This is the web version of the WSJ’s newsletter on the economy. You can sign up for daily delivery here.
Yesterday we debuted our pilot of a downloadable Real Time Economics calendar with entries for the most important data releases and events, which we’ll update with analysis and links to our coverage. Some of you encountered a technical problem with a link to access the calendar. If that’s you, we hope you’ll give us another shot: Here’s our how-to for adding the calendar. Let us know what you think by replying to this email.
SLOW DOWN
China lowered its economic growth target. The government now expects annual gross domestic product to advance between 6% and 6.5% in 2019, recognition of a deepening slowdown that can’t be quickly arrested without aggravating already-high debt levels. Though still strong by many countries’ standards, China’s economic expansion weakened last year to its slowest in nearly three decades. The country’s main drivers of growth, including exports, investments and consumption, are all under pressure, Lingling Wei reports.
China’s plan to prop up growth: increasing deficit spending, launching new tax cuts and other fee reductions for businesses—totaling 2 trillion yuan, or 2% of China’s $13 trillion economy—and boosting bank lending to small and private companies by 30%. Premier Li Keqiang delivered a blueprint that also calls for giving foreign investors greater access to China’s markets and allowing foreign firms to enter more sectors without Chinese partners.
WHAT TO WATCH TODAY
IHS Markit’s U.S. services index for February is out at 9:45 a.m. ET.
The Institute for Supply Management’s nonmanufacturing index for February is expected to inch up to 57.0 from 56.7. (10 a.m. ET)
U.S. new-home sales for December are expected to drop to an annual pace of 595,000 from 657,000 a month earlier. (10 a.m. ET)
The Boston Fed’s Eric Rosengren speaks on the economy at 7:30 a.m. ET, the Minneapolis Fed’s Neel Kashkari testifies before the Minnesota Senate Finance Committee at 9:30 a.m. ET, and the Richmond Fed’s Thomas Barkin speaks about the rural economy at 11:30 a.m. ET.
The Bank of England’s Mark Carney testifies before the House of Lords at 10:35 a.m. ET.
Treasury releases its monthly budget statement at 2 p.m. ET.
TOP STORIES
I THOUGHT WE HAD A TRUCE?
Chinese hackers have targeted more than two dozen universities in the U.S. and around the globe as part of an elaborate scheme to steal research about maritime technology being developed for military use. New research, to be published this week, is the latest indication that Chinese cyberattacks to steal U.S. military and economic secrets are on the rise. The findings name a substantial list of university targets for the first time, reflecting the breadth and nature of the ongoing cyber campaign that dates to at least April 2017, Dustin Volz reports.
FOOD FIGHT
U.S. and European differences over agriculture threaten to rekindle a tit-for-tat economic war. U.S. farm lobbies, Congress and some Trump administration officials are demanding access to European markets following a trans-Atlantic trade truce in July. European Union officials are refusing to engage, arguing the White House agreement specifically omitted agriculture, Emre Peker reports.
U.S. Trade Representative Robert Lighthizer and EU Trade Commissioner Cecilia Malmstrom will meet in Washington on Wednesday for their fifth round of talks, now under pressure to avoid a fight over agriculture that neither appears to want. The big threat: President Trump faces a mid-May deadline to decide whether to impose duties on U.S. car and auto-parts imports. That could hit $60 billion in annual EU exports and would trigger immediate retaliation from Brussels.
SWAP TEAM
U.K. banks will be able to borrow in euros from the Bank of England from next week, the latest move to shore up the financial system in the event of an abrupt and messy break from the European Union. The U.K. central bank said it has activated a dormant financial crisis-era “swap line” with the European Central Bank that allows it to provide euros to any British bank that needs them to keep functioning in a funding crunch. The BOE warned, however, that investors should brace for severe disruption in financial markets if the U.K. tumbles out of the EU March 29 without a Brexit deal, Jason Douglas reports.
THIS IS WHY WE CAN’T HAVE NICE THINGS
Amtrak’s high-speed rail route from Chicago to St. Louis will cost about $2 billion, shave just an hour from a 5½-hour trip, and boost ridership by only a few percentage points. The project is a case study in why high-speed train travel remains an elusive goal in the U.S.
Illinois didn’t have the money, or the right-of-way, to lay tracks that would be exclusively for a high-speed service. So its fast passenger trains will have to share the track with lumbering freight trains. Illinois settled for weaving improvements along the route and rebuilding an existing single-track line. In effect, it chose higher-speed rail rather than actual high-speed, Shayndi Raice and Paul Overberg report.
WHEN EVERYTHING SPARKS JOY
Marie Kondo is on Netflix (“Tidying Up with Marie Kondo”), has a best-selling book (“The Life-Changing Magic of Tidying Up”) and her own catch phrase (“does it spark joy?”) that are all about getting people to tidy up their homes and declutter their lives. But is anyone getting rid of their stuff? U.S. construction spending on self-storage hit another record last year.
Ken Simonson, chief economist at the Associated General Contractors of America, speculates: “It’s a combination of millennials who are still in small apartments but have enough income that they keep acquiring stuff, and their parents, who have been holding onto stuff for the millennials and are now downsizing. Don’t know if it’s true but seems plausible!”
QUOTE OF THE DAY
Barack Obama rolls into office with Mitt Romney’s health care policy, with John McCain’s climate policy, with Bill Clinton’s tax policy, and George H.W. Bush’s foreign policy. And did George H.W. Bush, did Mitt Romney, did John McCain say a single good word about anything Barack Obama ever did over the course of eight solid years? No, they [expletive] did not. —University of California-Berkeley economist Brad DeLong, on why Democrats should embrace a more left-leaning economic agenda (via Vox.com)
TWEET OF THE DAY
[wsj-responsive-sandbox id = "0" ]WHAT ELSE WE’RE READING
Modern monetary theory is the voodoo economics of our time. “A valid idea—that traditional fiscal-policy taboos need to be rethought in an era of low real interest rates—has been stretched by fringe economists into ludicrous claims that massive spending on job guarantees can be financed by central banks without any burden on the economy,” Lawrence Summers, former Treasury secretary and current Harvard professor, writes in the Washington Post.
President Trump’s trade fights are hitting his supporters the hardest. “U.S. tariffs favored sectors located in politically competitive counties, suggesting an ex ante rationale for the tariffs, but retaliatory tariffs offset the benefits to these counties. Tradeable-sector workers in heavily Republican counties are the most negatively affected by the trade war,” Pablo Fajgelbaum, Pinelopi Goldberg, Patrick Kennedy and Amit Khandelwal write in a new research paper.
UP NEXT: WEDNESDAY
The ADP jobs report for February is expected to post a net gain of 185,000. (8:15 a.m. ET)
The U.S. trade deficit for December is expected to widen to $57.3 billion. (8:30 a.m. ET)
The Bank of Canada releases a policy statement at 10 a.m. ET.
The New York Fed’s John Williams speaks on the economic outlook at 12:10 p.m. ET.
The Federal Reserve releases its beige book at 2:00 p.m. ET.
from Real Time Economics https://ift.tt/2HmnD3l
No comments:
Post a Comment