if the pboc mandate is domestic, why do they need to bother? expectations are always high going into g-20 meetings, imf meetings, world bank meetings. the reality is messages are never that clear. the one thing i would do is temper expectations if something major comes out of this weekend's meeting with that the bige of fundamentals that is driving market volatility today outside of liquidity is what is going on with global growth. china is clearly at the center of one of the questions of where is global growth going to come from. we have all seen china slowdown from a double-digit plus growth economy when they were going through their big capital expenditure environment, and we seen them drop into the mid-single digits growth environment. whether it is 5, 6, 7, none of us know, but we know they are transitioning from a capital expenditure environment to an operational expenditure environment, meaning the economy is driven by consumer spending p it was that mean? consumer spending is consumer discretion are spending. the world is trying to figu

increased. >> the pboc governor broke his long silence. what did he say gekko >> it's pretty significant he spoke at all. it's the first time we've heard hou since last august. there was a big change in august and the move in december. wasn't a newtself we have had officials say, we are not engaged in competitive currency devaluation. the fact that he said it at all should add clarity for investors. i think his key message is that we are not going to push the currency down to restore exports and competitiveness. we expect volatility along the way. at hisonly take him word, and we will see if he will stick by his word. there is a message coming from china that this is not about devaluation. >> that is what a lot of asset managers said -- the fact he said anything at all was a sign of support, and we also saw that in the fixed rates. >> that's to be expected. i should also say, on the exports, even with the yuan weakness, they haven't received much bang for their buck. even if china did want to devalue to improve exports, they would have to

the pboc is the helping hand. he wants urges to the most -- the yuan surges the most in a decade. ♪ francine: welcome to the pulse. live from european headquarters, i am francine lacqua. let's tackle the markets. we have a busy day ahead. in the u.s., bonds, stocks are closed for president's day. if you're watching from the states, happy residents day. -- happy presidents' day. on the rise. i'm tishri japan -- i want to show you japan. japanese yen falling for once. let's get to bloomberg's first word news with nejra cehic. nejra: china's yuan surged in the most -- surged the most in a decade. the central bank support the exchange rate. the currency advanced the most july 2005.ations -- hsbc has decided to keep its global headquarters in london, saying the u.k. is an important and globally connected economy. the vote was passed unanimously on sunday. hass these it -- hsbc remained there for 20 years and it is important for both investors and shareholders. say they willders not consider a replacement until after

that gives the pboc time to establish credibility. sound words, he gave some piece of a device -- establish a range. for the trading range when it comes to the currency. some downwardsee depreciation or downward pressure. david, thank you very much. great job in shanghai. the global market shortages at j.p. morgan, always great to get them into the hot seat. a lot to discuss, have a look at this. the world is waiting for the g-20 to give succor and life to the rally. the yen, andg into world bonds, what do you need to hear from the g-20? are you please with what the president said? monetary policy is still on the table. >> this is along the lines of many central banks. your hearing them still having tools, and are still ready to use them. speech, and it's a good message. it's what i would expect for someone working in the economy and the markets. manus: what would your best case -- but are saying what they need to the rebalancing story and provide a sufficient floor. how does that translate for j.p. morgan? what is the floor? is it cu

this has not been confirmed by the pboc. it would add to the concerns of the market that banks have overextended themselves. not necessarily the big chinese banks, it is the small regional lenders. the biggest acts have lost market share in the new loan race. let's take a look at what is moving in hong kong. any financials are being caught up in this news. a short while ago, about 20 minutes ago, no banks moving significantly at the moment. we're seeing property related shares doing well, up 3%. china having- sans a tough run because the tourist numbers are not there. we have mgm overnight reporting a decline in its numbers from macau. stripstrips the las vegas in terms of visitor numbers. it is a down day in south asia for the most part. japan nikkei 225 lower because the yen strengthening on risk aversion. check this out, index, another oil price has pulled back it easy oil producers following -- down about 10%. a lot of moves here, manus. the pboc course of action is what we need to watch every closely. manus: zeb, thank

stephen engle has been looking at what the pboc chief had to say. stephen: i want to pick up on thee haidi mentioned about fixing rate. as i sit at the terminal waiting for the latest trade numbers we are going to get, exports and imports, possibly money supply numbers, as well as aggregate financing. we are still awaiting those numbers from beijing if they do indeed come out. right now, the pboc earlier this morning said the daily yuan rate is at a six-week high. the onshore yuan, now trading sharply higher against the dollar, reflecting dollar weakness that we saw over the past week when china was on holiday. isnwhile, the offshore yuan weakening as the discrepancy that built up over the holiday starts to narrow. governoryou said, pboc iata has been often new -- advice, up a slew of saying the exchange rate is basically stable. he says capital outflows in his estimation are normal, despite the estimated record $1 trillion in outflows last year, that according to bloomberg intelligence. zhou dismissed speculation that china plans to tighten capital

