Investors Brace for Inflation Data; Biden Critical of Israel

Bloomberg Audio Studios, Podcasts, Radio News. 0:00:11.000 --> 0:00:11.559 Good morning. 0:00:11.600 --> 0:00:14.400 I'm Nathan Hager and I'm Karen Moscow. Here are the 0:00:14.440 --> 0:00:15.920 stories we're following today. 0:00:16.200 --> 0:00:18.600 Karen, we begin with the report Wall Street's been waiting 0:00:18.640 --> 0:00:21.360 for all week. This morning, we get the latest read 0:00:21.440 --> 0:00:26.000 on inflation with the March report on consumer prices. Economists 0:00:26.000 --> 0:00:29.040 are forecasting a rise of three tenths of one percent. 0:00:29.400 --> 0:00:31.880 Let's get a preview from Bloomberg's Michael McKee. 0:00:32.200 --> 0:00:35.880 For investors and central bankers, it's the same story. Will 0:00:35.920 --> 0:00:39.280 inflation keep falling enough to keep the Fed on track 0:00:39.320 --> 0:00:42.839 to lower interest rates this year? Yes, economists say, at 0:00:42.920 --> 0:00:46.320 least on a month to month basis, food prices, car prices, 0:00:46.360 --> 0:00:49.239 even home prices have come down a little bit. But 0:00:49.479 --> 0:00:53.400 energy costs rose during March, particularly for gasoline, and that 0:00:53.520 --> 0:00:57.320 means headline CPI is expected to rise year over year. 0:00:58.160 --> 0:01:01.720 While the Fed follows the PCE Inflation Index. Most consumers 0:01:01.800 --> 0:01:05.680 watch CPI, so a mixed report won't be very good news, 0:01:06.040 --> 0:01:10.080 even if incremental progress is made. Michael McKee, Bloomberg Radio. 0:01:10.280 --> 0:01:12.760 All right, Mike, thanks wella headed the report. We are 0:01:12.800 --> 0:01:16.959 getting more Fed speak Atlanta Fed President Raphael Bostik reiterated 0:01:17.000 --> 0:01:20.760 his expectation for one interest rate cut this year, but 0:01:20.840 --> 0:01:23.320 added he is open to changing his view to later 0:01:23.520 --> 0:01:27.319 or additional rate reduction should the economic picture change. Meanwhile, 0:01:27.319 --> 0:01:31.960 Bloomberg opinion columnist Muhammadalarian expects the Central Bank's overall trajectory 0:01:32.080 --> 0:01:33.320 to remain unchanged. 0:01:33.760 --> 0:01:36.360 I think Chef Poald has made it very clear that 0:01:36.400 --> 0:01:39.080 he's willing to look through these bumps. They will need 0:01:39.280 --> 0:01:43.280 overwhelming evidence that it is more than a bump in 0:01:43.360 --> 0:01:46.480 order for them to ch interviews. Inflation will be sticky. 0:01:46.800 --> 0:01:49.480 Inflation will be absolutely sticky. We're going to get stuck 0:01:49.520 --> 0:01:51.400 at a round two and a half to three percent, 0:01:52.160 --> 0:01:55.200 and I do think that that actually warrants over the 0:01:55.240 --> 0:01:58.520 long term. The Fed rethinking is inflation targeting, and. 0:01:58.560 --> 0:02:01.880 Muhammad Larian says expecs two rate cuts this year. 0:02:02.040 --> 0:02:05.280 Well, forget rate cuts, Karen. Corporate earnings may fuel the 0:02:05.280 --> 0:02:08.560 next leg of this record breaking stock market rally. Let's 0:02:08.560 --> 0:02:11.040 get the details on that from Bloomberggs John Tucker. 