Lot of political crosswinds depending on which way they choose to do it. Jonathan a big story for us in fx volatility as well. David the big story comes up in just about 45 minutes from now. The ecb will be announcing its latest Monetary Policy decision. We will break that down when it happens. Well bring you to Mario DraghisNews Conference. First, lets take a look at those markets. Jonathan a look at the market futures. In europe, it is a decent session with the ftse up. The dax is marginally negative. It is sitting very close to the january 2016 high. No drama and the market. No drama in the fx market, that is the story. A boring currency market implied volatility. It is approaching new load for the year. The boring one so far as the euro dollar currency cross. It is stable and stronger today. We have been in a very tight range. We trade stronger ahead of draghi. Four days of gains for crude. A 46 and 4627. In the bond market, we come in at basis points to 2. 26 . Fulltime year bonds four times ahead of druggie. Draghi. David it is quite a story in spain. Lets get back now to our big story that is the ecb. Our colleague Caroline Hyde is covering the decision from frankfurt where mario draghi will be holding his News Conference. Give us a sense what are the options available to him today . Caroline 80 economist to think he could pull the trigger sometime this year. About half think it could be s s today. That would be notably extended quantitive easing. Going past march 2017, past 1. 7 trillion euros of bond buying to extend that to try to lift that inflation figure to go up. Trying tos personal growth. Interestingly, abb will see a downgrade of some projections coming up to terms of 2017 growth prospects. Howeally is a question of he can make his life easier. How can he keep buying 80 billion euros worth of debt per month. Theres plenty of selfimposed rules that actually make many of the bonds ineligible . David we have various options about raising the limit of what he can buy. What of the political consequences he has available to him . Jonathan the most politically palatable option would be to be a third of more than each individual bond issued. Potentially, they moved to 50 . They have already raised at that once. Stomached by the likes of germany even though it does make the ecb a powerful bond owner. The number two possibility which could be it could be worthwhile considering the deposit rate. Theme rate you cant buy that are less than that. Farewell 17 of the german debt market, 30 of all euros on sovereign debt. That could certainly make their lives easier. Will it just crash yei crush yields lower . Notably, the socalled t. Capital key. Up italian debt based on the size of its economy, german debt based on the site of its economy. They can have more spanish and italian. Is that just moving into monetary financing of debt . Is that letting them get away with it . David thank you so much. Were coming back to caroline regularly to the program as we have the announcement of a press conference. That sets the stage for the program. Now lets bring in a global chief economist from the city of london. It is great to have you with us on the program. I want to begin with the forecast. A series of downgrades to inflation. You can put that up on the screen. Bes year, it is likely to seen for 2017 and 2018. The question is whether this is still the ecbs job. You dont so Much Research on the output gap. It hasnt been the lack of Monetary Policy accommodation it the is itn draghis job . It is, because his job is to to getnflation to inflation to 2 . If do it with the headline inflation number which is now also impacted by all of this. This is a difficult job. There was help coming up. The fiscal side is down. Jonathan it is starting to ease up a bit but the pressure is on him once again. I wonder what he can do and what is left on the table. Were talking about an extension of qe. Draghi ever said that was the end date. What do you expect . At the the try to avoid it today. I would be surprised if they avoid say anything i post march the prepared statement. I am sure that they would ask about it. I dont know how they handle it apart from saying that they are probably continuing somewhere. The fact is, i think there was a plausible argument to be made that there is not a whole lot more the ecb can, or should do. You dont want to say they should stop. You have monetary tightening a bit certain not ecb should be doing. They have to find a way of smoothing after march. Jonathan it will be tricky. To make a subtle point of subtles can we make a point of politics. how significant is that for the frankfurt bank. I dont think it is that important to be honest with you. There is broad support for the ecb in the policy community. Urse, lobbyistso including germany and other places who are suffering. Banks suffer also in this game. Helps same time, if it the economy will benefit from it down the line. It is got no bit tougher in germany lately. Is supportive of the ecb. The speaker is moved to bit. I wouldnt be surprised if they ecbd quite like to see the take the foot off the accelerator little bit. Jonathan another question is whether not the bill changes their headline anytime soon. A differentat is one altogether. You could however politics devolve in germany altogether. In more perspective and others have. Others have said this is a warning sign for angela merkel. In your view it is not a representation of the water germany. Are you worried about this shift to the right as many are in europe . No, iam much more worried about it in america. It is conceivable that trump wins the election. That is seriously dangerous for markets. There is no realistic probability in europe than any of the super right or nationalist parties get to power. I cant see it. The worst case in germany you get is that the mainline party are shifting out to a dress