President Trump's Trade Threats, Zelenskiy Heads to Washington
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Good morning, I'm Nathan Hager. And I'm Karen Moscow. Here are the stories we're following today. Karen, we begin with the news out of Washington roiling investors. President Donald Trump is doubling down on his promise of 25% tariffs on Canada and Mexico to take effect March 4th and a further 10% levy on Chinese imports that same day. Global equities sold off on the threat. The S&P 500 is now just another 1.4% drop away from wiping all its gains today.

since Trump's election. But the president is pushing back. It concerns the tariffs will lead to inflation.

It's a myth that's put out there by foreign countries that really don't like paying tariffs and especially to even up. So we've been treated badly by a lot. We're using tariffs. And I find, and you just have to look at the numbers, but I find that it's not about inflation. It's about fairness. And the inflation for us has not existed. And I don't think it's going to exist. President Trump spoke at a news conference with UK Prime Minister Keir Starmer heard on Bloomberg Radio.

Nathan, and the British premier left his meeting with President Trump with a promise of a trade deal. The president said he'll restart trade talks with the UK. He was asked if Starmer convinced him not to impose tariffs. He tried.

He was working hard, I'll tell you that. He yearned whatever the hell they pay him over there. But he tried. I think there's a very good chance that in the case of these two great friendly countries, I think we could very well end up with a real trade deal.

where the tariffs wouldn't be necessary. President Trump's comments come after he seemed to suggest a 25% tariff on the European Union following a meeting with French President Emmanuel Macron earlier this week. As for the 10% tariff on China, Karen, that will come on top of a previous 10% duty implemented earlier this month. A Chinese Ministry of Commerce spokesperson said the country will defend its legitimate rights and interests with, quote, all necessary measures.

We get more on the potential impact from Bloomberg's Min Min Lo in Hong Kong. Bloomberg Economics had crunched the numbers. They said that the original 10% tariffs might still be manageable for China, but the additional 10%, that would be equivalent to about double the scale of the first trade war. It could cut China's exports to the U.S. by about 50%.

Bloomberg's Min Min-lo says the new tariffs will come just one day before President Xi Jinping heads into the Chinese Communist Party's biggest political meeting of the year, where his lieutenants will unveil their economic blueprint for 2025.

Well, Nathan, back in Washington, President Trump is getting ready for another pivotal meeting today with Ukrainian President Volodymyr Zelensky. And Bloomberg's Amy Morris has a preview from the nation's capital. President Trump expects to sign a deal with Zelensky allowing the U.S. access to Ukraine's minerals in exchange for military support. We're going to have a very good meeting. We're going to get along really well.

We have a lot of respect. I have a lot of respect for him. We've given him a lot of equipment and a lot of money, but they have fought very bravely, no matter how you figure it. But a White House national security official tells The New York Times the deal does not include any guarantee of future war funding, a difference that is expected to be at the center of this meeting.

In Washington, Amy Morris, Bloomberg Radio. Okay, Amy, thank you. And ahead of today's meeting, President Trump walked back his recent criticism of Zelensky. A reporter asked if he still thinks Ukraine's president is a dictator. Did I say that? I can't believe I said that. Next question. And President Trump had called Zelensky a dictator without elections in social media posts and in recent speeches.

Well, we turn to the markets now, Nathan, and later this morning we get a key data point that traders are keeping a close eye on. The Fed's preferred inflation gauge, the PCE index, is due out at 8.30 a.m. Wall Street time. Bloomberg's Michael McKee joins us with the preview. Wall Street is looking for a bit of a silver lining amid somewhat dark inflationary clouds. Economists anticipate a soft PCE report that will see year-over-year inflation fall.

That would contrast with other price indicators for January, like CPI, that came in higher and raised questions about the durability of inflation. If inflation is sticky, the Fed isn't going to be inclined to cut rates again.

