(Bloomberg) — European Central Bank policy makers expressed uncertainty at their latest policy meeting about the economic outlook and the extent to which they’ll have to deploy monetary stimulus.
The account of their July session showed officials were reluctant to draw conclusions from early signs of economic recovery after pandemic lockdowns were eased. Chief economist Philip Lane told the gathering that the breadth and scale of the recovery remained uneven and partial.
“At its September meeting the Governing Council would be in a better position to reassess the monetary policy stance and its policy tools,” the account of the meeting showed. “This would provide more clarity regarding the medium-term inflation outlook” and prospects for economic activity.
A sharp initial rebound had some officials speculating in the run-up to the gathering that the ECB might not need to spend the full 1.35 trillion euros ($1.6 trillion) earmarked for purchases under its pandemic program. That debate was reflected in the account, with some policy makers arguing that “the net purchase envelope should be considered a ceiling rather than a target.”
Other officials countered that the “current presumption” was that the envelope of the program “would have to be used in full.”
Since then, prospects for the economy have darkened, with some indicators suggesting activity has plateaued. Lane warned earlier this month that uncertainty about the coronavirus will weigh on consumers and businesses for some time.
Infections are rising again across Europe as peak vacation season is under way. That’s forced some governments to reinstate travel warnings and tighten restrictions on mask-wearing and social contact.
At the same time, unemployment is beginning to creep up — despite generous furlough schemes in many countries. The numbers are likely to rise further in the coming months as governments start to phase out support programs.
That’s why some cautioned during the meeting against reading too much into initially strong data. A “technical” rebound was to be expected, they said, but that “didn’t answer the question of how steady the recovery would be in the period ahead.”
Forward-looking indicators, such as new orders have remained well below their average levels, according to some of the participants.
What Bloomberg’s Economists Say
“While the Governing Council seems unlikely to unveil new monetary stimulus next month, the occasion will probably be used to shape expectations for the next change in policy. That’s probably set for December, if at all.”
–David Powell. Read the ECB REACT
In the U.S., central bankers backed off in July from an earlier readiness to set a clearer bar for raising interest rates. Minutes of the Federal Reserve’s last meeting published Wednesday showed officials are committed to keeping policy ultra-loose so long as the coronavirus crisis is significantly holding the economy back.
As ECB officials bid their time to decide if more stimulus is needed, most economists predicted ahead of the July meeting that the central bank would increase pandemic purchases this year.
“While it was underlined that the Governing Council should avoid creating new expectations of further monetary-policy action, it should also emphasize that it had the tools and policy space to take further action if needed,” according to the account.
(Updates with comment from Bloomberg economist.)
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Trump says the economy is booming. He's right — but you don't feel it – CNN
The other side
Fears of funds drying up
Between the economy and coronavirus pandemic, Biden keeps his advantage nationally: POLL – ABC News
Biden’s 54%-44% advantage over Trump in a two-way contest precisely matches the last national ABC/Post poll in mid-August. Biden’s support slips to 49% when the Libertarian and Green Party candidates are included, versus 43% for Trump.
The results underscore Trump’s precarious position as the first president in 81 years of modern polling never to achieve majority approval for his work in office. He’s at 44% approval among all Americans, ranging from 52% for handling the economy to 40% on the coronavirus outbreak. Fifty-eight percent disapprove of his performance on the pandemic, a key to Biden’s support.
At the same time, the presence of Libertarian candidate Jo Jorgensen and Green Party candidate Howie Hawkins could pose a challenge to Biden in close states. Biden’s 5-point decline when these candidates are included is a significant, albeit slight, shift.
Biden continues to trail Trump, by 20 percentage points, in strong enthusiasm among their respective likely voters in this poll, produced for ABC by Langer Research Associates. Still, another measure finds broad antipathy toward Trump: Among those who don’t support him, 59% say his reelection would be a crisis for the country. Among those not backing Biden, fewer — but still 50% — say it’d be a crisis if he won.
It’s true, as well, that national preferences don’t always reflect Electoral College outcomes, as was the case in 2016 and 2000. Recent ABC/Post state-level polls found virtually even races in Florida and Arizona and a close contest in Wisconsin, although a wide Biden lead in Minnesota, which Trump has sought to contest.
