Bloomberg Daybreak Weekend: Fed, Ukraine, Poland

in Hong Kong. We read the tea leaves on where the incoming bo j Governor Casual Uda is going with the whip in his hand. That's all straight ahead on Bloomberg Daybreak Weekend on Bloomberg. He Love on three O New York, Bloomberg one, Washington, d C, Bloomberg one oh six one, Boston, Bloomberg nine sixties, San Francisco, d A B Digital Radio, London, Sirius XM one nine team and around the world on Bloomberg Radio dot Com and via

the Bloomberg Business App. Good day to you, Tom Busby, and we begin today's program with the Fed and minutes from the Fed's latest policy meeting coming out on Wednesday and joining me to talk about it. Bloomberg's Global Economic and Policy editor Michael McKee. Michael, thanks for joining us. Happy to be here now. These minutes from the f O m C from their last meeting. It's wrapped up. On February one, the central bankers announced the pretty modest

basis point hike in benchmark rates. The key, of course, is what policymakers see looking ahead. So what are we hoping to see this time? Well, ordinarily you'd say you don't get that much from the minutes because it's three weeks old, and we've had a lot of data since then, and we have had a lot of data that may

have changed their views. And this week we got some of those views start to starting to change in public, with Cleveland Feds Loretta Mester, for example, saying that she thought that they should have done fifty basis points at that February first meeting. Uh, that would have been something we were looking for. In the minutes. Well, let's hear a sound from Loretta Mester right now on why she says the case was made for a much bigger basis

point hike. So at this juncture, the incoming data have not changed my view that we will need to bring the FED funds rate above five and hold it there for some time to be sufficiently restricted to ensure that inflation is on a sustainable path back to two. Indeed, at our meeting two weeks ago, setting aside what financial market participation participants expected us to do, I saw a compelling economic case for a fifty basis point increase. We

should have brought the top of the target range to five. Alright, Loretta Mester, there, and now let's go back some of the things that you just talked about. These data points that really may have been exactly what she was referring to about better than forecast jobs report for January, better than forecast Q four GDP, better than forecast retail sales for the same month, and and how that may have

influenced the FED in the last three weeks. It's gonna be interesting to see how it might have influenced the FED, because we've seen inflation come down a lot in November and December and then rebound in January in both the CPI and the p p I. And maybe it's telling us what the FED has been trying to tell us that the inflation genie is still not back in the bottle.

It's going to take a while to bring that down, and they need to do more for longer, raised rates higher for longer, which is something they've been saying for a long time. Uh. The real dichotomy seems to be on the growth side, where uh many of these FED officials, including Mester, uh, including Tom Barkin earlier um saying that we think there's gonna be a recession or darn close to it. Uh. Laura Mester said that business contacts in

her district are preparing for one. And yet, as you mentioned, the retail sales numbers and other signs of growth have come in fairly strong. So when does that happen? Right? And you spoke to Richmond FED President Barkin just this past week and got some great insight from him. So let's listen to what he told you about FED rate hikes. Well.

I try not to get to wound up in any particular data read, particularly a January data read large, seasonality factors, all that sort of stuff, um um, But I do think what we're now in a position to do is to react to multiple months of data as they come in. We may or may not choose to take rates up further if inflation continues to persist, We'll have to see what happens. All right, there's Richmond FED President Thomas Barkin there now, Michael, what other insights could you glean from

your conversation with him. Well, he's basically saying that the FED is going to be data dependent, which of course we all know, which means that their horizon is shorter. They're looking between meetings what's changed, rather than where we think will be at the end of the There they're all predicting that we're going to see inflation come down further. There are differences in the opinion of opinion in terms of how fast that's going to be. The question is,

in the meantime, what are they going to do? And they're looking at each meeting as a decision point based on the data that they have brought in, Whereas many in the markets had been looking out farther into two thousand twenty three and saying we're going to see us slow down, or we're gonna see a recession, or we're gonna see inflation come down. And so basically markets had been rallying on the thought that the Fed wouldn't have to do much more and we'd have lower interest rates.

