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tv   Trending Business  Bloomberg  February 14, 2016 8:00pm-10:01pm EST

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>> good morning. this is trending business. live in tokyand singapore, here is what we're wching is morning with the rebound underway and asian stocks inlying from their lowest three years. japan is rising. ante, breaking the
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silence and saying that there is no basis for the continuing depreciation. assessing and not much -- abenomics, three years in, has the programs finally failed? you can let us know by following me on twitter and do not forget to include the #. the chinese and hong kong markets get underway and singapore, taiwan, and malaysia and they remember that's. this is the past couple of would have the withgs of a recovery rally
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1% in the open. region,he rest of the it was the worst rout that we had seen. and a veryedible low different feature today. andre seeing the gold gains and energy resources named in new zealand. it is a big gainer, in terms of delivery.
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crude coming a little bit in this session. mind the gains are in the u.s. and will carry through in asia. 22. a look at there is a rally ahead of now. the numbers are going well and and weexpecting exports are looking forward to the opening in 30 minutes or so. say they have catch-up to do to meet the rest of the markets.
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and it is ahead of the china opening. the efforts to say that there is no basis to send the yuan down further. what did joe say? in about 10 minutes time, we are seeing the comments. the article offered of a slew of reassurances that china is seeking stability in the markets and there is no basis for the continued depreciation's and they said it is stable against a
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basket of currencies. the capital outflows are normal, outflows last year. they dismissed speculation and he said there is no need to worry about a decline. in a fewe watching minutes time with the onshore sawency appreciating and we the chinese markets were closed and offshore appreciated over that. raise thelemma is to dollarday to match the dropped, undoing the dollar
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depreciation. worsenrast, this could the global sentiment and the global confidence in the handling. >> thank you. we will take a look at that later in the show. we want your opinions. please tweet at us. the japanese economy expanded 1.4 percentnk by tokyo.r more, here is from thenot break contraction and expansion. >> that is right. these were worse than expected and are the second contraction
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after they had revised the quarter up and the second was also a contraction. these were a business investment and the consumption was down, a big concern. see what thed to driver of the economy will be, even with record profits. year numbers were for last forthe yen had appreciated the month and, with that, you start to think about companies and you see the market up on a sentiment with the bank of japan to do further easing and we will hear from the governor and we
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may get some indications of what comes next. >> thank you. at what we areok watching today. finally, a decision. >> they are keeping the headquarters in london and they posted does pointed to the legal complexnd handling international affairs. the importance of asia and said that they are looking at moving the headquarters to hong kong. tax,he and issues of financial regulations, and the brexit.ity of a
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they say they will look at the merger, if there is an extension of circumstances. alibaba is now the fourth biggest shareholder in groupon. they purchased 33 million shares and the filing showed they were in onlinekes retailers and magic leap. they went public more than four years ago. the results the estimates last week given by the buyers. for sharp. in paper says they could buy they asked for a
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commitment to maintain staff levels. they are up against japan. website, we are looking at the challenges and, coming up later, all of the action as the chinese markets return from the break and we look at the currency dilemmas. outnext guest says to watch for statements from the bank of japan as the yen continues to strengthen.
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>> the central banks are in the headlines today. there is imminent interest rate ins on tuesday with a yield sovereign debts dropping the rate. exports slumped the most and to seeonomists we spoke them the staying on old, after lowering the benchmarks. signals that he is in a waiting mode. there is a chance they lower the a record lowh and of 1.66 with in a year. the aussie dollar strengthens considerably.
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and, the bank of japan is discussing the market turmoil. the deputy governor says the rank is expanding assets purchases. there is talk of a coordinated response by policy makers. finance ministers and central bankers gather next week. joining us is the senior strategist. good morning and thank you for joining us. there are rumors of a coordinated response. what does that mean? >> it is unlikely that we will see it, in terms of intervention. it is rare that you get central banks to agree on that, really.
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you have to go back to the support for the euro and it was haphazard, in terms of contribution. what we could expect is the thatment from policymakers volatility is something they are concerned about and they are giving some cover to the bank of japan to support the dollar yen of it is in the interests reducing volatility. think spending, after a certain level, bodes well with countries. could we see intervention to prevent more volatility? andhat is what it would be divorcedave seen is
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from economic fundamentals and asset markets have not justified that. they have not collapse, in terms of equity. there is a structural stress and it would improve market and it seems to be a higher yield. >> investment companies have been changing for a while. why have we seen the yen surge and where did the dollar strength to go? bed as been since the december meeting and they were
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cutting back aggressively mainst currency from the euro positions against the euro over the past couple of months. the markets are doubting the outlook and it is possible that just what we not see in the asset markets. ratesare now seeing a what is your take on the income rate their and words you see it going? 6.5.other
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6.51. yes. wey had a weaker dollar and will get more of that in the the weaker dollar givess the decline and the u.s. dollar a chance to recover with interest rates later in the year and it will andupward pressure on china you are talking about maybe higher there. >> thanks a lot. now, a story making headlines are the world is that taiwan has ended the search.
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them were found in the golden dragon apartment complex that collapsed in the quake. the developer and two architects followingarrested, the accusations that quarters were cut. >> china is calling to formally end hostilities with north korea. the two sides remain at war. the head of the committee says that beijing is annoyed about the nuclear program and is concerned about american response. security in the cells china sea is expected to be on the agenda as leaders meet over a.