Trump and Biden meet Tuesday in their first presidential campaign debate.
What’s likely to matter more is turnout, a question complicated this year by pandemic-related concerns. Just 46% of likely voters plan to cast their ballot in person on Election Day; 50% instead plan to vote early or absentee. Who goes through with it is highly consequential: Trump leads by 19 points, 58%-39%, among Election Day voters, while it’s Biden by more than a 2-1 margin, 67%-31%, among those who intend to vote before then.
The pandemic, of course, has disrupted far more than balloting plans. Sixty-two percent of adults worry that they or an immediate family member may catch the virus, which has claimed more than 200,000 American lives. Likely voters who express this concern favor Biden, 71%-27%.
The economy, even in a pandemic-prompted recession, works better for Trump. While just 40% of Americans say it’s in good shape, that’s up from 31% just last month. And Trump leads by 82%-17% among likely voters who rate the economy positively. Further, a quarter call the economy the top issue in their vote, and those economy-focused voters favor Trump by 80%-18%.
That said, in a head-to-head test, the two candidates run very closely in trust to handle the economy, 49%-46%, Trump-Biden. And other results on trust are revealing: While Trump has hit hard on the issue of crime and safety, it’s Biden who’s slightly ahead in trust to handle it, 50%-44%. Biden leads by eight points in trust to handle the next Supreme Court nomination (as reported Friday), 11 points on the pandemic, 16 points on health care and 20 points on equal treatment of racial groups.
Trust on crime is about the same in the suburbs, 50%-46%, Biden-Trump, as nationally overall. Suburban men trust Trump more on crime by 20 points, but suburban women — a group Trump has focused on — trust Biden more, by 61%-37%. That tilts to Biden because of the share of suburban women — about 1 in 3 — who are racial or ethnic minorities. (Among suburban white women, it’s 51%-46%, Biden-Trump.)
There’s one warning flare here for Biden: His lead on trust to handle the pandemic has shrunk from 20 points during the summertime surge in cases in mid-July, 54%-34%, to today’s 11-point margin, 51%-40%.
As noted, the economy leads as the most important issue, with no consensus on what comes next. Seventeen percent pick the pandemic as their top issue, and likely voters who say so support Biden by 84%-13%. About as many say it’s either health care or equal treatment of racial groups; again more than 8 in 10 in both of these groups back Biden. Twelve percent cite crime and safety as their main concern — and in this group, 84% support Trump. Lastly, 11% focus on the next Supreme Court nomination, with closer vote preferences, 54%-45%, Biden-Trump.
In another delineating result, the public by 54%-42% supports recent protests against police treatment of Black people. Eight in 10 supporters of these protests favor Biden; 77% of opponents are with Trump.
Across issues, these results illuminate the logic of the current campaign, as Trump touts economic recovery and raises crime concerns while Biden pushes on the pandemic response, health care and equal treatment, and both navigate the trickier Supreme Court issue.
The impact of third-party candidates may be tough to gauge, since the pandemic has constrained their campaigns just as it has Trump’s and Biden’s. This survey asked two-candidate preferences first, then re-asked the question with Jorgensen and Hawkins added. Biden, as noted goes from 54% to 49% with these two included; that decline is significant at the 90% confidence level, as opposed to the conventional standard, 95%.
Trump moving from 44% to 43% is not statistically significant. Four percent express support for Jorgensen, who’s on the ballot in all 50 states; 3% for Hawkins, who’s on the ballot in 28 states. (In 2016, the Libertarian won 3%, the Green candidate, 1%.)
Using two-candidate preferences, huge gaps are evident across population groups. Trump leads by 13 points among men; Biden, by a wide 31 points among women. Trump’s up 6 points against Biden among nongraduates, while Biden leads by 30 points among college grads. The race is close among likely voters age 50 and older, while those younger than 30 back Biden by nearly 2-1 (using registered voters for an adequate sample size).
Unpeeling some groups demonstrates the depth of the gender gap, in particular. While the race is a close 52-47%, Biden-Trump, in the suburbs, that’s 60-38%, Trump-Biden, among suburban men, compared with 66-34%, Biden-Trump, among suburban women. And it’s Trump up 8 among men who are political independents, versus a 77%-20% Biden-Trump blowout among independent women.
