U.K. Wages Rise, China Port Shutdown, U.S. Fiscal Space: Eco Day

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Happy Friday, Europe. Here’s the latest news and analysis from Bloomberg Economics to take you through to the weekend:

• U.K. wages are rising as companies scramble to recruit workers after the last coronavirus restrictions eased in July, a survey showed
• A Covid outbreak that has partially shut one of the world’s busiest container ports is heightening concerns that the rapid spread of the delta variant will lead to a repeat of last year’s shipping nightmares
• Britain’s foreign-born population has doubled to 9 million in the last decade. Meantime, Hong Kong’s population shrank substantially over the past year as people left over the National Security Law
• Low U.S. government bond yields exaggerate the fiscal space available for deficit spending because Federal Reserve purchases are distorting market prices, the Institute of International Finance said
• It seems like Japan’s big recovery is always a quarter away -- a dynamic that’s playing out again ahead of Monday’s GDP release
• The delta variant’s blow to China’s economy deepened in the past two weeks, according to high-frequency data tracked by Bloomberg Economics. The effects of flooding and delta also are starting to show up in China’s prices
• Mexico’s central bank needs to be cautious on inflation given how unpredictable the Covid-19 crisis has been, Governor Alejandro Diaz de Leon said after Banxico raised borrowing costs for a second straight meeting
• Peru raised its key interest rate for the first time in five years after inflation accelerated faster than expected and political turmoil sank the currency 
• Indian bond yields will rise by year-end as disagreement among members of the central bank’s rate-setting panel suggests a more hawkish stance, a Bloomberg survey found
• Brazilian policy makers will do whatever it takes to bring inflation expectations back to target, central bank President Roberto Campos Neto said

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