Francine welcome to the pulse. Right here in london, i am Francine Lacqua. We have a great show lined up. Joining us, Rupert Harrison, chief macro strategist at blackrock. Lets check in on the markets. We will be joined battle mark gilbert just joined by mark gilbert joined by mark gilbert. Dollar weakening against most major peers. All jumped gold jumped. Equities decline in europe. Asia also declining as oil retreating a touch on brent. Where at 48. 44. Is get to the burkes first word news with nejra cehic. Nejra the minutes from the rba meeting where the Central Bank CutInterest Rates for the second time in four months were released today. The cuts would boost inflation. Big investment banks, the European Headquarters in london will start the process of moving jobs of u. K. Within weeks of the government triggering brexit. That is according to people briefed on the plan being drawn up by four of the biggest firms. They say executives are planning for the worst as they will lose the right to Sell Services freely around the eu. Donald trump has laid out his plan to defeat i. S. On further terrorist attacks in a speech in ohio. He said he would hold halt immigration from countries with a history of exporting terrorism. Overdue to is develop a new Screening Test for the threat we face today. Vetting. Extreme i call it extreme, extreme vetting. Problems. Y has enough. E dont need more these are problems like we have never had before. Francine joe biden has called Donald Trumps rhetoric a threat to u. S. Troops, campaigning with Hillary Clinton in pennsylvania, the u. S. Vice president also sharply criticized trumps suggestion that russia launched Cyber Attacks on america. This guys shame has no limits. He has gone as far as asking putin and russia to conduct Cyber Attacks against the United States of america. Even if he is joking, which he outrageous thing to say. Francine theresa may has totten to chinese president express her desire to the u. K. And china. That is according to the uks new asiapacific minister. The government reviews a project in which china could be a partner at speaking in beijing china ay, he called global partner. Global news, 24 hours a day, powered by 2600 journalists and analysts in more than 120 countries. I am nejra cehic. Francine. Francine a new policy for a new normal. Todays reality calls for a fresh approach to central banking. That is according to John Williams. He that is an argument he has been making. In an essay released last night, williams writes while gdp targeting monetary authorities are optional, fiscal and other policies must also take on some of the burden to help sustain Economic Growth and stability. Chief macroson strategist at blackrock. Rupert will be staying with us for the whole show. A lot of news from downing street. Every time we have you on, we have a lot of reading news. Thats a lot of breaking news a lot of breaking news. If you take a look at what a lot of central bankers are doing, they have not achieved with a set out to do which is increasing inflation. Need to abandon that mandate of targeting inflation . Rupert the speech by John Williams is interesting. This idea of a higher inflation 2010, a comesnd when was talking about it for a while. Central banks around the world would love a bit of inflation. If they were going to make an error, they want to have too much inflation. We have seen in the u. K. As well. UseMonetary Policy start to in 2012, the u. K. Government explicitly used a communication device to say theyre willing to tolerate higher inflation for a longer possiblynger po markets were ahead of the Central Banks. Central banks are going to tolerate our inflation. This is a part of the asymmetric risk that they face which is theres not much more they can do. If inflation is too high, they feel they have to do with that. Peoplee something about in certain circles talking about. What can they do . Lets move your target from 2 to 3. 5 , what can they do completely to try and spur that . Rupert they need to shift expectation. They need to change expectation of the firms and workers who are setting prices. That is going to depend on having credible tools. In the u. S. , public one of the it is one of the only economies where the economy is beginning to generate some domestic inflation. It is subdued. We are going to see more Inflation Numbers in the u. S. The challenge is more and other parts of the world, japan, the eurozone were such a banks are running out of ammunition. We are seeing increasing pressure on governments to step up with fiscal policy and other policies to try and generate inflation. Francine are you a believer in helicopter money . At it push back yesterday i had prospectus today i had push back yesterday. If youre explicit about the fact that we are printing money to spend it. Somewhere like japan, you have to factor that they have helicopter money anyway because the government is spending money and the central bank is buying all the debt. What are the expectations of consumers and firms about the future inflation . Demand ine source of the economy theyre going to dish that are going to generate that . That are going to generate that . Incrementally, i dont think we should give up our expectations about fiscal policy too far because it takes a long time, not easy to spend money. Francine it has to be the right one. Chief macro strategist at blackrock. He stays with us. Were getting started. We have plenty more coming your way, including an 81 drop in profits for the worlds biggest Mining Company. Ahead of the bloombergs interview, we focus on the was commodities producer. Our banks planning a exit. Could we bring you that bloomberg exclusive story. As the bank of england sets up its bond buying program, is it now time for governments to step in . Will discuss global growth. This is bloomberg. Frank i am Francine Lacqua here in london. Lets get to the burke business flash with nejra cehic. Nejra has removed its ceo sing the role has become so complex that it traditional management profile was no longer adequate. Bynk manion will be placed with immediate effects. Shares have fallen 22 since he took over as ceo in march of last year. Talks. Ere has held the combination of the two companies will create the Worlds Largest supplier of industrial assets. Warren buffets pressure hathaway posted boosted its investment in apple during the Second Quarter when the stock slipped according to a regulatory finding. 