Powell’s Revolution, Jackson Hole, South Korea Exports: Eco Day

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Welcome to Monday, Europe. Here's the latest news and analysis from Bloomberg Economics to help you start the week.

• Read our Big Take on how Federal Reserve Chairman Jerome Powell‘s policy revolution was blindsided by the covid crisis
• The road to more normal monetary policy runs through Jackson Hole. Topping Powell's to-do list will be clarifying when and how to phase down the asset purchase program, Bloomberg Economics says. Powell's chances for a second term also gained momentum with Treasury Secretary Janet Yellen's endorsement
• German exporters are facing increasing pressure in their home market from Chinese exports to the EU, according to a study by the Cologne Institute for Economic Research
• The Chinese Communist Party has a new catchphrase to guide its economic policy, a “cross-cyclical” approach that government advisers say means taking action sooner, in smaller steps and with a longer time frame in mind
• All eyes are on the Bank of Korea, viewed as most likely to lead policy tightening in Asia, Bloomberg Economics says
  • Meantime, South Korea's early trade data show exports are set to rise in August, suggesting global demand remains resilient
• Activity in Japan's service sector shrank at the fastest pace in 15 months as restrictions to combat the nation's worst wave of Covid-19 infections hit businesses
• Libya needs to boost oil output by almost 40% of its current level in order to cover its spending needs and begin revamping an economy battered by a decade of war, the OPEC nation's central bank governor said
• Former U.S. Treasury Secretary Lawrence Summers said China's markets are now a “riskier environment” for investors
• Afghanistan's new Taliban-led government faces a series of shocks that probably will lead to a weaker currency, faster inflation and capital controls, according to the nation's exiled central bank chief
• Wealthy Americans wondering how much more taxes they'll owe after Democrats pass their sweeping social-spending package may have to wait until deep into the fall, or later, to find out

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