August 27, 2025 • 19 mins
Your morning briefing, the business news you need in just 15 minutes.
On today's podcast:
(1) President Donald Trump said he was prepared for a legal fight with Federal Reserve Governor Lisa Cook after he moved to oust her from her post following allegations that she falsified mortgage documents.
(2) France’s bond yields could spike to 100 basis points above their German peers for the first time since 2012 if the nation’s political crisis deepens, according to Carmignac.
(3) UK long bond yields soared to within a whisker of a 27-year high Tuesday, piling pressure on Prime Minister Keir Starmer’s government to rein in its fiscal stance.
(4)Nigel Farage vowed to expel tens of thousands of asylum-seekers from the UK, tapping a policy deployed in the US by President Donald Trump as he seeks to guide his populist Reform party to power at the next general election.
(5) President Donald Trump imposed a crushing 50% tariff on some Indian goods — the highest in Asia — to punish the country for buying Russian oil, upending a decades-long push by Washington to forge closer ties with New Delhi.
(6) SpaceX’s Starship rocket launched to space and deployed satellites for the first time before surviving most of its journey to Earth, achieving new technological milestones after a year of fiery setbacks.
Podcast Conversation: Taylor Swift Turns Her Engagement Into Another Media Coup
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Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Speaker 1 (00:02):
Bloomberg Audio Studios, podcasts, radio news.
Speaker 2 (00:09):
This is the Blooe Big Dabacate podcast. Good Morning is Wednesday,
the twenty seventh of August in London.
Speaker 3 (00:14):
I'm Caroline Hepca and.
Speaker 4 (00:15):
I'm Stephen Carroll. Coming up today, Donald Trump vows to
go to court to remove Federal Reserve Governor Lisa Cook
as the White House considers ways to extend its influence
across the Fed's regional banks.
Speaker 2 (00:27):
As UK government boring costs come close to nineteen ninety
eight highs, we look at whether the data used to
measure the country's economy is up to the job.
Speaker 4 (00:36):
Plus, we have lift off SpaceX successfully launches its starship
reusable rocket, surviving most of its journey back to Earth.
Speaker 3 (00:44):
Let's start with a round up of our top stories.
Speaker 4 (00:47):
The White House is exploring ways to exert more influence
over the fed's twelve regional banks, including how their presidents
are vetted and chosen. That's according to sources who've spoken
to Bloomberg. The reporting comes as Donald Trump says he's
ready for a legal fight with FED Governor Lisa Cook,
adding that he's already looking for her replacement.
Speaker 5 (01:07):
Well, we have some very good people for that position,
and I think we have some very good people were
down to.
Speaker 4 (01:14):
I mean, I think I maybe in my own mind
have somebody that I like.
Speaker 3 (01:18):
But I deal with Scott.
Speaker 4 (01:20):
And I deal with Howard, and we're dealing with.
Speaker 1 (01:22):
A lot of people actually that are going to be
involved in that decision.
Speaker 4 (01:25):
Ultimate it's a very important decision. Yes, President, they're referring
to the Treasury Secretary Scott Bassant on the Commerce Secretary
Howard Lutnik, who would both be expected to weigh in
on any possible successor. In a statement released on Tuesday,
the Federal Reserve said it will abide by any court
ruling regarding Cook. If Trump succeeds, he could secure a
(01:46):
dubbish majority on the FED Board as he pushes for
lower interest rates. We got reaction from former Fed Vice
Chair Lal Brainard.
Speaker 6 (01:54):
Well, I think the Federal Reserve is an incredibly difficult
position here. But you have to remember this is not
about an individual governor. This is really an unprecedented attack
on the independence of the Federal Reserve as an institution.
Speaker 4 (02:11):
Former Fair Advice Chair Lale Brainard speaking there as concerns
grow that President Trump's unprecedented and escalating attack on the
federal reserve runs the risk of driving long term borrowing
costs higher.
Speaker 2 (02:25):
Now the United States has placed a fifty percent tariff
on some Indian goods, which came into effect only a
short time ago. The levee is doubled the existing rate
and threatens to damage the export competitiveness of the world's
fastest growing major economy. President Champ says that the charge
is punishment for India's ongoing purchases of Russian oil, which
(02:47):
he said is funding Putin's war in Ukraine. But despite
the move, India and Russia have pledged to increase their
annual trade over the next five years by fifty percent
to one hundred billion dollars. New Delhi has also called
the US actions against it unfair, unjustified, and unreasonable.
Speaker 4 (03:05):
The asset manager Carmeniac is warning that French government borrowing
cost could spike to one hundred basis points over their
German peers if the government collapses in ten days time.
That will be the widest yields spread since the height
of the Eurozone death crisis in twenty twelve. Ahead of
the confidence vote on the eighth of September, opposition to
French Prime Minister of France Barberou's government is growing. The
(03:26):
leader of the far right National Rally Party, Jordan Baldela,
told France's TF one television that he won't back the premiere.
