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This is Bloomberg day Break Weekend, our global look at the top stories in the coming week from our day Break anchors all around the world. Straight ahead on the program, Federal Reserve Chair Jerome Powell opening the door to a possible interest rate cut as early as next month. Plus earnings from the AI chipmaker and Vidia amid worries about its business in China. I'm Tom Busby in New York.
I'm Stephen Carolyn London, who we are looking at the difficult calculations looming for European governments as they prepare their spending plans for next year.
I'm Dek Krisner, looking ahead to this week's rate decision from the Bank of Korea, as well as the state of the IPO market in Hong Kong.
That's all straight ahead on Bloomberg Daybreak Weekend on Bloomberg eleven to three Yeho, New York, Bloomberg ninety nine to one Washington, DC, Bloomberg ninety two nine in Boston, DAB Digital Radio, London, Sirius XM one twenty one, and around the world on Bloomberg Radio dot Com and The Bloomberg Business app.
Good day to you.
I'm Tom Busby, and we begin today's program with some revealing statements from Federal Reserve Chair Jerome Powell about possibly changing the FED stance on rates. That's ahead of inflation and personal incomes and spending data in the US. We're
joined by Stuart Paul, us economist with Bloomberg Economics. Well, Stuart, I just want to hear your takeaways from Friday's rather dubvish speech from Fedchair Jerome Powell, because it looks like Wall Street's already pricing in a rate cut at the September meeting.
Well, the hot headline that we got from the speech at Jackson Hole is that the balance of risks for the Federal Reserve and for monetary policymakers are shifting, and in particular the downside risks to employment are shifting materially they're rising. So, if anything, the Federal Reserve chairman was opening the door or at least acknowledging the cooling labor market and opening the door to a rate cut in September.
But if anything, I think the tone of the speech was actually a little bit hawkish, so he could be getting something like a hawkish cut in September. He was really trying to keep people from reading too much into the idea that the resumption of rate cuts would mean a cycle of cutting follows. For example, he noted that the labor market is cooling, The pace of hiring is materially slowing, but there is not a lot of slack in the labor market. The pace of GDP growth is slowing,
but there's not a lot of slack in economic activity. Yes, risks to inflation are still skewed to the upside. So he was very cautious in his tone. He acknowledged that it might be time to adjust the stance of monetary policy, but he was not willing to go so far as to say there would be multiple sequential cuts.
Well, what he said about it is we're in a curious kind of balance right now in the labor department. So he is hedging his bets. And when you say a hawkish cut, you just mean a quarter percentage point, right.
A quarter point cut, and a clear signal at the time they decide to move right, that additional sequential rate cuts are not predetermined. When we get something like a hawkish cut, it's really an incremental loosening of monetary policy plus hawkish messaging, and that's what Powell was starting to signal in his final Jackson Whole speech.
We have had some dissension previously in the FED, some members saying, hey, we're ready to cut any time. Has that balance shifted now are there? Do you think it's not just him, not just the one or two. Christopher Waller and a few others are more saying this may be the time.
Heading into Chairman Powell's speech, other members of the FOMC, the branch presidents, including Susan Collins from Boston, All Goals from Chicago, Beth Hammock from Cleveland, they were very clear that they had not yet made up their mind that this is the time to cut rates. There was a coalition in July, and it seems like there's still a coalition now that is very cautious about moving to looser
monetary policy right now. But I do think that what we saw from Chairman from Chairman Powell, who does speak mostly to the central tendency of the committee, that central tendency that media FOMC participant is probably getting a little bit more comfortable with the idea of moving relatively soon.
But I think that This is what's most important, This relatively hawkish tone that was included in the speech, even with signaling that they're becoming more comfortable with one rate cut, it would just be probably one rate cut, and I think that there could be a negotiation come September that it's time to lower by a lower the federal funds rate target range by a quarter point. But they would move slowly, they'll move deliberately, they'll move cautiously, and probably
not another time this year. From an economic perspective, Does it really matter if they move in September or November or December. No, it doesn't really matter from an economic perspective. So I think that the Chairman can build a coalition
given the fact that there had previously been dissension. He can build a coalition now that would be more amenable to lowering the federal funds r a target range, as long as they feel like they're not getting too far out ahead of their skis and that they're not devoted to sequential rate cuts.
