Fed Rate Bets Change; Biden Aims to Reduce Gun Violence

Bloomberg Audio Studios, Podcasts, radio news. Good morning, I'm Nathan 0:00:12.119 --> 0:00:15.080 Hager and I'm Karen Moscow. Here are the stories we're 0:00:15.120 --> 0:00:15.920 following today. 0:00:16.280 --> 0:00:19.439 Karen Willcom has been restored to stock in bond markets 0:00:19.480 --> 0:00:24.360 for now. After the hotter than estimated inflation report for March, yesterday, 0:00:24.400 --> 0:00:27.080 a gauge of global bond suffered it's worst performance since 0:00:27.120 --> 0:00:30.440 February of last year. Investors now bet the FED will 0:00:30.440 --> 0:00:34.000 cut interest rates just twice this year. Neil Dutta, partner 0:00:34.000 --> 0:00:36.600 at Renaissance Macro Research, talked about the difference between the 0:00:36.640 --> 0:00:40.240 Consumer Price Index and the feds preferred inflation gauge, the PCE. 0:00:41.200 --> 0:00:44.000 You know, there are differences of scope between the CPI 0:00:44.120 --> 0:00:47.199 data and the pc data, and the CPI data is running, 0:00:47.680 --> 0:00:50.040 you know, over a full percentage point higher than PCE. 0:00:50.560 --> 0:00:53.440 That's about twice almost three times what's normal, and so 0:00:53.680 --> 0:00:55.800 you know, in some respects, I do think the market 0:00:55.920 --> 0:00:59.160 might be overstating how important CPI is for the FED 0:00:59.240 --> 0:01:02.240 reaction function, but you know, it's a bad number. 0:01:02.560 --> 0:01:05.600 Renaissance Macro Research partner Neil Dutta now expects the FED 0:01:05.600 --> 0:01:08.479 to cut rates twice this year, with the first move in. 0:01:08.520 --> 0:01:12.840 July, Well Nathan, Former Treasury Secretary Larry Summers says cutting 0:01:12.959 --> 0:01:15.760 rates would be a mistake. In fact, Summer says a 0:01:15.840 --> 0:01:17.640 rate hike may be necessary. 0:01:18.000 --> 0:01:21.400 You have to take seriously the possibility that the next 0:01:21.560 --> 0:01:27.560 rate move will be upwards rather than downwards, and anything 0:01:27.600 --> 0:01:32.240 could happen. Markets could crash, the indicators could turn down. 0:01:32.840 --> 0:01:38.200 But on current facts, a rate cut in June, it 0:01:38.280 --> 0:01:43.160 seems to me would be a dangerous and egregious error. 0:01:43.520 --> 0:01:46.760 Former Treasury Secretary Larry Summers estimates the chance of a 0:01:46.840 --> 0:01:49.640 rate hike in the fifteen to twenty five percent range. 0:01:49.760 --> 0:01:52.760 Here the full conversation on the Bloomberg Wall Street Week 0:01:52.840 --> 0:01:56.600 podcast downloaded on Apples, Spotify, or anywhere else you get 0:01:56.640 --> 0:01:57.400 your podcasts. 0:01:57.600 --> 0:01:57.800 Karen. 0:01:57.880 --> 0:02:00.840 Investors now turn their attention to another key inflation reading, 0:02:00.880 --> 0:02:04.320 the March Producer Price Index. Let's get a preview from 0:02:04.320 --> 0:02:05.760 Bloomberg's Michael McKee. 