0:02:10.840 --> 0:02:13.800 John Nathan Earnings season kicks off Friday, and ahead of that, 0:02:14.080 --> 0:02:17.680 Wall Street strategists have boosted their year end forecasts for 0:02:17.720 --> 0:02:20.720 the S and F five hundred. Deutsche Bank's strategists say 0:02:20.760 --> 0:02:23.680 earnings are expected to post a healthy ten percent gain 0:02:23.760 --> 0:02:26.280 in the first quarter in the headline numbers from a 0:02:26.320 --> 0:02:29.960 year ago. According to City Group, earnings upgrades of outnumbered 0:02:30.040 --> 0:02:33.400 downgrades of the first quarter. The rising profit forecasts have 0:02:33.520 --> 0:02:37.640 eased concerns that the rally is a bubble. Additionally, forecasts 0:02:37.639 --> 0:02:40.680 for tech earnings they remain strong, with analysts expecting the 0:02:40.680 --> 0:02:43.680 sector to report that profits stored twenty percent of the 0:02:43.680 --> 0:02:46.200 first quarter, and at the same time they outlook for 0:02:46.200 --> 0:02:50.600 the more economically sensitive sectors. That's brightening, suggesting a broader, 0:02:50.760 --> 0:02:53.360 healthier rally. I'm John Tucker, Bloomberg Radio. 0:02:53.560 --> 0:02:56.800 All right, John, thanks well. One company not participating in 0:02:56.840 --> 0:02:59.520 this rally has been Boeing. This stock is down more 0:02:59.560 --> 0:03:03.040 than three percent so far this year. The FAA is 0:03:03.080 --> 0:03:07.160 investigating whistleblower complaints that Boeing took shortcuts to ease production 0:03:07.280 --> 0:03:10.600 bottlenecks on the seven eighty seven Dreamliner. The company says 0:03:10.639 --> 0:03:13.360 that claims are inaccurate and do not represent the work 0:03:13.360 --> 0:03:15.679 it has done to ensure the safety of the plane. 0:03:15.800 --> 0:03:18.720 Bloomberg's brook Sutherlands says the complaints add to the many 0:03:18.840 --> 0:03:20.919 challenges facing the embattled plane maker. 0:03:21.360 --> 0:03:24.840 The FAA has capped Bowing's production rate at about thirty 0:03:24.840 --> 0:03:27.880 eight seven thirty seven jets per month. Now they are 0:03:27.919 --> 0:03:30.440 nowhere near that pace right now. They're taking a step 0:03:30.480 --> 0:03:33.600 back and really trying to drill into safety and their 0:03:33.639 --> 0:03:36.160 engineering processes. Now that is a good thing in the 0:03:36.200 --> 0:03:38.360 long run, but certainly not going to show up and 0:03:38.400 --> 0:03:40.280 their delivery numbers right here in the short term. 0:03:40.360 --> 0:03:43.760 Bloomberg's brook Sutherlands says the claims intensify the scrutiny of 0:03:43.800 --> 0:03:47.200 Boeing's manufacturing practices that have been building since one of 0:03:47.200 --> 0:03:50.000 their planes experienced a mid air accident at the start 0:03:50.040 --> 0:03:50.480 of the year. 0:03:50.760 --> 0:03:54.160 In other news, this morning, Karen Arizona will join fourteen 0:03:54.280 --> 0:03:58.680 other states that have banned abortion at all stages of pregnancy. 0:03:58.720 --> 0:04:00.960 Bloomberg's at Baxter the details. 0:04:01.360 --> 0:04:04.760 Arizona Supreme Court has ruled in favor of enforcing a 0:04:04.800 --> 0:04:08.840 Civil War era abortion ban. It says doctors can be 0:04:09.000 --> 0:04:13.000 prosecuted for performing an abortion except to save a mother's life. 0:04:13.240 --> 0:04:16.240 Both Arizona's Attorney General and the governors say they will 0:04:16.240 --> 0:04:19.320 not enforce the law. Governor Katie Hobbs. 0:04:19.000 --> 0:04:22.760 Here, we continue to live under an unacceptable ban, a 0:04:22.839 --> 0:04:26.680 law that still strips Arizonas of their personal autonomy and 0:04:26.800 --> 0:04:30.279 has no exceptions for women who are the victims of rape, insists, 0:04:30.800 --> 0:04:33.200 or any regard for pregnancy complications. 