Now the market seem to be catching up with the Fed and the idea that this is going to take longer than expected and they're going to raise rates faster and farther than expected. Now, the benchmark lending rate is not the only arrow in the Fed's quiver. There's also other quantitative easing measures they can take their tremendous balance sheet. What else can we maybe expect to see from the Fed? Maybe not at the March meeting, but later this year, Well,

that would depend on what happens in Washington. The Fed's gonna keep the balance sheet reduction going at the rate it has been sixty billion a month and there's no reason for them to change it at this point. There have been concerns of the markets that it might be disruptive to the markets, that it might lead to some liquidity issues in various markets, and we're not really seeing

that yet, so they can keep going. Um, the issue becomes if we get a debt ceiling problem, if we violate the dead ceiling, then uh, do the market sees up and does the FED have to start expanding its balance sheet again? To try to get us out of

the hole. That's gonna be something that's gonna worry the markets as we get closer to that X state, which the Congressional Budget Office said this week was maybe between July and September, and so you'll probably see some repricing as we get closer to that date, depending on the news out of out of Capitol Hill. Now without the thing the markets and the FED are are really focused on, and that is housing and its impact on the economy. So we're getting a report on existing home sales next week.

We just had some pretty encouraging data from home builders. They see things maybe turning around. We've seen uh interest rates fluctuate a little bit, maybe giving a little boost. How important is housing right now and could we be poised for a turnaround in the spring? Well, housing is a an important part of the overall US economy, smaller than it used to be, but it is also the most interest sensitive. So as the FED raises rates, we've seen a real fall off in housing activity. Now, mortgage

rates are kind of holding in. The question is do they start to come down a little bit. They've fluctuated some and does pend up demand get people to buy anyway. That seems to be happening a little bit. We're not at a a an inflection point yet, but we do seem to be getting close to the bottom in housing

and we're starting to see more activity. Home housing starts were weaker than expected in the month of January, but they may rebound as we get into this spring because the builders have a lot of backlogs that they're still trying to work off. And one thing we don't know is is there a problem building because they can't find enough workers. We know there's a shortage of construction workers out there, and that just feeds into the whole stronger economy thing. So a lot is tied up in the

housing market. Um, not to mention its contributions to inflation. Well boy, and three jobs essentially for every home that goes up. But if you can't find qualified workers, those homes are not going to go up. Yeah. That's been the real problem with new home construction and sales. Alright, So let's circle back to the next meeting of the FED. It's in March, just a few weeks away, and there's a lot of growing talk right now about not a basis point hike, but a fifty basis point hike, and

we heard from Mester just this past week. Are there any other Hawks comments you've heard from fits that that would indicate that we're looking at a much bigger hike here and that would really disrupt things. Well, so far, it's only been a little bit of speculation in the sense that Mester said she would have raised raids fifty basis points at the last meeting. She did not say what she would do at the next meeting, and others have sort of made the case that yes, we do

need to do more. But you go back to their last but dot plot that came out in December, and at that point they said we were going to go over five percent to five point one percent, and there was almost a majority for going above five point one percent to five point five. And so it is very possible that the data that are coming in stronger than expected will push them in that direction. And if you were gonna go higher than we're at four seven five, now, if you want to go to five point five, then

you might as well do a fifty basis point move. Um, so it becomes a more realistic possibility. Now we have another CPI report, another pp I report, another jobs report, all those before the next FED meetings, so a lot could change in the way that all these numbers changed from December to January. A lot could change between January and February. So we'll have to see which gets us back to the old FED thing about where data dependent.

And we're going meeting by meeting, all right, well about five weeks away, and Michael McKee, Bloomberg's Global Economic and Policy editor, thank you once again for all your insight. Coming up on Bloomberg Daybreak weekend, It's almost one year since Russia's invasion of Ukraine. The situation there remains tense. I'm Tom Busby, this is Bloomberg. This is Bloomberg Daybreak Weekend, our global look ahead at the top stories for investors in the coming week. I'm Tom Busby in New York.

Up later in our program, a lot of political changes in Washington, all of which could make or break for Democrats or Republicans. But first, next week marks one year since the start of the full scale invasion of Ukraine. For more on what's happening now, let's head to London and bring in Bloomberg Daybreak anchor Caroline Hepger, Tom Vladimir Putin's war in Ukraine is an energy war against the

whole of Europe. For more, I'm joined by Bloomberg's oil trading team leader in Europe, All Nightingale and Rachel Morrison, who is our gas power and renewables reporter. Welcome to both of you, um to talk about, you know, an immensely difficult subject. Next week we'll see the one year commemoration of the start of this invasion of Ukraine. It has had such huge implications for the whole of you

of a hot war, it's really changed everything. Rachel, can I start with you though, and just talk about whether Europe has stopped using Russian energy now for good? Is that one of the big consequences of this conflict. Well, gas in particular was a really big week point for Europe when it came to dependency on Russia, and that was one of the first things that the European Union thought to do was to try to reduce that dependence.

