Euro-area economic activity is shaking off COVID fears

2021 ◽  
Keyword(s):  
Euro Area ◽  
Economic Activity ◽  
Content Type

Headline EU: Economic activity is shaking off COVID fears

Renewed ECB easing places further pressure on banks

2019 ◽  
Keyword(s):  
Fiscal Policy ◽  
Interest Rate ◽  
Euro Area ◽  
Economic Activity ◽  
Commercial Banks ◽  
Governing Council ◽  
Monetary Policies ◽  
Content Type ◽  
Supervisory Authority ◽  
Forward Guidance

Subject ECB easing. Significance The ECB’s Governing Council announced on September 12 another round of ultra-loose monetary policies. 'As long as necessary' has replaced 'whatever it takes' in departing ECB President Mario Draghi's speech. The lowering of the deposit facility rate for commercial banks from minus 0.40% to minus 0.50% will provide them with additional liquidity at favourable conditions. The ECB has also enhanced its forward guidance by linking future interest rate moves to the inflation outlook. Euro-area economic activity is deteriorating and inflation is far below the ECB’s target. Impacts Fear of losing customers is stopping banks charging negative rates on household deposits, but the debate about this will grow. However, an outright ban, as advocated by Germany’s Federal Financial Supervisory Authority, seems unlikely despite the risk of withdrawals. The ECB’s Governing Council urges that fiscal policy should be the main stimulus, but countries show no sign of coordinating on a package.

Germany’s economic recovery may remain anaemic

2017 ◽  
Keyword(s):  
Financial Crisis ◽  
Euro Area ◽  
Economic Activity ◽  
Domestic Demand ◽  
Growth Potential ◽  
Economic Recovery ◽  
Content Type ◽  
Positive Effect

Significance Germany, like its euro-area partners, has struggled to achieve anything resembling a strong recovery from the 2008-09 financial crisis. Forecasts for 2017 have been revised downwards and there are few signs -- at either the macroeconomic or macropolitical level -- that European stagnation will dissipate. Impacts The weak euro will benefit Germany’s exporting industries. Frankfurt could attract some banks looking to leave London after Brexit. Migration has increased Germany’s domestic demand potential and could have a net positive effect on economic activity in the long term. Europe’s lack of dynamism may weaken the growth potential of other regions.

Weak economic activity will support the ECB's stance

2015 ◽  
Keyword(s):  
Euro Area ◽  
Economic Activity ◽  
Content Type ◽  
Weak Activity

Headline EURO-AREA: Weak activity will support the ECB's stance

The international strength of the euro will grow

2021 ◽  
Keyword(s):  
Euro Area ◽  
Financial Services ◽  
Raw Materials ◽  
Domestic Demand ◽  
Content Type ◽  
The Us ◽  
Us Dollar ◽  
Strategic Autonomy ◽  
Geopolitical Risks ◽  
The Eu

Significance The proposals identified areas where the euro could potentially become more dominant, such as the issuance of green bonds, digital currencies, and international trade in raw materials and energy. Ambitions to enhance the international leverage of the euro are being driven by the aim to strengthen EU strategic autonomy amid rising geopolitical risks. Impacts Developing its digital finance sector would be an opportunity for the EU to enhance its strategic autonomy in financial services. Challenging the US dollar would require the euro-area to rebalance its economy away from foreign to domestic demand. Member state division will prevent the economic reconfiguration the euro-area needed to make the euro a truly global currency.

Ecuador’s Lasso weathers early storm but clouds loom

2022 ◽  
Keyword(s):  
Economic Growth ◽  
Economic Activity ◽  
Direct Investment ◽  
Tax Reform ◽  
The Political ◽  
Tax Reforms ◽  
Content Type ◽  
Downward Pressure ◽  
New Challenges ◽  
International Investors

Significance He appears to have weathered this early political storm, achieving notable successes in areas such as tax reform. However, the political outlook remains uncertain, with a likely COVID-19 resurgence heralding new challenges in 2022. Impacts Containing the spread of the Omicron variant will be a priority for Lasso in the coming months. A pandemic resurgence would place downward pressure on economic growth and tax collection. Tax reforms will please international investors and support efforts to attract foreign direct investment to stimulate economic activity.