But they might, if the economy is seriously slowing. We'll get some evidence on that from the spending side of the PCE report. Spending forecast to be down from December. Michael McKee, Bloomberg Radio. All right, Michael, thank you. I'll stay with Bloomberg for full PCE coverage on Bloomberg Surveillance. We'll break the numbers down live here on Bloomberg Radio and on the Bloomberg podcast page on YouTube.

Well, Karen, we want to turn to crypto markets now because Bitcoin looks like it's been sliding off a cliff really for the last several weeks. Bloomberg's John Tucker is here with more. John, just how bad has this sell-off been? Well, remember, Nate, that Bitcoin hit a peak January 21st. It touched $107,000. And this morning, it is right around $80,000 per token.

it's lost over a quarter of its value in just over a month. This is a slide of almost 25%. Other tokens like Ether, they're plunging as well. And the reason behind it, President Trump's latest tariff threats. Investors have dumped risk assets like crypto. Last time we saw sentiment this bad was in 2022. And you'll remember that it was the so-called crypto winter. Crypto was one of the most popular Trump trades in global markets.

buying Bitcoin on the expectation that the president's crypto-friendly approach would lead to a broad rally. In New York, I'm John Tucker, Bloomberg Radio. All right, John, thank you. The company NewsNow MetaPlatforms is said to be in talks with Apollo for $35 billion in financing to help develop data centers in the U.S.

Sources say the alternative asset manager has discussed providing a major part of the financing. And we're also told KKR is part of the investor group. Meta has said it plans to spend as much as $65 billion on AI projects this year. And checking Meta shares this morning, they're up half percent. Staying with tech, Karen, Dell's earnings topped expectations. The company delivered a strong outlook for servers optimized for artificial intelligence.

PC Maker expects to ship $15 billion worth this fiscal year. That's a 50% jump from the year before. But Dell also says its gross margin will fall one percentage point due to the high cost of NVIDIA chips. And checking Dell shares this morning, they are down more than 2%.

Nathan, the Securities and Exchange Commission is expressing concerns about a first-of-its-kind private credit exchange-traded fund. In a letter to its backers, State Street and Apollo, the SEC, said it wants to know more about its liquidity, its name, and its ability to comply with valuation rules. The ETF launched yesterday under the ticker PRIV. Filing shows the fund will cap illiquid investments at 15%.

But private credit is expected to take up 10 to 35 percent of its portfolio. And speaking of going private, Karen, there's a new Bloomberg newsletter just on that topic. It is called Going Private. It's delivered to your inbox Wednesdays and Fridays, bringing you coverage of private markets and the forces moving capital away from the public eye. Subscribe to the Going Private newsletter now at Bloomberg.com slash goingprivate.

And it's time now for a look at some of the other stories making news in New York and around the world. And for that, we're joined by Bloomberg's Michael Barr. Michael, good morning. Good morning, Karen. The mystery deepens into the deaths of two-time Oscar winner Gene Hackman, his wife, and their dog. Police in New Mexico have now ruled the deaths suspicious.

Authorities say there were no initial signs of a natural gas leak or carbon monoxide in Hackman's Santa Fe home, but they add it is possible the gas could have dissipated in the time between their deaths and when authorities arrived on the scene Wednesday. The front door was open. Santa Fe Sheriff Aiden Mendoza says in terms of potential causes of death, everything is on the table. All I can say is they have been deceased for quite a while.

You know, that's a determination that's better suited for OMI and the experts, but it sounds like they had been deceased for a while, and I don't want to take a guess in reference to how long that was.

Sheriff Mendoza says they will do an autopsy and a toxicology on the bodies to determine whether there were drugs in their system or was there carbon monoxide in their blood. It could take at least eight weeks. New Jersey officials say the spread of measles in the state involves three members of the same family. State Health Commissioner Dr. Caitlin Bastin says a child in Bergen County traveled internationally and two close family members were later infected.

