Lineup today. T first, live pictures from moscow as president putin makes his annual president ial address. We will discuss whether russia, brexit, and a u. S. President could make 2017 the year of total reset for Foreign Policy. We have a little bit of manufacturing pmi. The italian data is significant because this gives us a glimpse in the state of the Italian Economy just three days before they vote. These are the figures crossing our bloomberg terminal. We are seeing the Unemployment Rate staying put for october at 11. 6 . Line withty much in what were seeing in spain. Three days until renzis make or break referendum. Votell discuss what a no could mean. Lets get to the bloomberg first word news. Heres Sebastian Salek. Sebastian glencore will reinstate its dividend policy next year and plans to pay out the minimum annually. The worlds biggest commodities trader has seen its shares trickle this year. The chairman of bloomberg lp and the parent of Bloomberg News is a senior independent nonexecutive director at glencore. Oil is Holding Gains at around 50 a barrel after opec agreed to its first Production Cut in eight years. Saudi arabia, iran, and iraq bridged their differences. Productions will cut by 1. 2 Million Barrels a day while russell also changed it stands. Its stance and will reduce output. During the meeting, when we were drawing up the accord, but we had difficult questions to resolve, the Russian Energy minister gave the information that he would reduce by 300,000 barrels a day. Sebastian chinas factory gauge climbed to match a post 2012 high, thanks to a credit fueled recovery. To 51. 7. Ring pmi rose input prices import prices jumped to their strongest reading since 2011. Global news 24 hours a day powered by more than 2600 journalists and analysts in more than 120 countries. Im Sebastian Salek. Francine thank you so much. You are watching live pictures of president Vladimir Putins annual address. It is quite a glamorous, opulent room. We are used to seeing these scenes. It is a similar room to where he takes questions from the nation. This time we are expecting him to address the nation but not take questions. It is quite a ceremonial thing. You have two guards opening those great doors and president Vladimir Putin coming to the stage. We are watching. They want to know about his relationship with the u. S. , oil, and we want to know a little about his stance on syria. Hes on stage, talking and hes stting his address. We will keep on top of the news and bring you anything he says. Lets have a listen to what Vladimir Putin has to say. Economy, social issues [indiscernible] we have to deal with all these issues in quite difficult situations. We are capable of doing it. We are capable of defending national interests, sovereignty, and territorial integrity of our country. I would like to repeat, we see it. Let us say thank you to our citizens. They got united around patriotic values. Francine Vladimir Putin starting his state of the Union Address in moscow. We will get back to him and monitor any breaking news on the bloomberg terminal. We understand from insiders at the kremlin that putin may be offering a bridge in ties with some of his western allies. The election of donald trump changes quite a lot for putin. The u. S. Economy has continued to expand, with rising activity and little inflation. Mario draghi will be monitoring this weeks economic data. It is seven days until the ecb makes its next policy decision. Lets introduced my guest for the next hour, George Magnus from oxford university. Right to have you on the program. While the world has significantly changed, we have donald trump reflecting with hopes of infrastructure spending. We have Vladimir Putin may be opening his arms a little more to the u. S. ,e have the italian referendum more Political Uncertainty. What will the ecb do . George it is almost a little academic and a bit of a sideshow. I think the consensus for the ecb is there has been, as im sure you know, some talk about the draghi might announce kind of a tapering or a wind down of qe, but the most likely outcome i think is we will get an extension from march to september. Theres also been some sort of speculation that the ecb might take a little bit of a leaf out of the bank of japans playbook and kind of move to yield targets rather than quantitative purchases for peripheral debt. This kind of falls within the tinkering around the edges about the Central Program of the ecb. Think the kinds of things we are expecting to happen in 2017, the ecb is a bit of a sideshow. I think the most they can do with Monetary Policy in the euro area is keep the level of monetary accommodation. Francine what is the main show . Is it Foreign Policy . We are looking at a speech by Foreign Policy. A speech by Vladimir Putin. Is it Foreign Policy that you need to look at, or it is the fed, Dollar Strength . George i think investors need to keep a wary eye on Foreign Policy. The lurches in Foreign Policy, to the extent these may if it results in some kind of accommodation between the u. S. And russia and china in some we want toangle, know what the terms of that might be, but i think the most immediate things will be about onomics, americas policy for itself, and the threats that have been made to the World Trading system. Francine we will talk about currency wars next. George magnus from oxford university. We are seeing more live pictures from Vladimir Putin, who started his speech about five minutes ago. We are expecting him to go on for at least an hour. Hes just started talking about the need for developing direct democracy in russia. We are expecting him at some point to turn onto foreign affairs. See if be interesting to his view of the world has changed. Stay with surveillance. Plenty coming up including the return of opec. The organization agrees its first output cut in eight years. As Vladimir Putin makes his annual address, a new u. S. President , rebounding oil price, and Political Division in europe could spell opportunity for moscow. 