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they stressed the need for navigation and filed the international arbitration case and beijing refused to recognize or participates in the proceedings. journalists,00 this is bloomberg news. changing perceptions. we will look at what the indonesian president is doing with the transpacific partnership when trending business returns.
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>> welcome back. hadindonesian president has
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an up and down first year in office and struggle to impose his grip on politics. and hepublic spats enjoys the approval rating of 67%. speaking exclusively to cause n, there are issues. >> we have egg good relationship with political parties and parliaments and there was no problem with the revision of the budget. the support for the government has been good. >> did you underestimate the influence in the groups? >> in my opinion, it is about how you communicate and it is important to maintain good
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communications with parliament. >> we spoke to a trade minister about how the transpacific partnership affects plans to boost growth. >> we have made progress and have a long way to go. markets that are in somet shape and there are experiencing contractions of 5% , hopefully, 5.1%. again, one thing at a time. you do not get there by teleporting and the president reassuresurer -- investors that we will modernize and simplify the rules and
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regulations to get them in line with international best practices. >> the president expressed interest in joining the tpp. stomach fighting interest groups? >> a lot of the protectionist from business elites . that they would have to execute one of the sharpest u-turns in policy. >> i would say that we are 15% into this and what we have done is changed the mindset and the
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way the executive branch of the government thinks about the positioning and i think you can ask world bank and a lot of most experts who are the protectionist regimes. change made measures to mindsets that that is wrong and .hat we want to qualify >> that was the indonesian trade minister speaking to has haslinda amin. china return to the fray after the break. ?ill we see a selloff i will have the opening numbers after this, when trending
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business returns.
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>>. top stories trending, japanese stocks are surging despite weaker than expected gdp. the economy shrank an annualized 1.4%, more than previous estimates. prime minister shinzo abe has been trying to boost inflation by encouraging consumption by private spending affected the economy. the pdr ca governor has broken his silence on the yuan and says
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there is no basis for its continued depreciation. capital outflows are normal in the exchange rate is stable. speculates that china will tighten controls in insisted they are ample .ithholdings for payments hsbc has decided to keep its global headquarters in london saying the u.k. is an important and globally connected economy. the decision was passed unanimously on sunday following months of debate. hsbc has been based there for 23 years and says remaining there is the best option for both customers and shareholders. , who isrn to heidi monitoring the market openings in shanghai and hong kong. how is it looking? i'm just refreshing to see
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whether we will see a bounce at the open. mainland markets not playing along with the regional recovery rally. shanghai, down. a lot of selling coming through from mainland markets. the only other market in the red , taiwanese stocks. elsewhere, we are seeing a strong rally being led by japan. tokyo stocks up. the nikkei was down close to 11% last week. we are seeing that recovery. a number of markets are starting to look quite oversold. we are seeing quite a bit of recovery when it comes regionally. we also have that move, setting the yuan higher.
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>> thank you. the pboc has said they are fixing rates on the yuan higher, reflecting the currency's weakness. stephen engle has been looking at the developments. >> they had a dilemma coming into today. they were off last week and the shore.d not trade on offshore, it strengthened because the dollar weakened by nearly 1%. had a fixing rate 15 minutes ago, they had that dilemma -- to match to reflect the weakness of the dollar? ?du let it continue to fall -- or do you let it continue to fall? what they did is better than economists expected. 6.5118%.was set at
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it is the biggest gain in about three months. it was almost double expectations. a little bit of a confidence-boosting measure from the pboc. however c,nh is the offshore rate. it is weakening further. change the page and we can see the divergence between the onshore and offshore, how the chart shows what had happened over the previous week -- if we can change that. ?ou know why it is not working i set it up before the market opened. i want to run through those comments. >> it is finally out.
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>> i have been raising this question for a long time. >> joe is back now. articleast in a print on saturday, saying a number of interesting things, trying to reassure the market as we come out of the holiday. there is the chart. they are coming back close r together after the holiday. the cnh is starting to strengthen. >> the yuan is tricky for the pboc. see his statements. he says there is no basis for continued yuan depreciation because they had been getting mixed signals. it was devalued in august, then they spent the next months
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defending the currency. he says capital outflows are there was a though trillion dollars estimated. the exchange rate is basically stable, he says. he dismissed speculation that china planned to tighten capital control. he also says, no need to work about short-term compliance in reserves. he says china has plenty of reserves to keep the yuan stable. >> thank you. back to our other top story, contracting once again preliminary numbers showing growth hit a major snag in the last three months of 2015. >> the point is this. we already knew that this fourth quarter was going to be bad because most parts of the economy cooled down. atnks to our colleagues
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bloomberg intelligence, we have this wonderful chart, looking at growth over the last 10 years. this box that you see right here -- really hitting a snag. 1.4% contraction. let's break this down. we have to get a better understanding of where the problem is. it was actually consumption, the biggest component of growth in point 8%my, shrinking -- 0.8%. the other pillars of the economy are not exactly firing on all cylinders. looking at exports, the second-biggest component of growth you have to consider when you look at net
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exports because japan actually managed a trade surplus in the fourth quarter because of cheaper oil imports. so the net contribution to the gdp from net exports was 0.1% to not a lot, but it helps if the economy is shrinking. the third biggest component of growth, spending. corporate japan. are they confident enough to go beyond dividends, beyond by inks, and really invest increased capacity? this was actually the bright spot. 1.4%, about 1/8 of the economy. 14%-15% of overall output. instilling some sort of confidence. if you look at what is happening
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right now, what will that do to confidence? the most recent survey suggested that corporate japan was looking at 10.4%-11%. that is very sensitive, related to where we are with the yen. it is hard to imagine that we will see that cap on spending top 11% given the across-the-board deterioration. on the question of which part of the economy will drive growth this quarter, maybe consumption? >> thank you for the breakdown. now checking in on some other stories this morning. shares finishing higher in new york after receiving an video-sharing
