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This is Bloomberg Daybreak Weekend, our global look at the top stories in the coming week from our Daybreak anchors all around the world. Straight Ahead on the program, we'll look ahead to the final monetary policy decision from the Fed of twenty twenty five and how that could affect interest rates into the next year. I'm Nathan Hager in Washington.
I'm Caline Hegger in London, where we're looking ahead to the black Hat cybersecurity conference in London.
I'm Doug Prisner looking at why China's economy is stuck in deflation.
That's all straight ahead on Bloomberg Daybreak Weekend on Bloomberg eleven three zero, New York, Bloomberg ninety nine to one.
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Around the world on Bloomberg Radio, dot Com and the Bloomberg Business app. Good day to you. I'm Nathan Hager. We begin today's program with the Federal Reserve. The Central Bank holds its final two day policy meeting of twenty twenty five this week, issuing its final monetary policy decision of the year on Wednesday. So for more on the path ahead four interest rates, we are very pleased to be joined by Stuart Paul, us economist with Bloomberg Economics. Stuart,
thanks for being with us. And it seems as though the market is all but fully priced in that we are going to get a rate cut this week. Did some of the private data that we've seen ahead of this decision sort of shake any of that, bet?
I don't think so. When we look at some of the private sector data, including the ADP report showing a pretty cool labor market, and then some of the official data as well, relatively weak manufacturing in the month of September, import prices that were relatively dull. When we receive those data points earlier last week, it basically gave the green light for this rate cut. So I don't think that the Fed is going to be that concerned about whether it can defend its decision to cut when it meets
this week. I think that the bigger conversation around the table at the FOMC meeting is going to be what message to send to the markets and what message to send to interested parties out there when it releases it's summary of economic projections. I think that's where we're going to see a more division and in fact, maybe a little bit of confusion.
How so, I mean, I guess we have seen sort of diversion of thinking when it comes to where policy should go from even some of the FED speakers ahead of this meeting. But I mean, how much of a change could we see in the dot plot.
I think it's going to be pretty significant in twenty twenty six. And I think that even more important than the dispersion of dots in the dot plot included in the summary of Economic projections, is to remember that the voters on the FMC next year are going to be shifting pretty dramatically. There is going to be a contingent of hawkish regional Fed bank presidents that become voters, and among them are Dallas FED President Laurie Logan, Cleveland FED
President Beth Hammock. Those are some folks who were among the more hawkish, among the more hawkish and the more vocal FED speakers over the last several months, and when they become voters, it's going to be all the more important to try to identify which dots they are and I expect they're going to be among the more hawkish cluster when we look into twenty twenty six. A lot of attention has been put toward who the next FED
chairman is going to be. But I think then more important actually than who the next FED chairman is is this point about division on the FED, because we're going to see a lot of it. We're going to see a growing division on the FED, and.
We've even heard some concerns raised. I guess you could say about whether that next FED chair is going to be able to deliver the kind of rapid rate cuts that President Trump has been looking for. We heard from p Jim's Greg Peters just in the last couple of days saying, even if it is Kevin has it, the President's White House Economic advisor, he might not be able to get that kind of consensus. How do you see it.
I think that's right. I think it's going to be difficult for the next FED chairman to build a coalition of voters that can show some sort of a united front around the pace of rate cuts. I think that's going to be true of any FED chairman. It seems as though a lot of attention over the last week has turned to whether or not somebody like Kevin Hassett, someone coming from the White House, has the credibility that the Fed will remain devoted to its two percent inflation target.
Somebody like that has the credibility to keep markets calm. I will say that when the trial balloon was floated a couple of weeks ago. Now regarding Kevin Hassett as the finalist for the chairmanship, he passed the markets test with flying colors. Equities rallied, two and ten year rates fell.
It's exactly what the White House wants to see. So as much as we've heard chatter over the last week questioning whether somebody like Hassett has the credibility to build a coalition or to maintain the FEDS two percent inflation target, it seems as though the market thinks he has enough credibility. It seems as though to me, no matter who the next FED chairman is, it's going to be difficult to build a coalition. I think that's just the nature of the evolving voting roster at the FOMC right now.
