Euro Status, Powell’s Dovish Message, Withering Trade: Eco Day

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Welcome to Monday, Europe. Here’s the latest news and analysis from Bloomberg Economics to help you start the week.

  • Jackson Hole sharpened the contrast between a Fed telegraphing an end to stimulus and a dovish ECB -- a boost for the euro’s status as a preferred funding currency
  • Fed Chair Jerome Powell’s Jackson Hole speech was dovish in the context of recent Fedspeak, Bloomberg Economics says. Ex-Treasury Secretary Lawrence Summers said Powell’s remarks amounted to a “serene” depiction of inflation that is misreading the risks
  • Global goods trade — a strong point of the Covid-era economy — is starting to wither under the supply-chain strains that the Delta variant has wrought
  • The U.K. is running out of time to find truck drivers before isolated incidents at supermarkets and fast-food chains erupt into a crisis that leaves businesses crippled by delivery delays and shortages
  • Data due Tuesday are likely to show consumer prices in the euro area rose at the fastest pace in nine years this month, exceeding the 2% rate the European Central Bank aims to achieve in the medium term
  • The delta variant has muted the progress of the U.S. recovery from the pandemic, with consumers putting off some leisure spending and businesses delaying a return to normal operations
  • As Chinese President Xi Jinping seeks to revive the egalitarian spirit of the Maoist era under the slogan of “common prosperity,” he’s demanding financial sacrifices from wealthy private entrepreneurs. China also kicked off a two-month campaign to crack down on commercial platforms and social media accounts that post finance-related information that’s deemed harmful to its economy
  • The International Monetary Fund delayed plans to have staff return to its Washington headquarters until January amid rising Covid-19 cases, and said all employees who want to enter the buildings must be vaccinated
  • Somewhere in the world’s busiest port of Shanghai, a container of fertilizer sits waiting for a ride to the U.S. It’s been on the dock for months, trapped by typhoons and Covid outbreaks. Meantime, the number of ships waiting to enter the biggest U.S. gateway for trade with Asia reached the highest since the pandemic began
  • Australia’s economy may have shrunk slightly in the three months through June, setting up the bad “optics” of a technical recession, according to Citigroup Inc. and AMP Capital Investors Ltd.

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