tv Bloomberg Markets Asia Bloomberg June 6, 2022 10:00pm-11:00pm EDT
rishaad: nearly 10:00 a.m., this is bloomberg markets. yvonne: the yen slides to a 20 year low. we are talking 132. pressure eases on the tech sector, signs beijing is preparing to ease the regulatory crackdown. commodity prices jumping to a record as the war in ukraine chokes energy and food supplies. exclusive insight on inflation and growth outlook with the economy minister rishaad: to the downside equity was. yields moved to the upside. we have had the reserve bank of
australia with a decision on interest rates. that yen, big story of the day. sending it to levels we have not seen since 2002. signs of peak inflation flashing in chips, shipping and fertilizer. david: hopefully the last one is a leading indicator, because when you look at the pain points, in terms of what you mentioned, equity markets we are down across the board with the exception of the nikkei entering the last half hour. we talk about the yen, the strong dollars story. the south korean won is down about 1%. these are the key yen profits to watch. 135 and change.
150 seems to be the next line in the sand. have a look at the aussie. we have the rate decision out of australia price for 25, slightly more priced for 50 in terms of the swaps. if you ask economists, it's 25 at least. 15 economists we have surveyed think we will get 25 basis points, the rest see a much bigger rate hike. rishaad: we will have a look at commodities. australia, the kfc is having to replace let us with cabbage. yvonne: wow. [laughter] rishaad: looking at spot commodity prices, food supplies roiled by this conflict, we also have the spot index, raw
materials, highest level ever, what going on in ukraine. disruption to bring supplies, energy supplies. 92% year to date. yvonne: natural gas, wheat, watching chinese tech and focus, perhaps this regulatory probe is nearing its end, they can republish mobile phones. there are questions about how sustainable the rally is. we saw optimism yesterday. we were talking -- the sentiment
is improving, but you have to see the fundamentals repair themselves before we see any sustained rallies. rishaad: north asia correspondent steve engle. what do we know? we have these reports, feelings, the crackdown may be coming to an end. we have been here before. stephen: it's a wall street journal story that people sunk their teeth into citing unnamed sources. we have not gotten confirmation from didi. the nuts and bolts is this company where regulators have
gotten shareholder approval to do list from the united states, it's been bad news after bad news. the wall street journal saying this company along with two other chinese companies under regulatory probes, they have been -- online recruitment company. an online aggregator of trucking services. anyway, less high profile. they have been told the app could be back on mobile platforms, it's convenient timing just one -- you are absolutely right. there is a little bit of caution going on in the markets. we have been down this road before.
when are we going to get concrete proof that the crackdowns are done but the companies are confident to start spending? they are feeling directly tory pressures -- regulatory pressures. yvonne: licensing issues, anti-monopoly probes. stephen: according to the story they will be faced with fines for whatever thing they did wrong, including handing over 1% of the company. yvonne: we are not clear about hong kong listings. stephen: they have to get through the delisting process in the united states. we got shareholder approval.
if they go back to hong kong, investors would welcome that. yvonne: stephen engle with the latest. we are watching what's on with fx rates, rem, rendon b. -- the yen, rendon b. david: the boj governor talking about how it's necessary to watch the currency impact reading between the lines, the weak yen changes different economic entities, it looks like they are trying to get a consistent tone on all of these lines coming through. this seems like verbal intervention, but to tell us more, our senior fx and rates
reporter is here. we are closer to 133 then 132, is this a case, are we looking at verbal intervention. >> it does appear to be the case. this has been bandied about, at what level would this help the yen slide? we are seeing kuroda talk about the yen, the weekends impact on households in japan, so you have investors in tokyo for example, others are saying 140, tank of america is one of them. it depends on who you talk to but intervention should not be
taken off the table. david: what should i believe? >> the multimillion dollar question. how you trade, how do you make money? until there is a firm tone taken by the boj, how they are looking at the monetary policy. you can can send you to see pressure on the yen. david: euro-yen. 141. >> speaking with the head of
trading earlier this morning who basically said the first thing i look at is cell yen orders whether is the aussie, euro or emerging markets. david: ruth carson. yvonne: pouring fuel. let's recap what we are hearing from hong kong. talking about the government, having internal meetings, we have seen cases rise to six-week cause, the line we continue to see is hong kong is going to be keeping covid measures unchanged until the end of june.