i think that is something the pboc is looking at as well. cohen, chiefs gary operating officer of goldman sachs, speaking to david ingles from shanghai. let's go to europe, where mark barton sees european stocks higher amid for this stimulus speculation. mark: you said it, matt. it was the bengals -- people's bank of china governor who vocalize the weaker monetary policy that set the tone today. look at this: right here. european markets rising today. looking for a second weekly gain after we saw two weeks of declines. this is the industry pick up on the stoxx 600. every industry, matt, is rising today, except telecom. oil and gas tracking the price of brent crude, which is at its highest level since january of this year. what a wiki it has been for sterling against the dollar. this is the five-day job. four days of declines, one day of gains. the weekly drop, 3.5%, is the biggest since 2009. uncertainty ahead of the june referendum on eu membership. big data today out of the euro zone. we had inflation out of spain, germany, france, all tho

easy to manipulate and a lot more flexible for the pboc. tai hui: we have seen them using a lot more money market instruments to manipulate a level of liquidity, probably because they don't want to rely on the banking center, they want to use other channels also to get liquidity into the system. are seeing now a greater use of starter term money market servants -- shorter term money market instruments. and the next few months, we may see more interest rates reforms, and i would change the policy rate mechanism in china, and therefore they will be relying less on the lending rates are rrr, and instead using a market force lead instrument to enforce n china. angie: until we see reforms, we could be seeing more numbers coming through. we will let and see of course, as they say. in 20 come on back minutes from now. coming up, national australia bank posting a healthy profit increase, and the balance sheet is strong. but is it enough to convince investors? in sydney, when "asia edge," returns. ♪ reporter: stories making headlines around the wo

traders take a week off of the pboc is hard at work as fx reserves tumble. manus: the world's largest energy trader says a low oil prices could persist for a decade. vitol ceo.he and will volatility not the fed off of its rate path? manus: welcome to "countdown." it is monday. the: a warm welcome to program. china, big news over the weekend. the data for january and terms of foreign exchange reserves down by 99.5 billion yuan. the chinese central bank spending money to defend the currency. it was not as much of an outflow as feared. we have not even gotten into the year of the monkey yet. manus: it was not as bad as everybody thought. what we have is a little bit of a picture or our viewers in through this period 2014, 2015. defending the yuan is the real story that comes through. we are seeing volatility rise. it is the lunar new year. we are seeing traders paying more premium for the u.s. --the yuan to devalue going into this year. -- janet yellen getting ready to speak. that is the big mark on the calendar. she speaks this week. let's take a look at what

the pboc is the helping hand. he wants urges to the most -- the yuan surges the most in a decade. ♪ francine: welcome to the pulse. live from european

you need to understand, when the pboc speaks, it is not an independent central bank. the western world should not be using expectations like the federal reserve or boj or rba. speaking -- that is a big deal. the language was a little bit of jawboning they are trying hard on a steep learning curve to make sure that all of the good work they have done for capital reforms in recent years does not go to waste. nevertheless, it was a nuance. at the end of the day they need to have stability for obvious reasons. we are going through started in mid-november when the pboc did a shock devaluation over three days. we have not rebounded from that globally. anything that comes, expectations coming forward, and try to indicate the pboc is trying to get under control -- that is a positive. you have to put it in context, the boc really speaks online. they come out and try to reassure people. whether it works or not, is another matter. and asiathink markets are reassured elisa headed that chinese reopened. how are you engaging today? we have been risk offer a good year and defensive.

what the pboc is also trying to do is be able to ease policy. let me get to my next chart. bring down, borrowing costs without exacerbating this problem when it comes to capital outflows, because sometimes you have a one up move, a passing rate cut, for example. may not be appropriate for every part of the economy. that sends a signal to the market for them to keep selling down the yuan, exacerbating this problem we have had in 2015. let's see if this works. hopefully it improves transparency, what analysts are saying, because it avoids creating bigger problems when you don't need to cut and then you cut. sherry, fingers crossed. back to you. shery: thanks, david. the weekend is hurting japan airlines. weak yenen is hurt -- is hurting japan airlines. tourism in japan, but it has raised costs and other expenses. jal emerged from bankruptcy protection in 2014 to become -- in 2011 to become the most popular publicly traded airline three years later. let's get those shares up if we can. let's move on the u.s. airlines, because they have one thing -- they have won the right to f