Speaker 7 (03:33):
We will obviously be voting against the government's confidence motion
and as seeking potentially a new government or new president
if this one has to choose constitutional tools to get
out of this crisis or hear what the majority of
the French people want today.
Speaker 4 (03:50):
Jodan Baldella, speaking there through a translator during an interview
with the Francis Fan. Three of the major opposition groups
have now indicated they will vote against the com Fidan's
motion next month, increasing the likelihood of a resignation. Barroo
is calling the vote in an effort to consolidate support
in parliament for forty four billion euros worth of spending
(04:11):
cuts and tax increases that he considers vital to averse
disaster for the public finances.
Speaker 5 (04:18):
Now.
Speaker 2 (04:18):
The yield on UK thirty year bonds climbed close to
a twenty seven year high yesterday, piling pressure on Keir
Starmer's government to tighten its fiscal policy.
Speaker 3 (04:30):
Bloomberg's un Parts reports long dated guilt yield surge.
Speaker 5 (04:34):
Yesterday's market's caught up with Monday's moves In the US
after the bank call of the closure, thirty yields are
now just a whisker away from five point sixty six percent,
a level they last saw in nineteen ninety eight. The
high cost of borrowing as yet another headwind for the
Chancellor as she works out how to make the sums
add up ahead of her or some budget, and if
(04:54):
she was hoping for some relief on interest rates, Catherine Mann,
who sits on the Berwis rate setting Committee, says now
is not the time. She says policies not currently tighten
off and holding rates is the appropriate thing to do.
In London, i'm umpot Splinberg.
Speaker 4 (05:08):
Radio Nigel for Hours, the leader of Britain's Reform UK party,
is vowed to expel tens of thousands of asylum seekers
if he wins the next general election, as part of
a program dubbed Operation Restoring Justice for ourset of reform
led government would remove Britain from the European Court of
Human Rights and carry out mass deportations.
Speaker 8 (05:29):
The only way we will stop the votes is by
detaining and deporting absolutely anyone that comes via that route,
and if we do that, the boats will stop coming
within days.
Speaker 4 (05:46):
The reform UK leader out of that he would scrap
the country's Human Rights Act to remove legal roots of
appeal and disipply the nineteen fifty one Refugee Convention for
five years. The CEO of the Refugee Council and ver
Solomon denounce the toxic narratives that dehumanize refugees and fuel
fear and division across the country.
Speaker 2 (06:07):
Elon Musk's SpaceX has successfully launched a test flight of
its Starship rocket, achieving new technological milestones after a year
of far e setbacks. Build as the largest and most
powerful rocket ever built. It successfully deployed satellites for the
first time and survived most of its journey back down
to Earth. Let's have listened to the moment that it
(06:28):
launched from SpaceX's starbase in South Texas.
Speaker 3 (06:33):
Bio three two one.
Speaker 2 (06:43):
The rockets super heavy boosters separated as planned before splashing
down in the Gulf of Mexico. Starship is at the
heart of SpaceX's plans to put Starlink Internet satellites into
Earth's Orbid and to one day put humans on Mars.
Speaker 3 (07:00):
Those are your top stories.
Speaker 4 (07:01):
On the markets, the msciosh Pacific Index down by a
tenth of one percent. European stock features are pointing higher
after we saw another day of selloff yesterday, so Eurostock's
fifty futures are up by three tenths of one percent.
On currency markets, the Bloomberg Dollar Spot Index two tenths higher.
The euro is trading at one sixteen fourteen, the pound
at one thirty four forty seven, and the ten year
(07:21):
treasury yield is upper basis point at four point two
seven percent.
Speaker 2 (07:26):
Now, in a moment, we'll bring you more on Donald Trumps,
pressure on the Fed, Lisa Cook, plus the latest in
the barrage of criticism over UK economic data. But there's
another story that's caught our eye. And of course, the
I peraps the entire internet.
Speaker 4 (07:40):
Where were you, Caroline when you heard the news?
Speaker 2 (07:43):
I shall not reveal, but I am totally fascinated by
Taylor Swift and yeah.
Speaker 4 (07:49):
In Instagram posts that took the world. Yes, I think
Taylor Swift is engaged in Travis Kelsey in case you
hadn't heard, And the Internet is full of people reacting
to it, which I think is more interesting than the actual.
Speaker 3 (07:59):
Point dress studying the flowers.
Speaker 4 (08:02):
But look at us being bloomberg. We've also been looking
at how people have been spending their money around this
as well. So, for example, on betting website, gamblers are
making wages on when the wedding will take place. Apparently
eighty thousand dollars worth of bets were placed on one
website in the hours after the Instagram post announcing the engagement.
Apparently on polymarket, betters are going as far as to
gamble when the couple might have a baby. Others are
(08:24):
also convinced the singers now going to headline the twenty
twenty six Super Bowl halftime show. So there are business
opportunities everywhere you look in this one. It's actually a
very interesting reflection of the gambling frenzy that's been going
on in the US, Americans batting billions on sport but
also cultural events. In advance of this, around two hundred
and fifty thousand dollars changed hands on one website for
(08:45):
bets on whether Travis Kelsey and Taylor Swift would get
engaged this year. Odds were hovering in case you're wondering,
at about forty percent going into this week. Yeah, other effects.