it exposes a bigger rebellion. pressure has been building on johnson for week. twitter saying it will hold elon musk accountable for his takeover. must believes twitter is breaching the agreement. shares falling in new york. further widening the gap between the valuation and must offer. david: just ahead, we are speaking to the malaysia economy minister about the country's socio-development plan. do not miss that exclusive interview. yvonne: central banks around the world are turning hawkish that
rishaad: 7.1 percent, the inflation rate. the inflation demon is out. thank you. everybody is in the mood for typing. -- tightening. reporter: that's the thing. inflation is everywhere. the energy basket, the food basket. pay attention to what each country can do fiscally. i'm keen on malaysian government bonds.
fiscal reactions are different. weight is very similar. i prefer malaysian government bonds, especially when you think about it, that's one of the largest net oil and gas exporters. the government is pressure to ensure at the very least, we have seen thailand increase fuel prices. that's the big difference here. yvonne: this underperformance and thailand. the market still seems to think
they may not raise rates until the fourth quarter. you're still starting to see people extend duration. >> i am on the opposite side of the trade because a fight acknowledge liquidity is flushed,; coming up on that is a question mark at the moment. tourism rebounding, domestic growth, the net of that starts bringing inflation back into play. the bank of thailand can sound as dovish as they want, but that will start biting into pockets and they will have to move. i think they will stay on hold, they will be forced to sound more hawkish. i am all for high yields moving up.
fiscal wide, they have to keep borrowing. you're looking at high yields. david: up until money market rates. >> i like the steepening trade. it's going to hold liquidity flushed. k monetary, fiscal policy. if you have more fiscal issuances coming through, the backend is going to drift higher. it's a great hedge against u.s. treasuries. rishaad: what other headwinds? the obvious would be another wave of the pandemic.
how much would a recession affect all of this? >> if the u.s. goes into a recession, yes. i'm seeing some change in policymaker behavior which will help support the rest of the region if you get any sort of dollar strength. the other two things i'm looking for is a resurgence of covid and the chinese economy and midterm elections coming up for the u.s.. i am not sure what geopolitical
announcements can come forth there. yvonne: given those two risks, which markets do you cover that seems to be more vulnerable to these risks right now? >> i definitely stay away from the likes of -- there are more capital imports. given china is the center of attention, i am favoring a shorts trade as a bit of a hedge versus something like adr. at the end of the day if things do blow up, that will depreciate. yvonne: thank you so much for joining us. plenty more ahead.
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yvonne: equity markets and the red this morning with the exception of tokyo. bain capital raising $2 billion for its second special situation fund giving at the biggest bull of capital focusing on restructuring credit in the asia-pacific. they have been accelerating expansion in the region since 2015 seeing what it calls pockets of volatility. the ftc is investigating whether binance rogue rules. we are told -- broke rules. we are told the regulator is
looking into whether they should have registered. binance faces multiple investigations. apple unveiled a flurry of features and services including a pay later option. the upgrades come months after ahead of the launch of the new iphone which accounted for more than half of apples earnings the last fiscal year. the updated laptop will have a new design. apple intended to launch the macbook air in 2021 but was delayed. rishaad: looking at what is happening with supplies. let's have a look at some of these companies which are being affected.
there we go. not overly impressed. 1.3% down. the tsmc is a bit weaker. these new capabilities for the macbook and some other things not really moving the dial with regards to investor sentiment. david: looking at tech plays in china, the benchmark itself, we opened weaker, we are up 25 points, it looks like we will pose a significant challenge, give it a few more days. the hundred day moving average is what you want to watch. it looks like more signs of a bottom. yvonne: we are watching defense stocks in south korea, coming back from a holiday.
