US Briefing - Thursday 07.11
Headlines
  • China MOFCOM: Agreed With US To Roll Back Tariffs In Phases
  • China Considers Removal Of US Poultry Import Restrictions
  • EU Commission Cuts Euro Zone Growth Forecast, Sees Muted Inflation
  • ECB Sees Modest But Positive Euro Zone Growth In Second Half
  • ECB Holzmann: Should End Negative Rates As Soon As Possible
  • Decline In German Industrial Output Adds To Recession Fears
  • BoE Leaves Rates On Hold; Two Members Vote For Cut
  • UK Budget Watchdog Ordered To Cancel New Fiscal Forecasts
  • Treasury Yields Higher As Investors Focus On Trade Developments
  • Dollar Strengthens Against Yen On Chinese Ministry Comments
  • Oil Prices Rebound; US Crude Futures Back Above $57
  • European Stocks Hit Fresh Four-Year Highs; US Futures Also Gain
Commentary
China Says It Has Agreed With The US To Cancel Existing Trade Tariffs In Phases

China’s Commerce Ministry said Thursday that Beijing had agreed with Washington to lift existing trade tariffs between the two nations in phases.

 

Gao Feng, a ministry spokesperson for China’s Commerce Ministry, said that both sides had agreed to simultaneously cancel some existing tariffs on one another’s goods, according to the country’s state broadcaster.

 

The ministry spokesperson said that both sides were closer to a so-called “phase one” trade agreement following constructive negotiations over the past two weeks. (CNBC - Continue Reading)

Prices Are The Missing Ingredient In The ECB’s Inflation Estimate

When Christine Lagarde tries to work out why the European Central Bank can’t hit its inflation goal, she might need to look at the measure itself.

 

The institution’s new president, who is widely expected to start a strategy review, is attempting to hit an official gauge of consumer-price growth that grossly under-represents housing costs by only including residential rents. That ignores the 66% of homes that are owner-occupied.

 

Economists say that by overlooking one of consumers’ biggest expenses, the ECB effectively traps itself into pumping ever more monetary stimulus into the financial system. A striking metric is that Eurostat, the European Union’s statistics agency, assumes people spend about just 6.5% of their after-tax pay on shelter. (Bloomberg - Continue Reading)

Bank Of England Surprises As Two MPC Members Vote For Rate Cut

Two Bank of England officials unexpectedly voted to lower interest rates this month due to signs of a deeper economic slowdown, and others said they would consider a cut if global and Brexit headwinds did not lift.

 

The BoE said on Thursday that its nine-member Monetary Policy Committee voted 7-2 to keep Bank Rate at 0.75%, in sharp contrast to forecasts in a Reuters poll for a unanimous decision.

 

So far the BoE has resisted following the United States Federal Reserve and the European Central Bank in cutting its main interest rate in response to Brexit challenges and a global slowdown caused by the U.S.-China trade war. (Reuters - Continue Reading)

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