July 25, 2025 • 16 mins
Your morning briefing, the business news you need in just 15 minutes.
On today's podcast:
(1) Federal Reserve Chair Jerome Powell is smack in the middle of one of President Donald Trump’s preferred attack strategies — flooding the zone.
(2) European Central Bank policymakers pushing for another cut in interest rates face an uphill battle, with inflation at 2% and the economy withstanding trade turbulence, according to people familiar with the matter.
(3) LVMH sales fell as shoppers reined in purchases of costly Louis Vuitton bags and Dior jackets, a sign the luxury titan remains stuck in its post-pandemic slump.
(4) Australia and the UK will hold talks between their foreign and defense ministers in Sydney on Friday, with the aim of signing a £20 billion ($27 billion) “treaty” to help build nuclear-powered submarines.
(5) The UK has restored its international standing after years of “performative” politics under successive Conservative governments, Labour Prime Minister Keir Starmer said in an interview after sealing a long-sought trade deal with India on Thursday.
Podcast Conversation: London's Central Line Is Broiling City Commuters Daily
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Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Speaker 1 (00:00):
Bloomberg Audio Studios, podcasts, radio news.
Speaker 2 (00:09):
This is the Bloomberg dayba q a podcast. Gootballing is
Finder the twenty fifth of July. On Caline, hepcat in London.
Speaker 3 (00:16):
And I'm Stephen Caroline Brussels. Coming up today. Donald Trump
turns to his favorite playbook of flooding the Zone to
attack the Federal Reserve Charge your Own Powell, while simultaneously
saying he has no plans to fire him.
Speaker 2 (00:29):
Bloomberg learns that City pushed its global head of short
term interest rate trading to delete a social media post
critical of Israel's actions in Gaza.
Speaker 3 (00:39):
Plus Gorillas, Grapes and Gulf Billions will take you inside
the rush to invest in ultra luxury travel in Africa.
Speaker 2 (00:47):
Let's start with a roundup of our top stories.
Speaker 3 (00:50):
Federal Reserve Charge your Own Powell is coming under increasing
pressure from President Trump, who is employing what our senior
national political correspondent Nancy Cook has described as flood the
Zone strategy. Trump's approach involves personally attacking Pal, questioning the
FED spending, and discussing potential replacements, while simultaneously signaling that
(01:11):
he has moved away from the idea of firing the
FED chair. Speaking yesterday, Trump downplayed his clash with the
Federal Reserve chair. I think he's going to do the
right thing. Everybody knows what the right thing is.
Speaker 4 (01:24):
Even people that believed in the higher rates are all
on board. They all want to see the interest rates
come down.
Speaker 5 (01:30):
It's very important.
Speaker 3 (01:32):
Trump's visit to the Federal Reserve was the first by
a US president in nearly two decades. It comes as
Fed officials are widely expected to hold interest rates steady
for a fifth consecutive time at their meeting next week.
Speaker 6 (01:45):
Now.
Speaker 2 (01:46):
Sources of spoken to Bloomberg saying that ECB policymakers pushing
for another interest rate cut face an uphill battle with
inflation at two percent and the economy in europew Withstanding
trade terps, the central Bank left interest rates unchanged on Thursday,
pausing its year long easing cycle amid ongoing trade tensions
(02:09):
with the US. ECB President Christine Laguard said the central
Bank is in wait and see mode, citing inflation at
target and rising global uncertainty.
Speaker 1 (02:20):
We are in a good place, and we are in
a good place because inflation is at two percent, but
we're not focused on data points We're looking at all
sorts of data and our target is the medium term inflation.
Speaker 2 (02:35):
Following those comments from Christine Laguard, markets paired bets on
a September rate cut from the ECB. They now put
the chance of a move at about twenty five percent
versus forty percent before Leguard spoke.
Speaker 3 (02:50):
Sales the luxury giant LVMH have fallen again as demands
slumps in Japan and China. Revenue after French Group's fashion
and leather goods division dropped nine percent over the second quarter,
a worse fall than analysts expected. But Jelenka Sokolova, senior
equity analyst at morning Star, says luxury demand in Asia
depends on the strength of the region's economy.
