U.S. Inflection Point, Europe Scars, Wealth Tax: Eco Day

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

• Fed Chair Jerome Powell said the U.S. economy is at an “inflection point” with stronger growth and hiring ahead thanks to rising vaccinations and powerful policy support, but Covid-19 remains a threat
• Recent reports show the U.S. economy is on a solid recovery path, but real-time indicators suggest the magnitude of the consumer-led rebound could be even more dramatic
• The euro area will not return to its pre-crisis growth path unlike the U.S., meaning that two years of economic expansion may have been permanently lost, European Central Bank Executive Board member Fabio Panetta said in an interview with El Pais
• The Biden administration is stepping up scrutiny of China’s plans for a digital yuan, with some officials concerned the move could kick off a long-term bid to topple the dollar as the world’s dominant reserve currency, according to people familiar with the matter
• Economics used to offer lots of metrics that claimed to show when growing economies were approaching some kind of speed limit. But increasingly, inflation is the only one that’s taken seriously
• A market-based gauge of inflation expectations is climbing toward the ECB’s close-to 2% goal, but Germany’s benchmark yieldsremain unmoved, creating the biggest gap between the two since 2019
• A wealth tax is a bad way to pay off pandemic debts and probably would become permanent if introduced, Nobel Prize-winning economist Angus Deaton said
• Japan’s vaccination drive finally kicks into gear Monday around four months after the start of inoculations in the U.S. and the U.K., a slow rollout that has generated further criticism of Prime Minister Yoshihide Suga’s handling of the pandemic
• The British economist John Williamson, who in 1989 coined the term “Washington Consensus” to describe fiscal-discipline and market-liberalization policies for Latin America supported by the World Bank and International Monetary Fund, has died
• In Myanmar, investors are fleeing and businesses are teetering close to the financial edge as the junta’s crackdown worsens

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