some issues like migration. Yesterday, it is on a back step now and in a reverse unfortunately. Economist like it but it is the political reality. It is not, to my best assessment, not any place where there is any measurable probability of the major countries getting a nationalistic government. Direct linkere a between what the ecb and other Central Banks have been doing with respect to Monetary Policy and what you are talking about with the retrenchment on globalization . What theyre showing us a they can get asset values up. That tends to increase the disaffection with globalization postup should Central Banks be concerned about that problem . Yeah, they should. But they didnt really have an alternative. The antiglobalization movement is much greater and more complicated than Monetary Policy for sure. The Central Banks didnt have much of a choice because they dont have a mechanism or you can help the poorest of society. From thehey do it is asset prices first of that is unfortunate in this setting. It comes back to the policymakers, the politicians of could have done a version helicopter money and then fiscal expansion and help the weaker in society to what happened what have you. Toy couldve played that fiscal policy. That would have been better policy. We didnt get that. That is not the Central Banks fault it is the politicians fault. Erik will be sticking with us. In europe, stocks are stable, features pretty stable. A few things i want to get up to speed on. Start with apple, day two after the introduction of the newest iphone, the iphone seven which features getting rid of the headphone jack. The Wireless Headphones the company introduced. Shares are down among many folks analystghing in is an at wells fargo who is downgrading the stock saying the positives are largely known. It will be effective the a neutral market performer. If apple moves laughs less today that would be unusual compared with recent history. We went back and looked over the appleear period since moved its Product Introduction to the fall. There is not a clear trend except that the day to move has always been larger in percentage terms. They try to analyze what the changes will mean. Seenis the actually have over the past several years. Of course, as we alluded to, nintendo was the big mover on the back of the apple announcement. Mario brothers would be coming to the apple iphone. That is another verification of nintendos strategy to monetize their product on mobile devices. The stock was up 13 . It is not more than 80 since nintendo go started catching fire earlier in the summer. The other stock were watching his micro focus. It is a u. K. Company combining some of the Software Asset with hewlettpackard enterprises. The ceo has been slimming down that company. You can see micro focus shares are up 17 . Hp shares are down a little bit. In contrast with the jonathan coming up, the cost of borrowing in hong kong hits a sevenmonth high. We talked china, next. In less than 30 minutes, 35 minutes to be precise the ecb will release their decision on Monetary Policy. Just how likely is mario draghi to expand his program . More coming up next from new york city. Outd china trade data just shows both import and export rising. The question is, whether these point towards a strengthening economy or are the result of a cheaper rmb. Now here to give us the strength of china as an engine for global growth. Which is it, is this a matter of adjusting the value of the yuan, or real strengthen the chinese economy . Is littleme there doubt that the chinese economy is picking up steam again. Theere down for a time, last few quarters thing to put the better. The latest trade members are in line numbers are in line with that. The business on the Interest Rates i think is silly speculation. Speculators have this idea that after the g20 you would have a different evaluation or a yuan move down. We dont think that is likely. Our forecast is for the yuan to stay. I think what you are seeing is the central bank fighting that speculative attack. David the story was a pretty notable jump up in the cost of borrowing money overnight for banks in hong kong. Is that because the pboc is intervening to try to affect the liquidity of offshore yuan . Erik i dont know that. Were not close enough to know exactly what theyre doing. It would be a good guess. Typical with a lot of levels on the system not only but what the chinese can do is to call the big banks and tell them to slow down the lending numbers of they want in certain areas. I think it is the Central Banks and how exactly to do it i dont know. And the fact of the placings the need for Chinese Companies to pay back loans and dollars to go offshore. How big a factor is that in what is happening . Theres a longerterm structural issue. You talk about the speculative attack is also the speculative speculation that when the fed hikes. That is noise in the system. On the structural side there is pressurental longterm on the chinese in the sense that a lot of money was looking for assets offshore. That may not be in line with what the government wants. David put aside the noise and get back to the signals. What is the signal youre looking at to determine what you say is the Chinese Government im sorry, the chinese economy picking back up again. Equivalentat the pmi in the retail numbers, we like trade numbers quite a bit. It is one of those that youre pretty sure theyre not cheating on. We have these leading indicators were you put a dozen indicators together from trade in retail a decent there is reason to think that we are moving slightly higher. Drop in growth rate is come to an end. It is slightly higher again. David erik, thank you very much. Jonathan fantastic to have him on the program. Timup, we talked to cook says this is the best iphone ever made. We look at the new product that is coming up next. From new york city this is