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China’s Top Negotiator ‘Cautiously Optimistic’ About Reaching Trade Deal

China’s chief trade negotiator indicated he was “cautiously optimistic” about reaching a phase one deal with the U.S., as two titans of American diplomacy in Asia warned of the dangers of escalating the tariff war. Vice Premier Liu He made the comments in a speech in Beijing on Wednesday ahead of the Bloomberg New Economy Forum, according to people who attended the dinner and asked not to be identified. He has also reportedly asked the top U.S. trade negotiator to travel to China to continue talks this month, an invitation ...

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Premier Li calls for joint efforts to safeguard globalization, tackle downward pressure

Premier Li Keqiang held the fourth ‘1+6’ Roundtable with leaders of six major international economic and financial institutions in Beijing on Nov 21. The six leaders are: President David Malpass of World Bank, Managing Director Kristalina Georgieva of the International Monetary Fund, Deputy Director-General Alan Wolff of the World Trade Organization, Director-General Guy Ryder of the International Labor Organization, Secretary-General Angel Gurria of the Organization for Economic Cooperation and Development, and Chairman Randal Quarles of the Financial Stability Board. This year’s dialogue was focused on ‘promoting openness, stability and high-quality ...

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Kissinger Says U.S. and China in ‘Foothills of a Cold War’

Former U.S. Secretary of State Henry Kissinger said the U.S. and China were in the “foothills of a Cold War,” and warned that the conflict could be worse than World War I if left to run unconstrained. “That makes it, in my view, especially important that a period of relative tension be followed by an explicit effort to understand what the political causes are and a commitment by both sides to try to overcome those,” Kissinger told a session of the New Economy Forum. “It is far from being too ...

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Modi Makes Huge Privatization Push to Jumpstart India Economy

India’s Prime Minister Narendra Modi is putting the flagging economy back on center stage after announcing the biggest privatization drive in more than a decade and making renewed attempts to ring fence the crisis-ridden shadow banking sector. The country is in the midst of a deepening slowdown amid waning consumption — the bedrock of the $2.7 trillion economy. And while Modi has targeted transforming India into a $5 trillion economy by 2025, of late, most of his attention has been focused on asserting a more muscular foreign policy and placating ...

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Italy’s alarm over reform of euro zone bailout fund may be overblown

A political storm has erupted in Italy over reform of the euro zone’s bailout fund, known as the European Stability Mechanism (ESM). The main government and opposition parties, as well as the Bank of Italy, say the reform could hurt market confidence in Rome’s debt and potentially make a debt restructuring or even default more likely. Here are some questions and answers on the reform: WHAT IS THE AIM OF THE REFORM? The role of the ESM is being expanded to include backing up the European Single Resolution Fund (SRF) ...

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Critics of Economics Fight a War That Ended Long Ago

Each year brings a reliable drumbeat of broadsides against the economics profession in the popular press. This year’s standout is an op-ed by anthropologist David Graeber in the New York Review of Books. Like its many predecessors, Graeber’s article gets a few things right and a lot of things wrong about the failings of economics and its role in the modern world. Like many of his fellow critics, Graeber focuses almost entirely on one particular branch of economics — business cycle theory, which occupies a small niche in the broad ...

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Only 14% of Chinese companies are embracing A.I., IBM says

China is widely referred to as a global leader in artificial intelligence (AI) but just 14% of companies in the country are actively using AI software, according to Alain Bénichou, CEO of IBM’s Greater China business. Citing research from IBM’s Institute for Business Value, Bénichou said the rate of adoption in China is higher than the global average, but still not as high as expected. “There is a long way to go,” Bénichou said Tuesday at CNBC’s East Tech West conference in the Nansha district of Guangzhou, China. “When you ...

