Underestimating Fed Patience, Mexico Rates, Suez Woes: Eco Day

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

  • A word of warning for all those bond traders banking on a Federal Reserve rate hike as soon as next year: Since 2008, markets have underestimated how patient officials can be in lifting borrowing costs from zero
  • It’s rate decision day in Mexico -- here’s what to expect
  • The Asian Development Bank warned that rising U.S. yields could trigger currency and debt crises across Asia like past shocks that rocked emerging markets
  • The ship that has completely blocked the Suez Canal remains stuck in place. While operations to free the channel continue today, the best chance to move the vessel may not come until Sunday or Monday when the tides are highest
  • The U.S. fiscal boost will bring huge spillovers to China
    • China’s services sector improved only marginally in the first quarter against a strong rebound in the broader economy, a sign of still weak consumption, according to a private survey by China Beige Book International
    • China’s central bank has asked lenders to keep loan growth stable and reasonable, with increased support to house leasing, innovative technology and the manufacturing sector
    • China faces a range of challenges in 2021. Reaching the official growth target of over 6% won’t be one of them
  • The U.K. economy could see a “rip roaring” recovery even if consumers spend just a bit of the additional savings they accumulated during the Covid crisis, according to Bank of England Chief Economist Andy Haldane
    • The networking website LinkedIn said its database shows more of its members left the U.K. for the European Union than arrived over the past year after the coronavirus and Brexit sent shock waves through the labor market

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