eu. You cant have Bilateral Agreement between the u. K. And countries outside the eu in brexit is completed. March. In 2019. This was vote of confidence it seems. For theresa may works has a difficult week. Shes got a big speech tomorrow on help having to call from the other parties to try and set the agenda straight u. K. Leaves the. Uropean union david you referred to the. Long on trade markets open. Trade and investment frame works of the principle nondiscrimination and continue to fight protectionism including all unfair trade practices. That latter part is you were about. It says, were for free trade. But we recognize sometimes you have to have sanctions . Part was a win or it is a win for trump. Wasll accounts, this something that was done in the the behindeen the scene officials working on summit. But also it bears stamp of macron and merkel who are europes new power couple. We were told by french, for macron was active in this. It goes along with this notion free tradeere for in principle which was important others and then for the trumpith administrations America First approach. To get this notion that we can retaliate when its appropriate tradeen we feel the fair violated. David thank you so much. Us now is Peter Schaffrik and aaron kohli here in new york. Withis your base case now any potential trade war with the u. S. And any other country at the g20 . Good morning. What i would say, looking at forets, weve been waiting this entire theme to unfold for quite a while. So far it hasnt. The major of challenges particular in fixed income market. Any disruptions to say what does that do to domestic inflation and the assumption there it could shoot higher. So far the markets is pricing that in. We saw the opposite last couple of months. Time being, the markets just sitting there and taking this all in. It when itl take comes and see it when its black white. Alix should the market be pricing in . I dont think so. We havent seen sign of real inflation. Especially to the trade point, of a risk scenario. That might create more ripples along the way in terms of growth. We have not dark clouds on the economic horizon in any case. Havent seen employment strength turn into inflation strength. Feds something that the seem to be having a love hope on. We know england is so dependent on trade and free trade. Amount about possibly u. S. Or u. K. Trade. How is it perceived in london, of trade . This is the key concern thats among the British Chamber of commerce. Many of the businesses based in the u. K. Are particularly worried about any hard brexit happening in the United Kingdom. Spell for the ability to access the eu when it march 2019. I do think theres some signs of the eu. Ce outside some of the big players. Leader theresahe may from the g20 saying that china looks up for it, so does the United States. Trade is the number one hierarchy. The United Kingdom depend on inward investment. Highly ofpeaking their commitment to continue to kingdom. The united trade, potentially not a good but services, are key importance british economy and largely they want to see people forinue to come in investment. David take us through what could happen. Not the question of the side of the trade flow. There are real questions about the structure with wto. If the u. S. Goes through with steel, europe said they will retaliate right away. It can bring w. T. O. Into play. Certainly. When you look very carefully at case. Rules, its really a by case basis what industries were talking about what can and done. Be therefore it becomes quite complicated very quickly. Add, going back to the comment we heard about brexit, here. In play one of the assumptions if nothing can be agreed by the been concluded in 2019, you fall back on the w. T. O. Rule. You have to look very carefully into what kind of things that u. K. Is importing and exporting. What regimes will be applying at w. T. O. Rules. Youre right, w. T. O. Would come in. Disruptingy sort of impact on the global scheme but industry by on industry basis. Have 56 billion of. Rade this week i think one of the things you like to start seeing in some of supply that we have so to investors to pick up. Thats been something weve seen at these kinds of uncertain times. Dollar has that safe haven. Liquidityries have advantage over most other types of investments. Lot of the very long and buying that weve seen coming from foreign buyers would likely accelerate. Alix that really hurt after they bought a lot in may. Aaron kohli and Peter Schaffrik of rbc. Caroline hyde will be with us. Coming up, well continue to wrap up the g20 headlines, marcus nolan, this is bloomberg. Alix pragmatism that was the message this weekend. Peter pratt seeing we will need period of policy and then of france governor talking about the importance of stimulus. Saying fall will be the next announced. Changes just mentioned, we had negative inflation bit more than one year ago. In 2016, 0. 2 . Year, average inflation 1. 