Big Reads on Economics: Fed Finds Footing, Trade Pacts Hit Snags

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The Federal Reserve’s highly anticipated cut again had analysts debating the policy path going forward. Growing skepticism over sub-zero interest rates threaten Christine Lagarde’s ECB toolkit, while trade relations hit hurdles on several fronts globally.

Here’s a collection of this week’s analysis and enterprise from Bloomberg Economics:

Powell Signals Fed Policy on Hold as Economy Eyes Soft Landing

You won’t see a “Mission Accomplished” banner, but there are strong signs that Fed Chairman Jerome Powell thinks they’ve ushered the U.S. economy to a soft landing. Washington’s Rich Miller and Christopher Condon read between the lines of the Fed’s statement and the chief’s press conference.

Sub-Zero Skepticism Grows in Threat to Lagarde’s Toolkit at ECB
Christine Lagarde Faces Peril on All Sides at the ECB

Doubts over negative interest rates are beginning to surface among policy makers in Europe where they first appeared half a decade ago. That’s a threat to Christine Lagarde’s toolkit as she takes over as European Central Bank president, according to Paul Gordon, Piotr Skolimowski and Craig Stirling. Still, it’s not the only peril she faces in her new role, Jana Randow and Sandrine Rastello report.

Tracking the Forces Threatening the World’s Hottest Economies
How Governments Use Immigration to Boost Their Economies

Winners and losers in the global economy in the decades to come will see their fates dictated by a slew of disrupting forces, as our Bloomberg Economics team outlines in a package of analysis led by Tom Orlik, Scott Johnson, and Alex Tanzi for Bloomberg Businessweek. Elsewhere in the issue, the case studies of Canada, Japan, and Colombia illustrate the range of strategies governments have employed to try to make immigration work for their economies, as Michelle Jamrisko, Jason Clenfield, Sandrine Rastello, and Matthew Bristow show.

China Said to Doubt Long-Term Trade Deal Possible With Trump
Trump-Xi Trade Deal Hits Another Hurdle After Chile Cancels APEC
Last-Minute India Demands Jeopardize 16-Nation Asian Trade Pact
Bloomberg Economics: Thai Trade-Preference Loss Is Warning for Region

It was a rocky week for global trade agreements. Chinese officials are casting doubts about reaching a comprehensive long-term deal with the U.S. even as the two sides get close to signing a “phase one” pact, Shawn Donnan, Jenny Leonard and Steven Yang report. And the cancellation of APEC meetings in Chile, where protests are raging, has now also put in question how and when the mini-deal will be finalized, according to Shawn, Jenny and Justin Sink.

The Regional Comprehensive Economic Partnership economies could be on the cusp of inking a deal at least in principle, though India’s demands are still getting in the way, Archana Chaudhary, Shruti Srivastava and Iain Marlow explain in a Bloomberg exclusive. And the U.S. removal of trade preferences for Thailand is a warning shot for Asean economies, according to analysis by economist Tamara Henderson.

How the Trade War Is Reshaping Supply Chains (Podcast)
These Asia Hold Outs Are One Shock Away From Quantitative Easing

This week’s Stephanomics podcast with Stephanie Flanders features the tale of a small cosmetics firm based in Los Angeles that’s caught in the trade-war crossfire, reported by Sarah McGregor. Stephanie also revisits the cases of South Korea, Australia and New Zealand and their prospects for quantitative easing, from a story by Enda Curran, Michael Heath, and Sam Kim.

To contact the reporter on this story: Michelle Jamrisko in Singapore at mjamrisko@bloomberg.net

To contact the editors responsible for this story: Simon Kennedy at skennedy4@bloomberg.net, Zoe Schneeweiss, Fergal O'Brien

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