Recession Risk, Trump’s Big Bet, Policy Surprises: Eco Day
(Bloomberg) --
Good morning Americas. Here's the latest news and analysis from Bloomberg Economics to help get your Wednesday started:
- The escalating trade war between the U.S. and China is nudging the world economy toward its first recession in a decade with investors demanding politicians and central bankers act fast to change course.
- Presidents Donald Trump and Xi Jinping are making big bets that could backfire; Trump's China problem is that a weak yuan is a strong weapon, and in the meantime, China reassures foreign firms that the yuan won't keep falling
- With U.S. warehouses bursting at the seams, the next barrage of tariffs on Chinese products may hurt more than the others because many American businesses are out of room to shield their supplies from the new import taxes
- Against that backdrop, three central banks across Asia Pacific delivered surprise interest-rate decisions on Wednesday as policy makers take aggressive action to counter a worsening global economy
- Policy makers in New Zealand and India went for bigger-than-expected rate cuts, while Thailand's 25-point reduction was a surprise to all but two in a Bloomberg survey of economists
- There's little historical precedent to help officials tailor a response to a potential no-deal Brexit
- German industrial production fell more than expected in June, further aggravating the country's manufacturing slump
- Finally, in the U.S., student loan payment assistance is catching on as a new form of benefit
To contact the reporter on this story: David Goodman in London at dgoodman28@bloomberg.net
To contact the editors responsible for this story: Paul Gordon at pgordon6@bloomberg.net, Zoe Schneeweiss
©2019 Bloomberg L.P.
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