Global briefing: Car wars, updated/ Higher for longer/ Whatever it takes/ Walking back on green/ New Zealand

In this week’s global briefing:

1. Car wars, updated: The EU’s announced anti-subsidy investigation into Chinese car imports creates the potential for a trade war with China, with material economic costs. This is a deeply strategic sector for both economies.

2. Higher for longer: Multiple central bank decisions over the past week suggest that the end of the hiking cycle is close, but that rates will remain higher for longer. But watch for economic and political stresses to accumulate in a high rates world.   

3. Whatever it takes: Mario Draghi has been commissioned by President von der Leyen to prepare a report on the future of European competitiveness - in response to mounting economic and geopolitical challenges. Expect something bold.

4. Walking back on green: PM Sunak’s unwinding of policies to reduce UK emissions is the latest example of political tensions associated with climate change policy. Governments will need to get better at managing the needed energy transition.

5. New Zealand: New Zealand reported stronger than expected GDP growth on Thursday, supported by near-record migration inflows. Labour productivity growth remains anaemic though, and will need to be a post-election priority. 

The full note is available at: https://davidskilling.substack.com/p/global-briefing-car-wars-updated