0:04:33.240 --> 0:04:36.320 Politically, this will test Donald Trump's gamble to leave decisions 0:04:36.360 --> 0:04:40.839 to the states. Arizona is a swing state. Aed Baxter Bloomberg. 0:04:40.480 --> 0:04:42.800 Radio, all right, ed, thanks well. Turning to the war 0:04:42.960 --> 0:04:46.440 in Gaza, President Biden has more tough words for Israeli 0:04:46.480 --> 0:04:50.279 Prime Minister Benjamin Netanyahu after the attack that killed seven 0:04:50.320 --> 0:04:51.040 AID workers. 0:04:51.320 --> 0:04:54.320 I think when he's doing his mistake, I don't agree 0:04:54.320 --> 0:04:58.720 with his book. I think it's outrageous that those four 0:04:59.120 --> 0:05:03.960 three vehicles Biden drones and taken out on a highway 0:05:04.120 --> 0:05:06.800 where it wasn't like it was along the shore, it 0:05:06.839 --> 0:05:09.040 wasn't like there was a convoy moving he, etc. 0:05:10.000 --> 0:05:12.440 The President spoke in an interview that aired last night 0:05:12.480 --> 0:05:15.760 on Univision. The conversation was taped last week, two days 0:05:15.760 --> 0:05:18.960 after the strike that killed the world of Central kitchen workers. 0:05:19.200 --> 0:05:22.719 President Biden also discressed immigration. He was asked whether he 0:05:22.760 --> 0:05:25.520 has the authority to shut down the US Mexico border 0:05:25.560 --> 0:05:26.800 on his own well. 0:05:26.839 --> 0:05:29.400 It suggested that we're examining whether or not I have 0:05:29.520 --> 0:05:32.440 that power. I would have that power under the legislation 0:05:32.560 --> 0:05:37.360 when the border has over five hundred thousand people fit 0:05:37.480 --> 0:05:40.040 five thousand people a day trying to cross the border 0:05:40.080 --> 0:05:41.800 because you can't manage to slow it up. 0:05:42.320 --> 0:05:45.279 And the legislation that President Biden is talking about collapsed 0:05:45.279 --> 0:05:48.600 in the Senate after former President Donald Trump pressured Republicans 0:05:48.600 --> 0:05:51.440 to kill it. The President says he's not giving up 0:05:51.480 --> 0:05:52.240 on that bill. 0:05:52.240 --> 0:05:55.120 I mean, well, Karen. President Biden and the Prime Minister 0:05:55.160 --> 0:05:58.839 of Japan are teaming up on an artificial intelligence program. 0:05:58.880 --> 0:06:00.760 We get the deals that deetis tails on that from 0:06:00.800 --> 0:06:03.080 Bloomberg Steve Potisk in Washington. 0:06:03.440 --> 0:06:06.479 The two nations are looking to improve collaboration around the 0:06:06.520 --> 0:06:11.400 quickly emerging technology. President Biden and Japan's Fumio Kashita have 0:06:11.600 --> 0:06:15.000 enlisted Amazon and Nvidia to fund a new joint AI 0:06:15.120 --> 0:06:19.200 research program. A senior US official says the fifty million 0:06:19.240 --> 0:06:22.120 dollar project will be a joint effort between the University 0:06:22.160 --> 0:06:25.760 of Washington and Seattle and to Scuba University outside Tokyo. 0:06:26.120 --> 0:06:29.600 The push for greater research into artificial intelligence comes as 0:06:29.640 --> 0:06:33.560 the Biden administration is weighing a series of new regulations 0:06:33.600 --> 0:06:38.280 designed to minimize the risks of AI technology in Washington. 0:06:38.400 --> 0:06:40.239 Steve Potis Bloomberg. 