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The U.S. says it’s prepared for trade talks to take longer, America’s economy slowed last quarter and Brexit continues to dumbfound. Here are some of the things people in markets are talking about.
Trade Talks May Be Extended
The Trump administration is prepared to keep negotiating with China for weeks or even months to reach a trade deal that will ensure the world’s second-largest economy improves market access and intellectual-property policies for U.S. companies, White House economic adviser Larry Kudlow said in a speech in Washington on Thursday. U.S. Trade Representative Robert Lighthizer and Treasury Secretary Steven Mnuchin met with Chinese negotiators in Beijing for a working dinner on Thursday and they’ll participate in a full day of talks on Friday. The discussions will continue next week when China’s trade czar, Vice Premier Liu He, will travel to Washington to meet with U.S. negotiators as well as President Donald Trump, according to Kudlow.
May Gambles on Last-Ditch Vote
Theresa May is making a desperate push to get her Brexit deal approved in Parliament to avoid a huge delay to Britain’s divorce from the EU, even though she’s facing what seem to be impossible odds. British members of Parliament, who have twice rejected May’s deal, will be asked to approve the Withdrawal Agreement in a vote Friday, House Leader Andrea Leadsom said. But the British prime minister has so far failed to win over enough of her allies to support the deal. If May can’t get her deal through Friday, the EU says Britain will have to choose between leaving with no deal on April 12 and a long delay that would require it to take part in European Parliament elections. Here’s how the arithmetic’s looking for May’s deal — and for other possible solutions.
U.S. Growth Cools
U.S. economic growth cooled by more than initially reported in the last quarter of 2018, signaling mounting challenges to expansion. Gross domestic product grew at a 2.2 percent annualized rate, Commerce Department data showed Thursday, less than the initial 2.6 percent reading and projections for a revision of 2.3 percent. Consumer spending, the biggest part of the economy, grew at a downwardly revised 2.5 percent pace that also missed projections. The current stretch of growth is poised to become the nation’s longest on record at midyear, but the downward revision indicates that the economy had weaker momentum heading into 2019, when various indicators in housing and manufacturing have been showing signs of cooling.
Stocks Rise, Dollar Climbs
Asian stocks looked set to edge higher at the open in the wake of gains in the U.S. The S&P 500 Index remained on track for its best quarter since 2009, with commodity and financial shares leading the advance on Thursday. The gauge briefly fell after White House economic adviser Larry Kudlow said the Trump administration is prepared to keep negotiating with Beijing for weeks or even months. Treasury 10-year yields rebounded from a 15-month low, while the greenback extended its advance into a third day. The pound slid as the U.K. government will put to a vote the Brexit withdrawal agreement only on Friday.
China’s $13 Trillion Debt Market Goes Global
From next week, China’s domestic bond market will see some of its securities included in benchmark global indexes for the first time. And global investors in the $13 trillion market will be a powerful new ally for China’s central bank chief, who spoke recently about the limits to support in his nation for financial liberalization. Foreign investors are already making demands, including readily available hedging tools, more transparent and faster registration procedures and — less loudly, given the sensitivity — assurance they’ll be able to take their money out when they like. Their voices are set to become more important as their share of the domestic market climbs from little more than 2 percent today.
What we’ve been reading:
This is what caught our eye over the last 24 hours.
- Trump’s warships test Xi’s red lines.
- Unicorns everywhere spread fear of an end to the bull market.
- A jumbo wager on an Australian rate cut emerges.
- The case for believing in Boeing right now.
- 5G will change your life. Here’s how.
- The world’s greatest delivery empire is reshaping city life.
- These are the world’s best airports.
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