Draghi's Output Gap, Central Bank Defiance, Trade Rifts: Eco Day

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

  • It’s all about the output gap: Mario Draghi sees the euro-area economy expanding faster than it could normally manage, pointing to more paring back of bond-buying even as growth is downgraded
  • Turkey to Russia, with love. Turkish central bankers defied the wishes of their president in raising interest rates Thursday, potentially paving the way for the Bank of Russia to do the same in a Friday decision
  • Smaller toolbox. China doesn’t have as much to shield itself against an economic downturn spawned by trade-war tensions as it did a decade ago amid the global financial crisis
  • Tough talk. President Trump boasted again that he feels no pressure to resolve the growing rift with China, insisting that the U.S. has the upper hand in talks
  • Gender balancing. The Australian government’s woman problem just got worse
  • Inside word. The Bank of Japan crafted its latest forward guidance with global markets in mind, according to people familiar with the policy makers’ discussions
  • EM pressures. Indonesia’s aggressive interest-rate increases and other rupiah-protection measures won the IMF’s backing, while the Philippine finance secretary says there’s no need to consider an out-of-cycle hike before the Sept. 27 meeting

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