0:06:39.920 --> 0:06:43.359 Radio, all right, Steve thanks. In company news, Morsign's Apple 0:06:43.560 --> 0:06:47.160 is pushing to diversify beyond Shina. The tech giant assembled 0:06:47.200 --> 0:06:50.360 fourteen billion dollars of iPhones in India last fiscal year, 0:06:50.720 --> 0:06:53.599 doubling production. Sources say the tech giant now makes as 0:06:53.680 --> 0:06:56.360 much as fourteen percent for about one in seven of 0:06:56.400 --> 0:06:58.120 its market devices from India. 0:06:58.200 --> 0:07:00.360 Sticking with tech Karen revenue as starch, you get the 0:07:00.400 --> 0:07:04.080 owner of TikTok Bite Dance's profits sword roughly sixty percent 0:07:04.200 --> 0:07:06.799 in twenty twenty three, outpacing the growth of online peers 0:07:06.839 --> 0:07:09.400 ten cent holdings in Alli Boba Group. Source to say 0:07:09.440 --> 0:07:12.840 earnings before interest, tax, appreciation and amortization jumped to more 0:07:12.880 --> 0:07:16.040 than forty billion dollars from about twenty five billion in 0:07:16.080 --> 0:07:19.640 twenty twenty two. The world's most valuable startup also grew 0:07:19.640 --> 0:07:22.120 its sales to nearly one hundred and twenty billion dollars 0:07:22.160 --> 0:07:23.320 from eighty billion. 0:07:23.720 --> 0:07:25.920 And we have one other note out of Asia this morning. 0:07:26.040 --> 0:07:28.840 Nathan Fitch has cut its outlook for China's long term 0:07:28.920 --> 0:07:32.320 foreign debt from stable to negative. The Writings Agency says 0:07:32.480 --> 0:07:36.960 rising economic uncertainties have eroded fiscal buffers, although Fitch sees 0:07:37.040 --> 0:07:39.960 government debt increasing in coming years at a firm China's 0:07:40.000 --> 0:07:45.200 A plus rating. And as time now for a look 0:07:45.240 --> 0:07:47.000 at some of the other stories making news in New 0:07:47.080 --> 0:07:48.960 York and around the world, and for that we're joined 0:07:49.000 --> 0:07:51.160 by Bloomberg's Michael Barr Michael, good Morning. 0:07:51.000 --> 0:07:54.000 Good Morning Cairon the first parents convicted and a US 0:07:54.200 --> 0:07:57.160 mass school shooting have been sentenced to at least ten 0:07:57.280 --> 0:08:00.520 years in prison at Michigan at Oakland County said that 0:08:00.640 --> 0:08:04.640 Jennifer and James Crumbley missed opportunities that could have prevented 0:08:04.680 --> 0:08:08.400 their son Ethan, from possessing a gun and killing four 0:08:08.440 --> 0:08:12.880 students at Oxford High School in twenty twenty one. Before sentencing, 0:08:13.000 --> 0:08:16.560 James Crumbley told the court that he couldn't have foreseen 0:08:16.640 --> 0:08:18.720 what his son was capable of that day. 0:08:19.360 --> 0:08:25.640 I cannot express how much I wish that I had 0:08:25.720 --> 0:08:32.520 known what was going on with him. 0:08:30.760 --> 0:08:32.120 Or what was going to happen. 0:08:32.520 --> 0:08:36.760 The Crumbleys were convicted of involuntary manslaughter. New York Mayor 0:08:36.880 --> 0:08:40.960 Eric Adams says he supports legislation to help protect homeowners 0:08:41.000 --> 0:08:44.800 from squatters. It comes after an ABC seven report about 0:08:44.800 --> 0:08:47.880 a Flushing homeowner who got arrested for changing the locks 0:08:47.880 --> 0:08:50.800 on their own home because of a squatter. During a 0:08:50.840 --> 0:08:53.640 news conference, Adam says, a woman's home is their castle 0:08:53.840 --> 0:08:57.000 and it's imperative that we continue to protect that. There 