U.S. Inflation, China’s Trade Silence, Carney on Brexit: Eco Day

(Bloomberg) -- Good Tuesday morning, Americas. Here’s the latest news and analysis from Bloomberg Economics:

  • Just when you thought U.S. inflation was stabilizing around the Federal Reserve’s 2 percent goal, it’s getting pulled back down again
  • China’s government isn’t yet able to formulate its response to the summit on trade with U.S. President Donald Trump as senior officials are still out of the country with President Xi Jinping
  • Intellectual property theft is one of the main points of contention in China’s dispute with Washington, and just days after Xi promised to resolve the U.S.’s “reasonable concerns,” China has announced an array of punishments for IP theft
  • Mark Carney defended the publication of the Bank of England’s Brexit scenarios, telling Parliament that the institution couldn’t hold back its analysis once lawmakers had asked for it
    • Those scenarios are the product of around 170 staff over a two-year period -- not an overnight “exam crisis,” according to Carney, who also said that there’s a low probability of the worst-case Brexit scenario materializing. Still, U.K. ports aren’t prepared for a sudden switch to trading with the European Union on the World Trade Organization’s rules, he said
    • The extent of the Brexit’s disruption to trade and the economy will determine how much the pound falls, according to BOE Deputy Governor Ben Broadbent
  • Meanwhile, Carney’s predecessor as BOE Governor, Mervyn King, accused U.K. Prime Minister Theresa May’s government of “incompetence of a high order” for negotiating a Brexit deal that is the “worst of all worlds”
  • French President Emmanuel Macron’s government reversed course and suspended a planned fuel-tax hike that had sent as many as 300,000 protesters into the streets for three weeks in sometimes violent clashes
    • Fixing France’s endemic unemployment problem remains one of the government’s key challenge, says Bloomberg Economics’ Maeva Cousin
  • Less than a decade after the financial crisis nearly tore the euro area apart, a long-anticipated push to shore up the single currency finally started taking shape at a meeting of the bloc’s finance ministers, though it will likely underwhelm those calling for tighter integration
  • Germans are spending more time than ever at work, but their renowned efficiency is slipping
  • Italian Prime Minister Giuseppe Conte indicated the populist government is about to back down in a budget standoff with the European Commission
  • Sweden’s exit from negative rates is looking a lot harder with headwinds mounting for the Riksbank
  • South Africa emerged from its first recession in almost a decade in the third quarter as recoveries in manufacturing and agriculture contributed to an increase in economic growth
  • Australia’s booming jobs market emboldened the central bank to scrap a long-held reference to weak wages, even as it signaled concern about a slump in an unchanged interest-rate decision
U.S. Inflation, China’s Trade Silence, Carney on Brexit: Eco Day

©2018 Bloomberg L.P.