Well, one thing the Chairman has been consistent on is that his decision, the decision of the Central Bank, will be data dependent, and we're getting some important data this week. July PCE the fence preferred measure of inflation and also personal incomes and outlays. You know, just on Friday, the Chairman said that the result of the Trump tariffs has been now clearly visible, but the effects made relatively short lived. So I mean, is he seeing inflation as maybe it isn't so bad.
For the month of July, We're estimating that core PCE prices rose zero point three percent on the month. There was actually relatively less pass through of tariff price pressures in the month of July. We had seen some in April, May, June, a little bit less in July. Where a lot of the core inflation pressures are going to be coming from is actually from financial services prices. This is a lot
of things like portfolio management fees, for example. And when you see financial services prices rising, it's mostly just the reflection of a rally in the equity market. It's a rally in financial asset prices that are feeding through into
financial services prices. And so there's an extent to which the Committee is going to be looking at this July PCE inflation report and thinking, hmm, there are elevated, frothy asset markets and so even if we decide to cut rates in September, even if we decide to cut rates this year, we should be very slow and deliberate in doing so. We still have a reasonably close federal funds rate target to what we consider to be neutral right now.
Monetary policy is only modestly restrictive, if it's restrictive at all, So we should move very slowly.
July PCE and personal spending both out just ahead of Wall Street's opening bell this Friday. The next FED meeting September sixteenth and seventeenth, a lot to look forward to our thanks to Stuart paul Us, economist with Bloomberg Economics. We move next to earnings from the last of text Magnificent seven to report this period AI chip maker and Nvidia.
Those results from the world's only four trillion dollar company are looming large over Wall Street because of all the spending out artificial intelligence and questions about the company's business in China. For more on what to expect and what maybe next, we're joined by Kun John Sobani, Bloomberg Intelligence, Senior Semiconductor analyst. Well, Kunjohn, thank you for here. In
video shares. They've taken a few hits in the past week or so, and there are questions about tariffs and what looks like a setback and its ability to sell chips in China. So with all that, looking backwards, what are you expecting to see in its second quarter results?
From a results and guide perspective, we expect Nvidia, in its typical fashion, to deliver again a strong beat and raise. Our checks suggest strong Blackwell ramp ongoing and also strong networking attached along with it, so that should boost both compute and networking. The GB three hundred, which is their next version of Blackwell GPUs, also is likely to be running ahead of schedules, so that can also help with
a guidance beat. But from a stock reaction perspective, the key focus again will be on narrative rather than purely numbers, as we have seen over the last few quarters. First, a key topic front and center is the magnitude and
the timing of resuming the China Hills. They have now received license approval from the Trump Admin, but there are still a lot of unclarity and moving parts regarding how soon can they restart production and start shipping if those customers are still there wanting the same h twenty parts news has come out which hasn't made confunded yet, but there seems to be that the Chinese government forcing the
customers not to buy in Nvidia chips. So there's a lot of moving parts around that China angle, which will be very important.
Well, those chips that the Trump administration has given Nvidia the access into China to sell, they're less powerful, certainly not the Blackwell trips. These are older chips. So the huaweis and the other companies there do they make a similar product? I mean, is that the reason why if this is confirmed about Beijing saying we don't want your chips.
At this point, there is if you take the best available GPU over in China, yes, you know, it is comparable to the older Age twenties that NVIDIAs said selling. But regardless of that, those GPUs don't have enough supply capacity because they don't have access to the leading edge fabs as Nvidia does. So you know, if there was no pressure from the Chinese government, the customers would happily and readily buy a lot more of the Age twenties.
So right now, it's a lot more geopolitics driving this scenario or rather than just pure demand, supply and performance comparison.
Well, Reuters reported last week that in Video may be working on a new chip a little more powerful than the Age twenty that is just for China. Has this been confirmed.
