Hong Kong ‘Special’ No More, 45% Tax, China Data: Eco Day

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

• President Donald Trump said he issued an order to end Hong Kong’s special status with the U.S. and signed legislation that would sanction Chinese officials responsible for cracking down on political dissent
• Fears of a Hong Kong brain drain are increasing after China moved to tax its citizens’ global income, undermining the financial hub’s appeal to thousands of bankers and other workers from the mainland
• China’s economy is set to post a return to growth for the second quarter, with a range of indicators due Thursday to confirm the upward trend as the nation slowly climbs out of its slump
• The Trump administration’s move to brand most of Beijing’s claims in the South China Sea a violation of international law doesn’t mean much on its own: China has repeatedly refused to acknowledge the 2016 tribunal ruling that the U.S. finally just endorsed. But it could lead to a miscalculation at sea
• Fed Governor Lael Brainard, painting a dark picture of the U.S. economic outlook amid a resurgence of virus infections, said the central bank should pivot its forward guidance and asset purchases toward providing longer-run accommodation
• Bank of Canada Governor Tiff Macklem is expected to say how much of the government’s record spending he intends to finance
• South Korea’s jobless rate unexpectedly fell in June, but remained well above levels seen before the pandemic struck, amid government efforts to stimulate the sagging labor market
• Currency intervention is an “essential” policy tool for Switzerland, its central bank chief said, in a riposte to the U.S.
• The U.K. economy’s expansion was much weaker than expected in May, casting doubt on how fast the nation can rebound
• Similarly, Brazil’s economy expanded less than expected in May, indicating the unchecked coronavirus outbreak is holding back demand even as some establishments reopen
• The world’s population is likely to begin declining after 2050, as this map shows
• Singapore has the world’s highest concentration of millionaires and one of the most expensive housing markets in Asia, yet it’s able to offer every newlywed young couple a home they can afford

©2020 Bloomberg L.P.