Fed Splinter, ECB Studies Revamp, Brexit Recession Risk: Eco Day

(Bloomberg) --

Good morning Americas. Here’s the latest news and analysis from Bloomberg Economics to help get your day started:

• Jerome Powell has faced the lowest number dissents of any Federal Reserve chairman in 68 years. But that unity -- forged in the face of repeated attacks by President Donald Trump -- could splinter as he leads the central bank toward its first interest rate cut since 2008
• Meanwhile, slow progress on key initial demands from Presidents Trump and Xi Jinping is raising doubts about whether the U.S. and China will actually return to the negotiating table to overcome their much deeper differences
• European Central Bank staff have begun studying a potential revamp of their inflation goal, according to officials familiar with the matter, in a move that could embolden policy makers to pursue monetary stimulus for longer
• Group of Seven finance chiefs acknowledged gathering threats to the global economy and gave a cautious pledge to provide fiscal support if those dangers materialize
• A no-deal Brexit could plunge the British economy into recession, hammer the pound and drive up government borrowing, according to the U.K fiscal watchdog
  • That might help explain why Bank of England policy makers are losing faith in their own call for higher interest rates
  • Still, Thursday saw some good news for the U.K. economy as a report showed retail sales unexpectedly rose last month
• Central banks in South Korea and Indonesia, slow to follow peers this year in cutting interest rates, finally joined the tide of monetary policy easing as the world economy slows
• The yellow-vest protests that shook France last year may be over, but the forces of political and economic anger continue to ripple around the world. Stephanie Flanders visits the City of Lights in her latest podcast

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