2017teen be the year be the year of a total reset . This is bloomberg. Francine this is bloomberg surveillance. Heres Sebastian Salek. Sebastian shares in bank about ally espanol are trading higher after reports that it is exploring the possibility of merging with another bank. That is according to the newspaper which did not say where it got the information. Citigroup is said to be considering moving some equity Interest Rate derivatives traders to frankfurt. According to people with knowledge of the matter, the firm is in discussions with the german financial regulator. Said, weup spokeswoman are evaluating our options as negotiations continue. China is slapping a 10 tax on cars like the ferrari, bentley, and aston martin. Buyers of super luxury vehicles costing 189,000 or more will be hit with the tax from today. It is beijings latest bid to combat suspicious consumption. Francine thank you so much. Opec sent crude oil prices soaring by agreeing to the first supply cut in eight years. The deal was broader than many expected, extending beyond the cartel. Opec and 600,000 from nonopec, so we have a total of 1. 8. Hopefully we will have a very high level of compliance. This gives a positive outlook for the market. Oil industry has seen a high level of demand and i think it will continue over the coming years. It is important for the oil industry to have a healthy level of investment to balance supply and demand. Balance supply and demand. That is what drove saudi arabia to bridge differences with other producers inside and outside opec. Francine that was the saudi oil minister. Will the agreement have the effect he outlined . Lets continue the conversation with George Magnus. The problem is that in one way you can say it will boost growth , but consumption is quite low across the world. As the Oil Price Goes up, does it make people feel poorer . George traditionally, we looked at the Oil Price Volatility as a tax. If we get we went up three or four dollars yesterday, and if that were to continue in the context of some continuing concerns about the robustness of the Global Economy, that would be a bit of a problem. I happen to think that in the foreseeable future, this is a bit of a boon. Particularly since it resonates with what happened to other materials and industrial prices as well, this is a bit of a boon for emerging markets. I think they could do with a bit of a lift. Francine do you believe they do have control back . I know this is an agreement to cut production, but in the past, a lot of opec producers had said , sure, we will cut, and actually they pump a lot more. George my sense is the fundamental position of supply and demand in the Global Economy really hasnt isnt going to be really chged for a much, unless there is absolutely rigid compliance, which has always been the problem. Wash withit of a energy. Moment, i think these prices will stick. I think they will have some impact on Consumer Prices and weve already seen examples in the media about petrol prices or gas prices in this country going up. These are not all bad things. We have to watch them quite carefully. Francine thank you so much. George magnus stays with us. As Vladimir Putin makes his annual address, how a u. S. President and rebound oil price could spell opportunity for moscow. You are still looking at live pictures. Some members of the audience there as Vladimir Putin addresses his nation. This is bloomberg. Francine this is bloomberg surveillance. President Vladimir Putin is making his annual president ial address in moscow. With the election of a u. S. President who has spoken warmly about the kremlin, an oil price rebounding, and continued divisions in europe, president putin certainly has plenty to be optimistic about. He has pretty dire economy back home. Lets get some more analysis with john fryer and George Magnus from oxford university. John, great to have you on the program. We hear putin. This is not the fivehour affair where he takes questions from the public. This is going to be short and sweet. What do we want to know about, from, syria, and oil . John lets start with trump. Theres a lot of talk about the sort of bromance between trump and putin. I would urge some caution. If you look at what trump has done so far, hes behaved in a way you wouldnt have expected. Listening to his campaign rhetoric, you would never have thought this is a future president whos going to pack his cabinet with former employees of goldman sachs. We shouldnt assume hes going to cozy up to russia. It will be interesting to hear what he says about the u. S. Relationship. There in mind, putin looks at the world solely through the lens of russias selfinterest. Any warm words should be taken with a pinch of salt. Francine is it a reset for Foreign Policy . Even if donald trump doesnt end up being that warm, as long as hes not antagonizing putin, can the world be a little safer . John i think theres nothing that can be said with any