Speaker 4 (03:12):
The sentiment, I think is affected by the real estate
prices that remain in the negative territory and also by
the economic growth. Once the real estate market price is stabilized,
there could be an uplift and there could be additional
spending of all those savings that have been accumulated during
COVID years.
Speaker 3 (03:31):
Morning Stars Jelenka Sokolova, speaking there, LVMH has been suffering
from reduced demand, particularly in China, traditionally a driver of growth.
Shares in the firm of dropped by thirty percent in
the past year, and in April LVMH lost its status
as France's most valuable company to birkenbag maker Ermez.
Speaker 2 (03:52):
Australia and the UK plan to sign a twenty billion
pound treaty in the coming hours to build a fleet
of nuclear powered submarines. The British Foreign offic says that
more than twenty one thousand people in the UK will
work on the conventionally armed nuclear powered ORCUSS submarine program.
The Times reports that the deal is part of an
(04:14):
effort to persuade the United States that uphold the accord
that were signed by former President Biden, which the Pentagon
says is currently under review.
Speaker 3 (04:24):
The British Prime Minister Kurros Starmer says the UK is
back on the world stage after sealing a trade deal
with India. The long sought after agreement was ratified on
Thursday during Indian Prime Minister Narendra Modi's visit. It's the
biggest trade deal struck by the UK since Brexit, cutting
ninety percent of tariff lines on British exports to India.
(04:44):
Speaking as it was confirmed. Hero Starmer emphasized the deal's
selling points.
Speaker 7 (04:49):
It is a deal that will bring huge benefits to
both of our countries, boosting wages, raising living standards and
putting more money in the pockets of working people. It
is good for business and making trade cheaper, quicker and easier.
Speaker 3 (05:06):
That's the Prime Minister Keir Starmer. He added the agreement
didn't mark the limit of the UK's ambition and would
provide a baseline of cooperation to build on. A separate
bilateral investment treaty is still being negotiated between the two countries.
Speaker 2 (05:21):
Bloemakers learned that Citygroup has pushed a trading desk head
to delete a social media post that was critical of
Israel and sought to draw attention to the situation in Gaza.
Bloomberg's un Pots has more.
Speaker 5 (05:34):
City's global head of short term interst rate trading actually
Single posted on LinkedIn that he believed Israel's actions in
Gaza were quote horrific and unacceptable and calling them, in
his words, genocide. Before the end of the day, though
we told the bank and asked the London based staff
member to remove the comments. City says the post was
inconsistent with its code of conduct, and it's reviewing the matter.
(05:56):
The Trader did not respond to a requests for comments.
The move is the latest reflection of corporation's reluctance to
take stances on polarizing topics. In London, I'm you in
pots Spoonberg.
Speaker 3 (06:07):
Radio, and the United States and Israel have withdrawn their
negotiating teams from Gaza ceasefire talks. The Trump administration says
ha Mass is not acting in good faith. A key
disagreement has been over Hamas's demand to bring back a
UN run aid network that Israel shut down, claiming Hamas
was taking food and medicine from it. Prime Minister Kristarmer
is among world leaders who've condemned what he called a
(06:29):
humanitarian catastrophe in Gaza, saying it has reached new depths.
Dozens of aid groups have warned that starvation and the territory,
particularly among children, is spreading.
Speaker 2 (06:39):
Those are top stories for you this morning. Let's look
at the markets. So the global rally in stocks losing steam.
In Asia this morning MSCI Asia Pacific Index is down
almost one percent. Stop futures for the USR in the green,
but for the US stox fifty futures. They're down a
tenth of one percent. We have seen the S and
P five hundred, of course, rallying twenty eight percent since
(07:00):
the eighth of April, so huge surge in US stocks,
and even yesterday we saw European stocks gaining about two
tenths of one percent at the close. But there's now
more uncertainty about the Fed's rate trajectory. Traders expect fewer
than two rate reductions this year after strong jobs figures yesterday,
initial claims for unemployment benefit and the ECB kept interest
(07:22):
rates unchanged. The Bluebig Dollar Spot index is also stronger
two tenths of one percent. Stephen.
Speaker 3 (07:28):
In a moment, we'll bring you more on Donald Trump's
pressure campaign against the Federal Reserve chair, plus how the
billionaires are pouring money into Africa's luxury travel sector. But
another story that we've been reading and sort of feeling
as well this morning. It's about the heat on the
Central Line in London, a frequent topic of conversation during
the summer, but Bloomberg's actually developed an index to track
(07:49):
the heat on the tube between Bank and Bond Street.
