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Draghi Multitasking, Greece Repayment, U.K. Sees Slump: Eco Day

Draghi Multitasking, Greece Repayment, U.K. Sees Slump: Eco Day

(Bloomberg) --

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

  • Mario Draghi is spending a chunk of his final year in office multitasking as a stopgap solution for the swelling empty-chair problem at the European Central Bank’s supervisory arm
  • Repayment plan: Greece’s plan to repay some of its loans from the International Monetary Fund ahead of schedule may soon come to fruition, paving the way for the debt-stricken nation to claim it has taken another step toward economic normalcy
  • Slump: Investment intentions among U.K. firms slumped to the lowest in eight years, just one of the measures of economic health that weakened “considerably” amid recent Brexit turmoil, according to the British Chambers of Commerce
  • Asset bubbles: Signs that China’s economy is stabilizing have kicked off a debate about whether the central bank should keep injecting liquidity into financial markets, with a former senior official warning of the risk of asset bubbles
  • RBA sidelined: Australia’s central bank remained on the sidelines Tuesday as it waits to analyze the economic impact of a fiscal injection designed to catapult Prime Minister Scott Morrison to a come-from-behind election victory
    • Australian Treasurer Josh Frydenberg will have buoyant commodity prices and a hiring bonanza on his side Tuesday when he presents a budget that’ll nevertheless also reveal the economy’s weaker underbelly
  • Rescue act: India’s government is increasingly looking to the central bank to help boost a flagging economy before an election that kicks off next week. And new Governor Shaktikanta Das is turning out to be a willing partner
  • Reversal: An unexpected slide in South Korean inflation is strengthening the view that the Bank of Korea may reverse direction and cut rates this year
  • Next Mistake?: Economists succumbed to hubris in the early 21st century. The Nobel Prize winner Robert Lucas even said the basic problem for macroeconomics had been “solved.” You don’t hear that kind of complacency today, as policy makers fret about a lack of ammunition for fighting the next recession

To contact the reporter on this story: Anirban Nag in Mumbai at anag8@bloomberg.net

To contact the editors responsible for this story: Nasreen Seria at nseria@bloomberg.net, Henry Hoenig

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