the pboc also indicated that they sold dollars to protect the yuan. let's welcome in bloomberg's asia emerging markets fx energy oneditor. what does this tell us about the health of the chinese economy? >> hi, francine. what this tells us is it raises thed flag, and that depreciation on the yuan continues. one has to be really wary of reading too much into the fact that the figures turn out to be less than expected, because in december we had a record drop of $108 billion, and january it was $99.5 billion. it's not very far from the record. if mexico had depleted its reserves by $100 billion, it would have wiped out more than half its stockpile. indonesia would have wiped out all, as well as malaysia. clearly tells us there a lot of depreciation pressure on the yuan, and it complicates the pboc's efforts to boost the currency at the same time as boosting the economy. francine: what does it mean that they will have to focus on? if you are the pboc, how are you doing this? what is your next step? >> the next step is really difficult to say. what they ca

you wonder what is going on inside the pboc. they are having to deal with some very difficult debt issues. credit stories are having to be finally balanced. it is a difficult task. >> we are concerned about china, especially in terms of their communication. the one focal point we are looking at now. obviously, the currency is fonccus.sly in we are focusing on the march budget. there has been a prioritization of recognizing loan losses. the budget will give us the best signal of how the government is going to deal with the sort of the low performing assets. i think that is where the market is focused. yes, we're going to take on more of the nonperforming loans. that would be a good sign in terms of reforms. guy: what is your read on that? >> we think this year we will see more reforms from the government. essentially, after their december statement where they prioritized the capacity within the commodity markets, the capacity within certain parts of the banking sector,. that was a big shift some of thato see action and we think w

but the pboc is aware of that. i think the danger is, both onshore and liquidity offshore is highly controlled. it is difficult to know what the market is telling you, or the price is telling you every day, because the pboc is so involved in taking liquidity and a doubt of the system. i don't see a collapse in china, it -- at least not because of the collapse in the economy. we, co-authorhow of "red capitalism and privatizing china," joining us from singapore. next, stay in or go? that is the message the u.k. government is getting ahead of the brexit vote. ♪ ♪ shery: you are watching "trending business," live from hong kong. brexit ealed plan b for and says asia is bumpy. what is hsbc saying? >> the ceo has been talking to bloomberg. he said that asia may slow slightly. they had said previously they were going to put about 4000 stocks in asia. they would hire in the region in the southern part of china. but now, he is saying they may be doing that more slowly, slightly slower than originally planned. asia is st

we haven't heard from the pboc in a long time. we are starting to hear from him in a more regular basis. the market was confused about policy formation. we cut comments now. maybe it is a sign of them needing to get in front of the story. they are starting to communicate. how critical a juncture is that? this is another step toward having an open capital account. they're going to have a currency that can float. maybe not in my career, but it will happen. this is a step in that direction. they will show you what tools they have in their box. they have this very large foreign reserve. they have very high rates. they have huge structural reforms which they can do very effectively given the centralized government. i think he has a lot of tools in the box. worried about not the hard landing this year. growthforecasting 6.2% this year, 5.8% next year. a managed deceleration is what we're expecting. guy: all those tools in the box that kuroda maybe doesn't have. ramin nakisa stays with us. next, kuroda's inflation problem. japan cpi stay

mark: what does this tell us about the pboc's priorities right now? enda: obviously, the have a balancing act going on. the wider economic backdrop is one of slowing growth and perhaps a bit of a struggle for policy. at the same time, they don't want to out right cut interest rates, because it would put pressure on the yuan and further accelerate capital outflows. threat to china's economy. what they are trying to do is juice the system without cutting rates out right. we see them pumping money into other channels to make sure that banks are going to lend that money to sectors that want it most without getting into funding those areas that are suffering from overcapacity. mark: good to see you. thanks for joining us. investment officer at some global, juicing the system, is it going to work? sanjiv: i think the backdrop is this date on lending which you can see on the bloomberg chinese lending function. a spectacular increase. higher than the lending we saw in 2008-2013, when the chinese authorities told the banks to open their wallets and lend. peopl

as early as last week we saw with the change in the pboc governance that there will be more communication and transparency. that was affirmed over the weekend by the g-20. , clearat investors want direction from chinese authorities regarding policy and more on the national people's congress in terms of the long term thinking. they are looking to see what is the growth target for gdp, which we think will be 6.5% for 2016. rishaad: it is probably the only country in the world that hits its target and knows about it in march. tell me something, what would you particularly like to see out of this. people have talked about as so

