Leaders
shouldn’t wait for the next disaster before addressing the euro’s flaws.
Ursula
von der Leyen’s bumpy start – The
Economist
Why
the incoming boss of the European Commission is struggling
EU
looking to compensate sectors for U.S. tariffs – Reuters
Italian
Prime Minister Conte: EU is working on measures to compensate sectors hit by
tariffs imposed by US over illegal EU subsidies to the aircraft industry,
Europe
recession expected to deepen as third quarter earnings outlook dims – Reuters
Europe’s
corporate recession is expected to deepen, the latest forecasts show, as
companies struggle with uncertainties from Brexit, the protracted U.S.-China
trade spat and Germany’s manufacturing recession. Companies listed on the STOXX
600 regional index are now expected to report a drop of as much as 3.7% in
third-quarter earnings, worse than the 3% fall expected a week ago, I/B/E/S
data from Refinitiv showed.
Another
piece of Europe’s financial architecture needs fixing – The
Economist
Money-laundering
scandals expose a host of weaknesses
Euro
zone inflation drops more than foreseen, trade surplus widens – Reuters
Riksbank
preview: Facing reality – Nordea
With
the slowing activity in the Swedish economy, the Riksbank will ultimately
shelve its plans for a rate hike near term. We believe a rate cut is on the
cards, although it may be some way off.
Sweden:
The Labour Force Shuffle – Nordea
The
situation on the labour market is deteriorating, but at what pace? And what
does it mean for the Riksbank?
Eastern
Europe’s Workers Finally Get Paid – BB
The
region’s populist governments are raising minimum wages as fast as they can,
and it helps the economies — for now.
Poland’s
Nationalists Underwhelmed by Historic Election Win – BB
Ruling-party
leader sulks despite best result since communism * Lack of knockout victory
shifts focus to presidential ballot
Polish
Premier Hails ‘Huge’ Mandate to Complete Remake of Nation – BB
Law
& Justice maintains majority in lower house, loses Senate * Party campaigned
on welfare handouts, spurning liberal values
Europe's
Climate Push Won't Come Cheap – BB
Poland
holds a veto to the European Union’s goal of achieving climate neutrality by
2050, and its support isn’t going to come cheap. Poland says climate neutrality
needs new financial tools, ECB has crucial role in green shift.
GERMANY
The
country’s economic woes are a symptom of a more deep-rooted growth problem, Harvard
research shows.
Holding
Off Stimulus in Germany Isn’t Just Political Mantra – BB
Officials
cite assessment of economy and spending strategy * IMF made new call this week
for Germany to use fiscal space
Angela
Merkel demands Germany retain EU budget rebate – FT
Chancellor
says Berlin faces ‘excessive burden’ as a result of Brexit
Germany
Seeks to Limit EU Budget Contribution – Spiegel
As
negotiations for the future EU budget heat up, Germany has angered some member
states by demanding that the money available to Brussels not exceed 1 percent
of the bloc's GDP. But Berlin has some allies.
Merkel
wants to discuss EU budget discount for Germany after Brexit – Reuters
Merkel
on Thursday said EU needed to discuss a possible discount for Germany as part
of budget negotiations because Germany would be "disproportionately
burdened" by an increase in the bloc's budget.
EUROPEAN CENTRAL BANK
ECB
critics are right to worry about ultra-loose monetary policy – FT
There
is moral hazard in debt monetisation as it can neuter market discipline
ECB
Policy Makers Cool on More Stimulus Even If Outlook Worsens – BB
Governors
said to expect another growth downgrade in December * Lagarde presidency in
focus after split over Draghi stimulus
Draghi
Seen Locking In Three Years of ECB Policy for Lagarde – BB
Economists
expect officials to hold fire in October decision * Draghi expected to make
swan song call for fiscal stimulus
Mario
Draghi’s ECB opponents shift attention to Christine Lagarde – FT
Critics
of his recent stimulus measures seek change of policy under incoming president
ECB’s
Visco Draws Line on Cutting Rates Deeper Below Zero – BB
Says
he didn’t support all elements of latest stimulus package * Cautions about
negative consequences of negative rates
Jean-Claude
Trichet defends Mario Draghi stance on monetary policy – FT
Former
central bank chief says ECB brought growth and price stability despite crisis
Central
bankers’ theories have in practice fallen short. That has left them vulnerable
to attacks.
The
ECB has apparently lost the ability to raise inflation and price expectations
have been sliding since the last recession. Much of the policy debate has
focused on the flattening of the Phillips curve. Yet, as this column shows,
estimations of the joint output-inflation process point to a decline of both
output potential and trend inflation as the most relevant elements of the
puzzle.
ECB
Preview - Arrivederci Mr Draghi, bonjour Mrs Lagarde – Danske
Bank
Next
week's ECB meeting is Draghi's final meeting before leaving office on 31
October. Despite lower inflation expectations, we do not expect any new policy
measures/changes as the September package is yet to be implemented. Focus will
be on the recent public disagreement in the governing council as well as
tiering implementation.
ECB
Preview: Draghi’s legacy – Nordea
Mario
Draghi’s last meeting is likely to revolve around his legacy at the ECB. From a
policy perspective, Lagarde’s first speech will be more important. Three
details are worth looking out for, though.
UNITED STATES
US
manufacturing woes mount – ING
US
manufacturing output has now contracted in six of the first nine months of
2019. With the economic slowdown spreading to other parts of the US economy,
the Federal Reserve will likely have to respond with several more rate cuts
OTHER
A
new Nobel winner’s overlooked paper suggests a solution to the challenge of
mass migration.
A
new eBook addresses the challenges of ageing populations in terms of both
individual and aggregate wellbeing, and highlights the options for countries
and individuals to address those challenges.
Trade Woes Push IMF Global Growth Outlook to Decade-Low of 3% - BB
Trade Woes Push IMF Global Growth Outlook to Decade-Low of 3% - BB
World
Economic Outlook projects deceleration in U.S. and China * Fund cites a broad
slowdown, shaky outlook, uncertain recovery
Everyone
Backs Budget Spending Except People Who Control Budgets – BB
Central
banks, IMF urge fiscal support for shaky world economy * But governments mostly
haven’t been racing to the rescue
China’s
Economy Slows on Weak Investment, Testing Global Growth – BB
Investment
growth weaker than expected at 5.4% year-to-date * Industrial production
accelerated in September, retail steady
China: Q3 GDP lower than expected – Nordea
As
expected, China’s GDP growth slowed in Q3. The growth was at a 27-year low of
6.0% y/y, below consensus, showing that growth momentum is suffering both from
domestic difficulties and the trade war.
China
quietly doubles troop levels in Hong Kong, envoys say – Reuters
There
are now up to 12,000 Chinese troops in Hong Kong, diplomats tell Reuters. Among
them: members of the People’s Armed Police, a paramilitary force that answers
to Xi Jinping. If China moves to put down protests in the city, they will
likely do the job.