Oil Price Risks, U.K. ‘Renewal’ Budget, Fed Easing Bets: Eco Day

(Bloomberg) --

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

• Financial markets had expected a bright start to 2020, buoyed by the sight of a U.S.-China phase-one trade deal and the lagged impact of rate cuts. But now they have a new risk to contend with -- higher global oil prices, Ziad Daoud writes at Bloomberg Economics
• Chancellor of the Exchequer Sajid Javid promised to unleash “a decade of renewal” when he outlines the U.K. budget March 11, as he seeks to ready the country to depart the European Union
• As Prime Minister Boris Johnson prepares to start trade talks with the European Union, U.K. companies are gearing up to lobby for a final accord that limits economic disruption. At stake is access to the U.K.’s single biggest export market
• Traders have firmed in their conviction that that the Federal Reserve will trim interest rates further as concern swirls around the deteriorating global geopolitical situation. But they’re far from pricing in the more dire economic scenarios seen several months ago
• American companies and consumers are paying almost the full cost of U.S. tariffs, and the impact of those duties on import volume magnifies over time, according to a paper circulated Monday by the National Bureau of Economic Research
• China’s surging consumer inflation will rise further on the current oil spike, but the jump won’t last long and probably won’t affect the pace of monetary easing in 2020, according to Citigroup
• Landlords in Hong Kong, a city with some of the highest commercial rents in the world, are staring down the barrel of a tough year

To contact the reporter on this story: Jiyeun Lee in Hong Kong at jlee1029@bloomberg.net

To contact the editors responsible for this story: Paul Jackson at pjackson53@bloomberg.net, Michael S. Arnold

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