We're seeing this already. The dress that Taylor Swift wore
in the engagement photos sold out apparently.
Speaker 2 (08:59):
And of how much and what the design of the
ring was all about.
Speaker 4 (09:04):
I mean, emergandising possibilities really are endless if you think
about it. Anyway, plenty more to read on this news.
Will put some of the links to our stories on
this on our podcast show Notes Now.
Speaker 2 (09:17):
President Trump says that he is prepared for a legal
fight with Federal Reserve Governor Lisa Cook as he attempts
to gain more control over the US Central Bank. Joining
US Now to discuss his Bloomberg's Markets live strut is
Mary Nicola, Mary, Good Morning. President Trump said yesterday we'll
have a majority I fall out of the seven FED
board members as Trump appointees, and they then have influence
(09:41):
over regional FED governors. So I suppose the fundamental question
is how likely is that?
Speaker 3 (09:47):
How quickly could it happen?
Speaker 1 (09:50):
Well, we know, for one thing, what is going to
happen with Lisa Cook in terms of there's it's going
to the court, potentially going to the courts, and that
could mean a very long drawn out legal battle. So
it might not be that swift that we get a
resolution on what happens.
Speaker 3 (10:05):
But even if not, the whole fact.
Speaker 1 (10:07):
That we're going through this long legal battle, the fact
that President Trump is trying to influence the Central Bank
is quite nerve wrecking for markets, and it's going to
weigh on the dollar because at the end of the day,
you're undermining the credibility of the FED. You're infringing on
(10:28):
the independence of the FED, and that is essentially one
of the key cornerstones of policy in the US.
Speaker 3 (10:34):
So a lot of it.
Speaker 1 (10:35):
For now it seems like the reaction is a bit complacent,
but if he gets what he wants, it's actually quite
damaging for the dollar and US assets.
Speaker 4 (10:45):
Well, I suppose let's talk about how this could play
down the line as well, because even a protracted legal
battle also casts a shadow over the FED. And of
course we're thinking about the decision over the FED chair
next year too. I mean, what is the outlook or
the market considerations about what the Federal Reserve could look
like in a couple of months time.
Speaker 1 (11:04):
Yeah, if a lot of I mean, there's obviously we
know and it's been very clear that the administration wants
lower rates. So I think what you end up getting,
especially if there is a lot of influence from the
political side, is that you get shortened rates quite well anchored.
The problem really comes in in the back end, where
concerns about inflation expectations, especially if you have PCE coming through,
(11:29):
or if you have you know, the concerns about a
policy mistake, and of course just where the trajectory of
inflation could be potentially going with tariff's coming through. So
I think the end result is going to be a
lot of emphasis on the back end, or pressure on
(11:49):
the back end of the curve. But what you'll see
is more of a lock in on the front end
because you'll there will be heightened expectations of more aggressive
easing if the administration really gets what it wants.
Speaker 2 (12:02):
So that's the sort of thinking around you know, an
independent federal reserve. Maybe that that looks a lessertain now
obviously that being you know, the bedrock of US and
global market is or was certainly a significant one. There
is also another political crisis though that we should be discussing,
and that's in France over the budget, which has seen
French boring cost surge and Comegnact warning that the yield
(12:25):
spread between French and German bonds could hit one hundred
basis points.
Speaker 3 (12:28):
So why is that so important?
Speaker 1 (12:31):
Yeah, I mean we're not it's nothing new that we're
getting some of these political rumblings from from France. And
we've seen it before in twenty twenty four when mccran
called a snap elections. We saw it again when the
prime minister was a government first collapsed, so there has
(12:51):
been a bit of a repeat. The problem is, and
we've seen it before, is the fact that there's a
greater scrutiny on debt sustainability, whether you have it from
the U or from France. The fact is government debts
are ballooning. We already see it in the borring costs
for guilt for example as well. So this just places
greater scrutiny under debt sustainability and it puts even more
(13:16):
pressure on the long end of the curve.
Speaker 3 (13:18):
And that's unlikely to go away.
Speaker 1 (13:20):
So we don't have the vote until September eighth, so
that's going to likely lead to a lot of investor
angst in the run up and there's going to be
a lot of pressure on French assets as a result.
Speaker 4 (13:31):
Well, continue to monitor that as it develops. Mari Nicola
for Now our Market's life strategist. Thank you, stay with us.
More from Bloomberg Daybreak Europe coming up after this.
Speaker 5 (13:43):
Now.