breaking the last 94, pboc announced its cutting the reserve, ratio for all banks. joining us now is fred neumann, head of research at hsbc. good to see you. >> with that timing now from the pboc -- >> just as we came on. >> you still have plenty of levers to pull if necessary during the g-20 meeting. clearly, he's doing a bit of that today, but how significant is this? the monetary policy changes they've done this year, they haven't taken as much effect as they did in the past, has they got that much as he claims he. >> well, it's not going to be that helpful for the economy. what the economy is needing is more demand. it's important to signaling here, remember in january, the pboc said we're not going to cut the triple arc. worried about output. and accelerating, and now confident about capital outflow and change rate and coming out of g-20 saying we're going to do our bit to help the global economy. >> can you just put this in the context of all the liquidity measures? it feels like every day we're waking up and they're doing something orthodox or unorthodox. jus

wasn't the market really expecting more from the pboc? andreas: enda: -- enda: trying to inject confidence back to the global market. there is a feeling that the g-20 has not delivered. perhaps people were expecting a push that they would deliver interest rate quotes. anything, they overstepped the mark a little bit. fundamentals are not as bad as you would think from watching the global up-and-down of the stock market. has made clear over the last few days, they are willing to do more if needed. i don't think the market altogether expects them to quote interest rates in a hurry because they need to watch the downward pressure of the.gov -- of the yuan. this is the balance that is going on at the g-20. there try to send a signal that things are slow but no crisis yet. no need to pump up the volume. guy: do you think there was a message from the the peers -- from the peers to the chinese saying do not accelerate this. do you think the chinese are going to do this at a slower pace, because of what they have heard from the rest of the g-20?

what the pboc is doing to the chinese currency. ♪ guest things the chinese currency is unsustainable at current levels. he sees a sharp depreciation of ahead. he joins us now from tokyo. you are suggesting that the efforts by the pboc and other bodies to shore up the yuan is a fools errand? i think they are. a lot of the outflows from china are temporary. revenuers closing off left over from the renminbi trade, and chinese companies repaying debts. there is some capital smuggling in high net areas. i did a deep dive into the chinese balance of payments, line by line, and the most i can come up with is 45 alien dollars a month presently flowing out of the country that will stop. it would still leave china with the reserve loss of $55 billion. i don't think investors will become double that. we will be back to the situation that we have been in for the last few months, where investors know that no matter how big your reserves are, if you're intervening every month to keep the exchange rate up, at some point you have to give in and let it float. rishaad: surely the whole to not just val

i was at that speech where the pboc governor was speaking. he was speaking in english, which i guess also shows you he was catering to mostly an international audience. we know there is a need to ease. interest rates, real rates, are on the way up. the real debate was not answered. it was how they planned to do that. we are in a situation in china where capital outflows are getting exacerbated by speculation that the pboc will ease, so they cannot exactly just cut rates. to matt's point earlier, where you look at the borrowing costs on the way down, they are really turning to daily market operations to inject liquidity into the system and ease, to some extent, that. he also made the point on speculation that there is no basis whatsoever -- you look at the fundamentals of the chinese economy -- no basis for a persistent decline in the value of the renminbi. that speaks volumes to what they are now using to turn off, if you will, all the speculation that the yuan will fall further. it has gotten very expensive to defend it. there has been a mas

he also argues that pboc still has tools to deal with potential downside risks to china's economy. meantime, imf chief christine lagarde is warning large capital outflows from china do pose risks to the global economy. in corporate news, apple is fighting back against the u.s. government. the company argues the fbi's demand that it unlock an iphone belonging to one of the san bernardino shooters violates free speech rights and overrides the will of congress. we'll have more on that story in just a bit. and deal or no deal. top executives from sharp and foxconn plan to meet in china today. this is just a day after foxconn put its takeover of the japanese electronics giant on hold, saying it wouldn't sign the deal due to previously undisclosed liability. sharp shares down about 11.59%. despite that move, asia is green. >> it is indeed. that's not quite eradicating the big decline in shanghai yesterday. the other big story this morning, the republican slug fest. the dplgloves coming off last night. ted cruz and marco rubio attacking gop presidential front runner donald trump. >> he hi

