Francine im francine lacqua. Central banks are in focus today. The fed left open the possibility of raising Interest Rates in the second half of the year. Guy bank of japan kept the status quo. It will keep adding 80 trillion yen to the monetary base. Brazils central bank boosted their Interest Rate for the fifth time in an effort to fight inflation. Finally the Russian Central BankRate Decision. Francine for more on this lets bring in james, a senior economist. Lets talk fed. It seems yellen is hanging on to this rate increase despite the weak economy . Is it a sign that she expects it to increase or is it a sign they are trying to give to the markets . James they are expecting real Household Income growth which they sounded upbeat about in the statement. It will feed to Consumer Spending and increased Business Investment down the track. I think they are hopeful that is going to happen. It struck me by not after the march meeting and by not saying there was no predetermined path like they said in the march statement, there is an opinion that they might get derailed by the data but they are not sure so they are keeping their options open. Guy i was trying to figure out exactly what was happening mere. My con sclution they are some of the locks they have put around themselves in terms of the language they have been using. Taking those out. James even that is in a sense hawkish. Francine when are you expecting the Interest Rates to raise . For a long time we were looking a bit behind the curve. If anything now were a bit premature. Yesterdays statement gives us some comfort that they could still go by september. The evidence that were seeing on the economy is there is going to be an overall bounce in the second quarter. Guy is that the data soft because over the weather or because of another factor . Why are the data as soft as they are . James weather is a factor. The u. S. Dollar depreciation is a factor. The oil is down. There are other issues in there too. The broader Business Investment story, equipment. Very soft for two quarters now. Guy very high at the moment. James that was probably unintentional. Francine when you look at the u. S. Consumer, he is not back. Will he ever be back . James the feeling that i have that they will be back. Noting the encrease in Household Income. I think the fed is hoping there is going to be a bit more of an inclination to spend on the part over the consumer with this newfound income. Also, because the labor market might be generating some better incomes. Having said that, jobs is going to be pretty weak going forward. Guy you till believe that the fed will raise rates this year. James yes, we have a september forecast. We havent yet seen enough weakness in the data to justify moving that. Francine how much are they looking at the dollar . James looking at exports. Francine why hike in september . James they have a view on the broader economy that it will be starting to improve by then. Inflation, which has been run to go low should be hitting back towards and the forecast, at some point they have to remove this extraordinary policy that has been in place. The last time they hiked was 2006. So i think there is going to be a strong opinion on the fed that they want to normalize policy because of the unknown risks of running that easy policy for too long. Guy what do you make of the price by the german bonds . James absolutely crazy. You would think that would be a negative in bond yields. The Inflation Numbers came out in germany benign. It was a positioning story. It was getting out of a position story. Nothing fundamental there. There were a lot of crazy price actions on a lot of markets yesterday. Francine does that make you more worried if we were to see a default on greece, an event on greece, lets call it. Given that we have seen a really Sharp Movement in the 10year germany, you know, the markets can react much more than what the markets are foreseing at the moment. James im not sure. I get the sense compared to 3 1 2 years ago, the fallout from the greek debacle, default, what have you, would be much less than we had back then. There is confidence in facing the European Central bank under draghi that he will do what he needs to do to ensure there is not the contagion. I have to say if there were to be some split separation of ways that it would be very painful, for greece in particular. Guy if you were draghi looking at the price action what would you what would you be making of it in terms of policy formulation . James he can keep buying more bonds cant he because the yields are rising which helps the margin, i suppose. He has to take a bigger view. Since he started hinting at q. E. Last year, the euro this is depreciated sharply. It is back to where it was when they actually started the program in march. The u. S. Dollar is there. The e. C. B. Chief, draghi and janet were winking at each other in august last year in jackson hole. I dont think anyone would have imagined policy would have taken the turn that it has with the fet not tightening at all and the e. C. B. Running its awesome policy that no one thought they could ever put in place except me. Francine there you go. Senior economist at westpac. Guy james thinks there is still the possibility of a rate hike coming through from the fed. Do you think the fed will raise rates this week . Tweet us at flacqua and guyjohnsontv. Francine tumbling crude prices have hit shell. Their first report since announcing their 17 billion acquisition of b. G. It was a big beat. They expected 2. 