Philippine twin deficits will likely widen this year

2019 ◽  
Keyword(s):  
Interest Rates ◽  
Trade Deficit ◽  
Social Policies ◽  
Content Type ◽  
China Trade ◽  
Downward Pressure ◽  
Midterm Elections ◽  
The Us ◽  
The Government ◽  
Agricultural Imports

Significance Spending on infrastructure and populist social policies signed into law ahead of the May midterm elections are putting pressure on the Philippine budget. Impacts More expensive social policies are likely before the 2022 presidential election. Further taxes will likely prompt popular protests targeting the government. The US-China trade conflict and changing Chinese consumption patterns could further dampen exports. A rice tariff law signed into law last month will likely boost agricultural imports. The widening trade deficit will put downward pressure on the peso and upward pressure on interest rates.

Low interest rates may be the new normal

2018 ◽  
Keyword(s):  
Interest Rates ◽  
Trade Deficit ◽  
Content Type ◽  
Fiscal Effort ◽  
Asset Bubbles ◽  
Forward Guidance ◽  
Downward Pressure ◽  
The Us ◽  
Low Interest Rates ◽  
New Research

Subject Modelling lower rates for longer. Significance The ‘secular stagnation' thesis argues that as population growth slows, the need of businesses to invest in plant and equipment slows and the supply of funds from households grows as they save more, putting downward pressure on interest rates. New research attempts to quantify this hypothesis and to show what it would take to go back to 'normal'. Impacts 'Forward guidance' will be of little use if there is a recession as there would be no reason to expect an increase in policy rates. Asset bubbles would likely be a feature of any sustained non-fiscal effort to engineer a deeply negative real interest rate. The US trade deficit, usually a welcome source of lower rates, will in this context exacerbate the zero-lower-bound issue in a recession.

Causes of U.S.-China trade imbalances: a review

2020 ◽  
Vol 13 (1) ◽  
pp. 37-44
Author(s):  
Yongqing Wang
Keyword(s):  
Bilateral Trade ◽  
Trade Deficit ◽  
Previous Literature ◽  
Common View ◽  
Content Type ◽  
Trade Imbalances ◽  
China Trade ◽  
The Us ◽  
The Usa ◽  
Trump Administration

Purpose It is a common view to Trump administration and public that devaluation of Chinese currency is the origin of the US trade deficit. However, the previous literature does not support this common view. To better understand the causes of the US trade imbalances with China, this study aims to review the previous literature focusing on the causes of bilateral trade imbalances between the USA and China. Design/methodology/approach Review previous literature according to the different reasons that each paper studies. Findings Based on the previous literature, the Chinese exchange rate is not the main reason for the US trade imbalances. The official US trade figures overestimate the amount of deficit. The actual causes for the US trade deficit with China perhaps should be the relocation of production to China, low saving in the USA and high saving in China, and the US dollar as the international currency and reserve. Originality/value By reviewing previous literature, the authors could better understand the puzzle of the US trade deficit with China.

US manufacturing slump will hinder growth into 2016

2015 ◽  
Keyword(s):  
Interest Rates ◽  
Manufacturing Sector ◽  
Trade Deficit ◽  
Consumer Durables ◽  
Content Type ◽  
Labour Unions ◽  
Political Clout ◽  
The Us ◽  
Low Interest Rates ◽  
Merchandise Trade

Subject Outlook for US manufacturing. Significance Decline in the US manufacturing sector has dampened the country's broader recovery from the 2007-09 recession and has significant regional implications for growth and employment. The political clout of manufacturers and their affiliated labour unions will play a significant role in the US domestic debate surrounding ratification of the Trans-Pacific Partnership (TPP) trade pact. Impacts Faltering manufacturing production, high inventory levels and a deteriorating merchandise trade deficit will likely slow US economic growth. Consumer durables, automotive products and capital goods will benefit from low interest rates, but face competition from cheaper imports. Deteriorating profit margins will reduce industrial investment as well as overall levels of employment in manufacturing. The decline in US manufacturing will boost protectionist voices in Congress and politically bolsters TPP opponents.