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company. say that would allow privatization before seeking an ipo in china where the brand has strong recognition. jack dorsey is reporting some of his deputies with stock after giving them extra responsibilities following high-level departures. bain and at a messenger have all been given equity with which will invest over four years. they took on a larger roles after five executives left in january or twitter shares are down 31% this year. wait one dayad to for his bet on jpmorgan to pay off. after buying $26 million of stock on thursday, he saw his net worth rise by $2.2 million
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as shares jumped more than 8%. the singapore airshow is underway amid warnings that carriers may delay deliveries of new planes. there is a bright spot, boeing and airbus expect chinese airlines to order nearly $1 trillion worth of new planes in the next two decades. amin is at the show. there is still confidence? give itabsolutely despite the slowdown, air travel demand in china is actually rising. take a look at the numbers. it is actually going gangbusters. china expected to order more than 6000 planes over the next two decades. $980 billion -- that is twice
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the value of singapore's gdp. imagine that you the government will be building about 66 new airports. that shows the demand in air travel is rising. you have heard about southeast asia, some airlines ending operations. others are mired in financial difficulties, like tiger airways. they have delay deliveries of their planes. airasia comes to mind, as well as malaysia airlines, which is undergoing restructuring after losses. at discrepancy in how the chinese aviation sector looks compared to the rest of southeast asia. the mood has suddenly changed. >> what is hurting the growth of southeast asian airlines then? overcapacity.
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intense competition. under 10 years of growth, southeast asia is finally slowing down. ,hen you talk about competition low-cost carriers account for about 55% of the market. that is the biggest market share in the world when it comes to the aviation industry and that is trickling down a comes to profitability. in terms of profitability, airlines here are just five dollars per passenger versus what we see in north america, which is $21. the intense competition is not helping. thanks a lot for that. business,on trending ubs world management takes on their world market turmoil.
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.> impact the united nations says civilian casualties from violence in afghanistan hit a record last year, the highest total since
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records began in 2009. more than 11,000 killed or wounded, a 4% rise from the year earlier. attacks have grown since u.s.-led forces enter their combat mission in 2000 15. security has deteriorated as the control.xpands india says it is disappointed with america's decision to sell f-16 fighters to pakistan saying such a deal would not help the fight against terrorism to washington has confirmed the $700 million deal and radarudes playing equipment. india is worried that giving pakistan -- able to the military balance in the region. that the former volkswagen chief was told about the emissions devices as long ago as may 2014. the newspaper says a vw staffer wrote to the then ceo to say the
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company couldn't provide an explanation for elevated nitrogen dioxide levels in that u.s. regulators would investigate. vw admitted last september that some engines have been fitted with suffer to beat emissions testing. news.s bloomberg it is back to business today in china and markets are looking like this, falling for the second consecutive session after coming back from that week long new year holiday or the shanghai composite down 2.4% of the hang seng index losing 2.8%. onshore yuan surging against the dollar, gaining by the most since 2007. we had a daily fixing rate this morning. let's bring a ubs world management now be a good
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morning. let me get started with chinese markets because they are playing catch-up. how far can they fall in wendy you start buying into the dip? what we are currently seeking is that they follow the global cues. .e are moving in on that maybe it is a bit cynical. he usually you have the world market taking their cues from china. in interesting take away while the markets were closed is really what not happen in china, but what happened in the u.s. with this is yellen -- with janet yellen taking her foot off the rate hike pedal. that puts us in an interesting .osition on the currency side you have a decelerating economy in china but it looks at the
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u.s. economy is not falling into a recession, the growth is starting to decelerate. the can take pressure off pboc on the currency side somebody they don't have to they did as much as previously to the extent that this has influenced the stock .arkets on the downside fear about the magnitude of the intervention could be helpful over the next couple of weeks. >> what is interesting is that you speak about the u.s. causing ent last week -- had you stop this downward spiral? what is the circuit breaker here? for ais not that unusual ms. cycle scenario. -- mid-cycle scenario. growth isum of the
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not as strong anymore, we're not really accelerating anywhere anymore. i would absolutely agree, sometimes it is oil, sometimes it is china -- there is always a different corporate. markets are a bit nervous but they also cannot pin down what they see is the ultimate corp. -- corporate. -- culprit. wage inflation has already started, maybe we will see more of that. i don't think it would take that much for this situation to calm down. is rising today but for the first time since abenomics began. end ofthink it is the
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the abenomics rally that we have seen in the last three years? think abenomics with with a currency is right now is increasingly getting called into or at least the bank of japan is worried about it which leads us to believe that, at current levels, and the next or, should we really move toward the 110 level, we could see an outright intervention. abe is probably starting to worry about the achievements so far that they had in abenomics. backaluation is actually to cheaper levels where they were before he came in. they want to do more on currency weakness again. betsickly, south korea,
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are rising that they will cut rates. where are equities heading? don'tour estimates, we have rates. not right now here in south korea, overall, certainly a cheap market that we prefer other markets. we have an outright play on china. this is where we think the cash flows first. the micro in china is going to improve visibly during the year. >> thank you so much. next, just how valuable it is an endorsement from lebron james? ♪
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>> time for a look at what is trending on social media. you are looking at lebron james. topping lists on social media. >> he currently is playing in the nba all-stars game. he is marked as the top layer in the nba with the top digital value. mark burns has cited the index saying his digital value is worth more than $15 million across google, facebook, instagram, and youtube. he is followed by jeremy lin and kobe bryant. they look at the number of followers they have, how may times they post or tweet, how
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often the athlete is mentioned on social media and how they rate against others in their sport. he wouldn't, for example, be rated against a football player. >> it says it tracks 24,000 athletes and 60,000 social all affect theg value so that if you are company looking for a sports store to help promote something, you can see what this player is worth forbes reports of the total social media value of nba stars is $47.3 million. >> what a comeback for lebron wass, can because there some controversy with him. thanks a lot for that. now looking at the next hour of trending business, we are back at the singapore airshow looking st aviation in 2016 and yatta'
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tony tyler. the latest when trending business returns. ♪
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>> good morning. it is monday, the 15th of february. i am shery ahn, and this is "trending business." ♪ shery: here is what we are watching this morning. gaining ground -- asian markets rally from their lowest in three years with tokyo rising more than 5%. china falls on its return to trade. japan disappoints as the economy contracts even more than expected.
