Wild Week Ahead for Trump, Kim, Brexit, Cohen and Fed's Powell

(Bloomberg) -- A U.S.-China trade deal is in the making. Theresa May will try to keep Brexit on track. Donald Trump and Kim Jong Un meet in Vietnam. Jerome Powell and Michael Cohen are set to testify before Congress.

Get ready for what's already turning out to be a wild week. There will be plenty of opportunities for risk to hit markets in the coming days, with heaps of geopolitical news and major economic indicators due to land.

Wednesday will be especially challenging for TV producers managing the split screens. On that day:

• The U.S. president and the North Korean leader begin their second summit in Hanoi.
• Michael Cohen, Trump's former lawyer, testifies at an open Congressional hearing on what he knows about the 2016 campaign.
• U.S. Trade Representative Robert Lighthizer gives an update on trade talks with China to the House Ways and Mean Committee.
• U.S. Federal Reserve Chairman Powell will address the House Financial Services Committee, his second of two days of testimony.

Here's a closer look at what's at stake:

Trade Deal

After days of buildup, Trump kicked off the week by delaying a threatened increase in U.S. tariffs on Chinese imports and dangling a summit with President Xi Jinping at Mar-a-Lago, his Florida retreat, if “both sides make additional progress.” Along the way, he slapped down Lighthizer on a semantic point. Earlier, the two sides were haggling over how to ensure Beijing lives up to its promise to not weaken the yuan. Trump then reported substantial progress, including on currency.

Trump and Kim

All eyes are on whether Trump, presumably eager for a foreign-policy win, offers U.S. inducements for Kim to abandon his nuclear arsenal. The regional implications could be huge for allies such as South Korea, where 30,000 U.S. troops are based, and Japan. There's concern that Trump will give up too much if Kim makes some kind of sweet-sounding offer, a U.S. official said. Trump tweeted Sunday that he has a “great relationship” with the North Korean communist leader. They're expected to meet one-on-one at some point during the Feb. 27-28 summit. Kim headed to Vietnam by train.

Gridlock in the U.K.

Don't count on European Union leaders to settle the U.K.'s departure terms in talks at an Egyptian resort that wrap up Monday. That'll leave May to fight it out with Parliament, where lawmakers are threatening to seize control of the Brexit process and force her to postpone the March 29 “exit day.” Seeking to hasten the endgame, EU officials now may tell the U.K. that any extension would have to run until 2021, not just a few months.

May on Sunday promised a binding vote on her divorce deal by March 12. But she's pledging to give Parliament a general vote on Wednesday, which members are threatening to use to delay Brexit. Also keep an eye out for comments by Emmanuel Macron and Angela Merkel in Paris.

U.S. Economy

Look for Powell to offer signals on what's next for the Fed during two days of congressional testimony. When they last met, policy makers broadly backed ending the runoff of the central bank's balance sheet. Lighthizer, who testifies Wednesday, may give a sense of how likely the U.S. is to impose tariffs on auto imports. The European Union is threatening to hit back. U.S. fourth-quarter gross domestic product, due Thursday, is expected to show 2.5 percent expansion last year, short of the Trump administration's ambitious goal.

Trump's Ex-Lawyer

Special Counsel Robert Mueller is close to completing his report on Russian election interference, though it probably won't drop this week. That turns attention to Michael Cohen, the former Trump fixer sentenced to three years in prison in December. He'll be giving two days of congressional testimony, including an open session on Wednesday.

It's a chance for Democrats to explore topics such as pre-election hush money paid to women who alleged they had affairs with Trump, and what Cohen knows about Russian influence in the 2016 presidential campaign. What's more, federal prosecutors in New York are still looking into Trump's company, presidential campaign and inaugural committee.

To contact the reporter on this story: Tony Czuczka in New York at aczuczka@bloomberg.net

To contact the editors responsible for this story: Matthew G. Miller at mmiller144@bloomberg.net, James Ludden

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