. >> measured using combined with more flexibility would make it easier for the pboc to deliver. i think this is a viable option, but at this point in time, for it to be nondestructive to growth might be tricky. it is not really the answer to the economic problem we have in china. it probably helps the margin, but it is not the solution. the solution is more fiscal expansion, commitment to turning mored the housing market, infrastructure investment, and more tax cuts to the corporate sector. angie: chris weston does not expect significant moves from the pboc ahead of the lunar new year. >> i struggle to believe they will do anything outrageous at of the new year. are they going to be more along the lines of bank of japan and hold the element of surprise? perhaps. they are a central bank, which can surprise, unlike the federal reserve or rba. , -- asee eight evaluation tion, i do not think the market is prepared for that. angie: that was the word from asia on china. rishaad: swiss investor-gate. theering questions about swiss bank accounts of former malaysian officials. prosecutor

the head of the pboc absent from comment for many weeks, dismissing the need to tighten, saying there is no incentive to depreciate the yuan. that is what this move has done. let's show you markets in terms of what they are doing. all predicated on the view that you may well see the japanese do more. mario draghi speaking today. it is the first back daily decline in normal month. best commodity out there. you are seeing this rejuvenation in the japanese equities, all hanging on the possibility of iran is on course to deliver their first target to europe. that is more supply coming on. how is the market positioned? net long positions rise by 5%. that is stellar performance in crude on friday. we are seeing traders building up your long positions to the highest since june of last year. 114 sinceot reached the 10th+++ of course, what you are seeing here is a shift by the hedge fund. they are cutting their long dollar positions. let's get to caroline hyde. good morning. caroline: china's trade numbers underlined the challenges facing the economy. exports fell for a 16th straight month. th

can the pboc fight it out all? kit: i don't believe they can fight the reality of access supply in commodities and goods markets from the post china era. i think there are good disinflationary pressures globally. this currency war just shuffles the deck around. you can't get it to go away. keyu: in china, we have excess capacity. that is going to lead to a lot forces.tionary also, people are not spending that much. they have expectations of a confidence issue in china. francine: when you look at that chart that tom brought up, looking at china, there seems to be a couple of positive or optimistic views on china. when you look at services, consumer spending, which markets sometimes miss. keyu: this is being too as a mystic about china. services will be a major force of growth. urbanization is only halfway done. consumer spending is picking up. can china develop the right environment for these companies to be in a more competitive environment? tom: from your purview, can you explain to me what a china depressurizatio

the pboc probably counted on that. with the head of the pboc, what was he trying to achieve? jonathan: he was trying to say it is not as bad as you think, do not worry about a hundred billion a month outflows, it is going to be all right. he has to come out and say it and we had not heard from him for months and months, where you would of thought with all the fx turmoil he would've been out front. francine: it is a little bit like deutsche bank. of whereepends on kind you stand on the longer-term china story. how do you read what is going on, do they have a handle? or doneed to be patient you think the pboc will mess us up? marvin: there's a question of whether they will mess it up or eventually lose control. i think to jonathan's point, one of the things that they are learning how to do is better communicate with markets. we have seen the have had a problem with that. joe had been out there on a more regular basis, this would have been perhaps less of a risk event. this unfortunately worked out for them. people took confidence in it rather than seeing the opposite message in

that plus the weakness in the overall manufacturing number, that giving the pboc a few headaches. do they go for more expansion in terms of their monetary stimulus? we will keep an eye on what is happening on the chinese story. let's look at what is happening in commodities. we have seen some moves in commodity prices as a result of that data. both nymex and brent moving a little bit lower. both of those down by more than 1.5% compared to the close in the last trading day. let's bring to you what we have what thee futures, expectation is in terms of where markets are going to open up. a mixed picture coming through from asia. a continuing sugar rush, as my colleague was describing it, and the japanese session. asia overall.e in we are expecting to open up a little bit on the front foot this morning. caroline hyde joins us. caroline: asian stocks are trading higher this morning with tokyo leading the way on the back of the bank of japan's surprise move to negative interest rates. today's overall gains come despite falls in hong kong and shanghai. china's official factory gate signa

news suggesting the pboc could inject up to $1.5 billion in money markets. not enough to support sentiment. the shanghai comp finishing relatively flat. energy and financial stocks also leading the decline. we saw the asx 200 in australia down 0.8%, losing 39 points. also, across the korean strait, we saw the kospi finishing up at just 0.4%. only a few bright spots asia side this session. interesting to also note the majority of the markets are finishing the week higher. back over to you. >> dan, have a fantastic weekend. are you up to no good? >> of course. >> excellent. good. that's what we like to hear. we'll see you back again bright eyed and bushy tailed on monday. dan murphy joining us live out of singapore. now, comments from iraq's oil minister overnight leave the door open for iraq to join a russian-saudi backed plan to freeze oil output at january levels. he described moves to help shore up crude prices as, quote, a step in the right direction. neither iraq nor iran have officially agreed on the production freeze. oil's rally in the wake of the tal

