Fed Rate Call, Mnuchin Interview, RBA's Sydney Worries: Eco Day

(Bloomberg) -- Happy hump day, Asia. Here’s the latest news and analysis from Bloomberg Economics to help get your day started:

  • To hike or pause? The Fed faces a tough call as it comes under sustained fire from Donald Trump. The president issued a fresh appeal to the bank to avoid making “yet another mistake” just hours before it starts its two-day meeting. Yelena Shulyatyeva says Jerome Powell will use his press conference to create more flexibility for an uncertain 2019
  • The U.S. and China are planning to hold meetings in January to negotiate a broader truce in their trade wars, Treasury Secretary Steven Mnuchin said in a round table interview with Bloomberg. He also sought to deflect blame for a gaping budget deficit and dismissed the economic significance of a flattening yield curve
  • Sydney’s plunging house prices are usurping a prolonged wage slump as the key worry for the central bank, with markets now showing more chance of an interest-rate cut than a hike in 2019
  • Italy’s populist government is betting the European Commission will ratify an informal deal to avoid sanctions over its spending plans. Up in Germany, business sentiment has deteriorated further, while France’s Yellow Vests protests will cut this quarter’s economic expansion in half
  • Southeast Asia’s two biggest economies are on different rate paths: Thailand looks ready to kick off its hiking cycle while Indonesia is nearing the end. Asian nations face downgrades to economic growth and more pain from rising U.S. interest rates next year, says S&P
  • Argentina has fallen into recession after growth contracted in the third quarter in the midst of a currency crisis
  • Fear of fear itself has now become an economic risk as “uncertainty” spreads in the lead up to 2019

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