Fed Lift Off, Biden Agenda, Global Supply Shortages: 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:

• Federal Reserve policy makers are expected to announce this week that they will start scaling back their massive asset-purchase program amid greater concern over inflation, economists surveyed by Bloomberg said
  • Here’s Bloomberg Economics’ take on why the Fed will lift off in 2022
• House Speaker Nancy Pelosi plans to hold votes this week on both the infrastructure bill and President Joe Biden’s signature stimulus package
• Last year the global economy came juddering to a halt. This year it got moving again, only to become stuck in one of history’s biggest traffic jams. New Bloomberg Economics gauges show the extent of the global supply shortages that are pushing prices higher and putting economic recoveries at risk
  • Meanwhile, the world’s largest shipping hubs are suffering elevated levels of congestion as containers pile up at seaports from Singapore to Greece’s Piraeus
• The Reserve Bank of Australia bowed to market pressure Tuesday, abandoning a bond-yield target after an acceleration in inflation spurred traders to price in higher borrowing costs.
  • The forecast for underlying inflation now suggests rate hikes could arrive a little sooner than previously expected -- in early, rather than mid-to-late, 2024, Bloomberg Economics says
  • The RBA’s action shows the Bank of Japan and other central banks the difficulty of maintaining a yield goal when market momentum builds. Here’s what it means for global central banks
• China’s fiscal policy will provide the main support to economic growth next year while significant monetary easing is unlikely, according to a former adviser to China’s central bank

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