0:02:06.120 --> 0:02:08.880 The Producer Price Index is forecast to come in cooler 0:02:08.919 --> 0:02:12.600 than yesterday's Consumer price index, and that may matter more 0:02:12.639 --> 0:02:15.720 to the Fed than the CPI. The reason the Fed's 0:02:15.760 --> 0:02:18.680 target is based on a third inflation measure, the Personal 0:02:18.760 --> 0:02:22.959 Consumption Expenditures Index or PCE. It tends to run lower 0:02:23.000 --> 0:02:27.120 than CPI. Some sectors in the PPI feed directly into PCE. 0:02:27.800 --> 0:02:31.560 For example, while CPI measures what consumers pay for medical care, 0:02:32.000 --> 0:02:36.040 PPI and PCE measure what insurance companies pay. So today's 0:02:36.080 --> 0:02:39.000 numbers matter for analysts and central bankers as they try 0:02:39.000 --> 0:02:42.679 to understand the direction of inflation. A strong PPI would 0:02:42.800 --> 0:02:46.920 reinforce pessimism about rate cuts a week one would revive hope. 0:02:46.960 --> 0:02:48.600 Michael McKee Bloomberg Radio. 0:02:48.639 --> 0:02:51.000 Right, Mike, thanks well. Interest rates are very much in 0:02:51.080 --> 0:02:54.680 focus overseas. Later this morning, the European Central Bank makes 0:02:54.680 --> 0:02:56.960 a policy decision, and we go to London and get 0:02:57.000 --> 0:02:59.360 a preview of the Bloomberg's You and Pots You in 0:02:59.400 --> 0:03:00.200 Good Morning. 0:03:00.480 --> 0:03:03.440 Karen and Nathan boringcoss Across the euro Area are set 0:03:03.440 --> 0:03:06.359 to be held at a record high today of four percent, 0:03:06.760 --> 0:03:09.120 but investors are expecting the ECB to further lay the 0:03:09.160 --> 0:03:12.560 ground for cuts to get underway in June. Euro Area 0:03:12.600 --> 0:03:15.480 inflation is within sights of the two percent target, but 0:03:15.520 --> 0:03:18.280 President Christine the Guard has indicated they'll need more confidence 0:03:18.320 --> 0:03:20.880 in the data, particularly wage growth, by the middle of 0:03:20.960 --> 0:03:24.200 the year. That decision comes at seven fifteen Eastern time 0:03:24.360 --> 0:03:26.400 in London. Immune pots beenber radio. 0:03:26.240 --> 0:03:28.920 Okay ewan, thank you. Oil is on the rise, and 0:03:29.000 --> 0:03:32.960 speculation hostilities may be escalating in the Middle East. Source 0:03:33.000 --> 0:03:35.560 to say the US and its allies think an Iranian 0:03:35.680 --> 0:03:39.200 strike on Israel is imminent. We get more from Bloomberg 0:03:39.280 --> 0:03:40.800 Israel Bureau chief Ethan Bronner. 0:03:41.160 --> 0:03:45.160 This is in retaliation for an attack that is presumed 0:03:45.240 --> 0:03:47.640 to have been done by Israel about ten days ago 0:03:48.200 --> 0:03:54.280 in Damascus on a diplomatic compound in which seven people 0:03:54.320 --> 0:03:54.880 were killed. 0:03:54.920 --> 0:03:57.400 The key point there is that the two of. 0:03:57.360 --> 0:04:01.480 The people were Revolutionary Guard command as to say, Iranian 0:04:01.800 --> 0:04:05.960 commanders of militias in Lebanon in Syria. 0:04:06.040 --> 0:04:09.600 Bloomberg's Ethan Bronner says Israeli officials have publicly threatened Iran 0:04:09.600 --> 0:04:13.200 that if it hits Israeli soil, Israel will hit Iranian soil. 0:04:13.640 --> 0:04:16.480 Well back here in the US, Nathan, the Biden administration 0:04:16.680 --> 0:04:19.600 is cracking down on unlicensed gun dealers, and we get 0:04:19.600 --> 0:04:22.880 the very latest at Bloomberg's John Tucker, John, Good Morning. 0:04:22.760 --> 0:04:23.120 And Karen. 0:04:23.160 --> 0:04:26.159 The Biden administration is issuing the rule designed to close 0:04:26.200 --> 0:04:29.880 a gap that allows gun buyers to avoid background checks. 