| I'm Chris Anstey, an economics editor in Boston, and today we're looking at Bloomberg Economics analysis of the US election. Send us feedback and tips to ecodaily@bloomberg.net or get in touch on X via @economics. And if you aren't yet signed up to receive this newsletter, you can do so here. - Federal Reserve Chair Jerome Powell said the central bank will lower interest rates "over time" and said the economy remains on solid footing.
- Dockworkers have walked out of every major port on the US East and Gulf coasts, starting a strike that could ripple through the economy.
- With the last traces of the global inflation shock fading, the shift toward lower borrowing costs is set to maintain momentum.
Every election looms as a fork in the road, and the two paths described by the US presidential candidates appear to feature very different economies, with the Republican favoring further tax cuts and the Democrat advocating for further social assistance. But the policies of Donald Trump and Kamala Harris also share similarities that mark the difference of the current era to the bygone days of globalization, when freer movement of goods, capital and people was viewed as the ticket to greater prosperity. Under either one, for example, there'll be a US administration comfortable with warning off foreign firms from takeovers of American businesses. Both candidates have vowed to block Nippon Steel's proposed takeover of US Steel, despite the would-be acquirer hailing from Japan, one of the closest American allies. And, while there are major differences in degree, they each endorse deploying tariffs as a policy tool. The Biden administration in the end never rolled back the tariff hikes on China that Trump imposed, and Harris hasn't suggested doing so either. In fact, President Joe Biden added to trade protection, in part to shield the US electric vehicle and renewable energy sectors from Chinese competition. And the World Trade Organization remains neutered by the US-led disabling of its appellate panel. And under either Trump or Harris, employers are set to confront a job market that sees a smaller influx — or an outright outflow — of immigrants. Trump has said he'll deport millions of undocumented migrants, while Harris has pledged to re-introduce legislation clamping down on border crossings. Bloomberg Economics modeled three scenarios. The bottom line is that fewer workers means less GDP. And without that income, the hit to demand proves deflationary. For voters in a deeply divided US, it's the differences between the candidates that loom largest. For the rest of the world, it might be the broad alignment on economic nationalism that matters more. For more, subscribe to Washington Edition, the newsletter about money, power and politics in the US capital. - Euro-area inflation slowed below the ECB's 2% target for the first time since 2021 — backing bets that rates may be lowered this month.
- The Bank of Japan should exercise caution when considering further rate hikes to ensure the country truly defeats deflation, according to Japan's new Minister for Economic Revitalization Ryosei Akazawa.
- Business chiefs are the most pessimistic they have been about Britain's economy since late 2022. Meanwhile, Bank of England policymaker Megan Greene said a consumption-driven recovery could renew inflation.
- Colombia's central bank cut borrowing costs to a two-year low.
- Australian retail sales rose by more than expected in August as tax cuts and warmer weather encouraged households to spend.
With economic development in emerging markets boosting the number of people around the world able to engage in international tourism, the global travel industry is set to evolve in coming years, bringing benefits — and potential downsides — to a new set of destinations, according to HSBC. Today, the top 10 destinations, led by the US, nab 45% of global travel spending, but "that could change in the coming years, with more destinations off the traditional beaten track set to become more popular," HSBC economists James Pomeroy and Yun Liu wrote in a note. Croatia, for example, has seen a "staggering" surge in foreigners flocking to its hotels. Next up could be Albania, touted as more affordable and having a similar climate to Greece but with fewer crowds. Neighbors to regional "stars" — like Laos and Malaysia, which neighbor Thailand — could also become new hotspots. Climate change may also open up new destinations. Bottom line: the nature of travel is set to evolve, with big global implications, Pomeroy and Liu wrote in a recent note. Bloomberg New Economy: The world faces a wide range of critical challenges, ranging from ongoing military conflict and a worsening climate crisis to the unforeseen consequences of deglobalization and accelerating artificial intelligence. But these challenges are not insurmountable. Join us in Sao Paulo on Oct. 22-23 as leaders in business and government from across the globe come together to discuss the biggest issues of our time and mark the path forward. Click here to register. | 
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