On the ten minute journey. We found that temperatures inside
the carriages are several degrees hotter than the surface, and
that weekday commuters have been faced the equivalent of non
stop heat wave conditions all summer.
Speaker 2 (08:04):
I love the fact that Bloomberg has an index, but
frankly I didn't need one because I know that that's
how warm the tube is, and I don't think it's
just the Central Line either. Look, this is becoming a
major issue because of climate change and London is now
seeing these warmer temperatures for so many more days. I mean,
the warning now is that it's affecting the drive to
(08:27):
get work, is actually back into the office, it's affecting
people's choice of jobs and where they live. Yeah, it's
really quite grim in London. The other thing that people
forget also is that noise. Noise on the tube is
also really really loud, especially on old lines like the
Northern Line.
Speaker 3 (08:42):
Yeah, like we know this obviously it's an old piece
of infrastructure, so there are problems that come along with that.
But this is also to do with the clay soil
under London too, So over time that's been absorbing the
heat from the trains, breaking an acceleration which has actually
made the tunnels hotter over time, and some of the
people that our colleagues spoke to during the story as well.
We're saying that it's affecting where people are choosing to
(09:04):
live if they can live near one of the very
few air conditioned lines in London as well, but also
affecting where they're willing to work, because some people just
aren't willing to take the tube every day.
Speaker 2 (09:14):
No, absolutely, and Olivia Vodgard writing about this along with
other colleagues. So we'll also pin a link to that
article in our show notes if you want to read
more about the details of London's heating tube.
Speaker 3 (09:31):
Well, let's go back to our top story this morning
and the pressure Donald Trump is putting on the Federal
Reserve chair to lower interest rates through multi pronged attacks.
User tour of the Central Banks building renovations in Washington
to again call for Jerome Powell to quote do the
right thing. Our market's life stratus, Mark Cranfield joins us
now for more. Mark just put this in perspectives for us,
(09:52):
how unusual is it to see a US president wage
a campaign like this against the Fed?
Speaker 6 (09:58):
Well?
Speaker 8 (09:59):
Extremely and there must be a lot of investors scratching
their heads because this morning in Asia we had yet
another record high on S and P five hundred futures,
which I think most people will probably agree is an
indication that investors are pretty happy with what's going on
in the American economy, with American companies making pretty good profits.
(10:19):
We've seen some really good numbers this week from Alphabet,
We've got some big ones coming up in the week ahead,
so it's a bit hit scratching. Really does America need
an interest rate cut at this stage? The markets are
certainly suggesting they don't, and yet there's been a lot
of discussion and pressure being put on your own power
all about it. And as you say, they met in
person at a building site yesterday just to emphasize the
(10:42):
point that America needs lower interest rates.
Speaker 2 (10:45):
Yeah, And the difficulty is how to defend the institution.
I think there's a bit of a struggle going on
about how to understand that Trump saying that it's not
necessary to fire. How are markets then viewing the prospect
of the Federal Reserve chair maybe being removed.
Speaker 8 (11:08):
Basically it will be taken out in terms of what
happens to American assets. There will be a discount applied
to anything related to America. Because of this uncertainty about
the direction of the Central Bank and the way in
which it's being undermined, the most obvious place for that
would be the US dollar. If this gets serious, if
(11:31):
there's no letter in the attacks against er own power,
then the US dollar will just have to go lower
because the investors will feel that it needs to be
cheaper than other major currencies to reflect the fact that
there is inconsiderable uncertainty, be a what's happening to the
central bank that it's no longer as independent as it
used to be. Any central bank which has a degree
(11:53):
of strength behind it will have a higher premium in
its currency, and that will have to be taken away
from the dollar because of the Federal Reserve. It's early stages,
but if they don't dial back from this continued approach,
then investors will do it for them. They will show
President Trump what they think about what it's doing to
(12:14):
the credibility of all American institutions.
Speaker 3 (12:18):
Okay, Mark Cranfield, our market's live strastis thank you very
much for joining us as we're looking at markets pricing.
As we said, the FED to hold interest rates at
its meeting next week.