Hungarian forint is increasingly vulnerable to attack

2020 ◽  
Keyword(s):  
Monetary Policy ◽  
Interest Rates ◽  
External Environment ◽  
Central Banks ◽  
Content Type ◽  
China Trade ◽  
Bond Yield ◽  
The Us ◽  
National Bank ◽  
Global Growth

Subject Central banks’ policy dilemmas. Significance The National Bank of Hungary (MNB) remains extremely reluctant to raise interest rates despite increasing pressure on the forint. While growth in the euro-area is likely to remain weak this year, strengthening the case for rates to remain on hold, a more supportive external environment, underpinned by an easing of US-China trade tensions, would accentuate the policy dilemmas confronting Central Europe’s central banks, especially given rises in inflation. Impacts Germany’s still-negative ten-year bond yield has risen from record lows in September as markets become less pessimistic about global growth. Markets expect Hungarian monetary policy to remain very dovish, as the domestic twelve-month bond-yield’s end-October turn negative shows. The US S&P 500 index surged by nearly 30% last year and if US-China trade tensions ease slightly this should help it to maintain momentum.

Trade uncertainty makes interest rates less effective

2019 ◽  
Keyword(s):  
Monetary Policy ◽  
Interest Rates ◽  
Developed Countries ◽  
The United States ◽  
Content Type ◽  
Forward Guidance ◽  
China Trade ◽  
The Us ◽  
Jackson Hole ◽  
Market Outlook

Subject Financial market outlook. Significance At the annual gathering last month of the world’s central bankers in Jackson Hole, Wyoming, policymakers acknowledged that the economic uncertainty that the US-China trade conflict is generating was undermining the efficacy of monetary policy. James Bullard, the president of the St Louis Federal Reserve (Fed), warned that developed countries are experiencing a “regime shift” in economic conditions, in which trade-war-induced uncertainty -- and the unpredictability of US policy more broadly -- is becoming a permanent feature of policymaking, sapping the potency of forward guidance and overburdening monetary policy. Impacts Since the US tariff increase in May, the global stock of negative-yielding bonds has surged above 16 trillion dollars and will rise further. The dollar is at its highest since May 2017 and seems likely to rise further as US growth is far outpacing other major developed markets. The renminbi/dollar rate fell the most on record in August, raising capital outflow risks, most likely to the United States or Japan.

‘America First’ trade unravels as market risks mount

2018 ◽  
Keyword(s):  
Interest Rates ◽  
Yield Curve ◽  
Emerging Market ◽  
The United States ◽  
Content Type ◽  
Market Risks ◽  
Bond Yield ◽  
Downward Pressure ◽  
The Us ◽  
Technology Stocks

Subject Outlook for US financial markets. Significance Since October, the benchmark S&P 500 index has fallen by more than 5% as part of a broad-based sell-off of financial assets. Indications that the ‘America First’ inspired trade agenda is unravelling include concerns that rising US interest rates will dampen economic growth and corporate earnings, and a rout in technology stocks, the high-flying sector that powered the US equity rally from mid-May to late-September when US stocks significantly outperformed their European, Japanese and Emerging Market (EM) peers. Impacts Lower oil prices will extert downward pressure on inflation. Efforts by China and the United States to wean themselves off mutual dependence in tech could escalate, curbing the US tech stocks bull run. The first inversion of the bond yield curve since 2007, will fuel speculation that the Fed will slow monetary tightening. EM equities will remain volatile, despite have risen by nearly 9% since October 29, partly reversing their 2018 sell-off.

New Zealand’s economy looks positive in uncertain 2019

2019 ◽  
Keyword(s):  
New Zealand ◽  
Commercial Banks ◽  
Global Economy ◽  
Central Banks ◽  
Content Type ◽  
China Trade ◽  
The Us ◽  
The Government ◽  
The Uk ◽  
Human And Social Capital

Significance The RBNZ’s no-change stance reflects major world central banks’ recent retreat from tightening. While current New Zealand economic growth is firm, the RBNZ and the government are concerned about the slowing global economy and potential disruption from Brexit and the US-China trade standoff. Impacts To strengthen commercial banks’ resilience, the RBNZ may double tier one capital reserves requirements; tier two could go. Robertson’s second budget on May 30 will further the “wellbeing” agenda, widening criteria for assessing government management. The wellbeing criteria will include assessing environmental, human and social capital. Wellington wants a New Zealand-UK free trade deal post-Brexit, but this will depend on the UK-EU withdrawal deal’s detail.