5 . Prices. Tly due to but also the progress of implementation of our community of Monetary Policy gives results. But we are not yet there. Alix still with us is peter rbc capitalom markets and aaron kohli doctor b bmo. That mean . I think what the acb absolutely clear about, policies is working as we heard. Nearhe economy is nowhere producing inflation in the near term. Or the medium term. Acb is absolutely convinced they have to stay accommodated. They are constrain much more constrained bank of england and fed. Some adjustments would have to come there. The design of the program. Other than that, they want to stay absolutely super cookedded accommodated for years to come. Alix we have aaron kohli. Pricing. 2 bases ecb. S by 2018 by the in mid june we were well below that. Seen. T the rerating weve those yellow bars. Large extent. A speaks how effective the change the ecb and the fed. Despite any real ability for to shown to show up robustness of the kind weve seen. Theyve been very much in concert. The reason whys they forced the mark to pricing. Dox aaron what would you then . Do you want to be short here. Buy the dip . O it speaks to more about horizon. Areink short term investors likely to continue selling. Weve seen momentum in positioning. Its still very bad. Year horizon or six month horizon, these are great levels to be buying. Lot of it was that talking of market will lead to kind of growth in the long run thats going offer inflation needs. B or fed alix how much juice is there over inyields in europe. Especially you see u. S. Premium to bond in europe, really coming down . I would make slightly different distinction. Make it to the instrument what youre talking about. Since theeen in u. S. Fed become more aggressive, short term Interest Rates have up. Going the markets more or less the fed canther deliver what they set out to do. In europe, its going to be opposite. I think the short term of the curve will be anchored. Ecb is trying very hard to put it back in the box. Curve, aaron the is right, its particularly over the short term it will be driven by other things positioning momentum in these forces. The curve inhink europe will be steeper. Curve herehappens to kum in the u. S. . You will have janet yellen testimony in the puss. You will be looking for inflation and yellens testimony. On friday. T number we have cpi coming out. Problem is the details has been weak. One orat you only seen two areas of strength. Disconcertingre for the feds. Theyre betting a lot of all this unemployment that theyve about is going to translate into inflation before they seen it. Theyre getting the markets ready for a hike. We dont have evidence of that. Alix temporary. Times are we going to hear that . Exactly. David peter, look at the fundamentals. It really is inflation. What are the fundamentals that will drive inflation. Its been getting softer here a little bit. At the same time, were employing more people and we more dollars to spend. Youre right. Outink theres other voices there that should have waited until you see the inflation indeed. If you look carefully with the market is pricing, the markets clearly, thery medium term inflation picture is bleak. Point, we need to see vast changes. Changing, bond yields are going up,ing on thing thats moving is real Interest Rates. Which is last thing the economy need to see rising wages, rising inflation and were talking. Elusive. Hats david Peter Schaffrik rbc will be staying with us. Aaron kohli, thank you for being with us. Hear from live from new york as you reported earlier, theresa may will call opposition makers help steer britain the eu. Rbc is stillik with us from the city of london. In may theas back disaster election happened. How much is that feeding into daytoday thing. Theyre looking at consumer spending. Good unemployment data. Is it feeding into the consumer there . I think its feeding into the consumer. Pattern here which is very clear. Going up. Flation particularly because the pound has been going down. Wages are stagnant. Are rising. Particularly for the essentials, food, shelter and these type of things. What you have, consumption is power and the rest is going down. So far, consumption has been up. Ped as falling saving rate is territory, it is questionable how much that can go on in the future. We are not optimistic when it u. K. To consumption in the whats interesting, its the pound and certainly the markets more rattled about to say. Land continues political posturing is a big theme tomorrow. We have theresa may making all important speech trying to get her opposition party. Something that sways the market . Youre asking about asset classes. Have to be careful what classes were looking at. So far what have not happened, all the political uncertainty, u. K. T uncertainty for the yields have been doing quite well. We had bank of england that they want might to raise rates. So far guild market has been holding up. Good part