So, given the evolving roster, how much attention should the markets be putting on chairman Powell's news conference after the decision on Wednesday.
I think that markets will put a lot of weight on it. Basically, no matter what, he still is the person who will be leading the FOMC for pretty close to six months, and I think that the question is going to be around whether the FED will maintain any sort of cutting pace in the first half of next year, given the expectation that a new more dubbish chairman will
take the reins starting in May. So I think that when we see this press conference from FED Chairman Powell on Wednesday, the question is really going to be what's it going to look like in January, what's it going to look like as we get towards the end of Q one and into Q two, What is the Board of Governors and what are the regional Fed bank presidents thinking about cuts in the first half of next year.
Right now, our base case in Bloomberg Economics is for the FED to move more towards a quarterly cadence of quarter point cuts next year, and that's based on our expectations for economic fundamentals right now. I think that FED Chairman Powell is going to try his best to not show his hand in any one direction. But again when we just at the evolving roster, it's going to be very difficult next year to deliver quick rate cuts the kind of the president wants.
Yeah, it is going to be a fascinating discussion and a fascinating final decision coming up later this week. Thank you for this, Stuart, really great having you on with us. That is Stuart paul Us, economist with Bloomberg Economics. We move next to more corporate earnings in the tech space. We hear from two big names on Wednesday, Oracle and Adobe. Let's bring in Bloomberg Intelligence technology analyst Anurag Rana from
More on this latest round of tech results. Anurag, these are a couple of names that have kind of been hit pretty hard lately around the question about whether artificial intelligence valuations have gotten two stretch. So let's start with Oracle. How high is the bar for their earnings?
So I think they have to come out and basically explain that the big backlock of orders that they have from open AI, how is that going to get funded and how is that going to get recognized into revenue. That is the single biggest question in our mind at this point, especially when you go back and look at the stock chart. It had a massive run up when they Oracle announced that big order book from open Aie.
But in the last you could say, two months, two and a half months, there has been a lot of scrutiny in the market as to how some of this is going to get funded, and that I think is what has been being on the stock. So the management has to come and explain their strategy of data center expansion and where that money is going to come from.
Yeah, to your point, I think we saw in just the last few days report that the cost of protecting Oracle's debt from default at its highest level in more than fifteen years. I mean, what kind of explanation can we expect for how Oracle can kind of service that.
So one of the things you have to think about it is there is a lot of investor demand for anything that's related to data center expansion because I think people understand that's an area where you are looking act more and more build up over the next several years. So you know, whether it's private credit or whether it is private equity. A lot of these companies may be
able to fund some of that expansion. But the big question is you know at what level, because one of the things is open AI has talked about, you know, several hundred billion dollar investments out in the public for those data centers, so the appetite is not so much. And also remember Oracle is not the one that's funding a lot of that from their own balance sheet or
their cash flow. They go out in the market, they raise the funds with the help of a consortium, and that goes you know, into that special purpose vehicle that does not impact Oracle's balance sheet directly, but at the end of the day, they are the ones who will be recognizing some of the revenue from it, not just the investors. So they have to come out and explain a bunch of these things.
Where do you see Oracle stacking up compared to some of the other hyper scalers. I mean, think of the Magnificent Seven all the time, and Oracle, of course isn't part of that cohort. Is it going to stay behind?
So one of the things that we have talked about quite a bit over the last few years when it comes to cloud computing, there are three big players, Amazon being the biggest one, Microsoft after that, and then Google, you know, the third player. But because of this massive demand for AI infrastructure and AI infrastructure workloads, Oracle has really kicked up and become what we call us the fourth hyperscale cloud providers. And the big question is are
they each other taking market share from each other? There is a little bit of that going along, but at the same time, the market has expanded very very strongly because one of the things that you have to do is when you're running an application like chat GPT, you will be running on a cloud infrastructure. You typically don't run that in somebody's internal data center. Same thing for an enterprise when they are expanding some of these AI workloads,
cloud is usually where it's hosted. So when you take a look at that, the the end markets, which is cloud infrastructure, has actually grown quite nicely, which gives growth opportunities for all foward vendors and not just one or two.