0:04:30.279 --> 0:04:33.360 It targets the so called gun show loophole by expanding 0:04:33.400 --> 0:04:36.720 the definition of who must obtain a license to engage 0:04:36.760 --> 0:04:41.520 in firearm sales. The regulation specifically singles out sellers online 0:04:41.600 --> 0:04:44.480 and at gun shows, where the background checks are often 0:04:44.520 --> 0:04:47.240 not conducted. According to a White House official, more than 0:04:47.279 --> 0:04:50.920 twenty thousand individuals engaged in unlicensed dealings could be affected 0:04:50.960 --> 0:04:53.719 by the changes. The President has seized on the issue 0:04:53.760 --> 0:04:56.640 of gun violence to contrast himself with former President Trump 0:04:56.680 --> 0:04:59.679 and Republicans. In a State of the Union address in March, 0:05:00.040 --> 0:05:03.599 mister Biden sattled his administration's efforts to address gun crime, 0:05:03.640 --> 0:05:07.719 including establishing the first ever Office of Gun Violence Prevention. 0:05:08.240 --> 0:05:09.640 John Tucker, Bloomberg Radio. 0:05:09.839 --> 0:05:13.120 All Right, John, Thanks at a disclaimer, Michael Bloomberg, founder 0:05:13.160 --> 0:05:17.040 and majority owner of Bloomberg Radio parent Bloomberg Lp, donates 0:05:17.040 --> 0:05:19.080 to groups at support gun control. 0:05:19.240 --> 0:05:19.839 All Right, Karen. 0:05:19.920 --> 0:05:23.120 In Legal News this morning, Donald Trump has lost his 0:05:23.360 --> 0:05:26.680 third try in a week to delay his Manhattan hush 0:05:26.720 --> 0:05:29.400 money trial. Bloomberg's Ed Baxter has the story. 0:05:29.640 --> 0:05:32.119 The week legally has had his attorneys trying to delay 0:05:32.120 --> 0:05:34.760 the trial on charges that he faked business records to 0:05:34.800 --> 0:05:38.279 cover up a sex scandal. The so called hush money trial. 0:05:38.600 --> 0:05:41.320 His attorneys say they want a delay based on several 0:05:41.400 --> 0:05:44.039 rulings that have been made, including waiting until after the 0:05:44.120 --> 0:05:47.599 final ruling comes down on immunity. How this latest ruling 0:05:47.640 --> 0:05:49.840 could be heard by a panel of five appellate court 0:05:50.040 --> 0:05:53.039 justices going forward, but it would be nearly impossible for 0:05:53.120 --> 0:05:55.599 the court to hear and rule before the trial's beginning. 0:05:56.040 --> 0:06:00.360 Jury selection is scheduled from Monday the fifteenth at Baxter bloom. 0:06:00.279 --> 0:06:03.120 Radio, all right ed, thanks well. Staying in Manhattan. There 0:06:03.200 --> 0:06:04.920 is not as much of a hush in New York 0:06:04.960 --> 0:06:07.680 City office buildings. The return to work rate is now 0:06:07.720 --> 0:06:10.880 close to eighty percent of where it was before the pandemic. 0:06:11.120 --> 0:06:13.080 We get more from Bloomberg's Doug Prisner. 0:06:13.400 --> 0:06:16.360 The data come from placer Ai. They show how Wall 0:06:16.360 --> 0:06:19.880 Street firms including Goldman, Sachs and JP Morgan helped drive 0:06:19.920 --> 0:06:23.240 New York City's return to office rate. A similar rebound 0:06:23.279 --> 0:06:25.640 was also seen in Miami, with a rate of seventy 0:06:25.680 --> 0:06:28.719 eight percent last year. The return to office rates for 0:06:28.800 --> 0:06:32.480 these two cities were the highest among seven major US markets. 