EU bonds will rival German Bunds as a safe asset

2021 ◽  
Keyword(s):  
Euro Area ◽  
Safe Haven ◽  
Content Type ◽  
The World ◽  
The Creation ◽  
Over Time ◽  
The Eu

Significance This could create an alternative benchmark safe-haven asset to rival German Bunds within the region. As part of its issuance plans, the EU intends to issue at least EUR50bn in green bonds annually, which is likely to make it the world’s largest issuer of these bonds. Impacts The increased importance of EU bonds over time will help to support the euro's value and could eventually put pressure on the dollar. The EU is leading the world in green bond issuance, but the risk of spurious environmental claims (‘greenwashing’) must be managed. The creation of new EU bonds will help reduce the funding costs of riskier euro-area members such as Italy.

Canada protests over Indian Residential Schools expand

2021 ◽  
Keyword(s):  
Indigenous Peoples ◽  
Economic Activity ◽  
Indigenous Population ◽  
Indigenous Communities ◽  
Residential Schools ◽  
Public Works ◽  
Content Type ◽  
Social Fabric ◽  
Government Services ◽  
Indian Residential Schools

Significance The discovery of the bodies of hundreds of children at Canada’s former Indian Residential Schools has unleashed a wave of anger and mourning across Canada’s growing Indigenous population. More discoveries are expected, posing challenges for the country’s economic and social fabric. Impacts Public works projects may slow amid intensified disputes between the Canadian state and Indigenous peoples over lands and resources. There will be more pressure to share wealth from economic activity that directly affects Indigenous communities. Indigenous communities are likely to benefit from greater control over the design and delivery of government services. Cultural and academic institutions will increasingly prioritise and amplify Indigenous voices and perspectives. Canada’s reputation as an advocate for human rights will be affected by its handling of the residential schools issue.

scholarly journals The impact of Musharakah financing on the monetary policy in the Islamic economy

2018 ◽  
Vol 3 (3/4) ◽  
pp. 139-152
Author(s):  
Hatem Adela
Keyword(s):  
Economic Theory ◽  
Monetary Policy ◽  
Interest Rate ◽  
Economic Activity ◽  
Methodological Framework ◽  
Mathematical Methods ◽  
Content Type ◽  
Return Rates ◽  
The Interest Rate ◽  
The Impact

Purpose This paper aims to contribute to formulating the methodological framework for a paradigm of Islamic economics, using the development of the conventional economics, theoretical and mathematical methods. Design/methodology/approach The study based on the inductive and mathematical methods to contribute to economic theory within the methodological framework for Islamic Economics, by using the return rate of Musharakah rather than the interest rate in influence the economic activity and monetary policy. Findings Via replacement, the concept of the interest rate by the return rates of Musharakah. It concludes that the central bank can control the monetary policy, economic activity and the efficient allocation of resources by using the return rates of Musharakah through the framework of Islamic economy. Practical/implications The study is a contribution to formulate the methodological framework for a paradigm of Islamic economics, where it investigates the impact of return rates of Musharakah on the money market and monetary policy, by the mathematical methods used in the conventional economy. Also, the study illustrates the importance of further studies that examine the methodological framework for Islamic Economics. Originality/value The study aims to contribute to formulating the Islamic economic theory, through the return rate of Musharakah financing instead of the interest rate, and its effectiveness of the monetary policy. As well as reformulating the concepts of the investment function, the present value and the marginal efficiency rate of investment according to the Islamic economy approach.

