Inflation Push Back, Testing Limits, Commodity Clash: Eco Day

Welcome to Tuesday, Asia. Here’s the latest news and analysis from Bloomberg Economics to help you start the day.

  • Federal Reserve officials pushed back against the threat that a spike in price pressures will prove lasting as the U.S. economy reopens
  • Asia’s surging coronavirus infections and slow pace of vaccinations is testing the limits of what central banks can do to further support what had been the world’s stand out economic recovery
  • China’s commodity markets may be hearing mixed messages from the government. Just hours after China’s state economic planning agency stepped up its fight against soaring commodity prices, threatening “speculators and hoarders,” Premier Li Keqiang urged further strengthening of imports, storage and transportation
  • Senator Elizabeth Warren is proposing to nearly triple the Internal Revenue Service’s budget to help identify wealthy individuals who are cheating on their taxes
  • Bank Indonesia will likely hold its policy rate steady to protect the rupiah amid fresh signals that the U.S. Fed could start unwinding stimulus, which has pressured Indonesia’s currency
  • India is bracing for a second severe storm in the span of about 10 days, with authorities in the eastern region preparing to evacuate people to safer places at a time when the country is battling the world’s worst outbreak of Covid-19
  • South Korea’s consumer confidence strengthened to a high of almost three years in May, fueling optimism that the economy is on track for a strong recovery from the pandemic slump
  • The U.K. began formal preparation for a free-trade agreement with India, a post-Brexit target for Prime Minister Boris Johnson as he seeks to prove the benefit of leaving the European Union
  • Bank of England policy makers pushed back against concerns that the U.K.’s rapid economic rebound from the pandemic will lead to a damaging wave of inflation
  • European Union leaders kicked off the process for adding more sanctions against Belarus and imposed an effective flight blockade on the country over the forced landing of a Ryanair Holdings Plc jet and the arrest of a dissident journalist
  • The U.S. said Americans should avoid traveling to Japan, with the country under a state of emergency over a widening Covid-19 outbreak that has sown doubts about Tokyo’s plans to host the Olympics in less than two months

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