Fresh Cracks in Germany, Soft China Prices, Fed on Hold: Eco Day

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

  • Poland’s central bank Governor Adam Glapinski has joined a growing list of east European interest-rate setters entangled in criminal probes. He was questioned by prosecutors last week in relation to bribery allegations.
  • Growing pain: Fresh weakness is emerging in the German economy, which may have shrunk again, note Bloomberg economists Jamie Murray and Maeva Cousin.
  • The woes for U.K. retailers are mounting as new report suggests that 2018 was their worst Christmas since the financial crisis.
  • Deflation worries: China’s factory inflation slowed sharply in December, continuing the slowdown for a sixth straight month to the weakest level since late 2016 on softening demand and lower commodity prices.
  • Piecemeal approach: Chinese policy makers are continuing their efforts to arrest the slowdown in the world’s second-largest economy, as further details emerged of measures to ensure credit to small businesses and ease their tax burden.
  • Soft landing: China and the U.S. are separately struggling to come in for unparalleled, simultaneous soft landings, an effort complicated by the trade war they’re waging at the same time.
  • What now? With trade talks over, the Trump administration is pushing for a way to make sure China delivers on its commitments in any deal the two nations reach.
  • On hold: U.S. central bankers could place interest rates on hold through March or longer as they wait for clarity on risks to global growth that could affect the economy.
  • Business as usual: In his first trip abroad as Mexico’s finance minister, Carlos Urzua had a message he clearly wanted to deliver to the New York investing community. It was, in essence: Don’t worry, the young administration of President Andres Manuel Lopez Obrador understands the laws of economics and isn’t about to try any radical experiments that could jeopardize Mexico’s financial health.

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