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Euro zone economy: real recovery or another Sirens’ song?

Over the years, euro zone economic growth has been a bit like the Sirens in Homer’s Odyssey: singing a song of promise, only to end up pulling you onto the rocks. Will it be different this time? The strong growth registered in numerous data releases and surveys at the beginning of this year has surprised many. One eye-opening example was the release of flash purchasing managers indices for France, Germany and the euro zone on Feb 21. Of nine indexes, eight registered growth and six did so at a higher ...

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China: A sustainable growth marathon is better than a sprint

When China overtook the United States as the world’s top goods trader in 2013, China’s celebrations were led by former commerce minister Gao Hucheng. On Tuesday, in response to news that the US had retaken the lead by about $20 billion in 2016, Gao expressed optimism: For major trading powers, short-term data anomalies are perfectly normal. Gao is more focused on a change of trajectory. China is weaning itself off its dependence on cheap exports and foreign money. For the past more than three decades, China has been the acknowledged ...

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If Trump imposes punitive tariffs, Europe must counter them – Merkel ally

Europe should impose punitive tariffs on imports from the United States if President Donald Trump acts to shield U.S. industries from foreign competitors, a senior ally of German Chancellor Angela Merkel said in a newspaper interview. Trump has already formally withdrawn the United States from the Trans-Pacific Partnership trade deal, distancing America from its Asian allies, and vowed to renegotiate the U.S. free-trade deal with Canada and Mexico. The tycoon-turned-president has also threatened German carmakers with a border tax of 35 percent on vehicles imported into the U.S. market, saying ...

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Global economy cannot afford Trump’s protectionist policies

For all of Donald Trump’s America-first pro-growth rhetoric, analysts don’t think the global economy can afford the US president’s protectionist policies. At the heart of Trump’s protectionist policies is the notion that free trade and globalisation have not benefited the middle and lower class, and created further income inequality. But economists argue that Trump turning his back on globalisation in favour of protectionism can hurt the US’s economy, especially the very social classes Trump vowed to help. Alp Eke, senior economist at the National Bank of Abu Dhabi, cited the ...

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Open economies role seen for BRICS

BRICS countries should make joint efforts to maintain the openness of global economies and oppose trade protectionism amid worldwide economic sluggishness, China’s top diplomat said on Thursday. This year’s BRICS summit, which will be attended by leaders from Brazil, Russia, India, China and South Africa, will be held from Sept 3 to 5 in coastal Xiamen, Fujian province, State Councilor Yang Jiechi announced at the opening ceremony of this year’s first BRICS Sherpa meeting, held in Nanjing, Jiangsu province. Sherpas are senior diplomats and officials in charge of coordinating affairs ...

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Market rotation doesn’t mean ‘impending doom’ for economy, strategist says

Investors may have moved into more defensive names this week, but this isn’t necessarily a warning signal on the economy, strategist Liz Ann Sonders told CNBC. Bonds and bond-proxy stocks like utilities and telecom did well, while the market rally took a pause on Friday. Sonders believes it is simply a rotation, some of which is reflected by falling correlations. In other words, stocks and other assets are beginning to move in opposite directions after trading in lockstep. And that benefits diversification and active management, she explained. “I wouldn’t yet ...

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Little Change in French Unemployment Numbers for January

The number of French job seekers inched up in January from December, showing the fragility of the recent decline in unemployment. The country counted 800 more Category A job seekers, people registered as fully unemployed, in January than in December at 3,467,900, the Labor Ministry said. The number of unemployed was 2.5% lower than in January 2015, though the decline doesn’t offset prior years of rising unemployment. The month-on-month rise in January underscores a mixed year in France’s job market, which sunk President Francois Hollande’s hopes of re-election in May. ...

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A good week for world trade, especially in Asia, as the TFA accord comes into force

In Bangkok this week for the year’s first meeting of regional business leaders in the APEC Business Advisory Council one modest sliver of good news brought smiles to a week better marked by anxiety and uncertainty over mainly bad developments that have marked the past six months. Even the good news, in better times, would have warranted little attention: the World Trade Organisation announced that the Trade Facilitation Agreement (TFA) intended to simplify border procedures so as to boost trade, and reduce costs linked with moving goods around the world, ...