And in a lot of countries it seems to be that piped gas from Russia has been almost entirely replaced. What it's been replaced with is liquefied natural gas or l n G. And a lot of that does actually come from Russia, so we're not completely independent from from Moscow in getting those supplies, but how we received them has completely changed. Alack, how do you think about this energy security? You know, has come to the forum like it has really done before, not not for many decades

in Europe. Well, in both oil and gas, there's a huge mutual dependency, or there was a huge mutual dependency between Russia and Europe, and in the oil market we've seen a ban on almost all imports from Russia. How that that's clearly going to last in the short term and may continue for a period after, because how do

you walk back from that? You know, there's a lot that has to happen, both in the conflict itself and then in the repairing of relationships before Europe can never resume Russian imports, but it's a huge source of supply and something that hasn't been painless for Europe or for Russia. Rachel, how did you manage to avoid a sort of energy breakdown? That was the doomsday scenario? Wasn't it that when this sort of shock attack happened, the idea that might be

rolling black house on continental Europe yes, that's right. When the Nord Stream pipeline was attacked, that did cut off a vital supply line to Europe. And ways in which we've managed that some have been fortunate, like a really mild winter helped us to use less gas, but also the message coming from the European Union and from governments to use less. The target or consumption cuts were voluntary, but we did see countries like France, like Germany taking

this really seriously, so people across Europe using less. We've switched on coal fired power stations as well. That has not had you know, that's something great for the environment and for emissions, but that has helped reduce the need for gas. And yes, this winter has been mild and continues to be so, so we've still got much more gas and storage than we usually have at this time of year, which will help us going into next winter.

So it's been a kind of combination of action by people kind of pulling together to try to save energy and also good fortune. What has it meant for gasoline and diesel prices for fuel across Europe, Well, I think it's been a bullish force. There's been a long period of uncertainty about what would happen with the supply of the raw crude that goes into world refineries that makes the fuels. And Russia itself is the biggest or was the biggest single supplier of diesel to the European Union

until an imports band began on. So are we're still in the early phases of understanding how the various bands will play out. Um, but it has been a source of supply concern. And if we start to see a real pick up in Chinese in the Chinese economy, and that's always been the big driver of demand growth in the old market. But if if that really does come into play and we see any kind of loss of Russian supply, I think there's a concern that prices could

could push higher. Rachel has Europe, then you know, to continue that the idea around energy independence. Has Europe managed to replace Russian energy? Is it kind of rebranded Russian energy or what is it being replaced by? Because again, the kind of the move towards renewables has been given a bit a big shove by by this fact. Yes,

you could describe it in that way. We've really replaced Russian piped gas with l erg a lot of that's coming from the US from catar and fundamentally we are short of gas in Europe and globally until when more exboot capacity comes online in the US. So if there are factors that changed the supply balance and that energy harder to get hold of or more expensive, then that will change things. There were sort of in this quite um strange situation where prices have fallen a lot. There's

lots of supply around China. The economy hasn't banked back as quickly as people thought from COVID, and so the pictures looking pretty good. But what we hear in the market is that can change very quickly. You know, we might see demand pick up from somewhere. We might see problems like the three Portum which had a huge fire in the US and stopped exports from there. You know, anything can happen. We might have cold weather next year.

So although we're looking quite good at the moment for this year and restocking gas reserves, there's still quite a lot of risk, aren't there in the market. And it isn't easy to replace this huge amount of gas that we were getting from Russia, and we've managed it so far, but it's not. You know, it's not sort of plane sailing from here by any stretch. Yeah, that's interesting. The energy transition, Rachel, you mentioned, um, you know, what are

we expecting to see them? There's a real kind of division about how quickly Europe is moving in terms of the energy transition. Yes, it's one of the sort of most straightboard solutions to the volatility in gas is to just use less of it, but that's difficult in the

short term. Renewables projects do take time to build. One of the biggest issues that we hear from developers is about red tape surrounding kind of planning and actually getting projects built so that flows everything done and those can't really be sped up anymore than they are at the moment. The European Union is looking at ways to try to get those projects online quicker, but while that takes time,

then fossil fuels are the sort of easiest replacement. And last year emissions, particularly in Germany, they didn't meet any of the reduction targets that they were supposed to do because they were using more cold to try to use less gas. If that continues, what that means for sort of interim climate targets in twenties thirty and whether we see a kind of broader backsliding on emissions reductions at a time when really we should be pushing forward and

you know, getting net zero as quickly as possible. Okay, thank you so much for being with the Splinberg's All Trading team leader here in Uniting and Rachel Morrison, or Gas Power and Renewables reporter as we think around the consequences of Putin's war in Ukraine. I'm Carline Heber here in London. You can catch us every weekday morning for Bloomberg Daybreak. You're at beginning at six am in London.