This has not been confirmed. And again this is a lot of news has come out over the last few weeks which everyone including US is waiting to speak to the company as they report earnings to confirm a lot of these things. And you know, I wouldn't be surprised regarding the new chip. Every big generation Leap architecture generation Leap,
Nvidia has designed a new chip for China. So now we are as it is shipping blackwell, it makes sense that it is designing a lower powered black Belt version, which is what the Reuter News was talking about, and so that would not be very surprising to us. But again you would have to go through this whole cycle of getting licensing and sanctions because it will be definitely more powerful than the Age twenty.
Well, with all of this is a four trillion dollar company. How important is China to Invidia's future revenue? I mean, it looks like they're doing well without it, but we all know it's the second largest economy on Earth. You know, the spending is astronomical. How big is China to Invidia.
Yeah, so there are two parts of it. One is from a tamp perspective. It's definitely the sort of biggest stamp outside of the US when it comes to what Nvidia can sell to, and it is home to the next largest hyperscalers and cloud providers. So it's definitely a big market that you don't want to lose out, especially if you're Nvidia for the long term. But however, in the near term, right now, you know it can do very well without it. It is doing very well without it.
We don't suspect that this China headwind will stop from it growing into the numbers and as estimates. But right now, given the size and the growth it has delivered, the
focus is how better can you do? So even if it's just let's call it ten to twenty billion dollars a year right now, which is a drop in the bucket given how much revenue they are setting everywhere else, because all the investors and Byside is trying to just get to the highest number, and if they can beat that to that, the narrative will be a lot more important right now than the numbers well.
In Vidious Q two earnings out after the market closes this coming Wednesday. Are thanks to Kunjohn Sopani, Bloomberg Intelligence Senior Semiconductor Analyst, and coming up on Bloomberg day Break weekend, we'll look at the difficult calculations looming for European governments as they prepare their spending plans for next year. I'm Tom Busby, and this is Bloomber. This is Blueberg Day Break 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, we'll look ahead to a monetary policy decision from South Korea's Central Bank. But first in Europe, the end of the traditional summer holiday period will see politicians return to work in the coming days. In many countries, their biggest challenge will be drawing up budget plans that increase defense spending while also tackling enormous debt piles amid week economic growth. In France, the conversation will kick off at the annual summer conference
of the country's biggest business group MEDEF. For more, let's go to London and bring in Bloomberg Daybreak. Europe banker Stephen Carroll.
Tom It's a cliche, but politicians do take summer holidays in Europe, and that usually means that at this time of year, the looming political challenges return with the bang. In France, the season known as Laurentree for schools but also for politics. This year's MEDEF conference is a chance for employers to set out their positions ahead of a
fractious budget to base. The Prime Minister U faces the daunting task of building support in Parliament for his budget plan, which contains forty four billion euros of tax rises and spending cuts. Without a majority, his government's future hangs in the balance. Bairu will be trying to avoid the fate of his predecessor, Michel Bagnier, whose government was toppled over its budget last December. The situation is causing growing concern amongst investors, not just in France, but also in several
other European countries. Many governments are grappling with similar budget try issues, and they need to submit their spending plans to the European Union by mid October. They're balancing the need to increase defense spending, pay bigger social welfare and pension bills for their aging populations and cover debts encouraged during the COVID pandemic, all the while trying to avoid
painful tax rises or spending cuts. Here's what Jeffrey's economist Madupe out of Bembo had to say about the situation when she spoke to us on Bloomberg Radio.
In previous kind of budget cycles last year, the opposition knows that they can extract the game from the government, and so they will do that. But I think the question is how far it goes. Will it just be a case of trying to maybe remove certain budget reductions that have been penciled in, or will it be a case of bringing down the government. And I think if we get into that situation where it's a case of
bringing down the government, that's where I see. I mean, it's a really big risk for France there because another election then we're thinking about presidential elections, a lot of uncertainty about who would come in presidential elections. I think it really opens up a really big can of worms. And that's why we are negative on France because I think all of these sorts of scenarios that we're talking about are very possible. They of course tell risks, but they have a greater probability.
