A very warm welcome. Bloomberg Technology Bits the dollar has had a of a rough and tumble week. Down. 1 . Trade whichnsensus lacks conviction. That is what our 7 00 guest said. That affairs it very quickly. This is a january effect. This is what weve done so far in january. Year, and down it went. Is january a real indicator . Of typicallyverage what happens on the dollar over the past number of years. The blue line is 2015. January, should you take it as a precursor for the rest of the year . Morgan stanley say reflation trade is still intact. Anna buy the dol as a result. Lar lets have a look at the rest radar. We need to focus on where it is going. Up. 1 for the dollar index. We have the chinese currency in there for you as well. Pbocse of this story stepping up control, matching incoming and upcoming u. N. And messing a message for the chinese bank. Deterring the outflow of chinese currency. Manus almost as if they are throwing every thing as its right now to stop the possibility. I went with the possibility is calling chinaump a manipulator on his first day. Up. 1 , the pharma got smacked. The msci world index, something that caught our eye. Global equities are holding onto the gains for the year. He jumped 1. 9 last week with just away from a record. 3 below the lifetime record in 2015. It is still fairly well. Anna some of the details stories moving around in asia at the moment. A couple of good stories over there in asia on that sector. Lets get to the first word news for you. Marianne. chinas exports remain subdued as weak Global Demand weight on sales. Oversee shipment in december fell 6. 1 in dollar terms. 3 tos rose more than leave a 41 billion trade surplus. The largest exporter chases more calexit challenges this year as it prepares for potential brazenness with the United States. Asking them to stop crossborder yuan payments. The direction was given verbally, requiring them to show up at the end of every month the amount of outgoing matching the enough that comes in. To attempting to curb a record amount of money leaving the currency. The u. S. S. Environment Protection Agency surgingy were putting vehicles allowing them to exceed pollution limits. The company contests the allegations set it met all revelatory requirements. Requirements. Whether or not james comey will keep his job after the internal watchdog opened an investigation into his handling of Hillary Clintons use of a private female server. The Inspector General will examine whether the fbi failed to follow appropriate procedures as he improperly release information. A campaign ceo said the company a merger with time warner did not come up when he met with donald trump. The pair focused on jobs and making u. S. Firms more globally competitive. The transaction was set to be discussed with trump who opposes the deal. Founder of sky Bridge Capital has been named an assistant to president elect trump. According to people familiar with the decision. Investing in goldman sachs, joining the new registration as an assistant to the president and senior counselor for economic initiatives. Barack obama surprised by President Joe Biden by the stowing the president ial medal of freedom on him. Yet going president called him an extraordinary man with an extraordinary career in public service. It also said it would give the internet one more chance to joke about their bromance. Global news 24 hours a day powered by more than 2600 journalists and analysts in more than 120 countries. You can find more stories on the bloomberg top. Thank you very much. Architect have had a interesting week. Trump and policy and the lack thereof. Asia stocks at a three month high. Samsung is in the sidelines. Yes, it certainly has been an interesting week for asian investors. A bit of a mixed end to that week that we are seeing. We did have movement coming in on the shanghai after the export data came through. It was pretty sluggish and they took it and tried to strike. Interesting to see the hensing back and you lockout of the last seven sessions. It has been higher. Weakness,e have seen down. 1. 5 . Up byg the nikkei hire. 8 . It was pretty weak across that corner of the world. Australia down. 8 . By 0. 6 . He week off if you rallied into the bull market territory. Stocks to keep your eye on in the asian session, Morgan Stanley saying it does have government support. Takata nintendo falling in tokyo. 299. 99ed the consul at with all the market moving action and information on the consul market as well. Says the u. S. Economy faces no serious shortterm obstacles. Dealing with more longterm challenges as low productivity and blowing growing inequality. One successfuls economy is not attracting media attention. We are doing work successfully our hope is the economy will generally function well. Happening instead of being on page one we can get back on page 19 in the newspapers, not in the headlines. Anna the treasury rallied, we have seen him it is because about to end. Yields will move higher. Joining us now from singapores nick. Ahead of multiasset solutions. We are trying to put in perspective what weve seen. What is your call. Given the number for the u. S. 10 year. Is the Inflection Point actually happened around the middle of last year, around june. After u. K. Independence day. That was really the major Inflection Pointing in bond yields. What we have leading into that was everybody was concerned about the trend growth, low inflation, low rates and the permanent rager nature of that. Thats what the case, your greatest risk was higher. Did was u. S. Election light a fire under that trend. We have seen a pretty significant move up in yields. A stabilization from the middle of december. That is when we took a short position off. We actually allocated back to the u. S. Treasuries. Since then i have cut that position and effectively put the reflation trade back on by cutting all of my treasury positions in the portfolio. Interesting that you use one of phrases,ssic market dropped out of the dollar and dropped out of the treasury. Weekdid you learn this from the bond market