That's one am on Wall Street. Tom. Thank you, Caroline, and coming up on Bloomberg Daybreak weekend more on NATO efforts to repel Russia and President Biden's trip to Poland and elsewhere. I'm Tom Busby and this is Bloomber broadcasting live from the Bloomberg Interactive Broker Studio in New York. Bloomberg elmon Frio to Washington, d C, Bloomberg to Boston, Bloomberg one O six one to San Francisco, Bloomberg nine

to the country. Sirius XM Channel one nineteen to London, d A B Digital Radio and around the globe the Bloomberg Business Act and Bloomberg Radio dot Com. This is Bloomberg day Break Weekend I Tom Busby in New York with your global look ahead at the top stories for investors in the coming week. President Biden heading out on a trip to Poland as we approached the one year mark of Russia's invasion of Ukraine. It's an important trip and for more let's add to our Bloomberg News room

in Washington and Sound On host Joe Matthew. Joe, thank you, Tom and joining us now to talk about this trip. Bloomberg's National Security Editor Nick wadhams he runs our national security team and it's great to see Nick. White House Press Secretary Karine John Pierre says this is a critically important opportunity to speak to both the international community and Americans back at home. Here's how she put it in the briefing room. Look, this is going to be the

one year. He's going there ahead of the one year anniversary and sending a strong message of solidarity and UH and the President understanding to reaffirm right our support for the Ukrainian people as they're fighting back against the boot the rude war that Russia started almost a year ago, almost a year nick. There are a lot of themes running through this support for Ukrainians, solidarity with NATO, message to the Russians that the US isn't giving up here.

And I suppose a photo up for American voters to maintain some domestic support. Although we know that there's already a little bit of pushback by some House Republicans when it comes to Ukrainian funding. What's the real audience for this trip? Well, you know, I think there are multiple audiences. One is back home. Obviously Republicans have not the most Republicans who actually have power are not calling for an

actual reduction and funding, but they do want more scrutiny. Uh. So he's got to keep um folks together back home to keep the money and the weapons flowing to Ukraine. Uh. It's also directed at Europe because there is a concern that now that we're a year on, you know, Ukraine is firing an awful lot of artillery shells, they're losing weaponry, they're using up all those uh long range missiles and

other things. So there really needs to be a continuous flow of of financial support, uh and also military support, and that's going to have to come from the US, but it's also going to have to come from other countries. So you know, the US has been the primary backer of Ukraine's military as well as its economic lifeline. So President Biden's going over there to sort of give a shot in the arm to all these efforts and say, okay, listen, it has been in a year that's gone so fast,

but we cannot let up. John Kirby spoke about this as well. He speaks for the National Security Apparatus at the White House. Wants to talk about the importance of the international community's resolve and unity in supporting Ukraine for now going on a year. Wouldn't it be great if the President didn't have to make a trip around a one yearniversary of a war that never should have started. Sadly, that's where we are, and he wants to make sure that he's sending that strong message not only of the

United States resolve but the international community resolve. Well, it is where we are. We have a sense of what this trip is going to be like. Obviously there you know, this is a massive photo opportunity is he going to speak on the border, will he be seen mingling with troops with people who live there, or do we not have a sense of that. Well, they have not released a lot of that information yet, but you can expect um that there will be obviously meetings with Polish leaders,

there will be meetings with Americans. I'm sure there will be an effort to get close to the border, though obviously there are security risks around that. So uh, I'm sure that the team is is figuring that that out right now. I mean, it is so interesting that clip you played for me, because it's like, well, uh, the message of unity and and they keep repeating this is about showing unity, and it's it's both showing unity, but it's also reinforcing unity. So you know, trying to make

sure that he is keeping those allies on board. Poland is a great example. They want to push harder, they want more. They are very worried, you know, Ukraine is on their border. Uh. And then you have other countries like France, for example, which is a little bit more hesitant about what to supply, though they have supplied a fair amount of weaponry and and how fast to do it. So it's it's they're they're talking about a message of unity that's directed of Vladimir Putin, but it's also directed