Speaker 2 (13:43):
Britain's Royal Economic Society is the latest to wade into
the crisis around the UK's economic data. The Body for
British Economists is warning that experts can no longer properly
analyze the gender pay gap, as well as other wage
and inequality measures. What it's The latest blow is the government,
civil servants and bankers all vent their frustration at the
(14:04):
deterioration of the UK's official statistics At Bloomberg's James Walcock
joins us now for more on this. So just tell
us and explain a bit more about the state of
this problem with economic data.
Speaker 9 (14:19):
I think, Karen, imagine an ideal economy and what you
would want to know about it. In an ideal world,
you'd love to know how much people are paid, how
much game people are in work, and maybe what's the
GDP actually Commy's worth. Now this sound is me getting
at my laundry list of all the statistics that have
been delayed or suspended or corrected in the past three
(14:41):
years by the Office of National statistics in the UK,
so labor force employments which has been suspended entirely until
twenty twenty seven, producer prices, trade data GDP, business surveys,
and retail sales.
Speaker 3 (14:56):
So like you pick.
Speaker 9 (14:57):
Your indicator of how the economy is going, the OS
has in some fashion had issues with that day to
the latest one being retail sales, which was just last week.
It has been delayed by two weeks where they do
quality assurance. Now we're now seeing the second order effects
from that. We've already heard from government ministers and politicians
and central bankers and financiers saying this is difficult, but
(15:17):
we're now say academics weighing and the Royal Economic Society
is one of the world's oldest and most prestidious can
make associations, and they're saying it's easier to study other
countries than the UK where they're based at this point
in terms of how to look after the labor market.
And then on top of that, a recent review by
the British journalm Industry Relations found the OS has underestimated
(15:37):
the gender pay gap for twenty years now by one percent.
They also say that they got the number of people
on the minimum wage wrong by twenty percent, and now
the Resolution Foundation have released a rival index looking at
unemployments which predicts will be at five percent by the
end of the year. The other thing, tanks are trying
to fill the gap where officialtistics used to be. It
(15:59):
all adds up to what is effectively this sort of
vacuum where UK for statistics used to be.
Speaker 3 (16:05):
So what's being done to fix such chains?
Speaker 9 (16:07):
It depends what you view as the problem, Stephen. In
many ways, the OS is a very good metaphor for
the UK. More broadly, you've got a changing society, you
have limited resources, you have a response to COVID, the pandemic,
and questions of a productivity. If you look at the surveys,
the onsay the surveys on labor being fixed. New leads
are in place and they say they are urgently refocusing
(16:30):
resources on their core economic outputs. And so if you
think the problems are survey based, they're hoping new techniques
will fix it. If you think this is an austerity problem,
ten million pounds is being cut from non urgent economic
data to go into sort of the essential areas. But
at Bloomberg Analysis says there is going to be a
six percent funding cut in real terms by twenty twenty nine.
(16:50):
If you think this is a problem of culture and productivity,
it's worth noting in two thousand and seven ninety percent
of the OS's London based staff quit than move to Newport,
so a leveling up sort of question. In twenty twenty,
over the pandemic, they all moved to homeworking and the
only's high people as far abroad as Northern Ireland, as
far as flung away from Newport. Then twenty twenty three,
(17:12):
when areas in the data started creeping in, they were
then told to move back to forty percent homeworking, which
means that the o ands are currently on strike where
they are doing a zero office attendance policy. All of this,
depending on how you want to look at it could
be sort of the problem or the range of problems.
It's not a short term thing that can be fixed
very easily.
Speaker 2 (17:33):
Yeah, so it's funding its people, but maybe it's also
the fact that we're becoming such a digitized economy and
so the way that you collect statistics is really changing.
Lots and lots of issues then really to get to
grips with and it all comes out kind of quite
a difficult time also for the government, certainly when we're
thinking about the autumn budget and government finances, and an
(17:54):
interesting interview.
Speaker 9 (17:56):
It quite I mean arguably, this could be one of
the worst possible moments to come. R high inflation, you
have a weakening jobs market. This is the moment that
central bankers sort of test their metal and earn their stripes.
And meanwhile interest rates being so high as putting pressure
on bond yields. They are now higher than the sudden
spike under the former Prime Minister of this trust who,
as you hinted, their Caline Bloomberg spoke to yesterday. Now
(18:19):
she thinks politicians here should be taking a leaf out
of President Trump's approach.
Speaker 3 (18:24):
To the FED.
Speaker 10 (18:26):
I think the Bank of England needs to be accountable
to politicians. I think the current system doesn't work. This
is why I'm very sympathetic to what Donald Trump is
saying about the FED. Monetary policy is incredibly important.
Speaker 9 (18:39):
Now you can hear that full interview on the Odd
Lots podcast later this week. But with central bankers under scrutiny,
and as we head into like you say, car into
this difficult autumn where Chancellor Racheries will be feeling endless
questions about taxes. She'll be hoping for better economic data
to try and give her more fiscal space. But if
that data does come at this crucial moment, will we
(19:00):
trust it.
Speaker 4 (19:02):
This is Bloomberg Daybreak Europe, your morning brief on the
stories making news from London to Wall Street and beyond.