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three years in, has the prime minister failed? winsn calling -- the u.k. a clash with hsbc deciding to stay put. chairman douglas flint says asia remains at the heart of strategy. let us know what you think of the top stories by following me on twitter. don't forget to include #trendingbusiness. trading in indonesia is underway, but a focused today on china as they return after that week long holiday. how is it looking? the chinese markets are doing their own thing in the worst possible way, playing catch-up after being off on the china new year's break. straight to the downside. shanghai's decline in over 2% at the moment. elsewhere, we are seeing a rally from southeast asia, it being led by japanese markets. . tumble of over 11% last week
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we are clawing back some of that this week. financials have been battered down to the tune of 25% apiece. the bank of japan announced its policy. interest rate having said that, we did get that disappointing gdp number out of japan. that seems to have translated into support for more stimulus. crucially, that shinzo abe will not be able to put through that sales tax as planned. we are seeing miners leading the gains when it comes to stocks, the afx 100 up over 1%. taiwan, just getting into the green after starting the day off a little bit lower. i do want to talk about currencies. we are seeing an interesting divergence when it comes to the chinese currency. the people's bank of china,
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setting the one higher 3/10 of 1%. onshore renminbi, trading at 6.5168, off 9/10 of 1% through this is the most we've seen since 2007. offshore yuan is going in the opposite direction. we were up by 4/10 of 1% at one stage. basically traveling in two completely different directions. we are seeing some yen weakness, really driving the risk on appetite when it comes to the tokyo markets here it we have resurgent yen strength carrying through -- markets. strengthesurgent yuan carrying through. that momentum seems to have halted somewhat. having said that, we are sitting , 113.59.13 handle
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these are the movers that we are watching today. as i said, the financials, mitsubishi, nomura, sony , 4/10 of 11 these stocks have been badly beaten down on the back of that bank of japan decision to go negative. these are the currency-sensitive stocks, mazda up by over 6%. yamaha, off its intraday high, up as much as 18%, the most since march of 2011, operating income coming in at 40% higher. that yen little bit of of fact but also some good earnings continuing to come through come in particular for the auto and export sector.
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shery: let's go back to china. president xi says there is no basis for sending the yuan down further. stephen engle has been looking at what the pboc chief had to say. stephen: i want to pick up on thee haidi mentioned about fixing rate. as i sit at the terminal waiting for the latest trade numbers we are going to get, exports and imports, possibly money supply numbers, as well as aggregate financing. we are still awaiting those numbers from beijing if they do indeed come out. right now, the pboc earlier this morning said the daily yuan rate is at a six-week high. the onshore yuan, now trading sharply higher against the dollar, reflecting dollar weakness that we saw over the past week when china was on
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holiday. isnwhile, the offshore yuan weakening as the discrepancy that built up over the holiday starts to narrow. governoryou said, pboc iata has been often new -- advice, up a slew of saying the exchange rate is basically stable. he says capital outflows in his estimation are normal, despite the estimated record $1 trillion in outflows last year, that according to bloomberg intelligence. zhou dismissed speculation that china plans to tighten capital controls, and he says there is no need to worry about a short-term decline in fx reserves. the dilemma going forward for zhou and the pboc is, what signals are you going to send to the market with your daily
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fixing right now that the holiday operations are rectifying? weakening could worsen the global market sentiment. it's going to be a wild ride this week as china comes back onto the global market scene. shery: thanks for that, steve. japan's economy contracted more than expected in the final three months of 2015. point 4%k by one compared to estimates for 0.8%. for more, here is japan economy editor jodi schneider in tokyo. can seem to break out of this cycle of expansion and contraction. what is happening with abenomics? : the numbers today for the gdp for the fourth quarter were worse than expected, and a lot thehat was driving that was
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personal consumption number, personal inventories. that was down more than anticipated. what we are seeing is two quarters for 2015 of contraction . the third quarter was revised up after earlier having been labeled a contraction, but it was revised. these are sobering numbers about abenomics. we are not seeing the kind of gains that have been forcing. the other thing that economists say is concerning is that since these numbers came out, we have seen the global market rout, and we have seen the strengthening of the yen, which is going to have an effect on corporate profits, which had been doing very well with a weak yen. that is something to watch for when we start getting numbers in the spring about this quarter. .ll eyes on the boj we are seeing the markets up, partly in japan, on thinking