0:06:32.680 --> 0:06:35.680 They were also above the national average of about sixty 0:06:35.720 --> 0:06:39.840 three percent. San Francisco saw the greatest growth in office 0:06:39.880 --> 0:06:43.400 visitations in twenty twenty three. However, it still lagged behind 0:06:43.520 --> 0:06:46.760 other major cities with an RT rate of forty five 0:06:46.800 --> 0:06:49.599 percent in New York. I'm Doug Prisner, Bloomberg Radio. 0:06:49.720 --> 0:06:53.400 Okay, Doug, thanks for watching shares of Alpine Immune Sciences 0:06:53.440 --> 0:06:56.200 on some deal news this morning. They're up thirty six 0:06:56.279 --> 0:06:59.680 percent in early trading. The kidney drug developers being bought 0:06:59.680 --> 0:07:06.800 by Tech Pharmaceuticals for four point nine billion dollars in cash. 0:07:07.279 --> 0:07:08.800 And it is time now for a look at some 0:07:08.839 --> 0:07:10.800 of the other stories making news in New York and 0:07:10.880 --> 0:07:13.200 around the world. For that, we're joined by Bloomberg's and 0:07:13.280 --> 0:07:15.800 Michael Barr. Michael, good Morning, Good morning, Karen. 0:07:15.880 --> 0:07:16.120 House. 0:07:16.200 --> 0:07:19.280 Republicans have failed to advance a bill that would renew 0:07:19.320 --> 0:07:23.560 the Foreign Intelligence Surveillance Act FISA, gives law enforcement the 0:07:23.600 --> 0:07:29.160 authority to monitor suspicious interactions with foreign adversaries. After former 0:07:29.240 --> 0:07:34.000 President Trump posted kill FAISA. Nineteen Republicans voted against the 0:07:34.040 --> 0:07:37.680 procedural vote, despite House Speaker Mike Johnson urging them to 0:07:37.720 --> 0:07:42.239 approve it. Republican Congressman Dan Crenshaw, Texas says he believes 0:07:42.280 --> 0:07:46.080 the laws renewal is necessary for the US to monitor 0:07:46.240 --> 0:07:48.280 bad actors all over the world. 0:07:48.600 --> 0:07:52.040 You lose our collection on our adversaries. That's one of 0:07:52.080 --> 0:07:54.800 the most seriously bad things that I can think of happening. 0:07:55.040 --> 0:07:56.720 I've never been worried like I'm worried now. 0:07:57.040 --> 0:07:59.680 However, critics on both sides of the aisle saying that 0:07:59.720 --> 0:08:04.680 Americans often get surveiled improperly because of it. The fallout 0:08:04.680 --> 0:08:08.560 continues in the fight over a newly revived eighteen sixty 0:08:08.560 --> 0:08:13.160 four Arizona law criminalizing abortion throughout pregnancy unless a woman's 0:08:13.160 --> 0:08:17.440 life is at risk. The Arizona Legislature devolved into jeering 0:08:17.520 --> 0:08:22.080 yesterday as Republican lawmakers shut down discussion on a proposed 0:08:22.120 --> 0:08:25.600 repeal of the law. The Arizona Supreme Court cleared the 0:08:25.600 --> 0:08:28.840 way this week for enforcing the pre statehood abortion ban 0:08:29.280 --> 0:08:34.320 throughout pregnancy, without exceptions for rape or incest. Democratic State 0:08:34.400 --> 0:08:38.560 Senator Anna Hernandez called the GOP bloc politically foolish. 0:08:39.000 --> 0:08:41.520 It's not about convincing somebody to have an abortion or not. 0:08:41.920 --> 0:08:43.160 That is their choice. 