Trump Victory Lap, China Soothes, U.S. Innovation Fears: Eco Day

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

• President Donald Trump is taking a victory lap at Davos after signing a trade deal with China and watching Congress ratify a rebranded Nafta accord. He used the conference to espouse his economic policies, sending some warm and some mixed messages to Europe
• Chinese Vice Premier Han Zheng told the World Economic Forum that the U.S. trade deal won’t hurt rival exporting nations as complaints mount from governments that were left out of the agreement
• America’s fear of losing its technological advantage over China has helped drive the trade war between the world’s two biggest economies, and Bloomberg’s latest innovation index shows the concern isn’t misplaced: The gap is narrower than ever
• A viral lung illness that originated in central China has been confirmed in a single case in the U.S., putting more pressure on health officials to contain an outbreak that has infected several hundred in Asia and spread to five countries
• A catastrophic drop in tourism is haunting Hong Kong as it moves into the New Year. Thailand’s economy also faces a new hurdle as the virus in China threatens to squeeze tourism
• Haruhiko Kuroda trod a cautious line despite the Bank of Japan’s stronger economic growth forecasts, in remarks likely aimed at pushing back early speculation that his next move will be to start normalizing policy
• Economists have pared back expectations for an interest-rate cut in Malaysia as global uncertainties recede
• Stephen Poloz is heading into the final few months of his term as Bank of Canada governor showing few signs of giving up his status as one of the industrialized world’s most hawkish central bankers
• Investors scrutinizing U.K. economic reports to gauge whether the BOE will cut rates are missing one potentially vital bit of insight: the bank’s liaison surveys
• Some of the world’s major central banks are teaming up to assess potentially developing their own digital currencies
• China is the front line in the battle against climate change. It has the most people, burns half of the world’s coal and emits the most greenhouse gases -- with no sign yet of reaching the peak. The rate of growth presages continued rising emissions. Can it turn this around? Meanwhile, here’s a live climate scoreboard for the world
• They are the two highest profile attendees at this year’s annual Davos Forum, but their respective recipes for global salvation couldn’t be further apart. Indeed, green is the word at the conference, as Simon Kennedy writes in the Davos Diary

To contact the reporter on this story: Michael Heath in Sydney at mheath1@bloomberg.net

To contact the editors responsible for this story: Paul Jackson at pjackson53@bloomberg.net, Alexandra Veroude

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