55 to 15. 2 million shares. Copper Miner Antofagasta has seen its revenue slump 18. 5 on lower prices. Speaking to bloomberg, the ceo says he sees profits rising in the mediumterm. Copper has traded sideways this year and we have seen a summer demand in the first half in china which represent around 50 of copper demand. The outlook for copper is favorable in the mediumterm. In the shortterm term, there is more production coming to the market. It is going to be similar to what we have seen recently. We see that the market will get tighter. Markets will start to increase. That is the Bloomberg Business flash. Francine shares are up a little after the worlds biggest Mining Company reported in 81 drop in profit. Classic monster prices is behind in plunge a 25 year low january. What these numbers can tell us about global growth, we are our guest host, Rupert Harrison. Stewart, first of all, thank you for coming on. We dont have an hour so lets quickly go down the list. Slightly below expectations. You have to think in this environment, negative yields just about everywhere. Has to bef dividend some sort of prize asset. Maybe that is a reason why shares are a little higher. By and large, the company is still managing to pay dividends. That is the take away. Francine how much can they tell us about the strengths or weaknesses in the World Economy and how much is it about these Huge Companies that see the downside and cut costs. Down 60 which is phenomenal for a company to do that in a year. If you lookis at their forecast for 2017, issue that number going up. The first time for a while. Certainly showing not as much pessimism. If you look at what theyre putting the money into, it is going to go into copper. Francine does it tell us about china echo about china . We caner the best lens look at china . Stuart i dont know if it is the best. It is one. There is such a glut. What is interesting about bhp, they are quite bullish in china. Theyre expecting the government to keep gdp between 7 . Relative to the economic community, that is quite a bullish outlook. Francine what is your take . Rupert it comes down to china for most of these commodities. They are significantly more cautious and we had a bit of a bounce. And that looks unsustainable, the housing market. We are still seeing over the mediumterm this steady downward trend in china. In that environment, it is going to be difficult for these for the chief executive sounds bullish about the mediumterm. It is hard to see that story personally. One, the we had glencore chief executive sounding bearish. Are we going to see more consolidation . Radio is probably the most consolidated industry group. In terms of the largecap companies, they have had varying degrees of success. Lots of people want to sell assets. Very few people are willing to pay the price. We have a complete disconnect it between valuations. Nothing substantial. Francine group, what is your take on china overall . Are we seeing the type of regulatory policy was on january . We are going to see this stop go cycle. They are serious about some aspects of the reform story. Whenever growth slows, you see these spurts of credit creation. They are finding it harder to make that credit count. I think well see a slow term declining growth. Dependent on some of that growth. Oming back sustained at 7 in the mediumterm, i dont see how that is going to happen unless youve got a real willingness to take on some of these very difficult issues. We just have not seen that. Francine rupert, think its a much. Thank you so much. Well be back. Stay with us, we will be talking to the ceo of bhp billiton. Up next, our banks running a brexit . Could investment banks move jobs out of london . Could be sooner . Will bring you that story next. This is bloomberg. Francine welcome back. Big investment banks with you European Headquarters in london could start the process of moving jobs. That is according to people briefed on the plan being drawn up by four of the biggest firms. Lets speak to michael moore. He is in charge of u. K. Banking team. Rupert harrison from across is still with us good michael, there seems to be frustration with us. Michael, there seems to be frustration. Frustration with top bankers and ceos that the u. K. Negotiators are still staying they can have access to Single Markets without giving in to a Free Movement of people. Michael the u. K. Government needs to take this time to convince banks they had a plan to keep passporting and a very reasonable one. The banks dont feel like that is happened. There seems to be this feeling from the government that they can get everything without giving up much of anything. The banks are concerned i that. Concerned by that. The process of moving people is going to take 18 months to two years between getting revelatory approval, Getting Office space them all of the logistics, they need to act quickly. If they want to have people in place when the twoyear negotiating period is up. Francine is it linked to brexit . Cuses . T more like brex michael i think this is tied to brexit. Betweensa lot of in between full passporting and not about all none at all. Banks held up the hope there could be some arrangement where