0:08:43.400 --> 0:08:45.839 This is about do we trust the people to make 0:08:45.880 --> 0:08:49.959 the best decision for themselves, And we're saying yes, we do. 0:08:50.559 --> 0:08:54.360 A proposed ballot initiative may ask voters in November whether 0:08:54.400 --> 0:08:59.760 to place abortion protections into the state constitution. New York City, 0:09:00.160 --> 0:09:03.560 fighting back against people who steal packages delivered to residents, 0:09:03.720 --> 0:09:07.880 city officials have now introduced new public delivery lockers. Each 0:09:07.960 --> 0:09:11.400 locker can hold twenty five packages at one time. New 0:09:11.480 --> 0:09:13.800 York Mayor Eric Adams New. 0:09:13.760 --> 0:09:18.280 Yorkers will be able to receive and send packages using 0:09:18.360 --> 0:09:22.680 secure lockers on public sidewalks. The program is available to 0:09:22.720 --> 0:09:26.240 all New Yorkers twenty four to seven and it is 0:09:26.280 --> 0:09:30.520 the favorite four letter road of New Yorkers free. 0:09:30.720 --> 0:09:34.000 Currently, seven lockers are installed around the city, including in 0:09:34.040 --> 0:09:37.800 Brooklyn and Hell's Kitchen. Global News twenty four hours a 0:09:37.880 --> 0:09:40.840 day and whenever you want it with the Bloomberg News. Now, 0:09:40.960 --> 0:09:43.960 I'm Michael Barr, and this is Bloomberg Karen. 0:09:44.120 --> 0:09:50.599 All right, Michael Barr, thank you time now for the 0:09:50.640 --> 0:09:54.240 Bloomberg Sports Update with John stash Hour. John, good morning, 0:09:54.280 --> 0:09:55.040 Good morning, Karen. 0:09:55.040 --> 0:09:57.360 There hasn't been a Master's without a drop of rain 0:09:57.440 --> 0:10:00.080 since twenty eighteen, and ranged in the forecast for this 0:10:00.200 --> 0:10:02.120 morning sounds like togat at least some of the opening 0:10:02.200 --> 0:10:04.439 round in It is expected to be clear Skys the 0:10:04.520 --> 0:10:06.840 rest of the weekend. The eighty eighth Masters, John Rahm, 0:10:06.840 --> 0:10:09.920 the defending jam Scottie Sheffer won two years ago. Here's 0:10:09.960 --> 0:10:11.240 the world number one on playing. 0:10:11.559 --> 0:10:14.160 That's the national I mean to me, it's just a 0:10:14.160 --> 0:10:16.440 special place. It's kind of the mecca for us growing 0:10:16.520 --> 0:10:18.520 up being you know, grown up here in the States 0:10:18.559 --> 0:10:21.400 and you know, being Americans. I think this is the 0:10:21.440 --> 0:10:24.640 tournament that we all look for, and to be here 0:10:24.720 --> 0:10:28.280 on property every year is extremely special. And I mean 0:10:28.320 --> 0:10:31.200 it seems like it all stands out. Everything has done 0:10:31.280 --> 0:10:31.920 so well here. 0:10:32.040 --> 0:10:35.160 Yesterday's par three won by Ricky Fowler, no one has 0:10:35.200 --> 0:10:37.200 ever won it, and then won the green jacket. They 0:10:37.200 --> 0:10:39.640 were five holes and won in the event, and including 0:10:39.679 --> 0:10:42.720 one by Gary Woodland, who's playing the Masters after undergoing 0:10:42.760 --> 0:10:46.000 brain surgery. Last fall at the Stadium Marlin's with the Yankees, 0:10:46.040 --> 0:10:48.560 five's too, Jake Berger a three run homer off Marcus Stroman, 0:10:48.600 --> 0:10:50.679 John Carlos Stanton homer for the Yanks. Mets and Braves 0:10:50.720 --> 0:10:52.719 reigned out in Atlanta. The Red Sox had a five 0:10:52.720 --> 0:10:55.320 to nothing lead in the sixth inning, lost to the 0:10:55.360 --> 0:10:58.840 Orioles seven to five. Twenty year old Jackson Holiday went 0:10:58.880 --> 0:11:01.880 over four Big League debut for Baltimore. He's the son 0:11:01.920 --> 0:11:05.760 of Matt Holliday. He's considered MLB's top prospect. Giants beat 0:11:05.760 --> 0:11:08.319 the National seven to one. Cleveland top the White Sox. 0:11:08.360 --> 0:11:11.480 The Guardians have brothers in their lineup, and Bow and 0:11:11.600 --> 0:11:14.679 Josh Naylor both homeward in the fourth inning. Big NBA 0:11:14.760 --> 0:11:17.200 game for first place in the West. Denver beat Minnesota. 