certainty about a Trump Presidency. Looking at the evidence we have, it would suggest that trump is putin aperhaps to give broader sphere of influence then perhaps barack obama or Hillary Clinton would have done. Putin is as unpredictable an actor as trump is. We could see more cyber hacks from russia on the u. S. Government agencies. Francine module versus macho. John exactly. Extremelying at two unpredictable actors. Francine george, when you look at the russian economy, with this agreement to freeze production, and you were saying the price of oil could go up, does it make putin more unpredictable . Does he focus less on scaremongering in the world . George not in my view. It is clearly helpful for russia, simply because of the role that oil revenues and hydrocarbon revenues play in terms of the fiscal balance in exports and so on. It is helpful for prices to be higher than it is lower. I dont think it really makes much effect or has much impact on russias engagement with the United States or china. Picking up on johns point, my sense is that weve got, in the United States, and russia, and china, we have to think of it as a trio. I think we basically going back to spheres of influence and national interest. Major powersof the of the world clearly do have, or look like they are wanting to emphasize, very significant geographic interests that are very important to the national selfdetermination. The noninterference bit, i think, is going to go. John i was in beijing last week. One of the things i took away from it, would you also agree with the idea that china is much more willing to sign up to the rules of the global game than the russians are . Therere a difference between russia and china . Francine maybe more than donald trump . George i think the chinese position is quite interesting. On Climate Change and on trade, they can say, we are we embody what International Cooperation should be about. There is truth in that. I think in terms of regional influence in asia, i think china will not they are not going to compromise on that. They have an agenda which is regional hague m a. Regional hegemony. Francine will they be antagonized by anything trump says . Hes said that any nation that has a surplus is cheating america. He mentioned china and germany. Do you look beyond that . John chinas officials expect him to be pragmatic. They look at trump and they dont necessarily see a maverick. They see a deal maker. China looks at the world through the lens of selfinterest. China more so than others. They say it is not in americas interest to start a trade war. Also theres an edge to that. They say, if trump does want to have a trade war, have a go. Francine do we need to spend more time thinking about the middle east . John it is a horrific humanitarian situation. It is only getting worse in aleppo. We look at it from the perspective of geopolitics and risk. It does look like this is all playing into Vladimir Putins hands. Francine thank you so much, john fryer, and George Magnus from oxford university. We will be talking the italian referendum next. Could donald trump and brexit mean 2017 is a total reset for Foreign Policy . This is bloomberg. Ways wins. Especially in my business. With slow internet from the phone company, you cant keep up. Youre stuck, watching spinning wheels and progress bars until someone else scoops your story. Switch to comcast business. With highspeed internet up to 10 gigabits per second. You wouldnt pick a slow race car. Then why settle for slow internet . Comcast business. Built for speed. Built for business. Francine this is bloomberg surveillance. We have plenty of news to get through. Lets get to the bloomberg first word news. Sebastian glencore will reinstate its dividend next year and plans to pay out a minimum of 1 billion annually. The worlds biggest commodity trader has seen its share price triple this year. The chairman of bloomberg lp, the parent of Bloomberg News, is a director at glencore. Oil is Holding Gains as opec agrees to its first Production Cut in eight years. Saudi arabia, iraq, and iran bridged their differences. Opec members will cut production by 1. 2 Million Barrels a day while russia also changed its stance and will reduce output. During the meeting when we were drawing up the accord, but we still had some difficult questions to solve, which are essential, the Russian Energy minister gave the information that he would reduce by 300 barrels a day 300,000 barrels a day. Sebastian chinas official factory gauge climbs to a high. The manufacturing pmi rose to 51. 7 in november. Import prices dropped to the strongest reading since march 2011, signaling that inflationary pressures may be building. That is your bloomberg first word news. Francine thank you so much. We are getting some breaking news out of the u. K. This is significant, as every piece of news is poured over to understand what mark carney will do and what brexit means for the u. K. Economy. We have manufacturing u. K. Pmi for the month of november. It is one of the freshest data sorry,ming in at 43 53. 4. Economists we had spoken to were expecting 54. 4. It is below what economists expected. Pound pretty much unchanged. Donaldes brexit and trump mean for Foreign Policy around the world . Will 2017 be the year of a total reset . With me now is john fryer and George Magnus from oxford university. George, we keep saying it is a reset, the end of the world. We had the greek crisis. We had what happened in the middle east. How signifi