World Economy Boxed In, Gaping Deficit, Taper Specter: Eco Day

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

  • Shocks to supply chains are engulfing a wider swath of the global economy, threatening to stifle Asia’s trade-led recovery
  • The U.S. federal budget deficit continued to balloon at the end of last year on spending to cushion the pandemic’s economic fallout
  • Fed officials are beginning to split over when they may need to start pulling back on their massive monetary stimulus, jittering nerves
  • Italy’s government led by Prime Minister Giuseppe Conte risks collapsing in the middle of the Covid-19 pandemic
  • China has been slow to announce plans on special local bond sales this year, another sign that it’s seeking to rein in debt
  • Japan’s decision to expand the state of emergency beyond the Tokyo region to some other key centers should reduce the ultimate toll on the economy, writes Yuki Masujima
  • The U.S. will bar entry of all cotton products and tomatoes from China’s Xinjiang region, where it says Beijing is oppressing Muslim-minority Uighurs
  • The Beige Book forecast choppy U.S. economic growth prior to fiscal lift, writes Eliza Winger
  • Sweden’s krona had its worst day in more than three weeks after the Riksbank said it will no longer rely on foreign borrowing to finance its currency reserves
  • The ECB’s latest projections for economic growth in the euro area are still “very clearly plausible” despite the resurgent coronavirus
  • Former Treasury Secretary Robert Rubin cautioned against taking rock-bottom interest rates for granted
  • The abstract concept of connected vehicles becomes easier to grasp at a test site in eastern China
  • After chaos engulfed the U.S. Capitol last week, some Chinese intellectuals found themselves searching for copies of an out-of-print book to make sense of events. “America Against America” forecast the U.S.’s decline due to domestic conflicts more than 30 years ago
  • Iran said it would restart production of fuel for its Tehran Research Reactor, a facility that runs on uranium enriched to higher levels in order to produce medical isotopes

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