Speaker 2 (12:30):
Now, there's been a surge in global investor interest in
luxury travel destinations across African countries, from Gorilla, Trekking to
vineyard days. Capital is pouring into the sector from billionaires,
tech moguls and Middle East investors who are stepping in
to fill a funding gap left by banks. Our reporter
(12:51):
Prunesha and i Do has been writing about this and
she joins us now for more good morning. Good to
have you with us. Who are these investors and where
are they putting their money?
Speaker 3 (13:00):
Exactly?
Speaker 6 (13:00):
Remarkedly, these investors are some of the most high profile
individuals in the world. Our story this morning spotlights an
investment by the Dubai ruler who has invested in a
private island of the coast of Tanzania. We also have
investors like Sir Richard Branson who's picked up his second
luxury Safari lodge on the continent or in Kenya rather
(13:25):
last year. And there's even investor interest from Asia, with
a unit of Nepal's only multi billion dollar company looking
to invest on the continent as well.
Speaker 3 (13:37):
So why are they seeing such an opportunity then in
African destinations?
Speaker 6 (13:41):
I think a lot of it has to do with
a change in the way people started to travel after
the pandemic. People are very much more interested in wellness, travel, eCos,
retreats and reconnecting with nature, and Africa offers that in
leaps and bounds. That's really driving a lot of interest
(14:02):
in the high end of the market. At the same time,
many of the world's top hoteliers and global chains see
Africa as the last underpenetrated market for travel and tourism,
so they're also rushing in.
Speaker 2 (14:20):
What are the risks then, potentially though for for investors,
I mean, we always have to think about the risks
and the benefits.
Speaker 6 (14:29):
So our reporting shows that and why we talked a
little bit about the funding gap being left by banks.
They typically only fund about fifty five percent of hotel
projects on the continent, and that's because there are some
difficulties in forecasting bookings and revenue streams in Africa. There
(14:49):
is a unique issue where there are too few hotels
in certain markets that report performance bench marketing data times.
That affects the outlook for investments and the confidence with
which some investors get in. There are also risks related
(15:11):
to conflict changes in political regimes and how that could
influence the overall business environment.
Speaker 3 (15:20):
This is Bloomberg Daybreak Europe, your morning brief on the
stories making news from London to Wall Street and beyond.
Speaker 2 (15:26):
Look for us on your podcast feed every morning, on Apple, Spotify,
and anywhere else you get your podcasts.
Speaker 3 (15:33):
You can also listen live each morning on London DAB Radio,
the Bloomberg Business app, and Bloomberg dot Com.
Speaker 2 (15:38):
Our flagship New York station, is also available on your
Amazon Alexa devices. Just say Alexa play Bloomberg eleven thirty.
I'm Caroline Hepka and.
Speaker 3 (15:47):
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 Bloomberg dayba q a podcast. Gootballing is
Finder the twenty fifth of July. On Caline, hepcat in London.
Speaker 3 (00:16):
And I'm Stephen Caroline Brussels. Coming up today. Donald Trump
turns to his favorite playbook of flooding the Zone to
attack the Federal Reserve Charge your Own Powell, while simultaneously
saying he has no plans to fire him.
Speaker 2 (00:29):
Bloomberg learns that City pushed its global head of short
term interest rate trading to delete a social media post
critical of Israel's actions in Gaza.
Speaker 3 (00:39):
Plus Gorillas, Grapes and Gulf Billions will take you inside
the rush to invest in ultra luxury travel in Africa.
Speaker 2 (00:47):
Let's start with a roundup of our top stories.
Speaker 3 (00:50):
Federal Reserve Charge your Own Powell is coming under increasing
pressure from President Trump, who is employing what our senior
national political correspondent Nancy Cook has described as flood the
Zone strategy. Trump's approach involves personally attacking Pal, questioning the
FED spending, and discussing potential replacements, while simultaneously signaling that
(01:11):
he has moved away from the idea of firing the
FED chair. Speaking yesterday, Trump downplayed his clash with the
Federal Reserve chair. I think he's going to do the
right thing. Everybody knows what the right thing is.
Speaker 4 (01:24):
Even people that believed in the higher rates are all
on board. They all want to see the interest rates
come down.
Speaker 5 (01:30):
It's very important.