As Jeffrey's economist and we dupey out of Bembo speaking to me recently about the situation in France. Let's get into the broader political and economic challenges ahead, then with our senior geoeconomics analyst for Europe, Antonio burrough So and are European economist Anna Andrade. Welcome to you both. Antonio, I want to start with you and just to lay the land of the political situation in France the heading
into these difficult negotiations. What is the situation looking like for the government.
Well, the picture is looking quite challenging, I would say, because the problem, the main problem is that the government lacks a majority in the National Assembly, that's the crucial lower chamber in France. The government is essentially short of seventy nine deputies, right, and I think that means two things. The first is that it's very hard to get legislation past in parliament, not just a budget. I mean, this is a government that struggles to get things done in parliament.
And the second problem is that it basically leaves the government exposed to potential no confidence motions in parliament, and that you know, if a non confidence motion is supported by the parliament, that leads to the collapse of the government, which is what happened last year. Right, So, I think that creates a very challenging situation for the government. Adding to this is the fact that there is a lot
of political polarization in the country. Political parties are extremely polarized, which makes reach compromise is also very difficult in parliament. So as a whole, I would say it's fair to characterize the political situation as quite difficult.
And let's turn to the fiscal situation that France is facing. How did it get to this position and how does it compare to what we're seeing elsewhere in Europe?
Sure so, I think the markets really woke up to francis fiscal problems in twenty twenty four when Macron called the snap election, but really the problems had been building way before that. And if you look at the primary balance, which provides a better reading on fiscal efforts because essentially
the excluding interest payments. While Greece, Italy and Portugal, all the countries that have been most affected by the sovereign depth crisis, were undertaking big consolidation efforts and targeting primary balanced surpluses away from deficits. France was still running significant deficits. Now it wasn't the only one. Spain was not necessarily
very committed to physical discipline as well. But the key difference then as now was that growth was much faster there, which helped reduced the dept to GDP ratio prior to the pandemic, while in France it actually increased. And now then we had the pandemic, which made everything worse. And France in particularly has had a problem in braining and spending over the past few years. Now that's due to a mix of factors including slippadge by local authorities, growing
spending in pensions and disappointing tax revenues. And the government's plan is quite ambitious. It's committed to that. I mean, obviously the politics of it are quite difficult, as Antonio said, but I would just flag that we also just don't know where these savings beyond twenty twenty six are going to come from, because in the medium term structural plans that France sent to the Commission, and by the way, this is not a friend's only problem. It's a problem
across all the governments. They send sort of the debt deficity targets that they want to reach in five to seven years, but they just haven't detailed the tax and spending decisions that will underpin those targets. So the plans are really not credible.
Well, let's discuss that further, Antonio. I mean, it was unusual to see the French Prime Minister lay out the first draft of his spending plans quite early in the summer. There was lots of unpopular proposals, and it's like cutting two public holidays for example. What chances are there really being able to get a compromise on a budget for France.
Well, just like last year were essentially the government collapsed over the budget and then last minute emergency budget had to be approved. I think it's going to be very hard for the government to get the budget passed. In a survey that was done in July by French poster Elab, you could see that seventy two percent of respondents said that, you know, they acknowledged that dead must be reduced, but that the efforts been demanded by the budget by the
government are too great. Right, So it's not a popular budget. Also same survey, sixty six percent of respondents say that they want the position parties to file and no confidence motion is the government right, So you can see it's not a particularly popular budget and you know, the challenge of the fact that you need to really engage in physical consolidation to reduce the budget deficit is compounded by the lack of parliamentary majority. But that doesn't mean that
the government cannot make some concessions. In fact, I don't think the current the budget in this current form might be able to be passed, but I think the government can provides certain concessions to at least have a chance to get it approved by opposition parties.
And Antonio because we're thinking about this in the context of this upcoming business conference, where of course employers and business leaders are going to be very worried about what it could mean for them fiscally. They've previously been asked to give larger contributions in terms of payroll taxes towards the French budget. I mean, how worried do employers and perhaps citizens have to be about tax ris as being part of an eventual budget package in France.