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that maybe the boj will further ease. they don't meet again until march 15 and 16. the markets are certainly taking that into account. shery: thanks so much, jodi schneider. let's go back to stephen engle because we have breaking news. china's latest trade figures are out. stephen: we do have the trade figures out. they are quite a bit worse than expected. these are the trade figures in yuan terms, which is important because of the weakness we have year overyear over year, down 6.6%. increase.pecting an the previous month had seen gain. even though 2015 saw the first annual decline in exports since 2009. looking at imports, which is a
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key indicator of domestic demand, we are seeing a fall in yuan terms of 14.4%. we were expecting an increase of 1.8%. the previous month was a decline of 4%. exports down 6% year-over-year inyuan terms and down 14.4% yuan terms. a trade surplus of $406.2 billion. we were expecting $389 million -- $389 billion. worse than expected exports, worse than expected imports. you shery:. thanks a lot for that. some disappointing numbers out of china, expecting to raise concerns about the economy. let's take a look at some of the other stories we are watching. here is roz starting us off with hsbc. hsbc has decided it is
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keeping its headquarters in london. in a statement, the bank pointed to the u.k.'s "respected regulatory framework and legal system and experience in handling international affairs."it's as remaining in london is the best decision for customers and shareholders. the importance of asia. the bank is discussing a new headquarters. it has been looking at issues such as tax, financial regulations, and the outcome of a brexit. hsbc said it would no longer review the location of its headquarters every three years and would look at the matter if there was "immaterial change in circumstances." alibaba is extending its reach --o the e=retailing w e-retailing world. the filing shows alibaba was
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buying elsewhere, snapping up andes in, lyft, magic leap. groupon shares have lost 86% of their value since going public more than four years ago. the company has struggled to reach growth and profits, but results beat estimates last week, driven by buyers in north america. softbank could become involved in foxconn's bid for sharp. the nikkei reports they could form an alliance with softbank taking up to a 20% stake. could said the ceo buy into sharp directly, as well. foxconn is up against japan's inc. j. shery: looking ahead on the show, nba superstar lebron james is making big bucks during his
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free time. you will see how he is cashing in. we read tooe say much into the chinese turmoil this year. we will find out why when "trending business returns. "♪
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shery: let's recap trade numbers out of china. the surplus for january was wider than expected as over $400 billion. both exports and imports fell a lot farther than we had expected. china's trade data, disappointing. we saw the surplus coming in at 406.2 billion yuan, higher than economists had expected. let's get reaction from richard jeremy, chief economist at the bank of singapore.thank you for joining us. give us your take on today's
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trade figures. was this what you were expecting yet the richard -- expecting? in termsthey were poor of showing declines in exports and imports. the caveat to these numbers is related to china and this time of the year. is related to china and this time of the year. they don't release a lot of the january data. they tend to lump it in with february data. there is so much volatility year on year. i think the market won't take it to negatively. there will be suspicion about what it reveals in terms of the trend. is this a signal of china's devaluation since august not really working when it comes to their factories? [no audio]
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shery: what about china's monetary conditions? we had data showing a new credit surge in january. could these flush monetary conditions be a buffer for the chinese economy? yeah, i think that is probably right. on have seen them loosening a terry policy over the past year as a way to try to create -- monetary policy over the past year as a way to try to create a cushion. they are hunting for growth. you have seen some fiscal support, as well. they are not panicking. they are not doing what they did after the lehman crisis. if you look at things like the pmi indicators, it suggests they are having crash -- traction. you are seeing the stabilization in a lot of these measures.
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i think the policy has been reasonably effective. shery: how about cash injections. we have seen so many cash injections, but what about a triple cut? do you think there should be a more permanent move? richard: yeah, i think we would expect to see more interest rate make sure there is enough liquidity in the system. if you look at interest rates or the credit creation taking place. it suggests policy is quite loose and being fairly effective . i think you will see some marginal loosening efforts over the next six months, but i don't think you are going to see any big policy swings. shery: we of course got japan's gdp figures this morning. again, a shrinking. how does japan get out of this vicious cycle of contraction, expansion? despite all the efforts put forth by abenomics.