Speaker 3 (01:32):
Trump's visit to the Federal Reserve was the first by
a US president in nearly two decades. It comes as
Fed officials are widely expected to hold interest rates steady
for a fifth consecutive time at their meeting next week.
Speaker 6 (01:45):
Now.
Speaker 2 (01:46):
Sources of spoken to Bloomberg saying that ECB policymakers pushing
for another interest rate cut face an uphill battle with
inflation at two percent and the economy in europew Withstanding
trade terps, the central Bank left interest rates unchanged on Thursday,
pausing its year long easing cycle amid ongoing trade tensions
(02:09):
with the US. ECB President Christine Laguard said the central
Bank is in wait and see mode, citing inflation at
target and rising global uncertainty.
Speaker 1 (02:20):
We are in a good place, and we are in
a good place because inflation is at two percent, but
we're not focused on data points We're looking at all
sorts of data and our target is the medium term inflation.
Speaker 2 (02:35):
Following those comments from Christine Laguard, markets paired bets on
a September rate cut from the ECB. They now put
the chance of a move at about twenty five percent
versus forty percent before Leguard spoke.
Speaker 3 (02:50):
Sales the luxury giant LVMH have fallen again as demands
slumps in Japan and China. Revenue after French Group's fashion
and leather goods division dropped nine percent over the second quarter,
a worse fall than analysts expected. But Jelenka Sokolova, senior
equity analyst at morning Star, says luxury demand in Asia
depends on the strength of the region's economy.
Speaker 4 (03:12):
The sentiment, I think is affected by the real estate
prices that remain in the negative territory and also by
the economic growth. Once the real estate market price is stabilized,
there could be an uplift and there could be additional
spending of all those savings that have been accumulated during
COVID years.
Speaker 3 (03:31):
Morning Stars Jelenka Sokolova, speaking there, LVMH has been suffering
from reduced demand, particularly in China, traditionally a driver of growth.
Shares in the firm of dropped by thirty percent in
the past year, and in April LVMH lost its status
as France's most valuable company to birkenbag maker Ermez.
Speaker 2 (03:52):
Australia and the UK plan to sign a twenty billion
pound treaty in the coming hours to build a fleet
of nuclear powered submarines. The British Foreign offic says that
more than twenty one thousand people in the UK will
work on the conventionally armed nuclear powered ORCUSS submarine program.
The Times reports that the deal is part of an
(04:14):
effort to persuade the United States that uphold the accord
that were signed by former President Biden, which the Pentagon
says is currently under review.
Speaker 3 (04:24):
The British Prime Minister Kurros Starmer says the UK is
back on the world stage after sealing a trade deal
with India. The long sought after agreement was ratified on
Thursday during Indian Prime Minister Narendra Modi's visit. It's the
biggest trade deal struck by the UK since Brexit, cutting
ninety percent of tariff lines on British exports to India.
(04:44):
Speaking as it was confirmed. Hero Starmer emphasized the deal's
selling points.
Speaker 7 (04:49):
It is a deal that will bring huge benefits to
both of our countries, boosting wages, raising living standards and
putting more money in the pockets of working people. It
is good for business and making trade cheaper, quicker and easier.
Speaker 3 (05:06):
That's the Prime Minister Keir Starmer. He added the agreement
didn't mark the limit of the UK's ambition and would
provide a baseline of cooperation to build on. A separate
bilateral investment treaty is still being negotiated between the two countries.
Speaker 2 (05:21):
Bloemakers learned that Citygroup has pushed a trading desk head
to delete a social media post that was critical of
Israel and sought to draw attention to the situation in Gaza.
Bloomberg's un Pots has more.
Speaker 5 (05:34):
City's global head of short term interst rate trading actually
Single posted on LinkedIn that he believed Israel's actions in
Gaza were quote horrific and unacceptable and calling them, in
his words, genocide. Before the end of the day, though
we told the bank and asked the London based staff
member to remove the comments. City says the post was
inconsistent with its code of conduct, and it's reviewing the matter.
(05:56):
The Trader did not respond to a requests for comments.
The move is the latest reflection of corporation's reluctance to
take stances on polarizing topics. In London, I'm you in
pots Spoonberg.