0:08:57.040 --> 0:08:59.400 was a reason that squad of laws was put in place, 0:08:59.840 --> 0:09:02.800 and you know, I think people are starting to exploit 0:09:02.840 --> 0:09:05.480 with some of those reasons. Are City Council members say 0:09:05.480 --> 0:09:08.240 they plan to file legislation that will make it easier 0:09:08.240 --> 0:09:11.400 for police to remove squatters. Today was supposed to be 0:09:11.480 --> 0:09:16.280 the day the articles of impeachment against Homeland Security Secretary 0:09:16.320 --> 0:09:19.960 Alejandro Majorcis we're going to be transmitted from the House. 0:09:20.320 --> 0:09:23.959 That process was delayed by House Speaker Mike Johnson until 0:09:24.040 --> 0:09:27.080 next week. Senate Republicans want to make sure they're in 0:09:27.160 --> 0:09:30.959 full force when the proceedings start. Senate Majority Leader Chuck 0:09:31.000 --> 0:09:34.120 Schumer says there are no charges in the House complaint 0:09:34.360 --> 0:09:37.760 that rise to the level of impeaching. Mayorcis, We're going 0:09:37.800 --> 0:09:40.920 to try and resolve this issue as quickly as possible. 0:09:41.400 --> 0:09:45.839 Impeachment should never be used to settle policy disagreements. 0:09:46.640 --> 0:09:50.760 US Ambassador to Japan Rama Manuel says President Joe Biden's 0:09:50.760 --> 0:09:54.560 administration is looking to reverse China's attempts to isolate countries 0:09:54.559 --> 0:09:57.840 in Asia, including the Philippines, with help from Japan and 0:09:57.920 --> 0:09:59.160 other allies in the region. 0:10:00.040 --> 0:10:02.680 Our strategy is to flip that script and make the 0:10:02.960 --> 0:10:04.440 isolated party China. 0:10:04.920 --> 0:10:08.280 Emmanuel's comments to Bloomberg come ahead of the summit between 0:10:08.320 --> 0:10:12.240 Biden and Japanese Prime Minister fumi Yo Kashita. Globalding was 0:10:12.280 --> 0:10:14.520 twenty four hours a day and whenever you wanted with 0:10:14.520 --> 0:10:17.720 the Bloomberg News. Now, I'm Michael Barr. This is Bloomberg. Karen. 0:10:17.880 --> 0:10:24.600 All right, Michael, thank you. Time now for the Bloomberg 0:10:24.640 --> 0:10:26.560 Scores update with John stash Hour. 0:10:26.800 --> 0:10:29.959 John, thanks Karen. The Yankees are ten and two. It's 0:10:30.000 --> 0:10:32.120 their best starts. In two thousand and three they won 0:10:32.160 --> 0:10:33.760 the pen at that season. They've only won it one 0:10:33.800 --> 0:10:35.880 since then. At the Stadium. They beat the Marlins three 0:10:35.880 --> 0:10:38.000 to two. The big story of the pitching of Carlos 0:10:38.080 --> 0:10:40.720 Redon last season. He was hurt and then he struggled. 0:10:40.800 --> 0:10:41.240 Last night. 0:10:41.320 --> 0:10:43.719 Radan took a shutout to the seventh inning. Yanks go 0:10:43.840 --> 0:10:45.800 for the series sweep tonight and Atlanta. The Mets, who 0:10:45.840 --> 0:10:48.480 came from four onnes down on Monday, trailed six to 0:10:48.559 --> 0:10:50.439 Uphing in the eighth inning when Pete Alonzo had a 0:10:50.440 --> 0:10:52.760 three run homer. They added two more in the ninth, 0:10:53.000 --> 0:10:55.160 with the Braves held on six to five. Red Sox 0:10:55.200 --> 0:10:57.800 lost their home opener, out hit by the Orioles thirteen 0:10:57.880 --> 0:11:00.760 to two. Baltimore won seven to one. Nationals beat the 0:11:00.800 --> 0:11:03.200 Giants five to three. The Knicks lost the other night 0:11:03.200 --> 0:11:05.880 in Chicago and then bust to Milwaukee, beat the Bucks, 0:11:05.920 --> 0:11:08.200 and then returned to Chicago and this time beat the 0:11:08.200 --> 0:11:11.880 Bulls one to seventeen. Another big game for Jalen Bruns, 0:11:11.880 --> 0:11:14.480 and he scored forty five. The Knicks sid third in 0:11:14.520 --> 0:11:17.120 the East. They're only a game behind second place Milwaukee. 