Well, I think that depends on the final compromise that the government, if they can get a compromise, that the form of that that will take. So, as I said, I think there is room for concessions and I think that's, by the way, probably why the initial draft of the budget looks so tough, because I think the strategy of Prime Minister consul who is essentially to present a very tough budget and then leave room to negotiate with opposition parties.
But obviously consolidation physical consolidation is never popular, so the problem is that opposition parties do not want to be associated with the consolidation efforts. That being said, if you look in terms of potential compromises. So last year, the previous government of Prime Minister Darnie tried to make concessions to the far right National Rally Party of my Elepen and then that backfire in the end, actually a no confidence motion, as I said, was voted and the government
ended up collapsing. So I think the government is not going to look at its right, rather, in my look towards its left when you have the Socialist Party which has rejected the budget in its current form. But I think the strut might be to try to offer some concessions on what the Socialists called physical gassis, which is essentially increase taxes on the highest earners in the country.
So I think ultimately you might see some concessions that might look like tax increases, even though the government would try to keep those at a minimum because Macone and by who are really fixated or not increasing taxes. But that might be an area. But you might find some concessions that might lead ultimately to the plole of the budget.
And in terms of the broader economic outlook for France and for the euro Area, I mean, what should we be watching out for. I suppose the potential petfalls as policymakers are considering what effect their decisions might have on the economic trajectory for the country.
Yeah, I mean growth in France in your area hasn't been spectacular over the past few years, but I would say that given all the shocks that the currency block has been hit by, I think it has been holding up fairly recently. Of course, you know there's a big utrogenerity bit across your area. We have spaying grecent Portugal really experiencing dicent growth runs, while Germany barely growing. France
is somewhere in the middle. And now when I think about the outlook over the next few years, I think it's going to be essentially shaped by three things. One is fiscal and in that i'm including, you know, the defense spending. The other is obviously US tariffs, and the third one is the euro appreciation. Now, the ear area had a strong start at the beginning of the year. Essentially that was due to front floating ahead of the US tariffs, and that should ensure that growth is above
one percent this year. But the base of growth, at least in our forecast, we expect it to moderate over the coming quarters to around point two point three percent, which is really below trend, and for twenty twenty six we expect zero point eight percent. Now, it could be worse, and it could be worse generally for your area if we hadn't had this sort of fiscal listening coming from Germany. Germany is has engaged on spending splurge in infrastructure and defense,
which we expect to start fitting through next year. But I would say that's sort of that fiscal loosening is really a story that's contained to Germany because in other countries, as Antoni just now said, The trend in France and in Italy for instance, is one of fiscal tightening, so the support from that will be modest. And then the big question is how tariff's and uncertainty will play out.
Tariffs will affect all countries, obviously to different extents, and we expect I mean, we've had a trade deal being reached which sort of maybe provide some stability, but taken together with uncertainty, we still expect that to drag on growth. And we're actually expecting a point four percent heat to the level of GDP at peak, so you know, there will be some growth, but it will be modest and sort of you know, brought down by taris and uncertainty overall.
Okay, Antonio Burrows, our senior geo economics analyst for Europe, and our European economist Anna Andrada, thank you to you both for helping set us up for what is expected to be a long debate over the French budget and the European budget cycle to come. I'm Stephen Caroll in London.
You can catch us every weekday morning here for Bloomberg Daybreak here at beginning at six am in London and one am on Wall Street, Tom, Thank you, Steven, and coming up on Bloomberg day Break Weekend, we'll look ahead to a monetary policy decision from the Bank of Korea. I'm Tom Busby 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 Tom Busby in New York. South Korea's Central Bank faces a tough call on rates next week. Economists are divided over whether the BOK will extend its easing cycle or keep the current two point five percent rate unchanged. For more, let's get to the host of the Daybreak Asia podcast, Doug Krisner.
Tom.
South Korea's economy rebounded in the second quarter, although recently the Governor of the Bank of Korea Ri Chang Yong said it still faces high levels of uncertainty as a result of US trade policy. Now, trade is just one of many factors the BOK will have to consider in the week ahead. For a closer look, I'm joined by Bloomberg's Brian Fowler. He is senior Asia ecogov editor for Bloomberg News, joining us in the Japanese capital of Tokyo. Thank you so much. For making time to chat with me.