Speaker 3 (06:07):
Radio, and the United States and Israel have withdrawn their
negotiating teams from Gaza ceasefire talks. The Trump administration says
ha Mass is not acting in good faith. A key
disagreement has been over Hamas's demand to bring back a
UN run aid network that Israel shut down, claiming Hamas
was taking food and medicine from it. Prime Minister Kristarmer
is among world leaders who've condemned what he called a
(06:29):
humanitarian catastrophe in Gaza, saying it has reached new depths.
Dozens of aid groups have warned that starvation and the territory,
particularly among children, is spreading.
Speaker 2 (06:39):
Those are top stories for you this morning. Let's look
at the markets. So the global rally in stocks losing steam.
In Asia this morning MSCI Asia Pacific Index is down
almost one percent. Stop futures for the USR in the green,
but for the US stox fifty futures. They're down a
tenth of one percent. We have seen the S and
P five hundred, of course, rallying twenty eight percent since
(07:00):
the eighth of April, so huge surge in US stocks,
and even yesterday we saw European stocks gaining about two
tenths of one percent at the close. But there's now
more uncertainty about the Fed's rate trajectory. Traders expect fewer
than two rate reductions this year after strong jobs figures yesterday,
initial claims for unemployment benefit and the ECB kept interest
(07:22):
rates unchanged. The Bluebig Dollar Spot index is also stronger
two tenths of one percent. Stephen.
Speaker 3 (07:28):
In a moment, we'll bring you more on Donald Trump's
pressure campaign against the Federal Reserve chair, plus how the
billionaires are pouring money into Africa's luxury travel sector. But
another story that we've been reading and sort of feeling
as well this morning. It's about the heat on the
Central Line in London, a frequent topic of conversation during
the summer, but Bloomberg's actually developed an index to track
(07:49):
the heat on the tube between Bank and Bond Street.
On the ten minute journey. We found that temperatures inside
the carriages are several degrees hotter than the surface, and
that weekday commuters have been faced the equivalent of non
stop heat wave conditions all summer.
Speaker 2 (08:04):
I love the fact that Bloomberg has an index, but
frankly I didn't need one because I know that that's
how warm the tube is, and I don't think it's
just the Central Line either. Look, this is becoming a
major issue because of climate change and London is now
seeing these warmer temperatures for so many more days. I mean,
the warning now is that it's affecting the drive to
(08:27):
get work, is actually back into the office, it's affecting
people's choice of jobs and where they live. Yeah, it's
really quite grim in London. The other thing that people
forget also is that noise. Noise on the tube is
also really really loud, especially on old lines like the
Northern Line.
Speaker 3 (08:42):
Yeah, like we know this obviously it's an old piece
of infrastructure, so there are problems that come along with that.
But this is also to do with the clay soil
under London too, So over time that's been absorbing the
heat from the trains, breaking an acceleration which has actually
made the tunnels hotter over time, and some of the
people that our colleagues spoke to during the story as well.
We're saying that it's affecting where people are choosing to
(09:04):
live if they can live near one of the very
few air conditioned lines in London as well, but also
affecting where they're willing to work, because some people just
aren't willing to take the tube every day.
Speaker 2 (09:14):
No, absolutely, and Olivia Vodgard writing about this along with
other colleagues. So we'll also pin a link to that
article in our show notes if you want to read
more about the details of London's heating tube.
Speaker 3 (09:31):
Well, let's go back to our top story this morning
and the pressure Donald Trump is putting on the Federal
Reserve chair to lower interest rates through multi pronged attacks.
User tour of the Central Banks building renovations in Washington
to again call for Jerome Powell to quote do the
right thing. Our market's life stratus, Mark Cranfield joins us
now for more. Mark just put this in perspectives for us,
(09:52):
how unusual is it to see a US president wage
a campaign like this against the Fed?
Speaker 6 (09:58):
Well?
Speaker 8 (09:59):
Extremely and there must be a lot of investors scratching
their heads because this morning in Asia we had yet
another record high on S and P five hundred futures,
which I think most people will probably agree is an
indication that investors are pretty happy with what's going on
in the American economy, with American companies making pretty good profits.
(10:19):
We've seen some really good numbers this week from Alphabet,
We've got some big ones coming up in the week ahead,
so it's a bit hit scratching. Really does America need
an interest rate cut at this stage? The markets are
certainly suggesting they don't, and yet there's been a lot
of discussion and pressure being put on your own power
all about it. And as you say, they met in
person at a building site yesterday just to emphasize the
(10:42):
point that America needs lower interest rates.
