Trade ‘Snap-Back’ Risk, Davos Kickoff, Modernizing ECB: Eco Day

(Bloomberg) --

Good morning Americas. Here’s the latest news and analysis from Bloomberg Economics to help you start the day and week:

• The risk of a reversal in progress agreed to under the U.S.-China phase-one deal is keeping prospects for the Chinese economy in check

  • Meanwhile, shipping gauges on Bloomberg’s Trade Tracker show global trade could be losing steam, ahead of a Lunar New Year period that will wreak havoc on the data
• As global elites descend on Davos for their annual gathering, up for debate is whether some of the big themes of our time, including globalization and cars, will hit their peak in the 2020s
  • Also in Davos, an Oxfam report showed the world’s richest 1% have more than twice the wealth of the rest of humanity combined, and how governments are “massively under-taxing” rich individuals and corporations, and under-funding public services
  • The forum organizers separately warned that global inequality is going to worsen unless governments do more to ensure those most affected by rapid technological change aren’t just cast aside and forgotten
• Christine Lagarde is preparing to modernize the European Central Bank. The process will include questioning the ECB’s inflation goal and addressing topics including inequality, technology and climate change
• A Bank of England rate cut still could be in the offing even if key economic numbers show improvement this week
  • That’s even as a report showed asking prices for U.K. homes increased by the most for any January on record in a sign that the Conservatives’ December election win boosted confidence, according to property website-operator Rightmove
• For the first time Japanese Prime Minister Shinzo Abe didn’t even mention the word “deflation” in his annual start-of-the-legislative-session speech to lawmakers, an omission that may help cement a view the Bank of Japan is now under less pressure to meet its elusive price target
• The Swiss National Bank appears to have resisted taking dramatic action in the past week to curb the franc’s appreciation to the strongest in almost three years
• Finally, here’s our preview of what to watch this week

To contact the reporter on this story: David Goodman in London at dgoodman28@bloomberg.net

To contact the editors responsible for this story: Paul Gordon at pgordon6@bloomberg.net, Zoe Schneeweiss

©2020 Bloomberg L.P.