Let's talk about Adobe. Now, looking at a chart on that stock it's kind of upper left to lower right for the whole year here. So what are the expectations around Adobe's results?
Yeah, I think that seems to be a big story when it comes to Adobe, that you know their lunch is going to get eaten up by AI related tools that are out there, free tools. So when you look at Adobe and you go back a few years before the launch of any large language models, this company used to trade even higher than Microsoft because of high free cash flow, the perception that nothing can happen to some of their marquee products, that is Photoshop or Acrobat, et cetera.
But what has happened is when you're seeing these free products that can create images and videos, investors allverrid that their code business is going to get attacked and they won't be able to protect that. Now, when you look at their results, at least in the last three quarters, they have reported decent results, but at the same time, you know they have not seen any acceleration, and I think that's always brings that question mark. So we're going to see that a little bit of the same thing.
They're going to come out talk about how they can grow next year, They're going to talk about their own AI products. The question is whether that's going to be enough to pacify this this little fear that's out there in the market that Adobe is a net casualty of AI related developments.
Thanks for this on a rock, great having you with us. That's honorog Ran, a technology analyst for Bloomberg Intelligence, and coming up on Bloomberg Daybreak weekend, we look ahead to the black Hat Cybersecurity Conference in London. I'm Nathan Hager, and this is Bloomberg. This is Bloomberg day Break weekend, our global look ahead at the top stories for investors in the coming week. I'm Nathan Hager in Washington. Up later in the program, we'll preview upcoming data out of
China in the health of the Chinese economy. But first, cybersecurity challenges facing Europe are clear. Airports, businesses, financial institutions are all at risk from an increase in cyber attacks by criminals and state actors. That's the black drop to the Black Hat Europe conference in London, which gathers top professionals for briefings on modern day strategies to counter those threats online. Let's get more from Bloomberg Daybreak Europe banker Caroline Hepger in London, Nathan.
The Black Hat cyber Security Conference in London over the next few days will look at the latest trends in cyber security, as attacks are becoming increasingly costly for governments and businesses, sometimes into the billions. Briefings will be held on how to bolster sign defense strategies in both the public and private sector. The Bloomberg London Tech Summit recently featured interviews with top CEOs on how businesses can build
resilience in a rapidly changing threat landscape. Speaking at that summit, Yevgeny Dibrov, who is the CEO of the cyber security firm Armis, who explained why there's been such a surge in interest in the company, the.
Great demand that we are witnessing right now because of attacks on critical infrastructure. Basically all the geopolitical tensions Russia, Iran, North Korea, everybody. You see a lot of targeting infrastructure, targeting national infrastructure, the most critical areas from airports to grids to manufacturing in the US, in the Mia, we see a lot of UK as well.
That was Armis CEO Yevgeny Dibrov being interviewed there by Bloomberg's senior cyber security reporter Jordan Robertson, and Jordan is with me. Great to have you on the program. It has been such an important and interesting year, hasn't it? For your beat? The era of rapid digital advancement of AI. Can you just talk to us about the elevated kind of cyber threats levels that we're seeing in the UK in Europe. I mean you heard it in that interview
that you did. It's everything from big companies to personal data to airports. This ahead of discussions at black Hats.
Sure, yeah, thanks for having me on. You know, if you take a look at the conference agenda for this Blackhat conference, I mean, first of all, it's a very technical conference. It's technical content for technical people, but the overarching themes are still the same that people would kind of recognize. And there are two main themes that are happening in cybersecurity right now. One and perhaps the biggest one is ransomware. Computer hacks used to be pretty secret things.
Companies by and large could keep these events secret unless certain data was leaked, and they could prove that certain data was leaked, personal information, things like that. But most cyber attacks were secret and companies were allowed to do that. You can't keep secret a ransomware attack because your business stops. And we saw that this year with the you know, the attacks on m ands. We saw that this year with the attacks on Jaguar Land Rover, you know, which
brought really significant critical operations to a halt. And this idea of ransomware, which very often is executed by by young people, by kids. In many cases you're talking about teenagers. You're talking about young people who connect online and kind of I guess, get radicalized if you will, and see this as a real business, business opportunity. There are millions of pounds to be made through some of these hacks. These attacks are very easy to do, they're extremely disruptive.