Building entrepreneurial capacity in rural areas

2017 ◽  
Vol 23 (6) ◽  
pp. 903-918
Author(s):  
Anna Krakowiak-Bal ◽  
Urszula Ziemianczyk ◽  
Andrzej Wozniak
Keyword(s):  
Rural Areas ◽  
Economic Activity ◽  
Local Development ◽  
Practical Implication ◽  
Public Investment ◽  
Empirical Work ◽  
Important Criterion ◽  
Economic Activities ◽  
Ahp Method ◽  
Content Type

Purpose The purpose of this paper is to verify the development of economic activities in rural areas in terms of their public infrastructural equipment. Design/methodology/approach As a case study, the Polish rural areas were selected. A two-stage survey was conducted in 2015. The first stage involved entrepreneurs from rural areas. The second stage of survey was data collection for rural areas regarding economic activity and infrastructural equipment. In total, 121 objects (communes) were selected. The multicriteria analytic hierarchy process (AHP) method was used for the analysis. Findings The results demonstrate that for each kind of business, communication accessibility is the most important criterion. By contrast, environmental awareness and concern for the environment is the least important element for pursuit of the economic activity in rural areas. Research limitations/implications Limitations are connected mainly with the applied AHP method. The number of the comparable elements at the same hierarchy level is limited due to practical purposes. In addition, an assumption of full comparability of elements (criteria and alternatives) in the hierarchy model can be discussed. Furthermore, data quality and availability limit the scope of the empirical work. This study is a major simplification of reality modeling, but it gives practical benefits by simplifying the decision support procedure. Practical implications The findings of this paper contribute to the advancing theory of local development, with public infrastructure being one of its basic elements (factor of production). This paper explores the importance of physical infrastructure for different economic activities, and thus offers theoretical insights in two areas. First, this paper indicates the uneven weight of each infrastructure element for the various business sectors. Second, based on the collected data, this study also contributes to the literature, by using the AHP method to explore the relationships between infrastructural equipment and economic activity in rural areas. As the practical implication for local and regional development policies, this study indicates, that the most important criterion for each kind of economic activity is communication accessibility. This kind of public investment should be undertaken primarily to support entrepreneurship, especially in rural areas. Originality/value The uniqueness of the method lies in assumption about the uneven weights of infrastructure elements and therefore their impact on the process of ranking the objects (rural areas). The weight of individual infrastructure elements will vary depending on the kind of economic activity; therefore, the way of ordering will also be different for each economic activity.

Spillover effects of financial development on the informal economic activity

2020 ◽  
Vol 13 (3) ◽  
pp. 471-482
Author(s):  
Salih Katircioglu ◽  
Hatice Imamoglu
Keyword(s):  
Interest Rates ◽  
Financial Development ◽  
Informal Economy ◽  
Economic Activity ◽  
Missing Values ◽  
Spillover Effects ◽  
Ordinary Least Squares ◽  
Annual Data ◽  
Content Type ◽  
Cointegration Tests

Purpose This study aims to investigate the role and spillover effects of the financial sector on the size of the informal economic activity in Turkey. Design/methodology/approach Time series analysis has been adopted for annual data of the 1970-2017 period. New approaches in unit root and cointegration tests have been used in this study. Estimations have been done via dynamic ordinary least squares and fully modified ordinary least square approaches. Findings Results confirm the existence of a long-run equilibrium relationship between the financial system and informal economic activities in Turkey. At the earlier stages of financial development (FD), informality tends to rise while in further stages, informality tends to decline over time. This study confirms the U-shaped relationship between FD and the informal economy in Turkey. Research limitations/implications This study has used logarithmic values of series in the econometric analysis except for real interest rates because of negative values in some periods. Thus, by using level forms of real interest, missing values would be avoided. Practical implications Increasing efficiency, control and institutional quality, as well as the quality of governance environment, would be useful tools in reducing the size of informality, as this study finds that spillover effects of financial services on the informal economic activity are adverse. Originality/value This study is the first of its kind to the best of the knowledge in the case of Turkey, which estimates the spillover effects of FD on informal economic activity.

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