0:11:17.240 --> 0:11:20.000 Nikolaoa could scored forty one. The netsbeat Toronto one of 0:11:20.080 --> 0:11:22.720 six to one oh two. The next play tonight in Boston. 0:11:23.240 --> 0:11:26.600 Rangers trying to finish first overall. They host Philadelphia, the Islanders, 0:11:26.640 --> 0:11:30.160 seeking a playoff for their home for Montreal. The WNBA 0:11:30.320 --> 0:11:34.280 TV schedule is out. Thirty six of Indiana's forty games 0:11:34.280 --> 0:11:38.040 will be on National TV. The Fever Expecutive Draft Caitlin 0:11:38.120 --> 0:11:42.040 Clark on Monday, John Stashawer Blueberg Sports, Karen Nathan. 0:11:42.040 --> 0:11:44.800 All Right, John Stashauer, thank you. SMP futures down to 0:11:44.960 --> 0:11:47.679 tenth seven percent, so our down futures Now's day futures 0:11:47.720 --> 0:11:50.040 down about the same. In the ten year treasury yield 0:11:50.080 --> 0:11:52.200 is that four point five six percent. 0:11:54.840 --> 0:11:59.199 Coast to coast on Bloomberg Radio nationwide, on Sirius XM and. 0:11:59.240 --> 0:12:02.559 Around the world on Bloomberg dot com and the Bloomberg 0:12:02.600 --> 0:12:03.280 Business app. 0:12:03.440 --> 0:12:07.600 This is Bloomberg Daybreak. Good morning, I'm Nathan Hager. Well, 0:12:07.640 --> 0:12:10.240 the third month was definitely not the charm on the 0:12:10.320 --> 0:12:13.000 road to disinflation. The March Consumer Price Index did come 0:12:13.040 --> 0:12:16.560 in hotter than expected, once again, keviny investors pushing back 0:12:16.640 --> 0:12:20.800 bets on rate cut timing from the Federal Reserve. For more, 0:12:21.160 --> 0:12:25.200 we're joined by City US economist Veronica Clark. Veronica, good morning, 0:12:25.240 --> 0:12:25.800 Thanks so much. 0:12:25.640 --> 0:12:26.080 For being with us. 0:12:26.120 --> 0:12:28.000 Good morning, Yeah, thank you for having me. 0:12:28.280 --> 0:12:31.920 So is the road to disinflation still bumpy or is 0:12:32.000 --> 0:12:35.440 this third in a row CPI hotness the new trend? 0:12:36.600 --> 0:12:39.120 Yeah, I mean I think most food officials will probably 0:12:39.160 --> 0:12:42.719 still characterize this as bumpy. Of course, it will be 0:12:42.800 --> 0:12:47.360 core PC inflation that matters most for the Fed, and 0:12:47.400 --> 0:12:49.840 we'll see what that comes out today once we get 0:12:49.840 --> 0:12:53.560 details of PPI data. But I think, you know, maybe 0:12:53.600 --> 0:12:55.760 the hawks are getting a bit more uncomfortable and it 0:12:55.760 --> 0:12:58.359 does kind of get harder to come to a consensus 0:12:58.360 --> 0:13:00.920 to cut maybe as soon as June. But there are 0:13:00.960 --> 0:13:02.720 a lot of uncertainties, of course, with all the other 0:13:02.800 --> 0:13:04.120 data that we're going to get before June. 0:13:04.160 --> 0:13:07.240 Also, do you guys over at City count yourselves as Hawks, 0:13:07.280 --> 0:13:09.120 So are you getting more uncomfortable yourselves? 