German-Russian relations. In an interview with German news outlet Pfalzischer Merkur, the German commissioner for Russian relations said he expects setbacks in relations with Moscow in 2019. He described Russian policy as “unpredictable,” noting as examples the poisoning of former Russian spy Sergei Skripal, the end of the Intermediate-Range Nuclear Forces Treaty and the ongoing conflict in eastern Ukraine. He added that Russia is facing growing social and economic pressures. Just this week, in fact, Russia’s chief auditor, Alexei Kudrin, reported that Russians’ real incomes grew by only 0-0.4 percent in 2018. This could create problems for the Russian government – which could, in turn, complicate relations with Germany.
Bad signs for U.S. economic growth. The Institute for Supply Management and IHS Markit released indexes for December 2018 – gauges of U.S. manufacturing activity – and the results are much lower than expected. Last month, the ISM index was 54.1, down 5