As I recall the BOK meeting in July when the policy rate was held steady at two and a half percent. At the time, Governory seemed to keep the door open to a rate cut this month. Has anything changed between then and now.
Well, Doug, so he definitely kept the door open to a cut. He said at the time that four of the board members, that's four out of seven, were open to a rate cut sometime in the next three months. And that's a pretty clear signal that the BIAS is towards further easing, and probably further easing pretty much in the short term. He also cited concerns about household debt and the housing market and soul and that tends to raise the risk of financial imbalances and that's something he
wants to keep an eye on. And I think another reason why the BOK began its pause in June and July is that there were fading thoughts of the FED easing policy and the BOK tends to want to move in lockstep with the Fed in order to avoid putting downward pressure on the wand the one was the weakest major currency against the dollar of last year. And that repped up inflationary pressure. So that's one thing they want to keep an eye on.
So when you look at the household debt story, I'm curious, is that more likely to be concentrated in mortgage lending or are there other forms of borrowing that may trouble the Bank of Korea.
Mortgage lending is absolutely the key fact there because that's driven by the housing market in Sol when it's hot, and that people tend to borrow money to speculate on that market. And we've seen housing prices rise now in Sel for twenty eight consecutive weeks. But on the other hand, the pace of increase has slowed after the government took some steps to cool demand, including putting some restrictions on mortgage lending.
So where do we find the inflation story right now in South Korea? I know that the recent numbers on consumer prices earlier in the month seemed to suggest a bit of deceleration. And I just saw the recent print on producer prices. They advanced at an annual rate in July by a half of one percent. Is that considered hot?
That consumer inflation is a little bit hot? Consumer prices rose two point one percent in July. The BOK has a target of two percent, and core inflation rose two so it's right about at the Bok's target. I think going forward, the BOKA wants to see if the tariffs have an inflationary impact impact on prices and if that feeds into the economy were broadly.
So, the tariff story is obviously a key part of the trade story, and when I think of South Korea, I think of not only automobiles, semiconductors as well. How have trade flows been, especially to the US in light of these tariffs.
We had some early trade data for August showing that exports to the US have started to fall until now we had actually we had a lot of front loading, so exports held up relatively well. Also, companies like Samsung electronics tech sector did pretty well because the Trump administration puts some exclusions on consumer electronic goods and that's helped
put a floor under those exports. Also, of course, the supply chain relationships with Apple of help, as Apple has managed to win some exemptions going forward, though, as you mentioned, I mean, the outlook is pretty cloudy. Trump has threatened to put new tariffs on chips by the end of this month, and that would be a huge threat to South Korea's economy because it relies very heavily on trade, and in particular on trade of semiconductors.
So when you think of sentiment on both the business side and the consumer side, what's it been like. How are people feeling.
I think they're feeling a little bit worried about how things are going. The Bank of Korea's GDP forecast for this year calls for zero point nine percent growth. That would be the weakest performance since the pandemic, when the economy contracted in twenty twenty. And I think people are thinking this the shoe is is about to drop. It hasn't really dropped thus far, and there's concern about how things happen, how things in full from August on now.
I know recently within the last several months, there's been a little bit of turbulence on the political side in South Korea. Have things calmed down right now to help maybe support the idea that the Bok has a little bit more flexibility to do its job and not to be distracted by political developments.
Definitely. The new administration got started obviously in early June, and that's taken away a huge source of uncertainty. Lee so far has done his best to first of all put aside any sort of concerns about diplomatic spats with Japan, and I think that's he's looking confident, and that's meaning that the government can come through with fiscal stimulus if it feels that it needs to.
That is Brian Fowler. He is senior Asia ecogov editor for Bloomberg News. Joining from our studios in Tokyo, let's pivot to one of the most important equity markets in Asia. Hong Kong Exchanges and Clearing posted record quarterly again of forty one percent. Trading surged with average daily turnover nearly doubling, and new listings rebounded, with IPO applications topping two hundred.
The exchange of CEO is Bonnie Chan, and she recently told Bloomberg how she is optimistic about international investors returning to Chinese assets and how that will keep momentum strong. Here is part of chance conversation with Bloomberg zivonn Man.