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i think you had a new story a month or so back saying it's not so much the economy, it's the quality of the data, and the gdp data is famously poor. you had the economy growing 0%.where between 0.1% and i think it's a mistake to read too much into these indicators. realistically come if you look at some of the more stable measures like business confidence, it tells you the economy is ok, not great. it get gdp bouncing around, up around this stable trend. i think the markets have learned that the japanese gdp is not a great indicator, and they will generally ignore it. shery: let me move to australia and korea. we are seeing traders bet that they will get another interest
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rate cut. could we see another cycle of easing in asia? richard: it's possible. less likely than it was a year ago. we have jobs data for australia later this week that is going to be important. they seem to be comfortable that the domestic economy is doing ok. korea, it's going to be a possibility given the way the world has gone. indonesia we have later this week, as well. there is a decent chance they will cut. i think a rate cut in indonesia is probably the highest probability around the region at the moment. shery: thanks a lot for your time, richard jerram of the bank of singapore. other stories making headlines -- taiwan has ended the search for victims of last week's earthquake. all but two of the dead were found in the 17-story golden
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dragon apartment complex, which collapsed in the quake. the developer and architects have been arrested on suspicion of negligent homicide. that followed accusations that corners were cut during construction. tona has called on the u.s. formally end 76 years of hostility towards north korea in the hope of persuading kim jong-un to give up nuclear weapons. inarmistice was agreed to 1963. the head of china's foreign affairs committee said beijing is annoyed about kim's nuclear program but is more concerned about america's response. maritime security in the south china sea is expected to be on the agenda as asian leaders will meet with president obama and california later today. the philippine president intends to press the issue to stress the need for freedom of navigation. manila has filed a case
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questioning china's right to the artificial reefs, but beijing has refused to participate. powered by over 2400 journalists in 150 bureaus around the world, this is bloomberg news. i'm david engel. shery: coming up, firmly grounded. indonesia's president looks back on his first year in office and gives a favorable verdict. hear what he says after this short break. ♪
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shery: indonesia's president has had an up-and-down first year in office. was criticized for policy initiatives, but he enjoys an approval rating of 67%. has, and exclusively to the president said the problems were just communication issues.
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tospeaking exclusively haslinda, the president said the problems were just can indication issues. >> we have a good relationship with political parties. there was no problem with the approval of the state budget. overall, politically, the support for the government has been good. haslinda: did you underestimate the influence of some interest groups? >> no. in my opinion, it's about how we communicate. it's up to you what you want to say. it's important to maintain good communication with political parties and with parliament. to thewe also spoke trade minister about how the controversy or transpacific partnership affects plans to boost growth. we have made a fair bit of progress, but we have a long way to go. it, we aretive about
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probably in pretty decent shape. there are emerging-market economies that are experiencing -2% year ons of year, and this year, we are posting up to 5%. the 7%that is far from target. >> one thing at a time. you don't get there by teleporting. the present will reinsurer -- reassure investors that we will keep pushing, keep reforming, keep modernizing, keep simplifying rules, regulations to bring them in line with international best practice. : there was an uproar when the president expressed interest in joining tpp. is indonesia ready? can it stomach the likely long fighting interest groups, for instance? >> i think a lot of the
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mentalityist, bunker rhetoric has come from more business elites. why should we be so afraid? why should we be resistant to change? where are you on this specifically? you said indonesia will have to execute one of the sharpest you turns in terms of policies. >> i would say we are probably only 10% or 15% into it. i think what we have done in the last six months is change the tone and mindset, change the way certainly the executive branch of our government thinks about our positioning vis-a-vis the rest of the world. i think you can ask -- ask world bank experts. we were one of the most protectionist regimes.
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to change people's mindset, no, no, that's wrong. we want to be open to qualify for trade agreements with europe, tpp, and the like.
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shery: welcome back. these are the top stories trending this hour. china's trade numbers for january underline the challenges facing the economy. exports fell 6.6% from a year earlier while imports declined 40 15th straight month, leaving a trade surplus of more than $63 billion, the biggest on record. suggest the depreciation has failed to boost the competitiveness of chinese industry.
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the yuan earlier surged by the most in 10 years after the pboc voiced its support and said the fixing at a1-month high. no basis forre was continued depreciation, adding that china's balance of payments is good, outflows are normal, and the yuan is basically stable against a basket of currencies. more doubts about abenomics as japan delivers disappointing data. the economy shrank more than expected in the fourth quarter with weak private consumption as the biggest factor. the yen depreciated 6% this morning, undermining exporters. with a look atdi what is moving the markets this morning. haidi: things are looking marginally better when it comes to the chinese markets. we are seeing -- off the intraday lows we were seeing.
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the shanghai composite, down 7/10 of 1%. having said that, if you look at valuations, it is unsurprising. we are seeing china play catch-up after last week's global selloff. we are seeing valuations when it comes to mainland market shares, still looking very high, particularly if you compare it to emerging market peers. shanghai is down 22% year to date. premium is at about 34%. when it comes to the shenzhen market, they are four times pricier then there emerging market peers. it is unsurprising. having said that, really strong gains throughout the rest of the 5%ion, the nikkei up by after being done 11 then percent -- 11% in last week's selloff. shery: we have breaking news for you.