You can get a lot of money in extortion fees if you're the hacker. So, you know, one of the things that the cybersecurity industry, including this conference this coming week, you know, is really focused on, is, you know, technically, how do you get ahead of these attacks? Like are there technical countermeasures you can put in place to repel
ransomware attacks? And it's a really hard problem because it's not so simple as saying there's a bad actor on my network, therefore they are not allowed to do anything. Bad actors routinely impersonate real users or steel credentials of real users. So if you're running a large network, the biggest threat to your network is going to be somebody on your network, that is using credentials that belong to your employees. So very very hard problem. There are no
easy technical solutions. But that's one of the themes of this conference, and another which is kind of a perpetual theme. You know, ransomware is here to stay. And one of the things I like to describe is that we didn't have ransomware before we had crypto, Like we have crypto and now we have ransomware, and the two are interrelated because prior to crypto hacker, it was really hard for
hackers to get paid. They would sell data on the dark web, and you know, they'd have fake bank accounts and it was very, very challenging to actually collect revenue from your hacks. But now that you have digital currencies, that's that's what's facilitating all of these attacks and making
it easier for making it possible for criminals get paid. Okay, the other side of the ledger are espionage attacks, as you heard the Armiss CEO talk about, which is now that everything is digitized from obviously from telephones to cars, to transportation networks to you know, the power grid. You know, everything will have a digital footprint. So every country on the planet has intelligence services that's trying to build up
their cyber capabilities to potentially disrupt their adversaries. And you know that can range from hacking into a power grid and not doing anything but positioning yourself so that if there is some sort of armed military conflict, you can flip a switch and turn off the lights. And those are the threats that people are trying to protect against.
Yeah, and wow, that's the kind of head spinning list, isn't it, in terms of the threats that are out there. And you mentioned a little bit about the difficulties of how businesses come up, specifically business is with strategies to try to count these attacks. Maybe we can talk about that a bit more, because the thing that was extraordinary about the JLR hack in the UK was that the government agreed to an emergency loan for Jaguar land Rover
so that it could pay its suppliers. They were worried about the fallout across the UK, and so that is something very novel as well.
Yeah, the Jaguar hack was very significant in many ways, and we did some pretty great coverage of it, and as you mentioned, the most significant aspect of it was the UK government stepped in and underwrote an emergency two billion dollar loan to Jaguar land Rover, which by the way, is owned by a five hundred billion dollar foreign conglomerate, Caltata. You know, UK government underwrote that loan to bail out the company. It's not because the parent company couldn't pay.
It was the concern that if this breach dragged out, you'd have people out of work for a long time, potentially forever, if the factories had to close. And it's the first time to our knowledge that we've seen a government underwrite a rescue of a ransomware victim, especially to this degree. You know, governments will often send their cyber experts into these you know, critical companies, you know, nationally
important companies to help them investigate breaches. But you know now that the UK has kind of gotten into the business of underwriting the rescue packages for a ransomware victim. You know, it raises this question of precedent and it's like, is this what we're doing now and what are the implications of that? And I mean, to be clear, this is a loan that needs to be repaid. But when
if you're a ransomware operator and you're a hacker. This is the best news you could have asked for, because you know, and you are basically guaranteed that the companies that you are hacking will survive long enough to potentially pay you, and that's what they're after.
Yeah, if they dissrupt things enough that there would be a pay date at the end of it. You know, you've also covered the threats to buy things and critical financial infrastructure of particular interest. I imagine to our audience, how would you quantify and characterize the increase in hacks, especially from China, but maybe other countries.