0:13:10.120 --> 0:13:13.200 No, not necessarily. We're We're probably one of the more 0:13:13.240 --> 0:13:15.400 dubvish forecasts out there right now. We think the Fed 0:13:15.480 --> 0:13:18.360 is still cutting in June and then cutting every meeting 0:13:18.400 --> 0:13:21.040 after June. So that is one hundred and twenty five 0:13:21.160 --> 0:13:24.040 basis points of cuts this year. That's well more than 0:13:24.080 --> 0:13:26.800 what's priced right now. But I think for us, you know, 0:13:26.800 --> 0:13:29.480 we are trying to be more forward looking. We are 0:13:29.520 --> 0:13:32.640 trying to assess the other types of data that we 0:13:32.960 --> 0:13:35.240 might see over the coming months. You know, labor market 0:13:35.320 --> 0:13:38.160 data that has been very strong, but some of the 0:13:38.200 --> 0:13:41.160 details look a bit precarious, and I think the said 0:13:41.200 --> 0:13:44.000 would be very dubvish if we know we're getting some 0:13:44.040 --> 0:13:45.320 weaker labor market data. 0:13:45.520 --> 0:13:48.680 Yeah, first cut in June is looking more and more 0:13:48.840 --> 0:13:51.960 like a bold call given the data that we have 0:13:52.160 --> 0:13:54.160 seen so far. In some of the commentary that we're 0:13:54.160 --> 0:13:57.080 hearing from the likes of Larry Summers, the former Treasury 0:13:57.120 --> 0:14:00.319 secretary who was on Bloomberg yesterday, saying, maybe we they 0:14:00.600 --> 0:14:02.680 hold out the possibility that the next move from the 0:14:02.679 --> 0:14:04.960 Fed is a hike. I mean, how do you push 0:14:05.040 --> 0:14:05.760 back against that? 0:14:06.640 --> 0:14:08.960 Yeah, I mean I think that is probably pretty unlikely. 0:14:09.040 --> 0:14:11.559 I think at least Fed officials will see at least 0:14:11.559 --> 0:14:14.760 that the current level of rates is restrictive. And we've 0:14:14.800 --> 0:14:18.440 heard that most FED officials, certainly from fair Powell. And 0:14:18.520 --> 0:14:21.040 so if you know, inflation is coming in a bit 0:14:21.080 --> 0:14:24.000 hotter than comfortable and they're comfortable with they're not, you know, 0:14:24.040 --> 0:14:27.480 getting that further confidence that they want to see. It's 0:14:27.520 --> 0:14:29.800 not necessarily that we're talking about hikes again. They would 0:14:29.800 --> 0:14:32.800 probably just lead rights elevated for a bit longer. We're 0:14:32.800 --> 0:14:34.680 just talking about pushing out those cuts. 0:14:36.280 --> 0:14:39.720 What is it that's keeping these price pressures so sticky? 0:14:39.760 --> 0:14:43.720 What are you seeing in the data that has inflation 0:14:43.920 --> 0:14:46.840 where it is and has you still thinking that there 0:14:46.960 --> 0:14:50.000 is still room for the Fed to make a cut. 0:14:50.760 --> 0:14:53.680 Yeah, I mean, we honestly do still see a lot 0:14:53.920 --> 0:14:57.400 of stickiness and services inflation. So we've seen that for 0:14:57.440 --> 0:15:00.720 a while in shelter inflation, which which should slowing at 0:15:00.720 --> 0:15:03.240 some point and as we're getting into two later this year, 0:15:04.040 --> 0:15:06.920 but a lot of the strength and yesterday's CPI data 0:15:07.520 --> 0:15:11.560 with non shelter services. Actually about half of that strength 0:15:11.560 --> 0:15:14.360 and non shelter services had to do with auto insurance, 0:15:15.120 --> 0:15:18.480 which interestingly does not go into the Fed's preferred PC 0:15:18.680 --> 0:15:22.200 inflation measure. But even in PC inflation, I think we're 0:15:22.440 --> 0:15:25.480 we're still seeing a lot of stickiness to services inflation 0:15:25.680 --> 0:15:28.240 and that has to do with, you know, a tight 0:15:28.320 --> 0:15:31.160 labor market. We're still running wages that are around four 0:15:31.160 --> 0:15:33.600 to five percent or so. That's a fit stronger than 0:15:33.600 --> 0:15:36.960 you want to see to be consistent with two percent inflation. 