Speaker 2 (10:45):
Yeah, And the difficulty is how to defend the institution.
I think there's a bit of a struggle going on
about how to understand that Trump saying that it's not
necessary to fire. How are markets then viewing the prospect
of the Federal Reserve chair maybe being removed.
Speaker 8 (11:08):
Basically it will be taken out in terms of what
happens to American assets. There will be a discount applied
to anything related to America. Because of this uncertainty about
the direction of the Central Bank and the way in
which it's being undermined, the most obvious place for that
would be the US dollar. If this gets serious, if
(11:31):
there's no letter in the attacks against er own power,
then the US dollar will just have to go lower
because the investors will feel that it needs to be
cheaper than other major currencies to reflect the fact that
there is inconsiderable uncertainty, be a what's happening to the
central bank that it's no longer as independent as it
used to be. Any central bank which has a degree
(11:53):
of strength behind it will have a higher premium in
its currency, and that will have to be taken away
from the dollar because of the Federal Reserve. It's early stages,
but if they don't dial back from this continued approach,
then investors will do it for them. They will show
President Trump what they think about what it's doing to
(12:14):
the credibility of all American institutions.
Speaker 3 (12:18):
Okay, Mark Cranfield, our market's live strastis thank you very
much for joining us as we're looking at markets pricing.
As we said, the FED to hold interest rates at
its meeting next week.
Speaker 2 (12:30):
Now, there's been a surge in global investor interest in
luxury travel destinations across African countries, from Gorilla, Trekking to
vineyard days. Capital is pouring into the sector from billionaires,
tech moguls and Middle East investors who are stepping in
to fill a funding gap left by banks. Our reporter
(12:51):
Prunesha and i Do has been writing about this and
she joins us now for more good morning. Good to
have you with us. Who are these investors and where
are they putting their money?
Speaker 3 (13:00):
Exactly?
Speaker 6 (13:00):
Remarkedly, these investors are some of the most high profile
individuals in the world. Our story this morning spotlights an
investment by the Dubai ruler who has invested in a
private island of the coast of Tanzania. We also have
investors like Sir Richard Branson who's picked up his second
luxury Safari lodge on the continent or in Kenya rather
(13:25):
last year. And there's even investor interest from Asia, with
a unit of Nepal's only multi billion dollar company looking
to invest on the continent as well.
Speaker 3 (13:37):
So why are they seeing such an opportunity then in
African destinations?
Speaker 6 (13:41):
I think a lot of it has to do with
a change in the way people started to travel after
the pandemic. People are very much more interested in wellness, travel, eCos,
retreats and reconnecting with nature, and Africa offers that in
leaps and bounds. That's really driving a lot of interest
(14:02):
in the high end of the market. At the same time,
many of the world's top hoteliers and global chains see
Africa as the last underpenetrated market for travel and tourism,
so they're also rushing in.
Speaker 2 (14:20):
What are the risks then, potentially though for for investors,
I mean, we always have to think about the risks
and the benefits.
Speaker 6 (14:29):
So our reporting shows that and why we talked a
little bit about the funding gap being left by banks.
They typically only fund about fifty five percent of hotel
projects on the continent, and that's because there are some
difficulties in forecasting bookings and revenue streams in Africa. There
(14:49):
is a unique issue where there are too few hotels
in certain markets that report performance bench marketing data times.
That affects the outlook for investments and the confidence with
which some investors get in. There are also risks related
(15:11):
to conflict changes in political regimes and how that could
influence the overall business environment.
Speaker 3 (15:20):
This is Bloomberg Daybreak Europe, your morning brief on the
stories making news from London to Wall Street and beyond.
Speaker 2 (15:26):
Look for us on your podcast feed every morning, on Apple, Spotify,
and anywhere else you get your podcasts.
Speaker 3 (15:33):
You can also listen live each morning on London DAB Radio,
the Bloomberg Business app, and Bloomberg dot Com.
Speaker 2 (15:38):
Our flagship New York station, is also available on your
Amazon Alexa devices. Just say Alexa play Bloomberg eleven thirty.
I'm Caroline Hepka and.
Speaker 3 (15:47):
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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