Yeah, this is such an interesting topic because whereas ransomware is in your face, I mean, security experts describe ransomware as an exit strategy. The exit strategy is announcing to the world that this has happened and then demanding payment, so everybody sees a ransomware attack. These attacks on the financial system, however, that we've been writing about largely are designed to be totally invisible. And you know, what hackers in those cases are after is not disruption. In fact,
it's the opposite. What thereafter and that in those cases are intelligence, our information about how the financial system works. Who's under investigation who's under investigation for sanctions and things like that. You know, powers of the government, whatever government that is, US, UK, wherever governments have extraordinary powers to sanction individuals, and foreign governments that may be targets of those investigations, are extremely interested in understanding who's on that list,
who's being investigated, what information do they have. So there's so much, you know, reporting this year focused largely on the US Treasury, which has suffered a series of very devastating espionage attacks in recent years. And what we looked at was how does the US Treasury, which has a large cybersecurity team, which has a great budget for cybersecurity and increased budget, you know, for this this kind of work, how do they keep getting hacked at a very deep
level by Russia and China in particular. And the answer is a little bit complicated. But one thing that you take away from it is there is no silver bullet in cybersecurity. If there were, everybody would use it. There are best practices, there are approaches, there are techniques you can use, but there is no silver bullet. And you know, so what you're left with is whether it's ransomware or whether it's an espionage attack. You know, cybersecurity is an
even more difficult problem now than it was before. Even though we have more cybersecurity protections, we have more venus. Like the Black aut conference, there will be it's a vendor conference with research as part of it, so they're going to be there selling cybersecurity technologies that you know they all do something. But if there were a technology that could cure cybersecurity attacks, you know, everybody would obviously would be the most valuable company in the world.
It's the game of chase, isn't it? With all crime? Is how you know all perhaps criminal and other activities, how to keep pays. A final word then, too, on AI and what difference artificial intelligence is making, because this is another area that you've reported on in a big way over the past few months.
So what I've what I've been doing the past couple of years is with most sources I meet, and these are your senior cybersecurity people at governments and companies or whatever, and I will ask I will try to ask every single one of them, how is your organization using AI today? Like practical examples, not like experimenting, but like practical examples, how are you using AI? It's been really revealing, Like most of them have said, not really at all, very
surprising to me, with some exceptions. And the reason that's surprising when it comes to cybersecurity, you're dealing with hackers the way it's been explained to me. You're dealing with hackers that in most cases are trying really really hard not to be detected. If you're writing that code to perform those attacks, you're not going to outsource that to a large language model which can hallucinate and make mistakes
and maybe blow up your operation. So we're seeing that there's not a lot of utility for these llms in custom hacks, espionage attacks, really high level stuff. There's too many uncertainties around it. Where we are seeing AI being used is especially true in spamming. So if you're doing a spam operation. It's kind of a funny story is we're seeing increased spam activity in countries that previously didn't
have a lot of it. Japan comes up a lot, so places where you have character based languages that are not really used elsewhere in the world. Some of these countries have seen very very low rates of spam for decades. There just isn't a lot of that activity because crafting the messages in the local language is very challenging. You have to have subject matter experts. Large language models have really helped the hackers in that regard, Jordren.
That means many more stories I expect from you and from your colleagues. Thank you for being with me. Been a hugely fascinating conversation about cyber security, Bloomberg's senior cyber security report at children Robertson. Thank you, and we'll have full coverage on Bloomberg Radio of developments on this topic and the black Hat cyber security conference in London in the coming days. I'm Caroline Hepcker here in London. You can catch us every weekday morning for Bloomberg Daybreak Europe,
beginning at six am in London. That's one am on wol Street.
Nathan, Thanks Caroline, and coming up on Bloomberg day Break Weekend, we take a look at why China's economy is stuck in deflation. I'm Nathan Hager, and this is Bloomberg. This is Bloomberg Daybreak Weekend, our global look ahead of the top stories for investors in the coming week. I'm Nathan Hager in Washington. This week China releases the latest readings on consumer and producer prices. For more, Let's go to Bloomberg's Doug Prisner, host of the Daybreak Asia podcast.
Nathan the Chinese economy is caught in a deflationary trap, and the factors that led to steadily declining prices appear to be firmly entrenched. Bloomberg Economics is saying it's going to be tough to shake and to make matters worse. Economic growth in China in the current quarter has been weak. Let's bring in Bloomberg economist Eric Zu, who covers China and other economies in the Asia Pacific. Eric joins us from Hong Kong. Eric, thank you so much for making time.
This period of deflation in China has been going on, as we know for several years. Why the stubbornness.
