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Retail sales slump endangers Trump goal of 3% GDP

“The government on Thursday said retail sales fell a preliminary 1.2% in December in the biggest plunge in nine years” writes Jeffry Bartash for marketwatch.com. Read: The stunning drop in retail sales has Wall Street’s economists skeptical Before the retail report, economists polled by MarketWatch estimated the U.S. would grow 2.7% in the fourth quarter.Trump and his senior economic advisers have steadfastly contended their pro-business policies would regularly drive growth above 3% again. Source: marketwatch.com

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There’s now clear proof the threat of no deal Brexit is hurting the UK economy

“The final quarter of 2018’s number was only beaten by the 0.1% growth witnessed in the first quarter of last year” writes Will Martin for businessinsider.com. “The fog of Brexit is causing short term volatility in economic data, and more fundamentally is creating a series of tensions in the economy,” Bank of England Governor Mark Carney said at a press conference.On an annual basis, the ONS said that the economy grew 1.4% in 2018, the lowest growth since 2012.The central bank lowered its economic growth forecast for the UK in…

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EUR/USD Forecast Feb. 11-15 – Euro slips on weak retail sales, manufacturing reports

“The German and eurozone economies continue to produce weak numbers, underscored by weak scores in retail sales and manufacturing” writes Kenny Fisher for forexcrunch.com. The bank revised downwards its growth forecast for the eurozone to 1.9% in 2018, from 2.1% in the November forecast.For 2019, the growth forecast has also been revised down to 1.5%, compared to 1.9% in the November forecast.The European Commission economic forecasts projected moderate growth in the eurozone for 2019, but warned that significant uncertainties lie ahead.Eurozone retail sales plunged 1.6% in January, its worst reading…

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News Oil 

IMF’s Lagarde: Oil exporters not fully recovered from 2014 shock, warns of ‘white elephant projects’

“Oil exporters have not fully recovered from the dramatic oil price shock of 2014, the head of the International Monetary Fund said on Saturday, and she cautioned against spending money on “white elephant projects.”” writes Simon Dawson for cnbc.com. Speaking about the global economy, Lagarde said the IMF was not seeing a global recession on the horizon, but risks were rising for global growth due to trade tensions and tightening financial conditions. Source: cnbc.com

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‘Fragility in Italy’s economy needs to be addressed,’ EU warns as it slashes growth forecasts

“The 19-member bloc is set to grow 1.3 percent this year, from a previous forecast of 1.9 percent” writes Tiziana Fabi for cnbc.com. Italy’s economy is already in trouble, however, with the latest GDP data showing that the euro zone’s third-largest economy had entered its third recession in a decade.Dombrovskis’ comments come as the European Commission cut its forecast for Italy’s growth in 2019 to 0.2 percent, from a previous prediction (made last November) of 1.2 percent. Source: cnbc.com

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Three bears chase away the Goldilocks economy — and we set them loose

“The bears returned, and though Goldilocks escaped, she took our 3 percent GDP growth economy with her” reports washingtonexaminer.com. We seemed to be on a roll, but three bears came home and chased Goldilocks away: trade uncertainty, monetary policy uncertainty, and the government shutdown.If angered, any one of these three bears — trade wars, Fed uncertainty, and shutdowns — poses a threat to an otherwise happy situation.Until December 2018, strong GDP growth, the lowest unemployment rate in almost 50 years, and a stable price level were just right. Source: washingtonexaminer.com

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La dolce vita slips away again as country tumbles back into recession

“There was even less to laugh about on Thursday when figures revealed that Italy, which is saddled with a public debt of about 130% of GDP, had lurched back into recession for the third time in a decade” writes Phillip Inman for theguardian.com. At issue was the debt mountain and how the coalition planned to increase it in breach of EU rules. Source: theguardian.com

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The European Union’s subversion of democracy contributed to the recession in Italy

“Finally, the Conte government successfully persuaded the EC to approve a 2.0% fiscal spending deficit” writes Jim Edwards for businessinsider.com. They proposed a fiscal plan that would increase the spending deficit to 2.4% of GDP. The EU said no.To the surprise of no one, Italy has gone into a recession— two consecutive quarters of declining GDP growth. Source: businessinsider.com

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Italian economy dips into recession in setback for the new anti-establishment government

“Italy’s economy contracted for the second consecutive quarter at the end of last year, data showed on Thursday, throwing the country into recession in a setback for the new anti-establishment government” writes Alessia Peirdomenico for cnbc.com. The average forecast in a Reuters survey of analysts had pointed to a 0.1 percent fall quarter-on-quarter, up 0.3 percent year-on-year.The coalition approved an expansionary budget in December aimed at heading off the growing threat of recession.A Reuters survey of 46 economists published this month forecast 2019 growth of 0.7 percent. Source: cnbc.com

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