Davos not very popular this year. US and French presidents Donald Trump and Emmanuel Macron have announced that they will not be attending the Davos Economic Forum, which will take place in Switzerland from January 22 to 27. Macron said it is due to a busy agenda, as he faces an ongoing crisis with the "Gilets jaunes" movement. Donald Trump said he would not travel to Davos this year due to the ongoing partial paralysis of the administration.
Euro zone down. Slovakia's central bank governor Jozef Makuch said today that the "Euro zone growth is clearly slowing, indicators are trending down and optimism appears to be fading". He told the press that "some indicators, including soft indicators, are trending downwards". Meanwhile, Austrian policymaker Ewald Nowotny said the growth scenario outlined by the European Central Bank in December remains valid and a rate hike this year is still possible.
Powell worries markets again. A remark by Fed chaimran Jerome Powell on the Fed's balance sheet reduction negatively impacted US markets on Thursday. Speaking at an event at the Economic Club of Washington, he reiterated that the Fed wants to have its balance sheet "return to a more normal level", without specifying what a normal level is. He said that the balance sheet has declined to about $4 trillion, but that before the 2008 crisis it was below $1 trillion.