Speaker 2 (19:08):
Look for us on your podcast feed every morning, on Apple, Spotify,
and anywhere else you get your podcasts.
Speaker 4 (19:14):
You can also listen live each morning on London DAB Radio,
the Bloomberg Business app, and Bloomberg dot Com.
Speaker 2 (19:20):
Our flagship New York station, is also available on your
Amazon Alexa devices. Just say Alexa play Bloomberg eleven thirty.
Speaker 3 (19:28):
I'm Caroline Hepka and.
Speaker 4 (19:29):
I'm Stephen Carroll. Join us again tomorrow morning for all
the news you need to start your day right here
on Bloomberg day Break Europe
Bloomberg Audio Studios, podcasts, radio news.
Speaker 2 (00:09):
This is the Blooe Big Dabacate podcast. Good Morning is Wednesday,
the twenty seventh of August in London.
Speaker 3 (00:14):
I'm Caroline Hepca and.
Speaker 4 (00:15):
I'm Stephen Carroll. Coming up today, Donald Trump vows to
go to court to remove Federal Reserve Governor Lisa Cook
as the White House considers ways to extend its influence
across the Fed's regional banks.
Speaker 2 (00:27):
As UK government boring costs come close to nineteen ninety
eight highs, we look at whether the data used to
measure the country's economy is up to the job.
Speaker 4 (00:36):
Plus, we have lift off SpaceX successfully launches its starship
reusable rocket, surviving most of its journey back to Earth.
Speaker 3 (00:44):
Let's start with a round up of our top stories.
Speaker 4 (00:47):
The White House is exploring ways to exert more influence
over the fed's twelve regional banks, including how their presidents
are vetted and chosen. That's according to sources who've spoken
to Bloomberg. The reporting comes as Donald Trump says he's
ready for a legal fight with FED Governor Lisa Cook,
adding that he's already looking for her replacement.
Speaker 5 (01:07):
Well, we have some very good people for that position,
and I think we have some very good people were
down to.
Speaker 4 (01:14):
I mean, I think I maybe in my own mind
have somebody that I like.
Speaker 3 (01:18):
But I deal with Scott.
Speaker 4 (01:20):
And I deal with Howard, and we're dealing with.
Speaker 1 (01:22):
A lot of people actually that are going to be
involved in that decision.
Speaker 4 (01:25):
Ultimate it's a very important decision. Yes, President, they're referring
to the Treasury Secretary Scott Bassant on the Commerce Secretary
Howard Lutnik, who would both be expected to weigh in
on any possible successor. In a statement released on Tuesday,
the Federal Reserve said it will abide by any court
ruling regarding Cook. If Trump succeeds, he could secure a
(01:46):
dubbish majority on the FED Board as he pushes for
lower interest rates. We got reaction from former Fed Vice
Chair Lal Brainard.
Speaker 6 (01:54):
Well, I think the Federal Reserve is an incredibly difficult
position here. But you have to remember this is not
about an individual governor. This is really an unprecedented attack
on the independence of the Federal Reserve as an institution.
Speaker 4 (02:11):
Former Fair Advice Chair Lale Brainard speaking there as concerns
grow that President Trump's unprecedented and escalating attack on the
federal reserve runs the risk of driving long term borrowing
costs higher.
Speaker 2 (02:25):
Now the United States has placed a fifty percent tariff
on some Indian goods, which came into effect only a
short time ago. The levee is doubled the existing rate
and threatens to damage the export competitiveness of the world's
fastest growing major economy. President Champ says that the charge
is punishment for India's ongoing purchases of Russian oil, which
(02:47):
he said is funding Putin's war in Ukraine. But despite
the move, India and Russia have pledged to increase their
annual trade over the next five years by fifty percent
to one hundred billion dollars. New Delhi has also called
the US actions against it unfair, unjustified, and unreasonable.
Speaker 4 (03:05):
The asset manager Carmeniac is warning that French government borrowing
cost could spike to one hundred basis points over their
German peers if the government collapses in ten days time.
That will be the widest yields spread since the height
of the Eurozone death crisis in twenty twelve. Ahead of
the confidence vote on the eighth of September, opposition to
French Prime Minister of France Barberou's government is growing. The
(03:26):
leader of the far right National Rally Party, Jordan Baldela,
told France's TF one television that he won't back the premiere.
Speaker 7 (03:33):
We will obviously be voting against the government's confidence motion
and as seeking potentially a new government or new president
if this one has to choose constitutional tools to get
out of this crisis or hear what the majority of
the French people want today.
Speaker 4 (03:50):
Jodan Baldella, speaking there through a translator during an interview
with the Francis Fan. Three of the major opposition groups
have now indicated they will vote against the com Fidan's
motion next month, increasing the likelihood of a resignation. Barroo
is calling the vote in an effort to consolidate support
in parliament for forty four billion euros worth of spending
(04:11):
cuts and tax increases that he considers vital to averse
disaster for the public finances.
Speaker 5 (04:18):
Now.
