Europe Slump, U.K. Wage Support, Fed Pressure: Eco Day

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

• The euro-area economy ground to a halt in October and will probably shrink in the coming weeks after governments reinstated lockdowns to contain the pandemic
• U.K. Chancellor of the Exchequer Rishi Sunak is expected to unveil details of his wage support program Thursday, amid calls from his own side for more generous help for people who can’t work due to coronavirus restrictions
• The Bank of England boosted its bond-buying program by a bigger-than-expected 150 billion pounds ($195 billion) in another round of stimulus to help the economy through a second wave of coronavirus restrictions.
• British banks turned down more than 150,000 applications for government-guaranteed business loans during the Covid-19 outbreak in an effort to prevent fraud, according to the industry watchdog
• The tightly contested U.S. election puts pressure on the Fed to deploy even more monetary stimulus to support the economy under a divided government. Chair Jerome Powell will likely avoid discussing election results at Thursday’s press conference after the policy decision, and instead stress the urgency for further fiscal support, writes Yelena Shulyatyeva and others at Bloomberg Economics
• Gold inched higher as investors awaited the final outcome of the U.S. election, with Joe Biden on the brink of taking the White House from Donald Trump, but Republicans likely to maintain their hold on the Senate
• The Reserve Bank of Australia’s new quantitative easing program is set to close in on the Federal Reserve’s when measured against the size of the economy, highlighting the scale of its latest stimulus
• Indonesia’s economy contracted again in the third quarter, falling into its first recession since the Asian financial crisis more than two decades ago as the country grapples with Southeast Asia’s worst coronavirus outbreak
• Chinese President Xi Jinping tried to reassure international businesses that he’s committed to open trade, amid concerns the new ‘dual circulation’ strategy mean it’s set to become more insular
• India has scaled back expenditure, including on productive assets that aid economic growth, as the government is confronted with the risk of its budget deficit blowing out
• More monetary stimulus from the ECB is needed to support the economy, Executive Board member Isabel Schnabel said
• Spain’s government is too optimistic in its economic forecasts for next year and may need to revise its projections for output, the deficit and unemployment, the country’s central bank chief said

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