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‘America First’ No More as New Billions Flow Into World Markets

Faith in the world-conquering, relentless, sure-thing America First trade is fraying on bets world markets will turn the corner in 2020. Risky assets outside the U.S. are seeing fresh flows as optimism over a trade deal buoys expectations for global growth. Stocks in Europe just took in money for a fourth straight week and emerging markets notched the strongest buying in 41 weeks, according to a Bank of America Corp. report citing EPFR Global data. Meanwhile, U.S. equities saw outflows over the same period, with a similar phenomenon surfacing in ...

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Beijing tariff demands may expand U.S.-China ‘phase one’ trade deal significantly

A “phase one” trade deal between the United States and China was supposed to be a limited agreement that would allow leaders from both countries to claim an easy victory while soothing financial markets. But it may morph into something bigger if U.S. President Donald Trump agrees to Beijing’s demands to roll back existing tariffs on Chinese goods, people familiar with the talks say. China’s commerce ministry said this month that removing tariffs imposed during the trade war is an important condition to any deal. The demand has U.S. officials ...

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A U.S.-China ‘Phase One’ trade deal may not be inked this year

Completion of a “phase one” U.S.-China trade deal could slide into next year, trade experts and people close to the White House said, as Beijing presses for more extensive tariff rollbacks, and the Trump administration counters with heightened demands of its own. Just over five weeks later, a deal is still elusive, and negotiations may be getting more complicated, trade experts and people briefed on the talks told Reuters this week. Asked Wednesday about the status of the China deal, Trump told reporters in Texas “I don’t think they’re stepping ...

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Fed Officials Cut Rates Last Month Amid Worries on Trade, Global Growth

Federal Reserve officials said little about what would prompt them to resume interest-rate cuts when they signaled a pause following last month’s rate reduction. In cutting rates for the third time since July, Fed policy makers at the October meeting worried that weakness in manufacturing, trade and business investment could threaten the economic expansion by triggering cutbacks in hiring and consumer spending, according to minutes of the policy meeting, released Wednesday. “Risks to the outlook associated with global economic growth and international trade were still seen as significant despite some ...

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China to revise 2018 GDP to reflect asset, business growth

China will revise its 2018 gross domestic product (GDP) estimate in the next few days to reflect an increase in the number of businesses and assets recorded in the last census, officials said. China’s fourth National Economic Census, released on Wednesday, included “richer” data points that showed more business entities and a bigger total asset base in 2018 than assumed under earlier GDP estimates, Li Xiaochao, deputy head of the statistics bureau, told Reuters. While the revisions typically have no immediate bearing on policy, some analysts see other implications for ...

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Structural reforms can counter slower growth in Asia: Apec report

Growth has slowed in the Asia-Pacific due to trade tensions and uncertainty, but countries in the region should take this opportunity to adopt structural reforms to strengthen their prospects for growth in the long term. This is a key recommendation in a report by the Asia-Pacific Economic Cooperation (Apec) Policy Support Unit (PSU), the research arm of the regional bloc. Released this week, the report noted that the region grew at a slower pace of 3.6 per cent from January to June this year, compared to gross domestic product growth ...

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European third quarter earnings still seen down 4.7%

Earnings expectations for European listed companies for the third quarter remained stable, leaving the region stuck in a corporate recession, data published late on Tuesday showed. Companies on the pan-European STOXX 600 index are expected to report a 4.7% decline in earnings for the July-September quarter, unchanged compared to the drop expected a week ago, according to the latest data from I/B/E/S Refinitiv. At the end of October, expectations were for a fall of 8.6%. Overall, the current earnings season is set for its third straight decline and worst quarterly ...

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ECB Flags Risks to Financial Stability From Its Own Stimulus

The European Central Bank warned of potential side effects from its loose monetary policy, highlighting how years of unprecedented stimulus designed to bolster the economy is contributing to an erosion of financial stability. Low interest rates have encouraged excessive risk-taking by investment funds and insurers as well as in some real estate markets, the ECB said in its semi-annual Financial Stability Review released Wednesday. Signs of asset mispricing suggest potential for future corrections. “While the low interest-rate environment supports the overall economy, we also note an increase in risk-taking which ...

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