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china has just released its latest trade data in dollar terms. stephen engle is here. what are you seeing? stephen: these are significant numbers. uptick are seeing is the of what we saw in december, perhaps overstated because of frontloading of exports. we are seeing continued weakness , especially in dollar terms for exports in china today in january, down 11.2%. that is the seventh month in a row and 10th out of the last 11 .onths of exports declining it's much more than expected. the survey of economists was for a fall of 1.8%. inare seeing an 11.2% fall dollar terms for chinese exports in january year over year. the previous month, down 1.4%. it was up in yuan terms. what these numbers are telling
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us is that weakness in the yuan we have seen, including the office -- august devaluation, is not feeding in to the export competitiveness. it does not necessarily reflect increased demand. also, demand internally is continuing to weaken. imports in dollar terms year over year, down 18.8% year over year. the survey was for a fall of 3.6%. this is the 15th month in a row of declining imports. i'm going to bet that these numbers do not do much to boost confidence in the new year for the chinese economy. back to you. shery: thanks for that, steve. more breaking news for you. year's gdp expanded 2.8% over year. we are talking about fourth-quarter gdp figures. the estimate was for 2.4%, so
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that is beating estimates. it's also better than the previous gdp expansion that we saw. fourth-quarter gdp, expanding 2.8% year on year. for the whole year of 2015, the beatingnded 2.8%, analyst forecasts of a growth of 2.7%. it's time not to return to the singapore airshow and the aviation leadership summit. our southeast asia correspondent haslinda amin is there for us. : airlines enjoyed .heir most profitable year ever how solid is this recovery in profitability? airlinee forecasting
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profits of $36.3 billion. that is up quite a bit from $33 billion last year. that forecast was made in december, and we will be updating it in june. down has aice coming large part to play in that. linda: why isn't china a risk to the aviation sector? >> you are right. air travel to and from china is not slowing so much because the economy's weak shape is restructuring itself. we are not seeing china being such a big factor at the moment. structurally, is the aviation sector it better place now than before, or is cheap oil masking some of the weaknesses, problems? >> i think>> we need to keep it in perspective. it's only a profit of $10 per
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passenger. it's regionally divergent. $19.2 billion of that profit is being made in north america. only $6.6 billion in southeast asia. a lot of the impact of the cheap oil -- the impact of cheap oil thebeen less felt in aviation industry than people think for two reasons. one is, a lot of airlines have hedged their fuel exposure. haslinda: bad hedging. >> you hedge in order to smooth out fluctuations. this is costing airlines money at the moment. the dollar has gone up. fuel is paid for in dollars. it hasn't been a bonanza that some people might have thought. haslinda: what assumptions are you making about oil? we use the assumptions of the
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market. we don't make our own assumptions. in december, oil was above $50 a barrel. now it's about $30. we should see some improvement on the upside. clearly, markets have been very skittish in recent weeks. we will have to see how that plays out. haslinda: has america's recovery trickled down? we have not seen ticket prices going down. haven't comests down drastically. certainly, fuel is cheaper. if you look at what happens in this market, as costs come down, sales come down. we are in a very competitive market, and we will see fares coming down. you have also said is necessaryation for the industry to be sustainable in the longer term. is that still the case? what do you make of consolidation within asia?
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>> consolidation within asia will happen slowly. the process has almost played out in north america. it still has some way to go in europe. in asia, because the way the industry is structured, with most airlines being nationally owned or bilateral arrangements being nationality-dependent, it is difficult for airlines to consolidate across borders. i think the industry will remain fragmented. 370, the with mh safety issue has come up again and again. what is the industry doing to ensure that such incidents don't happen again? >> we are moving towards higher standards of aircraft tracking. the international aviation organization is put in standards together in consultation with the industry on how we can do that. coming onlogy is stream in terms of satellites, which should make significant progress in that area.
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what happened to that flight is still a mystery. haslinda:haslinda: that tracking system you are talking about comes in 2018. what can be done at the present? >> a lot of airlines are taking steps to improve the surveillance of their own aircraft to make sure we know where aircraft are within five minutes in a way that wasn't done before the incident. published,re being which will become regulatory requirements, for all airlines to keep closer track of their flights. haslinda: speaking of safety standards, is it safer now than before? what is your study showing about that? >> we're publishing our analysis for last year, 2015, and we are seeing steady improvement in aviation safety. last year, we saw serious accidents happening in only one flights,one million and that is a significant
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improvement. we are certainly seeing a safer industry. haslinda: asia versus north america versus europe, what is being done? >> improvements are taking place globally. it's a remarkable thing that last year in terms of accidents, there were no accidents in the world. there were hull losses in terms of for talent is, but in terms of jet accidents, there were none. germanwings tragedy, the metrojet tragedy, both of those were deliberate acts. people will take those into account when thinking about aviation safety. haslinda: are you concerned about the infrastructure? is it also getting more congested? done?eeds to be >> it's important that infrastructure keeps pace. >>haslinda: is it currently? haslinda:>> in europe, they are
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struggling. it takes decades to get a new airport or runway built. in asia, we are seeing runways built. we are seeing it in singapore, hong kong. we are seeing new airports all over the region. china is building many new airports, and airspace management is because in increasingly strong. in asia, we have a fragmented structure. it's important governments work together, and they are doing this, to make sure there is technological compatibility and that procedures work well to make sure airspace can be utilized. haslinda: open skies agreement in southeast asia, not happening, not yet at least. how soon? >> there is significant progress being made. we are seeing significant liberalize a shannon in asia -- liberalization in asia. we are seeing liberalization coming.
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that thereurprising .sn't big bang liberalization it took years for europe to work its way towards its current system. haslinda: your term ends in may. what will you do? will you be joining another airlines? >> i don't fancy joining another airlines. i want to do a bit less traveling than what i'm doing now. join one or two other enterprises in an executive capacity. haslinda: tony tyler, we have to leave it there. iata's chief speaking to bloomberg, now back to you. shery: thanks a lot for that. coming up next, contracting again. we will ask why japanese consumers are resisting calls to spend. "trending business" is back in two. ♪
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>> stories making headlines around the world -- the united nations says civilian casualties from violence in afghanistan hit a record last year the highest total since records began in 2009. what 11,000 people were killed rise from aa 4% year earlier. security has deteriorated as the taliban and other militants expander control. india says it is disappointed with america's decision to sell fighters to pakistan, saying such a deal will not help the fight against terrorism. washington has confirmed the $700 million deal, which includes the planes, plus radar and electronic warfare equipment. there are claims that the former volkswagen chief was told about
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the emissions defeat devices as long ago as may 2014. the newspaper says a vw staffer wrote to the ceo to say the company couldn't provide a next commission for elevated nitrogen oxide levels. vw admitted last september that some cars have been fitted with software to beat emissions tests. this is bloomberg news. i'm rosalind chin. return to the story we have been following throughout the morning, those comments made by pboc governor joe xiao chong after months of silence. he said, there is no basis for sending the yuan down further. let's bring in economics correspondent at duck current. why are his comments so significant? weit's the first time that have heard from this top pboc
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official since china started making these changes last august. if you remember, one of the big problems for global investors hasn't been the size or scale of the yuan move. it's been about the direction or methodology behind it. investors want to know exactly, what is the outlook for the currency? where does the central bank want to push it? there were a lot of question marks surrounding the yuan's direction. shery: what was the key message then? > in some respects, the key message isn't altogether new, is it is the fact that zhou emphasizing it. they are not pursuing a so-called currency war to cheapen the currency to help exporters.
