New Fed Approach, China Economy Accelerates, Slow India: Eco Day

Welcome to Friday, Asia. Here’s the latest news and analysis from Bloomberg Economics to help take you through to the weekend.

  • Fed Chair Jerome Powell unveiled anew approach to setting monetary policy, letting inflation and employment run higher in a shift that will likely keep interest rates low for years to come. The comments sent gold on aroller-coaster ride and the Treasury yield curvesteepened to the widest in two months
  • China’s economypicked up speed in August on a combination of a strong industrial sector and stock market, better business confidence and home and car sales
  • Business activity in India picked up slightly in July as a gradual improvement in services and exports showed the economypossibly moved past its worst-showing in the previous quarter
  • Japanese Prime Minister Shinzo Abeshould be able to serve out the remainder of his term as party leader ending about a year from now, his right-hand man said, after recent hospital visits raised questions about the premier’s health
  • Applications for state U.S. unemployment benefitsdecreased last week following an unexpected jump, indicating the labor market’s gradual recovery is back on track as Covid-19 infections ease
  • To gauge howeconomic factors may shape U.S. voting decisions in crucial swing states, Bloomberg Economics is using high-frequency data to track conditions
  • Sweden’s government is embarking on anhistoric spending spree as it acknowledges there’s now less scope to lean on the central bank
  • Canada’s economysuffered its worst contraction on record in the second quarter, official data is set to show on Friday, but the country appears to have rebounded strongly since the height of the pandemic
  • The current surge in the amount of money sloshing around in the euro zone isfar from being a signal that the ECB should guard against inflation, according to economist Nick Kounis at ABN Amro NV
  • China’s latest volley of missile launches into the world’s most hotly contested body of waterserved as a warning to two key U.S. targets: aircraft carriers and regional bases

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