0:15:37.640 --> 0:15:40.480 So there is still some loosening to go. But I 0:15:40.520 --> 0:15:44.160 think we do see the signs in the labor market, 0:15:44.200 --> 0:15:47.600 details in demand for workers hiring that has really slowed down. 0:15:48.280 --> 0:15:50.560 That leads us to think we are going into a 0:15:50.640 --> 0:15:51.960 much looser label market. 0:15:52.200 --> 0:15:54.440 So we only have about thirty seconds left here, Veronica, 0:15:54.480 --> 0:15:57.040 what are you expecting when it comes to producer prices 0:15:57.080 --> 0:15:59.720 out this morning and whether that could change the narrative 0:15:59.720 --> 0:16:00.960 that we're in this market. 0:16:01.800 --> 0:16:04.160 Yeah, this one one could be interesting. There's a couple 0:16:04.200 --> 0:16:07.479 things to watch, you know, we're looking at the transportation 0:16:07.600 --> 0:16:10.840 and the good kind of components of PPI data that 0:16:10.880 --> 0:16:14.240 could be a bit stronger. We might see a stronger 0:16:14.320 --> 0:16:19.080 headline PPI increase. But most importantly today, we're watching some 0:16:19.200 --> 0:16:23.640 very specific components that go into our mapping of core 0:16:23.720 --> 0:16:26.200 PCE inflation for March, and of course that's what the 0:16:26.280 --> 0:16:29.520 said we'll care most about. We are expecting to see 0:16:29.520 --> 0:16:34.680 some strength in components like medical services, certain financial services, 0:16:35.400 --> 0:16:38.480 and that could mean that forecasters are expecting, you know, 0:16:38.520 --> 0:16:41.840 a bit stronger core PCE even than we had in February. 0:16:41.880 --> 0:16:44.680 We had a twenty six basis point increase in February. 0:16:44.760 --> 0:16:48.320 We're tracking at around thirty basis points right now. That 0:16:48.360 --> 0:16:51.040 could mean that we're just pushing these cuts further out 0:16:51.840 --> 0:16:54.600 market continues to price outcuts. Yeah, but that might be 0:16:54.640 --> 0:16:55.600 a little bit tree mature. 0:16:56.760 --> 0:16:59.640 This is Bloomberg day Break Today, your morning brief on 0:16:59.680 --> 0:17:01.840 the store where he's making news from Wall Street to 0:17:02.080 --> 0:17:03.280 Washington and beyond. 0:17:03.560 --> 0:17:06.320 Look for us on your podcast feed at six am 0:17:06.400 --> 0:17:10.040 Eastern each morning on Apple, Spotify, and anywhere else you 0:17:10.119 --> 0:17:11.160 get your podcasts. 0:17:11.400 --> 0:17:14.120 You can also listen live each morning starting at five 0:17:14.160 --> 0:17:16.800 am Wall Street time on Bloomberg eleven three to zero 0:17:16.800 --> 0:17:19.680 in New York, Bloomberg ninety nine to one in Washington, 0:17:19.760 --> 0:17:22.639 Bloomberg one oh six to one in Boston and Bloomberg 0:17:22.720 --> 0:17:24.399 ninety sixty in San Francisco. 0:17:24.760 --> 0:17:27.920 Our flagship New York station is also available on your 0:17:27.960 --> 0:17:33.399 Amazon Alexa devices. 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