German Contraction, Tariff Delay, China Data Slump: Eco Day

(Bloomberg) --

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

• Germany’s economy shrank in the second quarter, piling pressure on Chancellor Angela Merkel to unleash fiscal stimulus as manufacturers reel from a U.S.-China trade war.
• At the same time, the European Union’s eastern economies are withstanding the brunt of global headwinds
• In Norway, one of the last interest rate hawks could make a stand this week
• Less than a week since he vowed to go to war to protect the independence of the South African Reserve Bank, Governor Lesetja Kganyagohas approached the courts to protect his name after a racial slur from a ruling party official
• President Donald Trump bowed to pressure, delaying the imposition of new tariffs on a variety of products until December. Tom Orlik explains why that makes little difference to the broader dispute
• Meantime, Chinese officials are sticking to their plan of visiting Washington in September for face-to-face meetings, signaling that talks remain on track for now
• China posted the weakest industrial output growth since 2002 and slumping retail sales in July, as a cyclical slowdown and trade tensions add to the case to roll out more stimulus. The weakness in July is just a taste of worse to come, writes Chang Shu and David Qu
• A key measure of U.S. consumer prices unexpectedly accelerated in July in a broad-based advance, suggesting inflation may be firming as the Federal Reserve debates whether to lower interest rates further
• President Mauricio Macri is set to unveil a plan to ease the economic pain of Argentines struggling with unemployment and inflation. Here’s what the latest rout looks like for small business owners in Argentina

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, Karthikeyan Sundaram, Tuhin Kar

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