eunice, thank you very much for bringing us those important comments from the pboc. you have to wonder whether this idea, the scary idea, a policy error by the most powerful people in the world, the central bankers. it's going to be discussed by them because it's certainly being discussed by the market. it starts in china with the exchange rate policy. this idea that the fed raised rates in december and the world fell apart. >> but what would be worse than policy error is the inability to act. have they been losing control of the currency and it's sliding more than they were allowing it to? the big development, i suppose why there's not con today onfrom the chinese stock market today, they've been able to bring back stability. >> we'll see. confidence is key. here in the u.s., it's another busy day of economic data, earnings, and fed speak. first, weekly jobless claims out at 8:30 a.m. eastern along with january durable goods, which are expected to have rebounded last month after a big drop in december. on the earnings front, best buy, campbell soup, kohl's, and sear

that is something the pboc is looking at as well. francine: dallas goldman president gary cohen speaking with david ingles in shanghai. next, apples's battle against the fbi heats up as the titans of tech lineup. ♪ to thee: let's get bloomberg business flash with nejra cehic. nejra: royal bank of scotland shares have fallen in london after britain's largest taxpayer-owned lender said it would take longer to resume shareholder payouts. rbs posted a net loss for 2015 of 1.98 billion pounds, its eighth consecutive annual loss. haslondon stock exchange released more details of a potential merger. the combined group would have headquarters in both london and frankfurt. the deal would see xavier rolet stepping down. that is not the only prospective merger in the sector. southeast asia's biggest operator is seeking to buy london's baltic exchange. has made a nonbinding bid for baltic. that is your bloomberg business flash. francine: thank you so much. apple's fight to stop the u.s. government unlocking a phone used by one of the san berna

antonio: clearly, this financial volatility, we saw it in september with the pboc decision, and now this volatility remains. on the back of that, it will be surprising to decide to hike anytime soon. we think the earliest they can do that is june. the u.s. economy, [indiscernible] eventually, you should see some wage pressure. i think we will probably look at the labor markets carefully and look past this next fed decision and think about whether june presents a better opportunity for a hike. as for the inflation expectations, indeed, they are on the low side. they are really on the lower range of where they would like it to be. crisis think it on a level for them. aolo, you lived through and run, very different from the talks of a default. what is the likelihood of something going down because they are big and the exposure is so large? paolo: not just on oil, but on all minerals, because minerals are so low that a risk of failure exists. no doubt about that. today, all eyes are focused on the shale oil producers in america. this has been a business growing on debt, very much on debt, an

everybody was surprised when the pboc governor started speaking in english. representative of how he wanted to reach out to a broad international audience. they managed to win a few successes, and we will be talking more about that. how people about were coming in with high what theons for finance ministers should agree on. rishaad: that was naÏve, wasn't it? see thes ironic to central bankers pointing and the direction of the finance ministers. the other thing was how wide the s were on how to address just in case we enter a recession. it doesn't seem that we have any agreement. rishaad: what was actually agreed? what specifics were actually agreed? maybe that is a leap too far. >> there are probably more disagreements than agreements. ,ertainly no shanghai accord but there was one thematic -- thatad: you're saying because of the plaza accord, everyone drawing a parallel. this was not supposed to be in the same league as that. >> they put a line in the communiquÉ saying the market volatility is not reflecting underlying fundamentals. be we have gotay to do

looks like the pboc governor trying to shore confidence. looks like it's working slightly. shares up, but not nearly enough to recover what we saw yesterday when small cap and tech stocks plummeted. the shanghai composite fell 6%.

china stocks tumble for the 15 month low after the pboc failed to buy back stimulus and raises its risk options. zero inflation expected a flatlined -- we will receive the numbers for mario draghi. and angela merkel warns that greece needs europe's help to deal with the influx of refugees. the next greek crisis. keene, new york with tom and we are getting some huge inflation figures. this has an impact on what mario draghi will be thinking about inflation rates, falling to 0.7%. you look at the immovable force of the last five or seven days, lowering german rates. it signals that lack of inflation. francine: and german yield is what we are looking out for but we also have breaking news on china, canning the requirement ratio. china is a little more fragile. let's get to the first word. vonnie: thanks. trucelargely holding its and russian warplanes received a tax on the second day of the in syria and forces fired artillery at the government. meanwhile, us-led coalitions did not. get covered by the troops baghdad,hat, -- in suicide bombings killed hundreds of people. the attacks occurred

