Bye Stimulus, U.K. Jobs, U.S. Inflation, China Slowdown: Eco Day

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Welcome to Thursday, Europe. Here’s the latest news and analysis from Bloomberg Economics to help you start the day:

• The world economy bounced back from the Covid-19 slump faster than most forecasters reckoned was possible a year ago—thanks largely to record injections of government money. Now those aid programs are getting trimmed or wound down
• Britain’s labor market slowed from near record levels of job creation as coronavirus infections surged last month
• A panel of lawmakers from the U.K. Parliament delivered a blow to the Bank of England’s effort to launch a digital currency, saying officials have given no convincing reason it’s needed
• U.S. consumer prices are likely to extend their eye-popping gains after soaring last year by the most in nearly four decades
  • The December CPI will keep the FOMC focused on upside risks to its preferred inflation measure, and the need to start winding down policy accommodation in short order
  • Fed Governor Lael Brainard said tackling inflation and getting it back down to 2% while sustaining an inclusive recovery is the U.S. central bank’s most pressing task
• China’s slowdown probably extended into end-2021, with growth falling below 4% year on year in the fourth quarter, Bloomberg Economics writes
  • China’s steady jobless rate is masking pain in the labor market
  • Ships looking to avoid Covid-induced delays in China are making a beeline for Shanghai, causing growing congestion at the world’s biggest container port
• France’s stunning economic rebound may seal Macron’s re-election
• Norway’s race to appoint a new central bank governor is reaching a finale mired in controversy at the prospect of a political ally and friend of Prime Minister Jonas Gahr Store getting the job
• Serbia will probably keep borrowing costs at a record low in the central bank’s first rate decision this year
• Italy is working on a spending package that won’t require revising the budget to expand the deficit
• There are few signs of a new-year reset for a global economy dogged by a supply crunch, soaring energy costs and ongoing disruptions in the strange conditions spawned by the pandemic

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With assistance from Bloomberg