Good morning! Here’s what you need to know in markets on Thursday.

Royal Bank of Scotland could face a penalty of more than $12 billion (£9.6 billion) to settle a decades-old misselling scandal in the US, according to the body which controls the taxpayer stake in the bank. The Guardian reports that the bailed-out bank has not set aside any money for a settlement with the US Department of Justice (DoJ) over the misselling of residential mortgage-backed securities (RMBS) before the 2008 banking crisis.

Goldman Sachs thinks Donald Trump will be bad for the global economy. In his 2017 outlook, Jan Hatzius, chief economist at Goldman, examined the key Trump policy proposals and found that while the plan would give the US a short-term bump in GDP growth, it would be a drag on global growth.

Brexit and the election of Donald Trump marks a change in direction of 70 years of global politics, according to Jes Staley, CEO of Barclays. “In our lifetime the developed world believed economic integration, leading to globalisation, was a necessary condition for political peace,” Staley said in London at a Financial Times banking conference. “The first time the developed world began to back off from that endeavour was the Brexit vote.”

The Treasury has granted the Bank of England formal powers to control lending in the fast-growing buy-to-let mortgage market. The Independent reports that the Bank’s Financial Policy Committee will be able to regulate the “loan to value” ratios granted by banks to buy-to-let borrowers and also their required “interest coverage ratios.”

US Federal Reserve chair Janet Yellen will talk to Congress about the state of the economy this afternoon. Yellen is due to appear at 3.00 p.m. GMT (10.00 a.m. ET) and Bloomberg says she will probably be quizzed about how President-elect Donald Trump’s fiscal policies might affect the economic outlook and path for rate increases.

Bill Gross thinks America has allowed populism to take hold with the election of Donald Trump as president and that it is making a big mistake. In his most recent investment outlook, the Janus fund manager and bond guru said Trump’s election was a misguided attempt by American workers to fix their problems and would only make their plight worse.

Retail sales are coming. British shop sales figures for October will be released at 9.30 a.m. GMT (4.30 a.m. ET). Economists are expecting year-on-year growth to accelerate to 5.4%, up from September’s figure of 4%.

Rio Tinto has fired two senior executives after an internal investigation into US$10.5 million (£8.5 million) in payments linked to the world’s biggest untapped iron ore deposit in Guinea. The Guardian reports that the Anglo-Australian firm last week said it had launched an investigation and notified American, British, and Australian regulatory authorities.

Stocks fell overnight in the US as the post-election rally took a breather, while Treasuries gained for a second straight day. The Dow closed down 0.26%, the S&P500 ended 0.18% lower, but the Nasdaq inched up 0.30%.

Asian markets are flat. Japan’s Nikkei closed unchanged from the day before, the Hong Kong Hang Seng is down 0.06% at the time of writing (6.38 a.m. GMT/1.38 a.m. ET), and China’s Shanghai Composite stock market is up 0.14%.

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