what we have seen the last few days is the pboc and government are intent on maintaining this lending momentum to boost the economy. --dman sachs came out with a they came out with a very bullish report on the economy saying that even though our growth has continued to slow and it will be bumpy, there is nothing to worry about. low and behold, the pboc comes out with all this measure that will reduce the rate that charges lenders to borrow money. it just shows the government is intent on spurring the economy through lower interest rates. is the consensus belief as a general statement on economic growth in china? oecd and catherine mann have just suggested over 24 months, it is 6% plus. how alone is the oecd? allen: it is really hard to say. they are probably in the lower end of the spectrum. today, the japanese ministers are saying that china is poised for a hard landing so there are a lot of conflicting views. last fewave seen the days if the government coming out with aggressive measures to boost lending, that we have not seen since 2009. the stock market more than doubled when the

caroline: the pboc coming out discussing potential moves. how are you negotiating this balancing act to put it so well for us? they are giving with one hand and taking away with the other. what are they trying to support? the chinese economy? >> they want to spin this into a good thing or a bad thing. on one hand they are quite hawkish. they don't want a repeat of the 2009 credit stimulus. the whole world has been scream where is the demand coming from? we may getting some evidence of that demand. that may be a good thing they are trying to calibrate things very carefully now. if demand is coming through, they may may be willing to provide lick witty. witty. -- liquidity. keep it going. that is going to weigh on the currency as well. a balancing act. i think the next phase is march. if we have credit demand right now foreseing upcoming growth and the government can play ball as well, i think the market also start to take notice. caroline: you're sounding pretty upbeat. the you're a man who cut his teeth in the fx market. are they steering lo

. >> he said that china's economy remains on a sound footing and the pboc has the tools to deal with any downside risks. well, german finance minister on the other hand has warned against more policy. opposing the g-20 stimulus package, he said fiscal and monetary policies had reached their limits and are failing to promote growth. speaking out in shanghai, he argued that the debt financed model is causing new problems and, quote, zombifying the economy. we've just heard the finance minister's words there. really not mincing how he feels over additional stimulus coming out of the g-20 meeting. but a lot of doubts about whether we're get any substantive agreement, or is this just an effort to correct a crisis in confidence? >> that's right. i think historically there have been many people who have doubted that you would see any substantive agreements coming out of these g-20 meetings. however, there's definitely a big push to have substantive discussions about the global economy because many here do fear that we will see stagnating global growth. as you were saying, there is concern t

. >> i was at the speech where the pboc governor was speaking. we should note he was speaking in english, which shows you he was catering to a mostly international audience, at least at that time. he said there is a need to ease. but we know that. interest rates -- real rates are on the way out. the real debate and what was not answered was how they plan to do that. we are in a situation, now, in china where capital outflows are getting exacerbated by speculation that the pboc will ease. they cannot exactly cut rates. he also made the point on speculation that there is absolutely no basis whatsoever. you look at the fundamentals of the chinese economy. no basis for a persistent decline in the value of the renminbi. i guess that speaks volumes to what they are now using to turn off, if you will, and all of the speculation that the yuan will fall further. it has gone very expensive to defend it. -- it has gotten very expensive to defend it. they have seen a massive drawdown on those reserves, which he says is not a trend. i guess that is what a lot

stocks tumbled 2015 month low after the pboc fails to step up stimulus. is it market expected to much from the central bankers? no plan b. the german chancellor wants that greece needs europe's help to deal with the influx of refugees. is this the next greece crisis in the making? zero down. zero zone inflation is expected to flatline in february. will this be the number that forces draghi to do more extra week? ♪

we've had these soothing words from the governor of the pboc. but we've also got too many people on one side the boat. the bouncing market started on friday. the thing i hate about mondays, i don't know whether we're looking forward to the week ahead, or we're just redoing friday's mood. a good end or good start. i don't know if i'm learning anything. the thing is here, a lot of bearish positions. now we're getting the snapback. >> what do we think of the yen? especially when we look at the mix and trying to define deflation? >> i'm curious to see how high the yen gets. economics makes the yen the cheapest by dragging it off to 120, close to 125. it's natural desire like anything is to pin back. we just pinned back very aggressively. now, the world stock is to see if we can get back to 120. the positioning is very long yen. if you wanted to intervene, now would be a good bet. >> i was looking over your notes that you sent. you talk about the good trades that you like at the moment. you talk about sticking with the kiwi cad shorts for the time be