question mark market . Week from the bondnick the dollar ite dollar is clearly a consensus belief for a trial crowd of trade. We have seen stabilization of the last 24 hours but a significant pullback in the dollar. That might have just reflect a positioning. Macroy perspective the news flow in the u. S. Is really strong. Surveys this week and last week were incredibly strong. We should see that starts to get reflected in the macro news flow. The hard data. To further lead treasury yields and another move higher in the dollar. One of the big insurgencies is how cumulative donald will be with fiscal policy. Suggesting this might be a question for 2018, is is a question for this year or does this year look more protectable . The uncertainty for physical is a problem for 2018 and not now . Nick could be immediate. Markets price the things more rapidly than policymakers. The way they think about this. The fact we have had a reasonable consolidation is one of the reasons why i put the reflation trade back on. In addition to cutting treasuries to zero, i added back to u. S. Financials which is a sector position. We have 10 of the portfolio in that position. A fairly aggressive position. U. S. Financials still trading at a significant discounts to Global Equities and the broad market in the u. S. People pessimistic were skeptical about returns or profits for the Financial Sector so we still see that as a multiquarter trade. You have the disadvantage i have the earnings yield for the s p 500, relative to the 10 year Government Bond yield. That is widening. Does that trade continue with renewed momentum . Nick clearly the u. S. Market overall is more expensive. We would have a preference for emerging markets with the earnings yield at 8 were 8. 1 . That would be my big trade for 2017. Look to take on the episode in emerging markets because in contrast to the u. S. , which is growth expeditions, emerging markets have rolled over. Anna thank you so much for joining us. Multinational solutions , is thattion trade still of the major dominant seen a for you take seriously the way the dollar fell out of bed yesterday . Manus the reflation trade is one way but another way is that we have the best economic backdrop since 2007. Our pointing up in a number of countries like u. S. , u. K. , germany, japan, china. Are you excited about china because what has happened there is not only does the economy look rather solid but also we have seen a reduction in the real Interest Rate do to rising inflation which is obviously very stimulative. It looks fairly optimistic and that is what is driving Inflation Expectations this year. Do,s less what trump will he is still undecided or unannounced, the economic backdrop this year looks fairly attractive. Manus the markets react emotionally. They havehe fed done this before time and time again. It could be more than three because we are looking at full employment. Manufacturing industry is recovering since mid last year which is a trend. Expenditure is staying up there. If a trump really follows through with tax cuts than this will be even more. It could not be that the economy is halted hotter at the end of the year than it is now. Anna bloomberg will be speaking to the former u. S. Defense secretary. That at 10 00 in the evening. Wall street earnings get on their way, jb morgan, bank of america, wells fargo reporting before the open. 1 30 anna theat ruling cdu party begins a retreat where Angela Merkel will start setting her agenda. Manus tanks in the u. S. Trading now. Diesel commissions cheating by the u. S. Will follow volkswagen and pay big . Anna it promises is a promise. Close to a twoyear low. The Conveyor Belt slows at the factory of the world. Chinas exports stay sluggish as the country races for a possible trump trade attention. This is bloombeg. Anna welcome back. This is Bloomberg Bloomberg bloomberg daybreak nintendo shares fell after the switch goes on sale and march 3 at the price of 300. A new feature, an Online Gaming network. The price is higher than most predicted and above the ps4 and xbox one. Down aselectronic share the vicechairman faced 22 hours of questioning. A suspect in south koreas influence scandal. Investigators have set charges to including allegations of embezzlement and breach of duty. The heir to the countrys richest family has denied any wrongdoing. Surge surged in tokyo. They may announce a settlement soon as today over airbox airbags late linked to deaths. As much as a billion dollars and face possible criminal charges. A settlement would allow him to move forward with these search for a buyer. Manus thank you very much. Accused of violating pollution laws in the United States, the wouldleges the company suffer more than put software in more than 100 thousand vehicles allowing them to exceed limits. Lets head to berlin and bloombergs manager in managing director. Benedict, expecting some to benect5i 0 benedict fiat took a major hit. They have added software to about 100,000 engines in grand cherokee and raima cars. There is a notable difference that i think was important to point out. A defeatid not call it device, they said there was software with questions about. It was not properly registered and so on. That is one notable difference. There are far fewer cars, it is only about 100,000. In folksong we are about 11 million songs. The reaction, a very forceful ceo coming out and calling it hogwash. Disappointedvery by this and thats really shows this company is willing to fight back. Hads been blindsided, meetings with the epa a meeting despicable of weeks before and everything seemed fine. Heres a Company Really coming out fighting back. After the initial hit they did come back. Sayingsergio marchionne this must be an understatement. Is been a charge of the company for quite some time. The potential numbers that we are looking at, put it in context. 23 billion. I am. What would that mean. . Is that civil and criminal together . Benedict we dont know how that will break down. Derived fromillion the number of cars. That he is kicked off this probably not directed at his own engineers brother the epa. You raise an interesting point, volkswagen is a company that is a lot bigger and deeper pockets. 