Speaker 2 (04:18):
The yield on UK thirty year bonds climbed close to
a twenty seven year high yesterday, piling pressure on Keir
Starmer's government to tighten its fiscal policy.
Speaker 3 (04:30):
Bloomberg's un Parts reports long dated guilt yield surge.
Speaker 5 (04:34):
Yesterday's market's caught up with Monday's moves In the US
after the bank call of the closure, thirty yields are
now just a whisker away from five point sixty six percent,
a level they last saw in nineteen ninety eight. The
high cost of borrowing as yet another headwind for the
Chancellor as she works out how to make the sums
add up ahead of her or some budget, and if
(04:54):
she was hoping for some relief on interest rates, Catherine Mann,
who sits on the Berwis rate setting Committee, says now
is not the time. She says policies not currently tighten
off and holding rates is the appropriate thing to do.
In London, i'm umpot Splinberg.
Speaker 4 (05:08):
Radio Nigel for Hours, the leader of Britain's Reform UK party,
is vowed to expel tens of thousands of asylum seekers
if he wins the next general election, as part of
a program dubbed Operation Restoring Justice for ourset of reform
led government would remove Britain from the European Court of
Human Rights and carry out mass deportations.
Speaker 8 (05:29):
The only way we will stop the votes is by
detaining and deporting absolutely anyone that comes via that route,
and if we do that, the boats will stop coming
within days.
Speaker 4 (05:46):
The reform UK leader out of that he would scrap
the country's Human Rights Act to remove legal roots of
appeal and disipply the nineteen fifty one Refugee Convention for
five years. The CEO of the Refugee Council and ver
Solomon denounce the toxic narratives that dehumanize refugees and fuel
fear and division across the country.
Speaker 2 (06:07):
Elon Musk's SpaceX has successfully launched a test flight of
its Starship rocket, achieving new technological milestones after a year
of far e setbacks. Build as the largest and most
powerful rocket ever built. It successfully deployed satellites for the
first time and survived most of its journey back down
to Earth. Let's have listened to the moment that it
(06:28):
launched from SpaceX's starbase in South Texas.
Speaker 3 (06:33):
Bio three two one.
Speaker 2 (06:43):
The rockets super heavy boosters separated as planned before splashing
down in the Gulf of Mexico. Starship is at the
heart of SpaceX's plans to put Starlink Internet satellites into
Earth's Orbid and to one day put humans on Mars.
Speaker 3 (07:00):
Those are your top stories.
Speaker 4 (07:01):
On the markets, the msciosh Pacific Index down by a
tenth of one percent. European stock features are pointing higher
after we saw another day of selloff yesterday, so Eurostock's
fifty futures are up by three tenths of one percent.
On currency markets, the Bloomberg Dollar Spot Index two tenths higher.
The euro is trading at one sixteen fourteen, the pound
at one thirty four forty seven, and the ten year
(07:21):
treasury yield is upper basis point at four point two
seven percent.
Speaker 2 (07:26):
Now, in a moment, we'll bring you more on Donald Trumps,
pressure on the Fed, Lisa Cook, plus the latest in
the barrage of criticism over UK economic data. But there's
another story that's caught our eye. And of course, the
I peraps the entire internet.
Speaker 4 (07:40):
Where were you, Caroline when you heard the news?
Speaker 2 (07:43):
I shall not reveal, but I am totally fascinated by
Taylor Swift and yeah.
Speaker 4 (07:49):
In Instagram posts that took the world. Yes, I think
Taylor Swift is engaged in Travis Kelsey in case you
hadn't heard, And the Internet is full of people reacting
to it, which I think is more interesting than the actual.
Speaker 3 (07:59):
Point dress studying the flowers.
Speaker 4 (08:02):
But look at us being bloomberg. We've also been looking
at how people have been spending their money around this
as well. So, for example, on betting website, gamblers are
making wages on when the wedding will take place. Apparently
eighty thousand dollars worth of bets were placed on one
website in the hours after the Instagram post announcing the engagement.
Apparently on polymarket, betters are going as far as to
gamble when the couple might have a baby. Others are
(08:24):
also convinced the singers now going to headline the twenty
twenty six Super Bowl halftime show. So there are business
opportunities everywhere you look in this one. It's actually a
very interesting reflection of the gambling frenzy that's been going
on in the US, Americans batting billions on sport but
also cultural events. In advance of this, around two hundred
and fifty thousand dollars changed hands on one website for
(08:45):
bets on whether Travis Kelsey and Taylor Swift would get
engaged this year. Odds were hovering in case you're wondering,
at about forty percent going into this week. Yeah, other effects.
We're seeing this already. The dress that Taylor Swift wore
in the engagement photos sold out apparently.
Speaker 2 (08:59):
And of how much and what the design of the
ring was all about.
Speaker 4 (09:04):
I mean, emergandising possibilities really are endless if you think
about it. Anyway, plenty more to read on this news.
Will put some of the links to our stories on
this on our podcast show Notes Now.