of the equity market been performing strongly. That has helped. Might continues. What we might be careful this Smaller Companies that are particularly within the u. K. Peter schaffrik of rbc. Wonderful to have you with us. Wednesday, fed chair yellen kicks off day one of her Monetary Policy report to congress. It happens 10 00 a. M. Eastern. Whoooo. Youre searching for something. Like the perfect deal. On the perfect hotel. So wouldnt it be perfect if there was a single site where you could find the right hotel for you at the best price . There is. Because tripadvisor now compares prices from over 200 booking sites. To save you up to 30 . On the hotel you want. Trust this birds words. Tripadvisor. The latest reviews. The lowest prices. Alix this is bloomberg day break. Heres with where we stack up. Before the open here in the u. S. Higher. Res are slightly euro stock still hanging on gains. Business confidence killed it in germany. The bond market got hit so hard last week, now you got the bond bull. Were seeing relief rally here. Yields move lower. Germany here and in the u. S. Across the board, it is a weaker dollar story. Reversing that downside we saw on friday. You had dollar yen at the two months high. Percent. By one now update on what to making outside the business world. Taylor next few weeks maybe crucial. Whether President Donald Trump on historic tax cuts. Several obstacles awaiting lawmakers. Division among republicans on the parameters of tax bill and deadlines to keep the government running in a on u. S. Debt. U. S. Secretary of state rex will go to kuwait, qatar and saudi arabia this week u. S. Et with leaders as the seeks help and standoff that u. S. Allies against one another. It accused qatar of destabilizing the region. Court will assess new evidence in the case of 11monthold charlie gard. New evidence relating to professional treatment for his condition. The application came after both pope francis and President Donald Trump brought to thetional attention case. Support for japanese prime abe shrinked. News 24 hours a day powered by more than 2700 journalist and analyst and more than 120 country. This is bloomberg. David thanks so much. Returning from its recess with a lot of on its platter. Thatuestion is how much of they can get to. To give us anens, were joined an answer were joined by kevin cirilli. Theres a lot congress to get to. Russia keeps coming back. Get back to the g20, the that het tweeted out thought it was a good ideas to russian onhe cybersecurity. Senator Lindsey Graham had opposition to that. It was pretty close. Gave a really good speech in poland. Ahead disaster meeting with president putin. Two hour and 15 minutes of meetings, tillerson and trump are ready to forgive and forget comes to cyberattack on 2016. An election of david with all Congress Nobody on russia. E up is this going to get in the things like healthcare . You had a good weekend. There is some precedence for working with top global power such as china and ofering into some type accord agreement of a truce so cyber technology. Weve seen this in the past with the United States relationship china. The president in his tweets suggesting a similar path forward. Of course, over the weekend, new report from the New York Times suggesting that donald trump jr. Had a previously undisclosed with a Kremlin Associated lawyer back on paul manafort. Th then the Campaign Manager as kushner. Ared this comes two days before chris reyes set to testify before the Senate Judiciary committee. Hell face questions on that as well as how he will continue the ongoing investigations into russias election. Nto the 2016 it is worth noting that Jared Kushner did note this specific meeting in question in his own disclosures. Once again, the president returning home from an International Trip and facing a about questions back here russia. David president putin hoping he loosened the sanctions against russia. But at the same time, theres a bill pending now in the senate that would take the sanctions farther than theyve been. What are the prospects of that . Bill passed nearly unanimously out the senate. In the houselimbo of representative. It has not had a date set yet for their to be a vote. Theres intense pressure from folks like senator lindsey democratswell as increase sanctions against russia as a result of this. This is where it gets interesting. TheEnergy Sector here in United States as well as some Technology Companies are actually taking a look at this bill andnctions scratching their heads. They are in agreement that there has to be something done against russia and a response to what election. N 2016 but they feel that this was actually end up hurting u. S. Companies. And u. S. The political framing here in washington, suggest that its a simpler case and that republicans are trying to go easy on russia along with the white house. The policy of this is where really is going to get interesting. Major oil and Energy