5 billion. Down 56 on earnings last year. Oil prices down 50 . About 1 so a barrel last year to about 55 in the First Quarter this year. You know, it was interesting to see the result from investors, how would they react . Share price up a little bit. No one incredibly surprised after we awe all of the European Oil CompaniesBeat Estimates and all of them for the exact same reason comes down to refining. Really saved their bacon and alsoing. We had a lot of volatility. That helps those traders. Here is the question. Will the share price of shell stay up today . If history is a guide, almost certainly. Last time they reported their First Quarter earnings in all of those cases, the share price had gone up 3678 this could be a clean decade. A niss little victory for the a nice little victory for the c. E. O. Ryan a beat. You know for many of the same reasons, refining really helping out there despite the huge drop in the crude price. Another thing, the Company Announced was an of about 6 billion on its u. S. Assets. These are unconventional shale drilling assets in pennsylvania ohio in the east in north dakota and montana. All the big Oil Companies that have had shale assets in the United States have written down those earnings. You might remember shell had a huge writedown last year. The reason was Natural Gas Prices very low in the United States. That was going to come. Investors, you wonder, impairment. Are they hearingimpaired . It seems like it fell on deaf ears. No one cares at all. Francine thank you so much. Ryan chilcote with the latest on shell and statoil. Guy we have had a lot out of europe today. S. P. Micro falling short. Underscoring the pressure it is seeing from rivals. Francine beating estimates. You can see basf beating estimates. The only gainer really, if you look at the three, stmicrodown. Nokia and sanofi down as well. Guy lets take a look at what else is on our radar this thursday morning. Greece and europe targeting a preliminary deal of may 3 for a deal. Francine lafarge reported First Quarter 593 swiss fraungs below estimates. Well be joined later this hour by the holcim c. E. O. That is a conversation you dont want to miss. Guy airbus earnings fell in the First Quarter. The drop comes after its airliner unit delivered fewer planes. The company confirmed slightly higher deliveries for 2015. Francine well look at r. B. S. s loss and b. N. P. s surprise gain. Veteran hotelier joins us. Well get his thoughts on the u. K. Politics ahead of the election. Francine welcome back to the pulse live on bloomberg tv and radio and streaming on bloomberg. Com, your tablet and phone. Guy r. B. S. Posted a larger loss than estimated. B. N. P. Paribas reported a surprise jump in profit. Shares are trading lower. Lets find out what is going on. Richard, let me start with you. My sense, having looked at the numbers is were going to be stuck with this for quite sometime. Richard i think that is the case for sometime. Heading into the election the government seeing r. B. S. Still making losses seven years. 45 billion pounds of taxpayers money. It is a huge amount. The biggest banking bailout in the world at the time. It has posted yet another loss. Underneath that, the business is doing ok. They are improving. When you strip out all of the restructuring costs that they are taking. Taking a big charge for potential fine for currency market manipulation. Payment protection insurance which rumbles on here in the u. K. Not going away any time soon. Were stuck with them for a while. Francine what are the hurdles that they have to overcome . Is the bulk of it defined and they just to have get better at what err they are doing . Richard exactly. 3 the bulk of it fines, customer address programs and a smaller number, 450odd million towards the restructuring toward the Investment Bank mainly. They are taking out a huge amount of costs there. That is having an impact on the earnings. The profitability of the business is they take out more employees and more business lines and that is going to recur in each quarter, the management of the bank said today. Were going to still see that throughout this year as they try and create the banks that they want to have in the future. Guy an odd way of looking at this. With all the fines and p. P. I. Effectively, tuck taxpayer is getting a really big dividend because they keep throwing money back. Francine that is a good guy im trying to look for a positive spin on this story. Seriously, how long is this going to take to work out . Richard quite a while yet. The management said they would like to start paying dividends. They are thinking about this kind of thing at the moment which is crazy given that still making losses. However they said they would like to do that one the next parliament. That is a fiveyear term. Francine long term. Richard it is indeed. The government said they would like to start selling shares of r. B. S. As soon as practical. George osbourne said he would like to as soon as the next parliament. It is going to take longer than perhaps he might hope given that r. B. S. Is going through this massive Restructuring Program still incurring costs with that over the next couple of years. There are fines to come. It is going to take longer than expected. Francine richard, thank you so much for the latest on r. B. S. Our banking reporter there. Now lets move on to b. N. P. Paribas surprise profit surge. The stock is trading lower. Caroline, walk us through the numbers. Caroline good morning francine. The earnings were well above estimated. There is a mixed reaction on the markets this morning. The shares are trading lower. It is good on trading. It is slightly disappointing on capital. Some analysts said they are slightly disappointed by the capital ratio which will remain stable at 10. 3 and the leverage ratio which fell from the First Quarter of last year to 3. 4 in the first three month s of this year. So the good headline on the Investment Bank might be slightly overshadowed by the softer performance elsewhere. The Investment Bank did indeed post a very good performance. The pretax profit was up 88 to 1. 