Speaker 2 (09:17):
President Trump says that he is prepared for a legal
fight with Federal Reserve Governor Lisa Cook as he attempts
to gain more control over the US Central Bank. Joining
US Now to discuss his Bloomberg's Markets live strut is
Mary Nicola, Mary, Good Morning. President Trump said yesterday we'll
have a majority I fall out of the seven FED
board members as Trump appointees, and they then have influence
(09:41):
over regional FED governors. So I suppose the fundamental question
is how likely is that?
Speaker 3 (09:47):
How quickly could it happen?
Speaker 1 (09:50):
Well, we know, for one thing, what is going to
happen with Lisa Cook in terms of there's it's going
to the court, potentially going to the courts, and that
could mean a very long drawn out legal battle. So
it might not be that swift that we get a
resolution on what happens.
Speaker 3 (10:05):
But even if not, the whole fact.
Speaker 1 (10:07):
That we're going through this long legal battle, the fact
that President Trump is trying to influence the Central Bank
is quite nerve wrecking for markets, and it's going to
weigh on the dollar because at the end of the day,
you're undermining the credibility of the FED. You're infringing on
(10:28):
the independence of the FED, and that is essentially one
of the key cornerstones of policy in the US.
Speaker 3 (10:34):
So a lot of it.
Speaker 1 (10:35):
For now it seems like the reaction is a bit complacent,
but if he gets what he wants, it's actually quite
damaging for the dollar and US assets.
Speaker 4 (10:45):
Well, I suppose let's talk about how this could play
down the line as well, because even a protracted legal
battle also casts a shadow over the FED. And of
course we're thinking about the decision over the FED chair
next year too. I mean, what is the outlook or
the market considerations about what the Federal Reserve could look
like in a couple of months time.
Speaker 1 (11:04):
Yeah, if a lot of I mean, there's obviously we
know and it's been very clear that the administration wants
lower rates. So I think what you end up getting,
especially if there is a lot of influence from the
political side, is that you get shortened rates quite well anchored.
The problem really comes in in the back end, where
concerns about inflation expectations, especially if you have PCE coming through,
(11:29):
or if you have you know, the concerns about a
policy mistake, and of course just where the trajectory of
inflation could be potentially going with tariff's coming through. So
I think the end result is going to be a
lot of emphasis on the back end, or pressure on
(11:49):
the back end of the curve. But what you'll see
is more of a lock in on the front end
because you'll there will be heightened expectations of more aggressive
easing if the administration really gets what it wants.
Speaker 2 (12:02):
So that's the sort of thinking around you know, an
independent federal reserve. Maybe that that looks a lessertain now
obviously that being you know, the bedrock of US and
global market is or was certainly a significant one. There
is also another political crisis though that we should be discussing,
and that's in France over the budget, which has seen
French boring cost surge and Comegnact warning that the yield
(12:25):
spread between French and German bonds could hit one hundred
basis points.
Speaker 3 (12:28):
So why is that so important?
Speaker 1 (12:31):
Yeah, I mean we're not it's nothing new that we're
getting some of these political rumblings from from France. And
we've seen it before in twenty twenty four when mccran
called a snap elections. We saw it again when the
prime minister was a government first collapsed, so there has
(12:51):
been a bit of a repeat. The problem is, and
we've seen it before, is the fact that there's a
greater scrutiny on debt sustainability, whether you have it from
the U or from France. The fact is government debts
are ballooning. We already see it in the borring costs
for guilt for example as well. So this just places
greater scrutiny under debt sustainability and it puts even more
(13:16):
pressure on the long end of the curve.
Speaker 3 (13:18):
And that's unlikely to go away.
Speaker 1 (13:20):
So we don't have the vote until September eighth, so
that's going to likely lead to a lot of investor
angst in the run up and there's going to be
a lot of pressure on French assets as a result.
Speaker 4 (13:31):
Well, continue to monitor that as it develops. Mari Nicola
for Now our Market's life strategist. Thank you, stay with us.
More from Bloomberg Daybreak Europe coming up after this.
Speaker 5 (13:43):
Now.
Speaker 2 (13:43):
Britain's Royal Economic Society is the latest to wade into
the crisis around the UK's economic data. The Body for
British Economists is warning that experts can no longer properly
analyze the gender pay gap, as well as other wage
and inequality measures. What it's The latest blow is the government,
civil servants and bankers all vent their frustration at the
(14:04):
deterioration of the UK's official statistics At Bloomberg's James Walcock
joins us now for more on this. So just tell
us and explain a bit more about the state of
this problem with economic data.
Speaker 9 (14:19):
I think, Karen, imagine an ideal economy and what you
would want to know about it. In an ideal world,
you'd love to know how much people are paid, how
much game people are in work, and maybe what's the
GDP actually Commy's worth. Now this sound is me getting
at my laundry list of all the statistics that have
been delayed or suspended or corrected in the past three
(14:41):
years by the Office of National statistics in the UK,
so labor force employments which has been suspended entirely until
twenty twenty seven, producer prices, trade data GDP, business surveys,
and retail sales.