Bank of Mexico governor nomination sparks uncertainty

2021 ◽  
Keyword(s):  
Exchange Rate ◽  
Interest Rates ◽  
Exchange Rate Regime ◽  
Exchange Rate Policy ◽  
Content Type ◽  
Finance Minister ◽  
The Us ◽  
Floating Exchange Rate ◽  
Rate Policy ◽  
The Government

Significance AMLO initially nominated Arturo Herrera for the role in June, replacing him as finance minister with Rogelio Ramirez de la O. Incumbent Governor Alejandro Diaz de Leon will stand down at the end of December. Impacts A tighter monetary policy will open a significant gap with US interest rates, helping to stabilise the peso against the US dollar. Given Rodriguez’s provenance, the harmonious relationship between Banxico and the finance ministry will probably continue. The nomination of an unexpected individual to lead the central bank will reaffirm AMLO’s authority on economic matters. Although the finance ministry controls exchange rate policy, the government is not likely to modify the free-floating exchange rate regime.

The problems facing agricultural sector in Zanzibar and the prospects of Waqf-Muzar’ah-supply chain model

Humanomics ◽  
2017 ◽  
Vol 33 (2) ◽  
pp. 189-210 ◽  
Author(s):  
Issa Salim Moh’d ◽  
Mustafa Omar Mohammed ◽  
Buerhan Saiti
Keyword(s):  
Supply Chain ◽  
Interest Rates ◽  
Financial Models ◽  
Agricultural Sector ◽  
Chain Model ◽  
Content Type ◽  
High Interest ◽  
Supply Chain Model ◽  
The Government ◽  
Clove Industry

Purpose This paper aims to identify the appropriate model to address the financial challenges in agricultural sector in Zanzibar. Since the middle of 1960, clove production has continually and significantly decreased because of some problems and challenges that include financial ones. The financial intermediaries such as banks, cooperatives and micro-enterprises provide micro-financing to the farmers with high interest rates along with collateral requirements. The numerous programmes, measures and policies adopted by the relevant parties to find out the solutions to the dwindling clove production have failed. Design/methodology/approach The authors will review and examine several existing financial models, identify the issues and challenges of the current financial models and propose an appropriate Islamic financing model. Findings The numerous programmes, measures and policies adopted by the relevant parties to find out the solutions to the dwindling clove production have failed. This study, therefore, proposed a Waqf-Muzara’ah-supply chain model to address the financial challenge. Partnership arrangement is also suggested in the model to mitigate the issues of high interest rates and collateral that constrains the financial ability of the farmers and their agricultural output. Originality/value The contribution of the agricultural sector to the economic development of Zanzibar Islands is considerable. As one of the important agricultural sectors, the clove industry was the economic backbone of the government of Zanzibar. This study is believed to be a pioneering work; hence, it is the first study that investigates empirically the challenges facing the clove industry in Zanzibar.

Australian central bank holds rate as growth slips

2021 ◽  
Keyword(s):  
Economic Growth ◽  
Central Bank ◽  
Interest Rates ◽  
Labour Markets ◽  
Content Type ◽  
Commercial Lenders ◽  
The Government ◽  
Roll Out ◽  
Growth Forecasts

Significance The RBA has cut its growth forecasts amid rising job losses, weakening demand and increasing signs that the latest COVID-19 lockdowns will continue to slow the economy until the pace of the vaccine roll-out programme can be increased. Impacts Although the RBA is independent, the government will hope it keeps rates low ahead of the elections due next year. Commercial lenders could raise interest rates independently of the RBA if inflation remains high. Wage pressures will re-emerge as labour markets tighten but may be mitigated by the extent of underemployment. Economic growth will be uneven across the country in coming months as pandemic-related restrictions vary by location.

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