first to respond when it comes to this ballistic missile launch we saw from north korea on sunday which is setting records for kim jong-un. we are seeing defense stocks spike on the back of that. the deputy u.s. secretary of state talking about how they will respond if we see more moves, forcefully respond if north korea conducts a new test. rishaad: the tell you what we got coming up right here. equity markets mixed, going in one direction which is down, we are speaking with a seat -- chief sustainability officer about financing the moves towards global decarbonization. that is going to be next. th david: just heading into the
lunch break. 6/10 of 1% to the upside on dollar-yen. we are looking at some key crosses as far as dollar-yen is concerned. 132.70. we are right at the session highs on japanese currencies. euro-yen, 141, aussie-yen in focus, a proxy for risk appetite. yvonne: we are expecting a hike. maybe even more legs on that rally as well. you mentioned the surge in commodities, the import bill in japan, record high due to
natural gas. prices. it's been a one-sided trade, oil prices -- opec-plus, the rest is about the china recovery story. it's a hot summer in the u.s., natural gas prices is what we are watching out for. reopening is playing out here today. rishaad: could see a little bit of froth on wheat prices. australia is the world's third biggest wheat producer after the european union and russia. the fourth biggest ever harvest this year. that could mean more could be coming on the market. we had the last two slightly
bigger, 2016. the question is, does this reduce inflationary pressures? the reserve bank of australia -- yvonne: commodities is the big? it things like -- you look at things like, maybe we have peaked, whether it's chips, fertilizer, shipping rates. we are well off the peaks we saw a few months ago. basically back close to pre-pandemic levels. it's interesting to see if it continues. david: we are well off the highs
from this year, what does it mean for equity markets? we are looking at 30 day and 15 day. just across the board, the asia-pacific, every single one, 30 day view is positive. where commodities go, equities go. we are at a record, it's counterproductive for every sector irrespective of where you are. the energy index is the only index that is up this year in the asia-pacific. we're back to the highest level since 2018 on the msci asia-pacific energy index.
rishaad: carrie lam said some classes will be suspended, but despite despite, hospitalizations and deaths remain relatively low. let's take a look at sri lanka. the president says he will finish his term despite months of protests calling for him to resign. he spoke to bloomberg in a rare interview. protesters have camped outside the residence since mid-march, blaming him for the economic crisis. the turkish president says his government will continue cutting
interest rates even as inflation soars. the benchmark is 14%. what do you think happened to the currency? losses got extended. the lira is the worst performer this year. singapore is advancing his leadership succession plan with the deputy prime minister. the 49-year-old becomes a deputy and is acting p.m. and an absence it remains unclear when the succession will happen. that is a look at the first word headlines. yvonne: singapore has committed $3.6 billion to an investment platform aims to accelerate decarbonization.
we spoke with steve howard at an event. he told us carbon zero is a megatrend. >> it's a dedicated investment platform focused on three areas. technology, solutions, nature, things like deforestation, regenerative agriculture. the carbon ecosystem. those will be project developers coming through with things like satellite technologies where things you can monitor biomass and natural systems. it's those three areas. we have a dedicated team asking how we can drive that carbon ecosystem to scale. >> are there are enough projects? it's difficult for capital to find good projects. >> the good thing is, we are
seeing capital markets wake up on climate change. net zero is the new normal. whether you are a private equity firm, people are starting to look deep in a way that was not there two or three years ago. there is this tremendous opportunity in terms of entrepreneurs maturing over several years. on the nature side, there is a finite amount of capacity. that's a welcome thing. we have a dedicated platform. >> most of these projects are long-term projects and hence investors are looking for higher returns given the higher risks involved. >> we are a trend aligned
investor. looking at megatrends. sustainability and climate change are a megatrend. we can debate net zero, the businesses that can enable that. yvonne: that was the chief sustainability officer speaking to our colleague. coming up, the economy minister joins us exclusively and we hear plans for sustainable development. do not miss that big interview, coming up next. this is bloomberg. ♪ \\ david: let's have a look at
southeast asian markets. 40 minutes in jakarta. mixed picture, nothing much happening which is -- we're down 7/10 of 1%. rishaad: let's have a look at malaysia, and increasingly steady footing. youth indicates the central banks caucus pigeon -- it's in --it vindicates the central bank's hawkish pivot. yvonne: optimism on reopening. emerging out of covid. do you see any risks to the
growth picture given what we are seeing? >> good morning. we have forecasted growth from 5.3% to 6.3%. this is premised on good growth in the first quarter of 2022 driven by private consumption and public consumption. we are now in june. we are optimistic [indiscernible] david: what about inflation?