Speaker 3 (14:56):
So like you pick.
Speaker 9 (14:57):
Your indicator of how the economy is going, the OS
has in some fashion had issues with that day to
the latest one being retail sales, which was just last week.
It has been delayed by two weeks where they do
quality assurance. Now we're now seeing the second order effects
from that. We've already heard from government ministers and politicians
and central bankers and financiers saying this is difficult, but
(15:17):
we're now say academics weighing and the Royal Economic Society
is one of the world's oldest and most prestidious can
make associations, and they're saying it's easier to study other
countries than the UK where they're based at this point
in terms of how to look after the labor market.
And then on top of that, a recent review by
the British journalm Industry Relations found the OS has underestimated
(15:37):
the gender pay gap for twenty years now by one percent.
They also say that they got the number of people
on the minimum wage wrong by twenty percent, and now
the Resolution Foundation have released a rival index looking at
unemployments which predicts will be at five percent by the
end of the year. The other thing, tanks are trying
to fill the gap where officialtistics used to be. It
(15:59):
all adds up to what is effectively this sort of
vacuum where UK for statistics used to be.
Speaker 3 (16:05):
So what's being done to fix such chains?
Speaker 9 (16:07):
It depends what you view as the problem, Stephen. In
many ways, the OS is a very good metaphor for
the UK. More broadly, you've got a changing society, you
have limited resources, you have a response to COVID, the pandemic,
and questions of a productivity. If you look at the surveys,
the onsay the surveys on labor being fixed. New leads
are in place and they say they are urgently refocusing
(16:30):
resources on their core economic outputs. And so if you
think the problems are survey based, they're hoping new techniques
will fix it. If you think this is an austerity problem,
ten million pounds is being cut from non urgent economic
data to go into sort of the essential areas. But
at Bloomberg Analysis says there is going to be a
six percent funding cut in real terms by twenty twenty nine.
(16:50):
If you think this is a problem of culture and productivity,
it's worth noting in two thousand and seven ninety percent
of the OS's London based staff quit than move to Newport,
so a leveling up sort of question. In twenty twenty,
over the pandemic, they all moved to homeworking and the
only's high people as far abroad as Northern Ireland, as
far as flung away from Newport. Then twenty twenty three,
(17:12):
when areas in the data started creeping in, they were
then told to move back to forty percent homeworking, which
means that the o ands are currently on strike where
they are doing a zero office attendance policy. All of this,
depending on how you want to look at it could
be sort of the problem or the range of problems.
It's not a short term thing that can be fixed
very easily.
Speaker 2 (17:33):
Yeah, so it's funding its people, but maybe it's also
the fact that we're becoming such a digitized economy and
so the way that you collect statistics is really changing.
Lots and lots of issues then really to get to
grips with and it all comes out kind of quite
a difficult time also for the government, certainly when we're
thinking about the autumn budget and government finances, and an
(17:54):
interesting interview.
Speaker 9 (17:56):
It quite I mean arguably, this could be one of
the worst possible moments to come. R high inflation, you
have a weakening jobs market. This is the moment that
central bankers sort of test their metal and earn their stripes.
And meanwhile interest rates being so high as putting pressure
on bond yields. They are now higher than the sudden
spike under the former Prime Minister of this trust who,
as you hinted, their Caline Bloomberg spoke to yesterday. Now
(18:19):
she thinks politicians here should be taking a leaf out
of President Trump's approach.
Speaker 3 (18:24):
To the FED.
Speaker 10 (18:26):
I think the Bank of England needs to be accountable
to politicians. I think the current system doesn't work. This
is why I'm very sympathetic to what Donald Trump is
saying about the FED. Monetary policy is incredibly important.
Speaker 9 (18:39):
Now you can hear that full interview on the Odd
Lots podcast later this week. But with central bankers under scrutiny,
and as we head into like you say, car into
this difficult autumn where Chancellor Racheries will be feeling endless
questions about taxes. She'll be hoping for better economic data
to try and give her more fiscal space. But if
that data does come at this crucial moment, will we
(19:00):
trust it.
Speaker 4 (19:02):
This is Bloomberg Daybreak Europe, your morning brief on the
stories making news from London to Wall Street and beyond.
Speaker 2 (19:08):
Look for us on your podcast feed every morning, on Apple, Spotify,
and anywhere else you get your podcasts.
Speaker 4 (19:14):
You can also listen live each morning on London DAB Radio,
the Bloomberg Business app, and Bloomberg dot Com.
Speaker 2 (19:20):
Our flagship New York station, is also available on your
Amazon Alexa devices. Just say Alexa play Bloomberg eleven thirty.
Speaker 3 (19:28):
I'm Caroline Hepka and.
Speaker 4 (19:29):
I'm Stephen Carroll. Join us again tomorrow morning for all
the news you need to start your day right here
on Bloomberg day Break Europe
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