they can keep full passporting. That is looking less likely than it was immediately after. You are talking probably thousands of jobs across the sector. Francine rupert, you are one of the rare insiders. How surprised are you that we dont have a plan yet . Rupert i am not very surprised. It is difficult to draw up a plan. If banks are moving some of these jobs, i think that is a rational thing to do. It is very hard to see the shape of the deal with the rest of the European Union that preserved Single Market rules and access and financial services. If you want anything real on Free Movement people, that is the first thing to do thing to go. The struggle will be maintaining Single Market and other places. The other thing is if you want to test even if youre not a member of the Single Market, can you maintain access . That is difficult for a big Financial Center like the u. K. To run large operations under someone elses rules. It is extreme the difficult. You will find the u. K. Regulators will be concerned about that. It is hard to see a way to run through this to maintain these Single Market access roles. Francine it was the day that theresa may moved over. Have you learned anything in the five to six weeks . We have learned how difficult this is going to be. We got not just one negotiation, but at least three negotiations. New relationship is and what is your relationship with the rest of the world. They are still in the process of putting together the department of people, the negotiators, the strategy. We have seen some stories that the timetable could slip. We may not trigger until later here. You really need to have your ducks in a row before you start the countdown. Youve got some very significant elections in europe next year. You wont really know who you are negotiating with until it is done. It is going to be long, slow process. Francine michael is so happy he moved from wall street to cover u. K. Banks. Michael, if we do trigger article 50 in 2019, what does that mean for job losses . Will some of the u. K. Banks wait . Or will they move jobs out of london and she replaces like earning him . Manchester . Michael the triggering when it happens will matter. A there is any negotiation on longer negotiating time. Hell a time longer time he oh a longer if theres going to be a twoyear window, there is a clock ticking on banks to make a decision on whether to move people in the u k in the u. K. Or start cutting jobs. Francine guys, think you so much. Coming up next, we have the first hard to data after the referendum. We get that. Will we see a inflation acceleration . Will they do like they suggested in the past. We will break down the numbers. , not is quite a lot of even in strength or relative strength, it is a story of dollar weakness. We will going to that. This is bloomberg. [ clock ticking ] time. You only have so much. Thats why we want to make sure you wont have to wait on hold. And you wont have to guess when well turn up. Because after all we should fit into your life. Not the other way around. Everything is cool when youre watching a screen everything is awesome, when youre sharing a meme a voice remote, show me angry kings you know whats awesome . Everything apps that please, more selfies, endless hours of the best tvs brand new apps, shows to go, awesome internet thats super whoa. Everything is awesome xfinity. The future of awesome. Francine welcome to the pulse. Right here in london, i am Francine Lacqua. All expected Inflation Report for the month of july. This is after brexit. 20. 6 , a rate rising touch higher than the commons had predicted. July import prices surging at the most since 2011. We are getting quite a lot of news so we are trying to break it up to see the most important one. Ppi input, that 3. 3 much more than expected. This is the first piece of real data that we are getting, cpi month on month, it was a little bit better than expected. We are not seeing any revisions. The pound at 1. 2966. The actual number came in at 0. 1 . Pound extending gains after the cpi and ppi data. This inflation data as an official measure as the ua has made its official vote to leave the eu eight weeks ago. Joining me now is mark gilbert, and Rupert Harrison former chief of staff and macro strategist at black rock. Thanks for sticking around. The inflation data is stronger than expected, 0. 6 . Is this to be expected . It is something mark carney warned us about. It is a little bit harder than expected but a sickly inline. The bank of england has laid the ground for this. They have signaled explicitly they are willing to let inflation overshoot for three years or longer. They are trying to signal that this is a temporary shock that has to be absorbed. Chart thato go to a you sent me yesterday. The inflation figure and in blue, which growth. Wage growth. Does it make a difference if we are importing stuff . If you look at the chart, there is that long. 20102013 where you are underperforming. If you look at where we are since the start of 2015, the picture is a bit better. Weight growth is getting better. You want that gap to be there for longer. Have more money in their pockets, otherwise the company cant recover. Brexit means inflation could shoot up and go to 2 . Saying particularly petrol food prices are not being it is not going to accelerate inflation. If we are already going in, we need to see wage growth even faster. , that is not bad but it is still not great. Member has been very vocal that you are going to have a massive drag on the economy. Backine if we take a step , u. K. Inflation accelerating is also assigned there is further price pressure with weak pound. It is a very interesting chart. You are going to see those lines cross again. You are going to see inflation moving well above 2 over the next 12 months. We had seen in the last 18