, things are so much worse that the pboc cannot do anything. enda: the wild card is the yuan. they let the currency depreciate. that triggers capital outflows. it is global deflationary force. it hurts foreign companies and earnings in china, etc. there is another scenario, central case scenario, where china muddles through. ofy looked through a period stability and look to keep the currency relatively stable and stability in the stock market and look to start regaining confidence among global investor base by trying to get the economy back on the table by targeting especially consumption side of things. measurestimulus that that drug consumption and retail . -- that promote consumption and retail. the wildcard is exchanging capital flows. scarlet: do you see the pboc returning to conventional rates, cutting interest or are they going to continue to target the currency? enda: i'm not altogether sure if they are targeting the currency -- scarlet: that is the view from eric nelson. enda: correct, an entirely fair view. the problem is being critic

we have had this sort of you turn by the pboc. what people are thinking about the direction of the pboc. there are competing signals of the time that china is trying to get a message out at the g-20. stephanie: there seem to be two schools of thought here -- be patient with china, or this patient is really sick. beth: if you look at china, they are a very patient economy as well. they are trying to do a lot. for a company like ge, we believe in china. growth is not quite what we wanted to be, but it is still growing. certainly in the kind of industries we see, big infrastructure industries, think of what is happening with the energy economy in china. health care. continue to invest in these infrastructure plays, and the consumers are adapting. that is one of the things we are seeing, is the adaptation. tell us muchs about the underlying economy in china, and is it a net stimulus anyway? typically last year we saw the triple arc cut with headline rates as well. supply credit and reducing the cost of credit. thecut the rrr and lead

clearly this afternoon big news out of the pboc. china's central bank announcing a series of measures aimed at more financial support to the nation's industrial sector. the pboc saying it does want to strengthen credit support by money supply and saying today that it's going to be using various tools to maintain adequate liquidity. this is interesting because we do know that there is already an agenda in place to clean up these so-called unproductive zombie firms over the next three years, at least according to existing reports. and this also follows on from additional reports that we've already seen just last month that chinese policymakers say they'll be using stock exchanges, property exchanges, and other capital markets to sell the assets of low-performing state-owned enterprises. so it's going to be particularly interesting to gauge the reaction to that when we see trade resume in asia. nevertheless, have a look at this. we saw green on screen in session today. some pockets of weakness, but broad based gains. i wanted to cast y

highsn from some of the after we heard from the pboc governors. this is the new normal. after plunging 6% we have seen a steady in the end and steady oil prices. the nikkei is up about 1%. ♪ cory: to turn to our top story, apple laying out its arguments against the fbi's request to unlock one of the iphones of one of the san bernardino terrorists. we seen fbi -- we have seen fbi director james comey testified. what happens next in this battle? >> tomorrow, apple's annual shareholder meeting. we will be looking from any comments -- for any comments from shareholders in cupertino. next week, we expect apples top lawyer and -- apple's top lawyer and the head of the fbi to be on capitol hill for a hearing. march 3 is the deadline for apple allies to file their briefs of support. reports of about mid-march, another apple event for their products. they are selling a lot of products. the annual spring event is around this time of year. toward the end of march, we are expecting to have a court hearing on these issues. cory: apple said they were developing a phone that would be

i spoke to the pboc, chinese central bank's chief economist, who said investor concerns have largely been overblown. >> investors are overly nervous about various aspects of the chinese economy. but if you look at the more fundamental aspect of real economy, for example, the consumption, it's actually quite robust. what i saw recent statistics is that during the chinese new year retail sales were growing 11%, quite an impressive number. >> reporter: market volatility front and center. shanghai markets thursday down by 6%. some of that's because of liquidity concerns as well as overall fragile sentiment in the stock market. for "nightly business report," eunice yun in shanghai. >>> slowing demand from china is one of the issues pressuring the oil market. in addition to excess supply. today san francisco fed president john williams said he expects oil prices to stay low for a few more years. simply because supply and demand is so out of whack. >> those falling crude braces are taking a toll on yet another engineer company, halliburton cutting 8% of its workforce, roughly 5,000 position

the pboc governor broke his long silence. what did he say? what was significant about it? enda: i would not call it officially new. he said we are not engaged in competitive currency devaluation. but the fact that he said at all is quite interesting. it should have some clarity for investors. he has got his key message out of it, that we are not going to push the currency down just to find restore export competitiveness. we do expect volatility along the way. we can only take him at his word, but there is a central message coming out of china that it is not about competitive devaluation. shery: that is what a lot of asset managers said, the fact that he said anything at all was a sign of support. we also saw the sign of report in the yuan fixed rate today. stephen: that is right, this poor set of data that we got today on the trade front hints that it does not make too much sense for china to maintain a strong currency. trade data suggests that they would kind of like a weaker one. francine: the energy ministers met,ssia and saudi arabia and the meeting ended less than an