0:11:17.120 --> 0:11:19.120 The Bucks ended a four game losing streak. They beat 0:11:19.160 --> 0:11:22.600 the league leading Celtics. The game with only two free throws, 0:11:22.640 --> 0:11:25.280 shattering the previous NBA record refused in a game. The 0:11:25.280 --> 0:11:27.839 record had been eleven. The Islanders have picked a good 0:11:27.840 --> 0:11:29.760 time for their hottest stretch. They made it five wins 0:11:29.760 --> 0:11:32.520 in a row, beat the Rangers at Ubs Arena forty two. 0:11:32.559 --> 0:11:35.160 The Islanders right now looking like a playoff team. Devils 0:11:35.160 --> 0:11:38.040 and Bruins both lost to Capitals one. John Califari's first 0:11:38.080 --> 0:11:41.680 comments since news that he's leaving Kentucky for Arkansas, he 0:11:41.760 --> 0:11:44.880 said after fifteen years Kentucky and needed a new voice. 0:11:45.000 --> 0:11:47.960 The Masters Tea's off tomorrow, forty eight year old Tiger 0:11:48.000 --> 0:11:49.960 Woods asked how he feels physically. 0:11:50.320 --> 0:11:52.920 I heard every day. 0:11:51.640 --> 0:11:56.960 Yes, I ache, No, I ache every day. 0:11:57.120 --> 0:12:01.320 And I prefer warm and humid and hot. 0:12:02.200 --> 0:12:04.319 And I know we're wearing some thunderstorms. 0:12:04.320 --> 0:12:06.720 At least it'll be hot. We'll be like last year, Tiger. 0:12:06.760 --> 0:12:08.880 We'll try to make the cut for the twenty fourth 0:12:08.920 --> 0:12:11.320 consecutive time. He's got an afternoon tea time tomorrow plane 0:12:11.360 --> 0:12:13.040 with Jason Day and Max Homer. 0:12:13.280 --> 0:12:14.920 Josh Dashawer, Bloomberg Sports. 0:12:14.960 --> 0:12:19.800 Karen Nan, all right, thank you, John. It is currently well. 0:12:19.840 --> 0:12:21.520 The S and P futures are higher, up a tenth 0:12:21.559 --> 0:12:23.520 of up percent or six points down. Futures up a 0:12:23.520 --> 0:12:26.200 tenth of up percent or fifty two points, NASDAK futures 0:12:26.240 --> 0:12:28.400 up two tenths of up percent, or thirty two points. 0:12:28.400 --> 0:12:31.280 In the ten year treasury yield four point three five percent. 0:12:33.679 --> 0:12:37.840 Coast to coast on Bloomberg Radio, nationwide on Sirius XM, 0:12:37.920 --> 0:12:40.800 and around the world on Bloomberg dot Com and the 0:12:40.880 --> 0:12:42.120 Bloomberg Business app. 0:12:42.320 --> 0:12:46.560 This is Bloomberg Daybreak. Good morning. I'm Nathan Hager. 0:12:46.679 --> 0:12:49.200 We are just hours away from the latest street on 0:12:49.280 --> 0:12:52.720 inflation in the US, the Consumer Price Index for March, 0:12:53.160 --> 0:12:58.200 and we get more now from Bloomberg's Kredi Gupta so critty. 0:12:58.679 --> 0:13:01.720 Since the start of the year, the road to disinflation's 0:13:01.800 --> 0:13:04.679 been choppy. Are we thinking that that's what we're going 0:13:04.720 --> 0:13:05.319 to see today? 