Budget Test, Scary Time for Workers, ECB Collateral: Eco Day

(Bloomberg) -- Welcome to Wednesday, Americas. Here’s the latest news and analysis from Bloomberg Economics to help you start the day

  • Budget support in the U.S. may not be sufficient to get the economy through the coronavirus crisis relatively intact
  • U.S. middle class faces a scary time as layoffs spread to offices and even survivors are taking salary cuts
  • A quarter of working Americans believe it’s “very likely” or “fairly likely” they will lose their job or be laid off in the next 12 months, according to a Gallup poll
  • The Trump administration signaled it’s under no obligation to comply with certain World Trade Organization dispute rulings because the trade body’s appellate function is no longer operational
  • European Central Bank policy makers will hold a call on Wednesday evening where they may discuss whether to accept junk-rated debt as collateral from lenders, according to officials familiar with the matter
    • Euro-zone leaders who oppose sharing the costs of the coronavirus crisis might end up doing so anyway -- through the ECB
    • The ECB may have to again change its rules on asset purchases to avoid an Italian sovereign debt crisis, Bloomberg Economics says
  • Italy will plunge further into debt as it seeks to double its economic support package
  • Turkey will likely lower interest rates for an eighth time in less than a year, showing the central bank remains unfazed by the lira’s steep decline

©2020 Bloomberg L.P.

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