U.S. Trade Goals, Fed Should Slow Hikes, China Slowdown: Eco Day

(Bloomberg) -- Happy Friday, Asia. Here’s the latest news and analysis from Bloomberg Economics to help get your day started:

• China enters trade talks said to begin early next month having made concerted efforts to end the U.S. standoff, yet unsure it’s done enough
• Fed officials should slow the pace of interest-rate hikes and consider President Trump’s criticism as “background noise,” Lawrence Lindsey says. An inverted yield curve can potentially harm U.S. economic growth and even cause a recession, a blog posted by the St. Louis Fed found
• China’s economy slowed for a seventh month as the trade war, subdued domestic demand and decelerating factory inflation undercut growth
• U.S. consumer confidence slumped as a gauge of labor market expectations fell by the most in 41 years, the latest sign Americans are growing less optimistic. Yelena Shulyatyeva sees a steeper drop in sentiment in the new year amid stock market volatility, the government shutdown and ongoing political uncertainty. Job growth in Texas will likely weaken if oil prices remain low, according to the Dallas Fed
• Yuki Masujima puts numbers to talk about the risks the Bank of Japan’s easing poses to the economy. This includes what an increase in financial imbalances means for the output gap on one-year and three-year horizons under good and bad scenarios
• Vietnam’s economic growth accelerated to above 7 percent, fueled by stronger manufacturing output, while Argentina’s economy shrank more than expected in the first month of the fourth quarter, amid a slower-than-expected rebound from the worst downturn in over a decade
• The U.S. government shutdown is likely to continue into 2019 after Republicans said they didn’t plan any votes this week and Trump said most federal employees losing pay because of the closure are Democrats
• The ECB expects the global economy to slow next year as protectionism curbs trade growth. Italy’s populist government is racing to push its budget bill through parliament, with a controversial tax increase for charities the latest hurdle to surmount

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