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expect some volatility in the yuan. it's not going to be that unusual. for then a one-way that best part of a decade. you are going to see some volatility with the u.s. dollar. he was reinforcing some points we heard before, but the fact that he came out and made those points ahead of the g20 meeting is significant. shery: let's talk about the disappointing trade numbers. does this mean that the yuan is not really bearing fruit after the depreciation? >> the move has been modest in the overall sense of, we are not getting any bang for our buck in that regard. shery: thanks a lot for that. pboc.test on the back to our other top story, japan contracting once again. preliminary numbers show growth hit a major snag in the last three months of 2015.
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david: the point is, we already knew that the gdp read for the fourth quarter was going to be bad. we got a number of -1.4%. it was worse than the median forecast. , japane mitsubishi research institute, seeing this coming. quarterly growth figures. during the depths of the global financial crisis. this was during abenomics. this was the recession after they imposed the increase in the sales tax. -1.4%. what does this mean? let's break this down further and have a look at some of these components of growth. biggest part of the economy,
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consumption, nearly two thirds, 60%. where the problem was, i guess, in the fourth quarter. you had a sharper than expected contraction in consumer spending. private consumption fell 0.8%. statistically, this is enough to ensure you don't have any growth. it's about two thirds of the economy. you look at the two other pillars, which i will get to right now -- exports, barely any 0.1% to gdp. that is a look over the past five years. economics 101. it's about net exports. it's not about exporting your way into a recovery. that's barely budging. that 18% of the economy. let me just have a look at business spending. this is where it gets tricky. we had a 1.4% increase quarter
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on quarter in the last three months of 2015. let's throw this forward. we had a survey coming out that indicated japanese corporate's are looking to increase capital inkding by -- let me get my -- by about 10.4% this quarter. this is very closely tied to the japanese. the reason this actually picked saying, economists are you had dollar-yen averaging 121. in japan, getting in that much-needed investment when it comes to increasing capacity. this will be the wildcard if you ask the question, what will be the growth driver for japan in the first quarter, will it be this? hard to imagine so, given the
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search in dollar-yen. maybe consumption. let's see how the boj reacts to this and the comments we will be hearing from the governor k uroda. shery: thanks for breaking it down. bigng up next, basketball's earner. lebron james is the king of the court, and now he has claimed another crown. that is next when "trending business" returns. ♪
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shery: iata welcome back. i'm am shery and. time for a look at what is trending on social media. athletes, one at in particular who is king not only on the court but also on social media. haidi: lebron james has been named as the nba's top social media contributor. that is according to one index. value ismes' digital millionre than $15 across facebook, twitter, google, and youtube. he is followed by jeremy lynn and kobe bryant. shery: that's an interesting concept. haidi: it is. it's a useful way for some companies to decide which
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athletes it wants to use to promote an item. m.v.p. index works out a ranking for enough late. they are ranked only within the sport that they play. and athletes will be ranked against other nba athletes. they look at how many followers they have, how many times they are mentioned on social media. they put this together to come up with a rating between zero and 10. website tracks 24,000 athletes and 60,000 accounts. lebron james, king james on .witter, 27.9 million followers on instagram, more than 18 million followers. "forbes" reports that the total social media value of nba all-stars, which may still be million.$43.7 shery: nba, the first professional sports league to
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pass that one billion followers on social media? haidi:haidi: this is what nba said. it said it was the first sports billiono pass one social media likes and followers. it counts all of its teams across social media accounts, across facebook and twitter. king james tops of that one, as well. shery: thanks a lot for that. that's it for "trending business ." stay tuned for "asia edge" and the big stories of the day. we will have more with verizon's ceo joining us. ♪
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>> it's the middle of the asian trading day, and it is back online for china. we are seeing it play catch-up an we.areor the, yu live in hong kong. this is "asia edge." top stories this hour -- new year's hangover. china's exports slump again. imports fell, adding to the economic challenges facing the government. gdp contracting more than
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expected, has abenomics failed? growingnd airbus see clouds in asia. coming up, a big earner -- lebron james, already the king of the court, but now he has claimed another crown. all that and more on this monday edition of. "asia edge" haidi: we've got the good, the is, the bad being that china playing catch-up, but in the worst possible way. we are off our intraday lows. elsewhere around the region, we are seeing a recovery rally. the yen down. gold prices are down. we are seeing more of a risk on appetite when it comes to equities across asia, being led by tokyo to the nikkei 225, up over 5%, this after it shed 11% yesterday.


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