bloomberg. David yesterday, it finally happened. The apple Product Announcement we were all waiting for. Did it deliver what apple needs to get its momentum back . Buy recommendation on apple. It is a top rated apple analyst on the board. Good to have you here. Answer the question, didnt get done what tim cook needed it to . At least for now, to deliver on the expectations. It was an iphone that had improvements. What they have done with this launch is created some different releases. E different difference can move the product. David everything apart from the jack, which is controversial, are they just catching up with samsung . Absolutely. Gotten to a point in this industry where the technology has gotten where all these theyre moving 36 months behind each other. Is of what were seeing at some point, appling to deliver on some big step up and functionality. This market the way we look at it it is a market which is going to become david lets bring up and look at the analyst ratings. Buy, throughuy, 2016. Envelope cut collation, looking at a 12 upside. What gets us there . It is between the now in the yearend it will be positive data points. As we look at this quarter you would get about eight days of ship ends. Uplift. S a natural next quarterly will expand teacher vision much faster. Between now and december we without positive news in terms of the iphone seven units. That can get us closer to our price target. David if you are tim cook, you have to get every nickel and dime until the next release next year. What about geography . Are there markets they can pursue more aggressively . Done aink they have pretty good job expansion wise. At this point, india is one of the markets there been focused on. David are they way overpriced for india . Absolutely. They need to come up with forms at a lower price point. In terms of geographic expansion, they need to come up with a much lower price form. David so, you are confident in your target price. You think you will get to that point. What multiple do you need to do to get there . Times withnine or 10 the cash flow. That can get us to around 120. When it comes to be sentiment on the stock it is fairly muted. At this point, expectations are not that high either. David thank you so much. The securities analysts on apple. Jonathan expectations in the market either unchanged. Coming up, this is the most boring trade. The flood of Central Bank Cash with more to come. It is crushed volatility in the eurodollar cross. Will that finally end today . What has happened to the price action . We will discuss his recount down to an ecb decision 19 minutes away. Full coverage right here on bloomberg. It is 7 30 on wall street. He was what you need to know this hour. Mario draghi and the European Central bank make a Monetary Policy decision. Investors are waiting to see the ecb will expand its Quantitative Easing Program to kickstart a lackluster economy. We have full coverage including the News Conference right here on bloomberg go. Japans economy expanded more than the government initially reported. 7 , that was higher than the initial reading. Hewlettpackard is combined think some assets with micro focus international. It is valued at 8. 8 billion. It is part of the chief executives efforts to slim down the u. S. Companys operations. That is what you need to know this hour. Jonathan as a market participant, if you had a decision to mario draghi or janet yellen i think we would all take the dinner date with the lady herself. At that shouldnt take any drama away from the potential of a move today first of this is how we are set up in the market. The stock is firmer in europe. The dax just pulling back. The fx market is interesting one. The ecb is on so much for the last 24 months in terms of Monetary Policy. A credit easing program, qe, the whole shebang. Stable,lar has been so it goes across the whole fx market for the lows for 2016. What will give the price action as we approach that monitor policy decision by one of the big chiefs. In the bond market this is the action for you. Not much on treasuries. Move the most interesting is the ecb buying a ton of debt. It yields plunging to new record lows. He said that once again in spain. David the spain story is extraordinary. You can borrow money at that low rate from spain. That is extraordinary. We turn to politics back here in the United States. There is a new bloomberg poll trumpday shows donald leading Hillary Clinton among white voters who have a High School Diploma or less. That is 35 to 33 . At Hillary Clinton overwhelming aad in minorities gives her lead in less educated voters overall. Now, the Senior Executive editor of government and politics from washington. Marty knows politics. Tell us about how significant this really is for donald trump and Hillary Clinton. Marty it is significant. It does bring up the volatilities of donald trump among less educated voters. Leadrys extraordinary among minorities, it is really 10 . S 7 10 87 david i wasnt surprised he was leading among White High School educated and less people. He actually is less ahead in that group than mitt romney was four years ago. That was extraordinary. Is for Percentage Points behind how romney performed with that group. The market of error is four percentage point on this poll. It is clearly is not doing nearly as well as romney was among that group. David there was some news out last night, i program there a program with donald trump and Hillary Clinton talking about commander in chief. One the things they both addressed is how they would approach isis. We will play a little bit about mr. Trumps approach to isis. When i come up with a plan that i like and i may love of the generals come back with. You have your own plan . I have, but i dont want to i have a substantial chance of winning. We are going to make America Great again. I have a substantial chance of winning. David