In another sharp difference, evangelical white Protestants, a core Republican group, support Trump by an expected 75%-25% — but non-evangelical white Protestants go 58%-41%, Biden-Trump. (White Protestants account for nearly 3 in 10 likely voters; 57% are evangelicals, the rest not.)
Notable, too, is that Trump and Biden are dead even, 49%-49%, in households that include a veteran or active-duty member of the military; these generally are thought to be a more pro-GOP group. Trump took criticism in the past month for reports that he had disparaged military service, which he denied.
Among other groupings, Biden leads by 54%-42% in the 13 states that currently are the most contested by the candidates (Arizona, Florida, Georgia, Iowa, Michigan, Minnesota, Nevada, New Hampshire, North Carolina, Ohio, Pennsylvania, Texas and Wisconsin). Moreover, it’s Biden by 20 points in the blue states won by Hillary Clinton, while dead even, 49%-49%, in the 2016 red states. Trump won those states four years ago by 53%-42%.
Comparisons to 2016, based on ABC News exit poll results, are telling. Among the most striking differences:
Trump, at the same time, has retained and even consolidated his core support groups. Overall, among 2020 likely voters who report having supported him in 2016, 91% support him now. He’s backed by 87% of conservatives, who account for a substantial 36% of all likely voters. And while Biden would be just the second Catholic president, white Catholics — an on-again, off-again swing voter group — side with Trump, 55%-44%.
This ABC News/Washington Post poll was conducted by landline and cellular telephone Sept. 21 to 24, 2020, in English and Spanish, among a random national sample of 1,008 adults, including 889 registered voters and 739 likely voters. Results have a margin of sampling error of 3.5 points, including design effects, for the full sample and registered voters, and 4.0 points for likely voters. Partisan divisions are 31%-27%-37%, Democrats-Republicans-independents, among all respondents; 33%-29%-35% among registered voters; and 33%-32%-32% among likely voters.
The survey was produced for ABC News by Langer Research Associates of New York, with sampling and data collection by Abt Associates of Rockville, Maryland. See details on the survey’s methodology here.
Asia Today: Morrison vows ‘titanic effort’ to lift economy – 570 News
CANBERRA, Australia — Prime Minister Scott Morrison says the Australian budget, to be delivered Oct. 6, will be a “titanic effort” to return the country to economic growth amid the coronavirus pandemic.
Morrison told reporters Sunday that the budget will the “most unprecedented investment in Australia’s future.”
Australia’s gross domestic product shrank 7% in the quarter form April to June, the largest contraction since record-keeping began in 1959. That followed a 0.3% decline in the first quarter, meaning Australia was technically in recession for the first time in 30 years.
Australia was the only major economy not to go into recession during the 2008 global financial crisis, its strength supported by strong demand, especially from China, for its natural resources — coal, natural gas and iron ore.
Even before the coronavirus, the economy was affected by massive bushfires in January that hit small businesses, which depend on tourism. Business shutdowns forced by the pandemic cost almost 1 million jobs and resulted in a major reduction in household spending despite Morrison’s government providing almost $200 billion Australian dollars ($140.5 billion) in economic stimulus.
Morrison said the upcoming budget “will be a titanic effort that we’re involved in to ensure that this country can get back on the growth path that we want to be on. That means we’re going to have to do some very heavy lifting in this budget and that comes at a significant cost.”
Treasurer Josh Frydenbeg, who will deliver the budget speech, on Thursday provided a downbeat economic outlook. Frydenberg said the economy likely will be 6% smaller by mid-2021 than forecast at the end of last year.
He said the government’s focus will be on economic recovery rather than budget repair until unemployment is “comfortably” less than 6%.
“Australia’s future population will be smaller and older than we previously assumed because of the sharp drop we are seeing in net overseas migration,” Frydenberg said. “While migration will eventually return to the levels we are accustomed to, lost migrants will not be replaced.”
Follow AP’s pandemic coverage at http://apnews.com/VirusOutbreak and https://apnews.com/UnderstandingtheOutbreak
The Associated Press
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