the private economist minister forecasted 4.6% for your country. do you think they're accurate? guest: cpi is an average number. if you talk to a man on the street [indiscernible] as you all know, cpi is an average number. we believe there will be a slight increase in inflation rate. that is a range we have forecasted.
going forward, the geopolitical uncertainties, the increase in commodity prices, prices are likely to trend upwards. there will be a slight increase. that is the forecast. we are fortunate because prices are subsidized. we only pay half of global market prices. looking forward, the possibility of subsidies -- this has resulted in stable prices. for the moment, we believe [indiscernible]
yvonne: can you tell us more about the strategy for inflation? chicken ban, subsidies for chicken breeders. you have allowed withdrawals of pensions. you mentioned target subsidies. what more can we expect? guest: chicken is a very important protein, the cheapest in malaysia. supply has not gone back to normal. there were issues of supply in the last two days but they have stabilized. chicken is under some control. in terms of strategy, there will be price control, we believe 60%
with stable prices. david: can you give us some guidance on how long or further you plan to have price caps in place? mustapa: work has begun on subsidies. the target is to ensure we will get subsidies. but the top 20%, that's in the works. those who deserve to be subsidized will receive subsidies. one is cooking gas, cooking oil. those are the four main subsidies. the biggest would be around 95. we are looking --
are committed to achieve the target. we believe with the commitment of everyone. we need the support of the private sector as well, and we know that our major corporations like petrel gas, other major corporate's can come forward and be forthcoming. rishaad: quickly, if you can answer this. how much is the private -- it's been a moving one. mustapa: we have been supportive. companies must abide. the central bank has been on
this. the bank is on board. some small and medium enterprises [indiscernible] with no full understanding of the net benefits of net carbon, zero carbon. that is one challenge we have. otherwise, corporate's have been supportive and central banks are pushing very hard. the government is supportive as well. the policy framework is coming out with the new energy with the set target on mobility. net zero by 2050. david: the final question.
the central bank raise rates. how many more rate hikes do you think you can expand this year? mustapa: early july. the last one was 25 basis points. inflation growth numbers, we do not speculate on what the right is going to be. analysts have been speculated, but it is not our job. inflation and growth numbers are two of the main considerations. thank you. yvonne: thank you so much for the time. the economy minister of malaysia. we have plenty more ahead. this is bloomberg.
continue sharing information. what we know about what's going on behind the scenes? is it buyer's remorse? >> it seems that way. meanwhile, we hearing from sources close to the matter that elon musk said the deal is proceeding. in an sec filing, he said he thinks twitter is breaching its agreement by -- a clear threat to end the deal. twitter has maintained its abiding by the terms. there were tech analysts saying either mosque has gotten cold feet or he is trying to negotiate better terms, in any event, legal analysts say there
is no way to walk away and there is a special provision clause were mosque may have to -- where musk may have to execute. david: coming up in 90 minutes, the rba rate decision, will they hike? how big will they hike? 25. it looks like they will move by at least 25 basis points. looking at what economists are saying and market prices. yvonne: they said you 40, right? -- they could do 40 right us to mark we are inching -- they could do 40, right? we are inching closer to 135. this is bloomberg. ♪
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