Japan has had an extended period of strong economic growth. But inflation remains stubbornly low, and macroeconomic and financial sector challenges are set to grow as demographic headwinds—the aging and shrinking of Japan’s population—intensify.
Source: IMF
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U.S. GDP
Revisions in the second estimate of third-quarter GDP along with a pickup in corporate profits growth signal a positive shift in the composition of economic growth. consumer remains king; but upward revisions to equipment and structures investment and a sizable acceleration in profits indicate that other growth engines like business investment will engage more appreciably in 2019
Growth should remain above trend in 2019, but the trajectory will slow as the tailwinds from fiscal stimulus fade — easing to 2.4% in 2019 and 2.1% in 2020
F.O.M.C. Minutes
Federal Reserve officials discussed modifying language on ‘further gradual’ hikes, according to minutes from the FOMC meeting that concluded Nov. 8
“Consistent with their judgment that a gradual approach to policy normalization remained appropriate, almost all participants expressed the view that another increase in the target range for the federal funds rate was likely to be warranted fairly soon if incoming information on the labor market and inflation was in line with or stronger than their current expectations,” the minutes stated
Chinese Manufacturing PMI
Further declines in China’s purchasing managers indexes in November show the economy is struggling to find even a temporary bottom. The manufacturing PMI fell to 50 – the level separating expansion and contraction
The weakness was largely driven by domestic factors. The economy could take a further turn for the worse at the start of 2019, should the U.S. tariff rate on $200 billion of targeted Chinese imports increase as planned. That would further depress exports — compounding domestic weaknesses
source: Bloomberg
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