I think the reason is the demand side, so the consumer side, business side, I mean the demand domestic demand is too weak, so it's not enough to you know, driving and sustain inflation especially. I think a key issue the confidence here. So we see lots of data, you know, see the consumer they're deleveraging, corporation they're also delaverging, so noing is willing to borrow, you know, to expand consumption spend investment. So there are lots of downward pressure on
the pricess on the from the domestic side. So I think so people are over anxiety, they overwork, so basically they don't have time to consume. And at the same time, you know, the income is slowing, you know, the job looks are not looking great. So people are very cautious, you know, on spending, and if they have any you know, money,
they would rather you know, say for the future. Right in the case I lose my job or I got income cut, so it's it's better to saving for you know, in a certain future rather than spend whatever I have right now. So I think that's long a deep rooted issue which is creating a very deflationary economy right now.
At the same time, I think we need to mention the issue of excess factory capacity, and this is something that many of China's trading partners have been critical of China, essentially exporting deflation.
They're you know blaming China for you know, down pins of chief goods into their country and you know, taking their markets. So but just at the same time, I think the key issue is China's although trying to have a very big domestic market, but just right now that demand is too slow, nobody willing to spend, so they cannot digest or the production within the country.
Under these circumstances, Eric, do you believe it's possible for China to achieve that growth target of around five percent or will a lot more be required in terms of stimulus.
I think in sery it's possible. You see this year, so although the four Q the last quarter, I think the data is quite weak, but they basically have done that within the first three quarters or within the first half of the year, so I think it's probably the same, you know style next year. They want front load some stimulus, you know, at the beginning of the year, make sure we have a strong first half. Then on the second half they might you know, relax the momentum a little bit.
But I think in theory we do not really think China needs to maintain a five percent every year. So if you look at the five year plan they just release in October, some reading is that if you still want to achieve the twenty thirty five, the develpment go. I think it's a mostly you just need four point five percent girls over the next decade. So I think probably next year they're still going to maintain five percent girls target, but I think further on they might gradually,
you know, be more relaxed on the girls time. It's no longer I don't think five percent is a must hit target. Maybe next year, but in the future years, I think they want to give more room, even solve the language, which means we no longer have to hit a hot target of five percent. They might you know, change your language like a range, right, we will have a range target instead of a very hard five percent target.
So help me understand how the currency enters into all of this. Lately, the Chinese you want has been stronger, particularly against the dollar, and if anything, you would think that authorities in China would want to slow that down just a bit.
I don't think the government, you know, will allow a very quick appression, just like they won't let depreciation to happen very quickly. So I think the government is okay with you know, appreasion, appreciation or depreciat They just don't like hit a very sharp one way, you know movement, so they're more like, you know, you can you know, gradually do that. But I think that the fundamental reason is one is the weaker dollar so globally because of
the US policy. And another thing is I think it's some funds coming to China, you know, betting on China's tech boom. And also the tear side, the China US relations seems you know, in quiet a periodore right now. So I think before the next excalation next year probably so, I think it's will be give a window for the currency, Chinese currency to gain stronger. But on the PBOC side, I think they will only try to manage this to happen in a you know, slow motion, not overnight.
So if you had to speculate on what more stimulus might look like, give me some possibilities, what might Beijing offer?
Yeah, I think next year it's probably quite similar to this year. I think on the monetor side, they're doing to be some monist modest eating you know, interestry cards and the triple our cards. I think it's more emphasis on the fiscal side, So like this year, I think again next year they will do some short term consumption tuments, right,
the subsidies for trading program. And also I would like to see you know more some long term structure, you know, measures like I just mentioned, you know, more subsidy for childcare, for elderly care for you know, services consumption, so which can help consumers ease their living off course burdens. So I think if the government continued to do that this, you know, in a sustainable way, that will give consumer more confidence. Okay, the government really you know, cared about
consumption and they want to support us. Although the amount may not be such big, but you add this at that together, I think it can create you know, more stumulus for for for the consumption next year.
As we know, the weakness of the property market has been central to the problems with Chinese an. Can you envision some sort of recovery that may take place, let's say in twenty twenty six.