We are doing safe contact tracing. We're out there trying to keep this contained. Dr. Bastion says all three were unvaccinated. As the measles outbreak in West Texas increases, officials in Houston are urging residents to get vaccinated ahead of upcoming events that will attract large crowds like the Houston Livestock Show and Rodeo and Spring Break.

Dr. Peter Hotez, co-director of the Texas Children's Hospital Center for Vaccine Development, said travelers should come to Texas because the measles vaccine is very effective. Don't change your plans. We don't want people canceling going to the rodeo because of worry about measles. For the simple reason it's not like COVID. Remember, we have a very effective vaccine. A single dose of the measles vaccine is more than 90% protective.

Earlier this week, the Texas Department of State Health Services reported the first measles death of an unvaccinated school-aged child in Lubbock. The Vatican says that Pope Francis continues to improve from double pneumonia, though doctors say he needs more days of clinical stability before they revise their guarded prognosis. Global News 24 hours a day, whenever you want it, with Bloomberg News Now. I'm Michael Barr. This is Bloomberg, Karen. All right, Michael Barr, thank you.

When you have bars in the sky, onboard showers and award-winning in-flight entertainment, it's no surprise that Emirates was recently named the best airline in the world. We fly you to over 140 destinations and with partners across the globe, we connect you to another 1,700 cities across six continents. So when we say we're also the largest international airline, what we really mean is...

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Time now for the Bloomberg Sports Update brought to you by Tri-State Audi. Here's John Stashower. John, good morning. Good morning, Karen. One of the bigger questions of the NFL offseason was answered. Travis Kelsey is not going to retire. He'll be back for a 13th season playing tight end for Kansas City. Kelsey said in a statement the Super Bowl blowout loss left a bad taste.

wasn't the way he wanted to go out. The Chiefs are also keeping Pro Bowl guard Trey Johnson. They're giving him the franchise tag. NBA in Orlando, a huge night for Steph Curry, 56 points. He made 12 three-pointers in the third quarter. Curry outscored the Magic by himself. The Warriors won 121-115. The Lakers beat Minnesota.

117-102. LeBron James and Luka Doncic combined for 54 points and 30 rebounds. Knicks are in Memphis tonight. They may have Mitchell Robinson in the lineup for the first time this season, back after a second surgery on his ankle. The Nets tonight host Portland and Cam Thomas.

for Brooklyn. He's missed most of the last nearly four months when Thomas hurt his hamstring. He was averaging 25 points a game. Speaking of injuries, Rangers have a big one. Star defenseman Adam Fox, upper body, placed on injured reserve. Rangers coach is Peter Laviolette. Yeah, I mean, I never want to see that happen for sure. He's such an important part of the team and plays so many minutes for us. So that's...

Always a tough break, but now that we know that, we have an opportunity for others to step up. Rangers are at the Garden tonight to play Toronto. Columbus last night beat Detroit. The Rangers are chasing those two teams for a playoff spot. Blue Shirts currently four points behind. Islanders 1-2-1 in Boston. College Hoops.

Heartbreaking loss for Rutgers. Michigan won on a three-pointer at the buzzer. PGA Tour is in Palm Beach in the opening round of the Cognizant. Jake Knapp shot 59. He's got a four-shot lead. It's the 15th sub-60 round in PGA Tour history. It's the first ever shot in the state of Florida. John Staschauer, Bloomberg Sports.

Coast to coast on Bloomberg Radio. Nationwide on Sirius XM. And around the world on Bloomberg.com and the Bloomberg Business App. This is Bloomberg Daybreak. Good morning. I'm Nathan Hager. Ukrainian President Volodymyr Zelensky will be making a personal appeal to President Trump not to sell out his country to Russia when he heads to the White House later today.

