ECB Drags Its Feet, China’s Worst Case, Russia Stalls: Eco Day

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Welcome to Friday, Europe. Here’s the latest news and analysis from Bloomberg Economics to help get your day started and send you into the weekend:

• European Central Bank officials dragging their feet over a potential revamp of their negative interest rates might be shutting off one way to convince investors they are serious on stoking inflation
• Russian officials touted last year’s surprisingly strong growth as a sign the economy was finally getting traction, but as initial results for 2019 come in, that’s looking more like a stall
• Days after his coalition partner roiled markets by threatening to breach European Union fiscal rules, Deputy Prime Minister Luigi Di Maio of the Five Star Movement said Italy’s government wants to rein in the debt load to avoid it spiraling
• Japanese Prime Minister Shinzo Abe sounded out four economists for their views on the economy Thursday night and was warned by one of them that postponing a sales tax increase could trigger a credit downgrade
• Whoever wins Australia’s election this weekend will be handed a formidable challenge: to keep an economy that’s just chalked up the longest expansion on record from running out of gas
• More than a half-century after coming together, the Association of Southeast Asian Nations is weighing a strong growth outlook with the reality of political and economic change
• As the U.S.-China trade war triggers the biggest rethink of supply chains in a generation, the world’s fastest-growing major economy with hundreds of millions of young and cheap workers should be atop the list of potential beneficiaries. And yet India isn’t getting such love, with foreign direct investment actually declining
• China’s economic growth could tumble, debt surge and foreign companies flee in a deepening trade war, economists warn as a week of escalating tensions forces them to ponder worst-case scenarios
• Meanwhile, policy makers will increase stimulus measures in proportion to the impact of higher tariffs from the U.S. in order to keep the economy in a “reasonable range,” the Chinese government said. Beijing separately signaled a lack of interest in resuming trade talks with the U.S.
• The trade war between the U.S. and China doesn’t look like it’s heading for a truce anytime soon - here’s our weekly review of the world economy and the lessons learned

To contact the reporter on this story: Anirban Nag in Mumbai at anag8@bloomberg.net

To contact the editors responsible for this story: Nasreen Seria at nseria@bloomberg.net, Karthikeyan Sundaram, Tuhin Kar

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