Another quarter of record profit. You have trading that's been booming and now more than two hundred active applications on the pipeline. What stood out to you for this quarter.
You know what really stands out for me for this quarter is the fact that it's writing on a pretty sustained momentum. If you look at our results, this is actually another set of record half yearly results. We deliver a pretty strong a pretty strong set already for the
second half of twenty twenty four. And so for me, my biggest takeaway is that actually, since I think September twenty twenty four, gradually we're seeing a return of interest from international investors and they want to again look for opportunities to deploy more capital to this part of the world. You see it, I think manifested in many ways in our daily turnover, but also I think you know in the way that all these investors around the world are participating in our IPOs.
The key question is it's sustainable. You mentioned about average daily turnover, which you nearly double from a year ago. Obviously with liquidity it has been quite ample. With these sell bound flows. What could extend the streak?
Right?
International investors are really again focusing on China assets, and I think as they try to come back to treasure hunt, it is a very good thing that we have equally a robust pipeline to match their appetite. I think that
is very very important. So you mentioned our pipeline. We're currently over two hundred companies already having filed their applications, and in fact, you know, on a daily basis, I'm speaking to a lot more so I think, you know, with the backdrop of you know, really the interest returning in earnest as well as you know, all these very exciting investment opportunities coming online, I do hope that the momentum can carry on.
How confident are you the Hong Kong can reclaim the number one IPO venue this year?
Yeah? People always ask me that question. I think it's certainly good to be sort of all the way at the top of the league table. I mean, at the moment, we're in a very good position, and we do have the pipeline to help us deliver and help us stay stay up there. But you know, to me, the more important thing really is to make sure that we able
to support the fundraising needs of these companies. And this year, I keep talking about the IPO pipeline, I think we also need to look at the follow on fundraising, which in fact has raised more money than the IPO proceeds. So yeah, today we have raised about sixteen billion US dollars close to seventeen for you by way of IPOs, but we have actually more than forty billion NEUS dollars
raised by companies already listed on our exchange. So to me, so long as we continue to support the fundraising needs of these companies, we continue to improve our listing framework.
Are you still doing a lot of marketing or do you think companies are starting to come to you now?
I think both.
I mean companies certainly, I think saw how well we've done in the IPO space, and so I think on the average I probably need two to three companies per day or to you know, wanting to understand more what we have to offer, and I want to expand the universe a little bit. I think it's very encouraging that in the past few months we have seen an increased appetite of companies beyond just the mainland China wanting to use Hong Kong as their or pick Hong Kong as their listening venue.
We've seen a bit of a quiet resurgence in the Asian market and the IPO market. There seems to be coming back to life right again as well, What does the rebound in Shanghai and Shanxen mean for the pipeline here.
I think that will be very, very encouraging because the way I see it, we always say the capital markets is there to serve the real economy. So the fact that capital markets are doing well, you know, should suggest that actually, you know, there's a lot of positive momentum in the real economy as well. China is a big country. It is producing a lot of very exciting investment opportunities.
I mean, you see our pipeline, right, it's really felled with a lot of excitement and then certainly enough for more than just Hong Kong to support. And I think increasingly I'm seeing the you know, the few exchanges in China, right, So Shanghai, Shinjin, Beijing and the Hong Kong market really playing a very complimentary role. Now for Hong Kong, I think one advantage we have is certainly the connection to
the rest of the world. And therefore, for a lot of companies when they decide to pick which venue to list, one thing which will gravitate them towards Hong Kong is if they have overseas expansion plans, and we actually saw that in a lot of companies which have been listed in the past few months. They want to raise proceeds. They want to therefore use the proceeds to expand overseas, and I think that is one thing which Hong Kong can actually serve the best.
That was Bonni Chan, she is the CEO of Hong Kong Exchanges and Clearing, speaking with Bloomberg TV host Yvonne Mann and I'm Doug Chrisner. You can catch us weekdays for the Daybreak Asia podcast. It's available wherever you get your podcast.
Tom, Thank you, 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 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.