Episode summary
Daybreak Weekend: US Tech, BOE Decision, BOJ Meeting | Bloomberg Daybreak: US Edition
Bloomberg Daybreak: US Edition
· · 39 min · Hosts: Nathan Hager
Summary
The week ahead is dominated by central banks and big tech earnings. The host says markets are split on whether the Fed will stick with policy or surprise with a hike, while a guest argues inflation risks are rising from $100 Brent oil, tariff pressures, and heavy AI-related spending. That guest also says the biggest market reaction would likely hit equities if borrowing costs rise, though the direct economic impact would be limited because a 25-basis-point move works with a lag.
On earnings, a guest from Bloomberg Intelligence says Microsoft, Meta and Apple face a high bar after Alphabet’s large capex increase. The guest expects a negative market reaction if Microsoft or Meta significantly lift spending without showing a clear path to monetization, especially because Google has clearer vertical integration and cloud momentum. Apple, the guest says, may struggle to deliver upside if price increases are doing much of the work behind revenue growth.
In the UK, another guest says the Bank of England can probably stay in wait-and-see mode because June inflation came in below forecast, even though renewed conflict in the Middle East has lifted energy prices. The labor market is soft, with vacancies and private pay growth weak, which reduces the risk of a wage-price spiral. In Japan, a guest says the BOJ is widely expected to hold rates steady, but officials may be open to a faster tightening pace if inflation stays persistent and the yen remains weak.
Key takeaways
- A guest says the Fed could still surprise with a rate hike because inflation risks are rising from oil, tariffs and AI-related demand.
- A guest expects a negative market reaction if Microsoft or Meta lift capex sharply without clearer monetization of that spending.
- A guest says the Bank of England can likely hold at 3.75% because inflation is below forecast and the labor market is weak.
- A guest says the BOJ is widely expected to hold rates steady, though market odds for an earlier hike are rising.
- A guest says Apple’s upside may be limited because higher prices are already doing much of the work behind its expected growth.
Notable quotes
“the markets are beginning to get more worried about inflation. We've now got $100 Brent oil”
“I expect uh a negative reaction if they significantly raise their capex”
“the BOJ is widely expected to hold the policy rate steady at next week's meeting”
How the episode opens
Bloomberg Audio Studios, podcasts, radio, news. This is Bloomberg Daybreak Weekend, our global look at the top stories in the coming week from our Daybreak anchors all around the world. Straight ahead on the program, we look ahead to the next Fed meeting and big tech earnings.
I'm Nathan Hager in Washington. I'm Caroline Hepku in London where we're discussing the outlook for the Bank of England against a backdrop of renewed conflict in the Middle East and a new UK government.
I'm Doug Krner looking ahead to next week's interest rate decision from the Bank of Japan. That's all straight ahead on Bloomberg Daybreak Weekend on Bloomberg 1130 New York, Bloomberg 991 Washington DC, Bloomberg 929 Boston, DAB Digital Radio London, SiriusXM121 and around the world on Bloombergradio.com and the Bloomberg Business app.
Good day to you. I'm Nathan Hager. We begin today's program with the Federal Reserve.
Kevin Warsh and company begin their latest two-day policy meeting this Tuesday with the interest rate decision to come Wednesday. Here to get us ready for it is our man in the room for the Fed's policy moves, Bloomberg international economics and policy correspondent, Michael McKe. And it's really interesting, Mike, leading up to this decision.
It seems like the markets pretty split on which way the Fed could go. Is that the way Kevin Worsh likes it? It's going to be interesting to see how he characterizes all of this when he does get to the news conference, which by the way, he is going to have.
Okay. — Uh we were able to confirm that because they always send out a uh reservation form for uh reporters to say, "Yes, we're coming." So, we got that. So, we figure that he's going to hold the uh the press conference.
From the episode’s captions: roughly the first two minutes, lightly cleaned. Keep watching on YouTube →
Topics
- fed rates decision
- bank of england policy
- bank of japan meeting
- us tech stocks
- week ahead market outlook
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Summary, takeaways and quote selection by Octagon. Quotes are short excerpts; the full conversation is in the episode.
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