But the U.S. president appears focused on a critical minerals deal with Ukraine and when asked whether he would back up European peacekeepers in a ceasefire with Russia. I think we're very well advanced on a deal, but we have not made a deal yet. So I don't like to talk about peacekeeping.

until we have a deal. President Trump speaking there alongside UK Prime Minister Keir Starmer at a White House news conference heard on Bloomberg Radio. For more, we are joined by Bloomberg Europe, Middle East and Africa News Director Rosalind Matheson. Ros, it's great to speak with you this morning. It seems as though this meeting with Zelensky and Trump is pivotal, particularly for Zelensky. What should we be expecting today? Good morning.

Good morning. Well, that's right. It's a really important meeting for Volodymyr Zelensky to be doing this in person with Donald Trump, ostensibly for the minerals agreement, but more broadly to be able to talk to Donald Trump about, again, what he feels he needs the US to be engaging on when it comes to the potential for a ceasefire in Ukraine and to be doing that directly because the concern has been

for some weeks now by Ukraine and Europe is that they're being cut out

of the conversation and that Donald Trump is having these very directly with Russia, with the Russian leader and then US and Russian officials have held several meetings of late to discuss this and other things in the bilateral relationship. And so, you know, is it the risk that Russia and the US really themselves come to a deal and then present it to Ukraine as what a ceasefire is going to look like? And so this is a real opportunity in a way for

for Vladimir Zelensky to present his case to Donald Trump and against the backdrop of what's been a very, very fraught relationship between the two of them of late. I mean, Donald Trump recently called Zelensky a dictator, although he then seemingly walked that back again overnight, saying he can't believe that that's how he referred to the Ukrainian president.

But it does show, again, the level of direct tension between these two men. Yeah, just the fact that the president did seem to sort of walk back that just a little bit. Does that indicate that we could see a little bit more of a warming of relations when we have seen this almost rush to reach a deal between the U.S. and Russia when it comes to Ukraine? Well, Donald Trump does like a deal and he's got at least an initial deal here on the mineral side. It's not limited.

the exact terms the US was initially pushing for, but it does stand to benefit the US economically and certainly gets them very much in the door on the vast mineral wealth and the energy wealth and even the ports and infrastructure to some extent of Ukraine. And so Donald Trump be pleased to have an initial deal on that front. Perhaps that takes some of the pressure off. But either way, he has indicated he does want to ceasefire on Ukraine

sooner rather than later. He's talked about Easter, which seems to be not necessarily that feasible given all the moving parts that are involved. But you can imagine that even talking with Zelensky today is going to press him to get to the table very quickly for a direct conversation with the Russian president. Our last 30 seconds, Roz. It seems as though the pressure is on still, though, when it comes to trade. This talk of tariffs in effect by this Tuesday.

Well, that's right. And so Donald Trump is keeping the pressure up in a bunch of places on tariffs, be it allies, including Canada, but also adversaries, including China, where he's announced another 10% on top of the initial 10%.

10% and still threatening Europe with 25% tariffs as well. So clearly operating in the mode again that whether you're an ally or an adversary that he's coming to you. On the trade front, the question is, do these things get extended again in terms of exemptions?

Do they get pushed back further? Do they get enacted? And that's really the unknown unknown right now. This is Bloomberg Daybreak, your morning podcast on the stories making news from Wall Street to Washington and beyond. Look for us on your podcast feed by 6 a.m. Eastern each morning on Apple, Spotify or anywhere else you listen.

You can also listen live each morning starting at 5 a.m. Wall Street time on Bloomberg 1130 in New York, Bloomberg 99.1 in Washington, Bloomberg 92.9 in Boston, and nationwide on Sirius XM Channel 121. Plus, listen coast-to-coast on the Bloomberg Business app now with Apple CarPlay and Android Auto interfaces.

And don't forget to subscribe to Bloomberg News Now. It's the latest news whenever you want it, in five minutes or less. Search Bloomberg News Now on your favorite podcast platform to stay informed all day long. I'm Karen Moscow. And I'm Nathan Hager. Join us again tomorrow morning for all the news you need to start your day right here on Bloomberg Daybreak.

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