0:13:06.280 --> 0:13:08.880 This is the make or break moment of whether or 0:13:09.000 --> 0:13:10.800 not this is kind of a one off or a 0:13:10.880 --> 0:13:14.240 two off in terms of hot CPI reports, to whether 0:13:14.320 --> 0:13:17.079 or not this was just kind of a momentary uptick. Nathan, 0:13:17.120 --> 0:13:19.000 I don't need to remind you of all people the 0:13:19.040 --> 0:13:22.320 transitory conversation, and it kind of has felt like the 0:13:22.360 --> 0:13:24.480 Federal Reserve and members of the FMC have kind of 0:13:24.480 --> 0:13:28.000 brushed off this uptick in the data as seasonal or 0:13:28.040 --> 0:13:30.600 as in kind of a one off for for lack 0:13:30.640 --> 0:13:33.640 of a better term, whereas the markets have said, well, actually, 0:13:33.679 --> 0:13:36.120 maybe this is indicative of some sort of persistent piece 0:13:36.120 --> 0:13:39.360 of inflation. That story of the last mile of inflation 0:13:39.520 --> 0:13:41.760 may be the most challenging. You've heard that narrative from 0:13:41.800 --> 0:13:43.800 around the world, and I think the best way to 0:13:43.800 --> 0:13:45.199 look at it, Nathan, is what you're seeing in the 0:13:45.200 --> 0:13:47.520 bond market right now. Take a look at yields. Four 0:13:47.720 --> 0:13:51.680 thirty nine is where we're at. We weren't expecting yields 0:13:51.679 --> 0:13:54.200 to stay this high. We had, in the words of 0:13:54.240 --> 0:13:57.080 Bob michael Over at JP Morgan Asset Management six months ago, 0:13:57.120 --> 0:14:00.280 he said, there would be insatiable demand for bonds, this 0:14:00.440 --> 0:14:02.960 kind of bull market for bonds that we haven't really 0:14:02.960 --> 0:14:05.720 seen in a while, given the inflationary standpoint that we've had, 0:14:05.960 --> 0:14:09.040 and we've actually haven't seen that fully manifest yet. Now 0:14:09.120 --> 0:14:11.640 more concerns about whether or not we hit say five 0:14:11.679 --> 0:14:14.120 percent on yields, for example, before we hit even three 0:14:14.160 --> 0:14:16.440 and a half, and that is really, at its core 0:14:16.480 --> 0:14:19.960 a concern that again, maybe it's not a story of 0:14:20.000 --> 0:14:23.040 services inflation anymore. Maybe we start to see more upticks 0:14:23.160 --> 0:14:26.920 or some sort of resurgence in goods driven inflation. Think commodities, 0:14:26.960 --> 0:14:29.720 oil prices, Does food get a little bit more expensive, 0:14:30.120 --> 0:14:32.880 Does housing, for example, eat up a bigger chunk of 0:14:32.920 --> 0:14:36.880 the inflationary story. This is potentially Chair Powell's worst nightmare. 0:14:37.120 --> 0:14:39.680 And when you think about the pressures that we're seeing 0:14:39.880 --> 0:14:43.680 in commodities, in food and energy, it makes you think 0:14:43.720 --> 0:14:47.400 about what kind of bleed through that has into that 0:14:47.600 --> 0:14:51.400 core inflation that the Federal Reserve does have some control 0:14:51.440 --> 0:14:54.040 over in terms of monetary policy, whether that could make 0:14:54.120 --> 0:14:57.640 the job for the Fed to get these price pressures 0:14:57.720 --> 0:14:59.320 under control even more difficult. 0:14:59.480 --> 0:14:59.800 It could. 