back at the Alliance itself. Let's talk a little bit more about that, because the Munich Security Conference that's underway ahead of this anniversary has has brought about some tough memories for some, particularly at Eastern Europe. It was nine teen thirty eight at that very same event, think Neville Chamberlain, eight five years ago. The checks know this as the Munich betrayal. They know that, Look, there's a window of opportunity here in war. Fatigue is a real thing in

the West. How concerned are they? Well, I mean this is this is very much a message directed at Vladimir Putin as well. So his forces have launched a counter offensive again, a sort of counter to the Ukrainian counter offensive,

firing off massive missile barrages. They have managed to take some more territory, but they have stalled out in other areas, and there are real divisions you've seen back and forth between the Wagner group, this this private military group that's fighting on the Russian side, and the Russian General Staff reports that Russia has now lost half of its tanks and basically doesn't have uh well trained troops to send

in anymore. So they're really trying to show Russia listen, if you want to keep prosecuting this war, it is going to be extremely costly for you. Munich, you know, Munich has really changed over the years because the Munich Security Conference has become, uh, this venue for Western countries to gather in one space. I mean, I've been in that. In that place, it's crazy. You'll be walking through this crowded hall and oh, there's the German Chancellor, there's the

German Oh there's Justin Trudeau. You're sort of rubbing suddenly in a room, rubbing shoulders with all these major power players.

This is really the place. I mean, in a way, it's perfect timing for Joe Biden because this is really the place where Western officials and people from around the world gather and make these pledges of unity, you know, stressing the importance of the of the global order that you know, the international laws and norms, and so it's a perfect place to sort of direct that message back at Putin. Talk to us Nick about what's happening on

the battlefield right now. General Mark Millie spoke a couple of days ago along with the Defense Secretary to reporters, describing this again as a war of attrition, but one that is really gutting to your point earlier, the run in military. Here's what he said. Their progress is slow. It's a war of electrician and taking heavy cassties. Their leadership and morale is not great. Um, and they're struggling mightily. However, Uh, they do have numbers. Uh. And as you know, uh,

President Putin did a call up of several hundred thousand. Uh, and those folks have been arriving on the battlefield, so they do have numbers. At what point, though, to those numbers show the diminishing returns of opening prisons, for instance, grabbing anyone you can and sending them into the battlefield.

At a certain point, you can't win a war that way. Well, I mean, you're right, And we do have reports that that Russia is trying to be a little bit more parsimonious in the way that it fires artillery shells and things like that. There are suggestions that it is running out. But you know, the numbers are so big, and compared to Ukraine, whose army is is quite a bit smaller, so there's there is a real numbers game that is

that it is hard to square against. I mean, Russia is is not going to be running out of boots on the ground. They may not be super high quality soldiers, but they're they're not running out of that particularly soon. The other problem you have here is that this is obviously a war, but Ukraine so far has been restricted from hitting Russian targets inside Crimea, which Russia took in twenty fourteen, or inside of Russia itself. That's a very deliberate policy by the West because they don't want to

start a wider war with NATO. But you have this issue where a lot of Russian assets are essentially untouched. One of the big ones is its air force, and uh General Milliye has talked about this before. Russia has used its air force to some degree, but not to the fullest extent possible. So Ukraine is very much focused on defense and protecting from incoming missiles and fighter jets and things like that, but they are not targeting Russian

forces on the ground inside Russia. And that's something that Russia is using to its advantage for sure. And of course the call for fighter jets, cant and news. As we go into the second year, we've seen a lot of different levels of hardware balked at and then eventually delivered. Uh, is that actually what they need? The Pentagon would tell you that it's actually not that they need air defenses.

Ukraine says, please send the jets, right. I mean this sort of fits a pattern with the Ukrainians where they they go from one piece of kit to the next. And you know, a couple of months ago it was all about tanks and now it's a huge focus on the fighter jets. I mean it's Uh. The bigger issue though, that Ukraine argues is again that they are too too They are focused on defense and they want to be

able to in some ways go on offense. And that's that's a situation that Russia is exploiting and using to its advantage. Great conversation and great insights from Nick Wadhams, who runs our national security team for Bloomberg News here in Washington. Nick, many thanks to you. Will be looking for your reporting on the one year mark next week.