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Sour grapes? Not if the central bank has your back

Devastated by the collapse of its iconic wine industry over a century ago, France may have inadvertently discovered the ideal way for central banks to aid an economy in crisis – open up the purse strings. The Great French Wine Blight, caused by an infestation of phylloxera aphids, laid waste to much of the French countryside in the second half of the 19th century, killing more than a third of vines and threatening to wipe out the entire sector. Enter the Banque de France, the country’s central bank. Research released ...

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Greek recovery could be hit without bailout review soon, central banker says

Greece’s central bank governor warned on Friday that “uncertainty” could hobble the country’s economic recovery if the government and its lenders do not conclude a bailout review soon, urging both sides to be “flexible” in talks. Governor Yannis Stournaras said the bank’s 2.5 percent growth forecast for this year, lower than a 2.7 percent growth expansion projected by the government and its lenders, hinged on a conclusion of the review, which has dragged on for months. “The Bank of Greece is of the view that, if our partners, the institutions ...

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Moody’s: Global economy to maintain momentum, but shifting US policies inject uncertainty

The modest momentum of emerging market economies, coupled with developed countries performing close to their potential, will help the global economy expand this year, says Moody’s Investors Service in a report. Nonetheless, the outlook could still be impacted by significant shifts in US policy on a number of issues, including trade and immigration. Moody’s expects the rate of growth in G-20 countries to pick up to around 3% in 2017 and 2018 from an estimated 2.6% in 2016. Growth in emerging economies will climb to 4.8% this year, and reach ...

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Global sovereign debt to hit new all-time high – S&P

Worldwide sovereign debt is set to reach a new record high of $44 trillion (35 trillion pounds) this year despite a slight reduction in governments’ annual borrowings, an estimate from credit ratings agency S&P Global said on Friday. The firm calculated that this year’s sovereign borrowing was likely to be $6.8 trillion, down around 4 percent or $315 billion on 2016’s amount and to 9 percent of global GDP. Absolute debt levels will continue to increase however. S&P projects an almost $1 trillion rise to $44.3 trillion, is up 2.3 ...

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Italy Dec Industrial Sales Rise 2.6% on Month; 9.4% on Year

Italy’s industrial sales grew by 2.6% in December from the previous month, fueled predominantly by foreign demand, national statistics institute Istat said Friday. Adjusted for calendar effects, industrial sales grew by 9.4% in December from the same period a year earlier, boosted by an 8.2% increase in sales on the internal market and 11.8% on the foreign market. Industrial orders grew by 2.8% in December from the previous month, but declined by 0.9% from the same month in 2015. Both industrial sales and orders grew in the December for the ...

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Greece PPI Rises Further In January

Greece’s producer prices rose for the second straight month in January, figures from the Hellenic Statistical Authority showed Friday. The overall producer price index surged 9.7 percent year-over-year in January, faster than the 5.1 percent climb in December. The increase in January was largely driven by a 25.4 percent jump in prices of energy goods. Producer prices in the domestic market climbed 6.9 percent annually in January and those in the foreign market grew notably by 19.6 percent Month-on-month, producer prices increased 1.0 percent from December, when it rose by ...

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Singapore Industrial Production Climbs Less Than Forecast

Singapore’s industrial production increased at a slower-than-expected pace in January, figures from the Economic Development Board showed Friday. Industrial production rose 2.2 percent year-over-year in January, much slower than the 9.5 percent surge expected by economists. That was also well below the 22.2 percent jump in December. However, this marked the sixth successive monthly rise. Excluding biomedical manufacturing, output expanded 7.0 percent. Among components, the precision engineering, electronics and chemicals clusters logged increase in output, while the remaining clusters reported declines in January. Month-on-month, industrial production dipped 6.0 percent from ...

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