Goldman on Recession, PBOC Cryptocurrency, Kiwi Brexit: Eco Day

(Bloomberg) --

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

• Goldman Sachs is raising concerns of a U.S. recession as the trade war with China intensifies. The U.S. and world economies are at their riskiest moment since the global financial crisis, says Larry Summers
• Even with Germany mired in an industrial slump and possibly flirting with recession, don’t expect Chancellor Angela Merkel to loosen the purse strings just yet
• There may be insights for the U.K. on leaving the EU without a deal from a long time ago on the other side of the world: New Zealand
• Chinese policy makers are holding back from rolling out the big guns of monetary stimulus, keeping options in reserve as the trade standoff with the U.S. risks morphing into a global currency war. Meantime, the People’s Bank of China is “close” to issuing its own cryptocurrency
• Even before the trade war, Xi Jinping’s plan to turn China into one of the world’s most advanced economies by 2050 was ambitious. Separately, the IMF said China should keep its exchange rate flexible
• Hong Kong’s economy, already reeling from the trade war and China slowdown, is ill placed to absorb a blow from escalating protests, writes Bloomberg Economics’ Qian Wan. The recent weakness in the yuan is different from a 2015 rout and any further declines will be moderate, says Ye Xie and David Qu
• New Zealand’s Treasury Department has identified a lower bound for the official cash rate as it studies the monetary policies that could be used to combat an economic downturn

To contact the reporter on this story: Jiyeun Lee in Hong Kong at jlee1029@bloomberg.net

To contact the editors responsible for this story: Malcolm Scott at mscott23@bloomberg.net, Chris Bourke

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