Thanks Joe, Tom Back to you. Bloomberg's Joe Matthew reporting from our Bloomberg One newsroom in Washington, and you can hear Joe on sound on weekdays five to six pm right here on Bloomberg Radio. Coming up on Bloomberg Daybreak Weekend, japan Central Bank faces a tangled policy web. Tom Busby, This is Bloomberg. This is Bloomberg Daybreak Weekend. Our global look ahead at the top stories for investors in the coming week. I'm Tom Busby in New York. Some changes ahead,

some problems for Japan's Central Bank. And for more on what we're watching, let's go to Hong Kong and Bloomberg Daybreak Asia host Brian Curtis and his colleague Doug Chrisner. Tom challenges a bound for the incoming Governor of the Bank of Japan, Kazuo Da. How do you stimulate growth without further stoking inflation? How do you reform the yield curve control program without driving j g B yields up

and the end sharply higher. Now, the combination of yield curve control and quantitative easing has earned the b o J into the largest owner of stocks and government bonds in Japan. The b OJ's balance sheet has jumped to the equivalent of five dty seven billion dollars. That's equal to a hundred and thirty percent of g d P. Yet instead of releasing the economy's animal spirits, it's driven investors abroad. So the question how does the new governor

get that money back without driving the end substantially higher. Well, joining us is through all of this is Kathleen Hayes, Bloomberg's Global Policy and Economy editor. Kathleen, thanks very much for joining us. Let's start off with the simplest question, or maybe it's not so simple. What's the biggest challenge that Kazuoita faces. Well, the biggest challenge is starting to walk down the path of normalization, and you've just laid out all the difficulties. Uh Inflation is rising in Japan.

It's far above its target, but a lot of it is commodity price driven, and the b O J currently

doesn't think that's potentially sustainable. So they feel that the current crew says, look, we can't stop monetary easing, and we're getting there's going to be a new governor at the HELM, but there's still gonna be a lot of the same people on the board, so it's not as though you're gonna have a wholesale change because you get a new governor and uh, he is well respected, well known within and out without outside of the Bank of Japan and in japan economic circles and globally. But it's

just even starting. It is going to be tough because of the ramifications it could quickly have in the market. So from what I've read, he seems to be characterized as being methodical. He's a gradualist, as one of our colleagues put a pragmatist and dubbed an owl in the tradition of Christine Legarde, who said she was neither a hawk nor a dove, but aimed to be the wiser bird.

So in terms of creating kind of a stable environment for the conversation to begin and not disrupt markets, not create a volatil right of course, And I think whoever would have gotten that job had it been Deputy Governor am A Miya who turned the JAB down. He didn't think he was. He thought he was too close to the process of creating this whole system, and he was. He was the architect of Yale curve control itself. That he didn't think he could he could appropriately review it.

And that's what's going to happen first, and that's been signaled by Prime Minister Fumyo Kishida for about the past two or three months. There. In a ten years ago led by former Prime Minister Abe uh there the government made a new accord with the b o J to get to two percent inflation as quickly as they could and then committed to two years and never exactly got there. Uh So that's the first thing. And I think this

is going to be methodical. I think it's gonna be step by step, and everybody has said for the past three or four months, I've asked this question communication. You need somebody who's a good communicator because communicating what you're doing and why to the markets is going to be critical. Well to your point, I mean, is a big champion of forward guidance. I mean, he was one of the kind of pioneers in that from what I've read about the way in which the b o J offers forward guidance.

Of course, he's never had to do it himself, since we shouldn't say that since five and let's remember too that he established he was part of a very hubbish, dubbish crew. But they needed it, you know, they were still struggling a lot with inflation and ultimately growth, but he voted for He helped us. You're in quantitative easing negative rates, so this is not some guy who's got We can't really tell if he's a hawker dot. I think the best central bankers they're not inherently hawkish or dovish.

They're inherently people who want to figure it out. All right, Kathleen, out of time now, but thanks very much for shedding some light on these big challenges ahead for the Bank of Japan and its new governor. Kathleen Hayes Bloomberg's Global Policy and Economy editor. I'm Brian Curtis, along with Doug Krisner. You can catch us every weekday here for Bloomberg Daybreak Asia, beginning at seven am in Hong Kong and six pm

on Wall Street. Tom. Thank you, Brian and Doug. And that does it for this edition of Bloomberg Daybreak Weekend. Join us again Monday morning at five am Wall Street time for the latest on markets overseas and the news you need to start your day. I'm Tom Busby. Stay with us. Top stories and global business headlines are coming up right now.