20 billionsorbed in fines and levees. Most would be bankrupt under such a waste. This is something that will be very difficult for fiat to absorb. Marchionne does have a reputation on the line. Anna thank you very much. Joining us from berlin. Cio at theack to private bank. This is a sector that not only faces the regulatory challenge but also faces the twitter challenge from donald trump. He tries to intervene in the decision of making businesses. The auto sector seems insight. Does the overlying potential the sector overline those . Is stillhe sector is writing strong citi trends in solidlogy is still fairly and also meets the mind of buyers. Obviously everybody has set their mind on what regulation will do in the u. S. And but through donald trump if there was a border preferred place to ship from the Auto Industry is south of the border in mexico. Autoco the impact the industry massively. This is very much on their radar screen. Manus look at volkswagen and fiats. When you look at the stories do you shift gears . In terms of propensity and exposer . They are a specific case and until we know exactly what of the lawsuits will be it is very difficult to say how thats will impact the bottom line. Fiatchrysler very strong. A different case because they have a u. S. American parts to it. Very different cases. Anna staying with us on day rate. Much more to discuss with him. The china story which we will go into. Oil productions near and on the a low. A big move as we head into friday. This is bloomberg. In 6 30 in afternoon london. The dollaryen is on the move but we will take it anyway began. 118. 86. Hopefully you have gotten used to it now. This is what we are looking at. We have been covering this story in the last couple of minutes with our orders in europe. Thefocus is fiat, calling ceo saying he is really ticked off by the solution allegations. , 4. 5ay the numbers look billion, nowhere near the scale of bmw great insights talking about the differences between this story and the bmw story. The next story looks at the feds speakers reinforcing the tightening case with some caveats. Little opportunity to talk about the fed this morning but a great insight on whether the inflation trade is still on from our guest in singapore. He certainly believes we are going back to that as bond yields go higher. Manus daybreak also has the story on russias governor who is set to speak at a fourrun in moscow. Forum in guy we are affecting a positive performance from the ftse. The ftse 100 looks like it will be opening up around. 5 according to the activation on your bloomberg this morning you outperforming its continental how fiat opens a little later. Has not been the sterling but what is going on with the dollar. The dollar has been week, one of the big trades as we work our way out of this reflationary emphasis. The dollar has been the real story. The greenback has come under great selling pressure. We are beginning to bump up, indicators that may provide some upside momentum into next week. Talking about no major obstacles for the u. S. Economy. Something of the want to mention as well because this has been the theme. We concert back to sterling and talk about the week liquiditys. This has been a medley morning for what has been happening with the dollar and the turkish lira. This is where week liquidity is an issue. That is where we see some of the biting of the dollar t. R. Y. It has been interesting to see how the liquidity stories is working its way through and how bad it is increasingly a feature. If this is just regular flow that has been preprogrammed or taking advantage of small movements . Extrapolating them a little further. There is continuation but i want to hold at a big point. Highlight the big point. Placeend is back in surrounding what is happening with gold. Nice to see some of those formations still working. Back to you. Thats get to oil, the Saudi Arabian defense minister has said the Oil Production is 10 milliond to barrels a day. Below the targeted level. Anna saudi arabia will consider renewing its pledge to cut out in six months. It comes as oil and us 10 millin barrels a day. Below the targeted level. Ministers hold the many opec in on without me. Us for a conversation about the meeting now. However oil prices reacted to the latest comments . Up,rter we saw them move the very important meeting here. As an unofficial meeting. I just spoke to the Energy Minister and all the spec elation about a many opec, there is no truth to it. A casual conference. We might be having dinner later. You mentioned saudi arabia, this became a little bit of a surprise in terms of saudi arabia going beyond the call of duty. Under 10 Million Barrels per day, the last time that happened was february 2015. The role ofng leadership within opec. Goingre committed and beyond that. Similar signals from kuwait, from l syria algeria. Anything else that anybody wants to do that is up to them and it is a bonus. Me get you a little bit of this tells you the story of two heavyweights. Thenonopec elephant in room. You are looking at opec production. You can see how it falls off of the agreement comes into force. When you also see in the tellsop, the histogram the story of u. S. Current inventories which remain at the highest seasonal level in three decades. That is the kind of oil in the system that needs to start getting out of the system for oil prices to really rally behind 625 per barrel. Manus he say today is perhaps a little more laissezfaire. What do you expect . Is this a show of strength from the core of opec trying to set a roadmap for those nonmembers . I am challenging russia, giving our bit to you. Reporter light muscle flexing. Nothing formal is on the agenda but the fact we are here and talking and continuing to follow up with the Monitoring Committee in terms of building a clear agenda for the way forward in terms of making sure that you are measuring the barrels correctly and everybody is o