13 billion euros compared to last year. A very good performance here of the Investment Bank. And it is also seeing a gradual recovery in demand across the eurozone. They had a better position. Also a better performance in italy and belgium. A slight disappointment also on the pretax profit. I spoke with the c. F. O. Of b. N. P. Paribas and asked him whether this recovery was attainable for b. N. P. Makes sense from a good performance and in our specialized businesses. As coupled with positive meaning our revenue is outpacing our cost low cost of risk, the acquisitions that b. N. P. Paribas did last year. Acquired later in france then germany. These elements contribute as well. But the main thing is if you look at c. I. B. , it contributed if i look to the Exchange Rates it contributed an increase of 13 . 15 global markets. 15 corporate banking. All stemming from business demand. High transactional volume on Security Services and actually growth in europe and asia pacific topped off with strong growth in the u. S. Caroline do you foresee this is going to be sustainable . There has been a good demand in quarter. Equities business is up. Lets not forget from a Strong Quarter actually last year, i would say it is off to a good start of the year. Well see how the glimmer of hope translates in a sustainable growth. Caroline this glimmer of hope is continuing today . What we see in the First Quarter is what we see if we look at our domestic markets for example, we have an increase of 1. 6 . A first indicator of some progressive returns. Caroline so there is a glimmer of hope this year for b. N. P. Paribas. The shares are down this morning but it has translated in a 15 rise in the shares since the beginning of this year. Well have to see how the u. S. Economy slowdown plays into b. N. P. Paribas next month. Game coming up, is greece headed for an exit . Those polled by bloomberg say yes. Details next. Francine a majority of investors surveyed by bloomberg said that greece will leave the euro. The finding comes as greece and its euro Area Partners are steppings up talks. Guy to fiend out whats going on, hans nichols has the latest. So the numbers on the poll with quite tight but the majority still has them leaving at some point. Hans yeah. 52 . What is remarkable another 52 , surveys that view bloomberg, it was just 31 four months ago. You really see a change. That is one of the reasons there has been a stress on the banks and just yesterday it increased by 1. 5 billion euros up to 76. 9 billion. Real stress on the banks. Guy . Francine hans what is with the sudden optimism . Hans one, mr. Tsipras is saying im in charge now controlling things. That is part of the optimism. I would caution against that saying we just heard from an e. U. Official saying that the idea of having a deal done by sunday would be optimistic. We spoke with a leader who has been talking about the challenges and what other countries can learn from the greek situation. Good interview we had with them. Now it seems there is optimism on greece. Well try to report back a little bit more and get a better sense on whether this optimism is merited. Guy . Guy hans, thank you very much indeed. Hans nichols joining us from berlin. Francine coming up, well talk to a holcim c. E. O. First about its latest earnings and its deal with lafarge. Guy you can tweet us. Join the conversation. Get involved at guyjohnsontv and fran seen is at flak flacqua. d im guy johnson. These are the Bloomberg Top headlines. Francine the Federal Reserve has left open the prospect of a rate rise this year. After a policy meeting, the chair, janet yellen, and her played down the significance of the u. S. Economys slowdown. They say growth will pick up to a moderate pace. Guy brazils central bank has signaled it will raise Interest Rates in june after increasing them for the fifth time since october. The key rate is up by half a point overnight. The decision means brazil is the only g20 nation to raise rates in 2015. Francine the leader of spains Podemas Party has weighed in on the euro crisis. He told bloomberg that european powers should not oppose too harsh reforms on britain. It is a problem for european democracy. We have to negotiate and we have to organize european powers in a different way. It is impossible for a state to pay the debts without austerity. Guy interesting view. Holcim reported higher firstquarter profit this morning. The company is in the process of merging with lafarge to form the worlds biggest summit maker. We are joined now by holcims ceo, bernard fontana. Thank you for taking the time to join us. The first question is, what happened in the middle east and africa that dragged these numbers lower than people were anticipating . First, good morning. Africa is a bit down because there was very bad weather at the beginning of the year. This is a kind of oneoff. The net income of the company has more than doubled in the quarter at 178 billion swiss francs. The return after tax is now 8. 1 . It goes in the right direction. Cash flow increased by more than 12 . We report in q1 this year compared with Previous Year. Last year, there was almost no winter in europe. The contraction season started already in january. We also saw [indiscernible] in india compared with the Previous Year. Globally holcim has been able to improve the price by 4 compared with the Previous Year which is better than we experienced in the past. This combined with the fact that we continue to cut our costs means that we improve our margins and we confirmed our outlook of an improved operating profit between 2. 7 billion and 2. 9 billion swiss francs. Francine mr. Fontana, give us a sense of how concerned you are about Foreign Exchange in the coming months. Bernard for