China Threat, Powell’s Charm, Stimulus Stalemate: Eco Day

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

• Vice President Kamala Harris warned that China poses a threat to Asian nations but reassured them that the U.S. wouldn’t force countries to choose between the world’s largest economies
• Federal Reserve Chair Jerome Powell has charmed both Democrats and Republicans, positioning him well if he is nominated for a second term
• Talks between House Speaker Nancy Pelosi and a group of Democratic lawmakers failed to break the stalemate over how to progress President Joe Biden’s legislative agenda
  • Discussions are set to resume today, with moderates wanting to ensure passage of the infrastructure bill, while progressives want to tie it into the larger stimulus package
  • For Pelosi, the stakes are high as she cannot afford to lose much support from either faction due to her party’s small majority in the chamber
• China’s central bank chief Yi Gang vowed to stabilize the supply of credit and called for efforts to lower financing costs for smaller businesses following a meeting with banks
• Paraguay hiked rates for the first time in more than five years as rising food and fuel prices boosted inflation above target -- it joins other Latin American peers such as Brazil, Mexico, Chile and Uruguay
• U.K. staff shortages in key industries such as haulage and construction are unlikely to be solved by the ending of the government’s furlough program, risking the nation’s economic recovery
  • The U.K.’s economy is set to be left damaged by the pandemic and weighed down too by an aging population and Brexit, according to Bloomberg Economics
• Finally, here are some reasons to be optimistic about the global economic outlook

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