(Bloomberg) -- Happy Friday, Europe. Here's the latest news from Bloomberg Economics:
- Italy's government set next year's budget deficit target at 2.4 percent of output, after the ruling populist parties pressured Finance Minister Giovanni Tria into giving way. The budget tussle highlight the growing strength of Italy's populists
- Chancellor Angela Merkel is letting Turkey's leader in from the cold, a year after he accused Germans of using Nazi methods
- If Jerome Powell has a worry list, he's made it clear a hot labor market kicking off runaway inflation isn't item No. 1. The Fed chairman also played down the signal sent by a flatter yield curve and said the risk of recession was not especially high
- Fresh data on the U.S. economy show President Donald Trump's escalating trade war is shaping up as a clear drag on growth this quarter
- The turmoil that's rocked emerging markets this year is spreading to main street, damping growth prospects for some of Asia's fastest-growing economies
- India is beginning to feel the heat of global trade tensions and tighter monetary conditions, as rising oil prices and waning consumption threaten to muzzle animal spirits in the world's fastest-growing major economy
- Oil's surge toward $100 is softening the blow of sanctions on Putin's Russia. Meantime, Congress is unlikely to pass any new sanctions on the nation, including proposals that would affect its sovereign debt and energy projects, until after November elections
- Here's what happened in the world economy this week and why it matters
To contact the reporter on this story: Connor Cislo in Tokyo at ccislo@bloomberg.net
To contact the editor responsible for this story: Brett Miller at bmiller30@bloomberg.net
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