U.K. State to Expand, U.S.-China Future, Japanification: Eco Day

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

• The U.K. could face a long-term increase in the size of the state and a substantial tax increase due to the pandemic, the Institute for Fiscal Studies says
• Joe Biden is set to face questions in Tuesday’s U.S. presidential debate on how he’d deal with China’s economy
• China reduced the pace of its purchases of U.S. goods in August, making slow progress in meeting the goals of the January agreement
• The looming low-growth, high-debt future for many post-pandemic economies draws parallels with Japan’s lost decades
• Argentina is weighing a temporary cut on some export taxes to boost dollar inflows as its foreign reserves fall to a three-year low
• Emerging markets are heading toward the end of the third quarter with more reasons to be cautious than optimistic, and Goldman Sachs and Deutsche Bank are among those flagging risks
• Federal Reserve Bank of Cleveland President Loretta Mester said the U.S. economy can’t reach its potential without addressing gaps in economic opportunity
• Vietnam’s economic growth accelerated in the third quarter on industry and exports, retaining its status as one of the few places in the world to avoid contraction amid the pandemic
• Stockton, California is running a radical free-money experiment with the first basic-income trial in the U.S. in decades

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