Depends how defire recovery. So my definition of recovery is, you know, like the government's saying, holt in the decline. So if we can achieve to you know, decline, you know, decline less than this year, so I will I think that of progress, and I think that's also the target of the government. I think they they're okay, you know, with the correction in the property market. But the bottom line is there are no collapse. So as long as you know, the adjustment is milder than this year, I
think they will feel comfortable. But that being said, I think in the near term they still want to you know, prevent a very sharp you know slow down, and they want to you know, put a flaw in the market, right so you can, you can, you can go downward, but just like you know, five percent or ten percent down, it's okay, but like twenty thirty percent, I think that
will create monitors for the governments. So I think we must still see some support measures in the new term, so some you know relaxing more mortgage relaxation and the more you know, just reducing the transaction costs, so which can help, you know, stimulate the demand a little bit, you know, trying to stabilize the market. But I don't
think the correction will be over next year. We still we're going to still see the markets down, but probably the magnitude of downwardjustment will be bounded than this year. So that's where still be some progress.
Eric will leave it there, thank you so very much. Bloomberg economist Eric Ju from Hong Kong. We turn to digital currency next and the firm you Trip. This is a fintech platform based in Singapore and it's known for a multi currency travel wallet. Well now you Trip is planning an expansion into Australia as it looks to target that outbound travel market. We caught up with you Trip co founder and CEO Secilia Chew about her company's growth strategy.
She spoke with Bloomberg TV host April hon and Shay on talk to us.
About why Australia. Why do you see so much opportunity in that market? Yeah? Absolutely. You Trip is a multi currency digital wallet that comes with a travel CUD, so users can actually use us to buy anything online offline around the world in any currencies at the best ethics rates.
We started a.
Business seven years ago here in Singapore twenty eighteen, and now we are category leaders in both Singapore Thailand, serving millions of travelers and Australia. It's a really important and strategic market for us. What we are committed to do is actually to invest into the market for.
The long term.
Australians love to travel, just like many of us. You know, every year there's more than twelve million people going overseas and spending more than fifty billion dollars on this category. We think it's going to be such a strategic choice for us.
To be there.
And many of the people also tends to make longer trips. You know what we saw in Singapore Thailand, we tend to travel about six to seven days each time. For Australians, they like to make longer trips like fifteen days on average each time. So I would say that, you know, for our no fee proposition, best ethics race, we hope we can actually make a meaningful impact on how they travel and how they spend. That's in Australia is a market where we do have already quite long established local
grown players. How do you expect to differentiate yourself? So absolutely right, you know, in terms of the banks who also might have a very similar offering to us, I would say we differentiate ourselves with our laser focus on the travel assignment, on the crossbord assignment. So when you really take a look at the big banks, right, so they do many things. They have saving products, they have lending products, they have mortgages. They might have twenty cuts
in just the cut portfolios. So how we differentiate it's over the last seven years we actually have created and optimized our business model, our pricing, our partnership network, and also our product features to be sure that we actually offer the best and most competitive products for travelers in any of our markets.
So, Cilia, that sounds like you're going to need a lot of employees to do all of that. Your expansion seems to be accelerated at this point. What does your workforce look like? Are you hiring more white regions? Are you putting more people in So.
A key part of our market expansion strategy is localization. So of course, over the years, we now have three hundred people in the business and we're growing in size. But for Australia, we have established a office, we are building up our team, we already have boots on the ground, and most importantly, we are going to do much more
in the market. So we are going to have partnerships team, we are going to have customer operations, we are going to have product compliance, marketing, really all aspects of the business. So I would say localization is a key aspect when we think about our strategy going forward, when we think about growth, because it's very important for us to show that deep understanding and also appreciation of the local preferences and also the local culture and people.
That was you Trip. CEO Cecilia Chew speaking with Bloomberg TV host April Hong and Sherry On and I'm Doug Kristner. You can catch us weekdays for the Daybreak Asia podcast. It's available wherever you get your podcast.
Nathan, thanks Doug, and that does it for this edition of Bloomberg day Break Weekend. Join us again Monday morning at five am Wall Street Time for the latest sun markets overseas and the news you need to start your day. I'm Nathan Hager. Stay with us. Top stories and global business headlines are coming up right now