As expected, the US and Chinese presidents Donald Trump and Xi Jinping met to discuss trade alongside the G20 summit in Buenos Aires. For now, a tentative truce has been agreed, with Trump calling off further tariff rises in January. On its side, China will purchase an unspecified amount of goods from the US in […]
The Federal Reserve (Fed) has been sending dovish signals in recent days: The previous exuberantly optimistic tone about the US growth has been pared down, as some pockets of data have softened, notably housing. Meanwhile, there is renewed debate about the landing zone of the current monetary tightening. Some Fed members want to change the […]
The Italian statistical office’s (ISTAT) final reading showed that the economy shrank 0.1% q-o-q (-0.5% q-o-q annualised) in Q3, whereas a preliminary reading on October 30 showed that growth was flat. The details were quite negative and confirmed the idiosyncrasy of the Italian economy. Unlikely other euro area economies, net trade contributed positively to growth […]
The strong growth enjoyed by the Swiss economy since Q1 2017 came suddenly to an end in Q3 18, when real GDP shrank unexpectedly by 0.2% q-o-q (-0.9% q-o-q annualised). This is much lower than consensus expectations of +0.4% and is down from an average of +0.8% in H1 2018. Details show that the contraction […]
US corporates are delivering strong profits and this robust profit picture is further enhanced by a sharp drop in the corporate tax burden. According to NIPA (national accounts) data, the effective tax rate for the year ending in Q3 2018 reached a new low of 11.9%. President Trump’s December 2017 tax cuts led to a […]
Having secured formal approval of the divorce deal from EU leaders on 25 November, Prime Minister Theresa May now faces the far bigger challenge of securing UK parliamentary approval by mid-December. Both political and economic uncertainty could remain elevated until the 29 March deadline. The tail risk of a no-deal Brexit on 29 March remains […]
Brexit and oil kept their centre-stage positions in last week’s headlines. Despite initial opposition from France and Spain, all 27 EU members agreed to Theresa May’s Brexit deal by lunchtime at Sunday’s European Council meeting. Could this be an indication of how poor the deal is for the UK? Despite May’s insistence that there is […]
This week, the European Commission issued its opinion on Italy’s budget plans. Deeming them noncompliant with the EU’s budgetary rules, it recommended that an Excessive Deficit Procedure (EDP) be opened.Of the options available to the EU, a debt-based EDP would be the most difficult for Italy to deal with, as it would last longer and […]
A new low point in trade tensions between the US and China was reached in September 2018 when the US placed an additional 10% duty on roughly USD200 billion of Chinese imports. However, since then, hints at a potential ‘détente’ have focused on the G20 summit in Buenos Aires at the end of November, with […]
The link between oil prices and the health of the US economy has changed considerably this decade, especially as a result of the domestic energy sector boom. The US produced a record high of 11.7 million barrels per day last week, versus only around 5 million in 2008. The epicentre of this oil boom, linked […]
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