0:15:00.080 --> 0:15:02.000 And look, I think this is where of the nitty 0:15:02.040 --> 0:15:04.760 gritty and the real nerdiness of the CPI report comes out. 0:15:04.840 --> 0:15:07.600 I think Anna Wongar, chief economist over at Bloomer Economics, 0:15:07.600 --> 0:15:09.320 does a really great job of explaining it in terms 0:15:09.360 --> 0:15:12.280 of saying you have to pay attention now perhaps less 0:15:12.280 --> 0:15:14.160 to the labor market, which by the ways, is something 0:15:14.200 --> 0:15:17.640 that Raphael Bostic over at the Atlantic Fed said as well, 0:15:17.840 --> 0:15:20.520 and pay more attention to the housing story. Pay attention 0:15:20.520 --> 0:15:23.040 to things like airfares, for example, because we're talking about 0:15:23.040 --> 0:15:25.640 the most direct read through from the Federal Reserve, Nathan, 0:15:25.680 --> 0:15:27.800 the most direct raid through to the consumer that I 0:15:27.840 --> 0:15:30.360 can think of is kind of interest rates going higher, 0:15:30.400 --> 0:15:34.120 that affecting mortgage rates, that affecting whether or not people 0:15:34.240 --> 0:15:36.480 want to actually invest that kind of money at these 0:15:36.560 --> 0:15:40.440 high rates in an actual house or continue the rental story. 0:15:41.160 --> 0:15:44.120 That is your most direct piece of the inflationary kind 0:15:44.120 --> 0:15:47.240 of impulse, especially at a time when wages are actually 0:15:47.320 --> 0:15:50.040 higher at the moment than inflation is. For a very 0:15:50.080 --> 0:15:52.560 long time they weren't be, and that time where it 0:15:52.560 --> 0:15:57.520 felt like inflation was outpacing the salary increases that Americans got. 0:15:57.800 --> 0:16:00.440 And I think this applies to every inflationary story around 0:16:00.440 --> 0:16:03.880 the world, but specifically Americans. It is still embedded in 0:16:03.920 --> 0:16:07.520 the psyche that maybe things are still really expensive and 0:16:07.560 --> 0:16:09.720 that we're not making as much in line with inflation. 0:16:09.760 --> 0:16:13.800 When the data shows the opposite, the psychoanalysis of that 0:16:13.920 --> 0:16:14.760 may be very different. 0:16:15.120 --> 0:16:18.240 And that feeds into that argument that Mohammadel area in 0:16:18.280 --> 0:16:21.240 Bloomberg Opinion has been arguing for quite some time that 0:16:21.320 --> 0:16:24.720 the FEDS two percent inflation target might not be realistic 0:16:24.760 --> 0:16:27.360 anymore and they should be thinking maybe more about three 0:16:27.440 --> 0:16:28.680 percent going forward. 0:16:28.800 --> 0:16:30.680 So we'll get much more. 0:16:30.520 --> 0:16:33.640 On this in the hours to come when that March 0:16:33.680 --> 0:16:36.440 consumer price index comes out. As we say, eight thirty 0:16:36.480 --> 0:16:39.480 am Wall Street Time, Critty Group of Bloomberg News, thank you. 0:16:39.560 --> 0:16:44.520 As always, this is Bloomberg Daybreak Today, your morning brief 0:16:44.560 --> 0:16:47.520 on the stories making news from Wall Street to Washington 0:16:47.600 --> 0:16:48.280 and beyond. 0:16:48.520 --> 0:16:51.280 Look for us on your podcast feed at six am 0:16:51.360 --> 0:16:55.040 Eastern each morning, on Apple, Spotify, and anywhere else you 0:16:55.080 --> 0:16:56.280 get your podcasts. 0:16:56.400 --> 0:16:59.080 You can also listen live each morning starting at five 0:16:59.160 --> 0:17:01.720 am Wall Street Time, on Bloomberg eleven three to zero 0:17:01.800 --> 0:17:05.240 in New York, Bloomberg ninety nine one in Washington, Bloomberg 0:17:05.280 --> 0:17:08.280 one oh sixty one in Boston, and Bloomberg ninety sixty 0:17:08.400 --> 0:17:09.359 in San Francisco. 0:17:09.720 --> 0:17:12.880 Our flagship New York station is also available on your 0:17:12.960 --> 0:17:18.399 Amazon Alexa devices. 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