Home / World Economy

World Economy

China’s Plan for the Yuan Could Backfire in Any Crisis, Strategist Says

China’s currency-swap lines with nations spanning the globe, designed to bolster the international role of the yuan, could backfire badly in a world crisis. So argues Mansoor Mohi-uddin, a senior macro strategist at NatWest Markets in Singapore. The danger is that foreign central banks would exchange their currencies for yuan with the People’s Bank of China, then dump those holdings for dollars if a crisis hits, he wrote in a research note Friday. “This would exert downward pressure on the yuan’s exchange rate against the greenback at a time when ...

Read More »

China to Work With Asia to Secure World Trade, Ex-PBOC Head Says

China will work with other Asian countries to safeguard international trade rules, as well as the monetary and financial order, according to its former central bank Governor Zhou Xiaochuan. The country is determined to uphold multilateralism, and is accelerating the pace of its opening-up to integrate more completely into the global economy, Zhou said Saturday at the Singapore Summit conference. It will also continue to build the Belt and Road Initiative with Asian counterparts. “The latest months of 2019 have witnessed many twists and turns and escalating trade sanctions,” said ...

Read More »

China needs to change way it finances economy, think tank says

China needs to develop a better system for financing small businesses that drive innovation in the economy but currently struggle to access the funds they need for growth, a leading Chinese think-tank said in a report published Sunday. China’s economic development over the past 40 years has taken place through a financial system that has high government intervention and is “absolutely dominated by banks”, the China Finance 40 Forum said in an annual report. Such a model, however, tends to distort financial resources in favor of large companies, the report ...

Read More »

Big companies commit to slash emissions ahead of U.N. climate summit

Almost 90 big companies in sectors from food to cement to telecommunications are pledging to slash their greenhouse gas emissions in a new campaign to steer multi-nationals towards a low-carbon future, organizers said on Sunday. We Mean Business, a coalition of advocacy groups, said dozens of companies had joined the initiative in the two months leading up to a United Nations summit taking place on Monday, which aims to spur faster action on climate change. “Now we need many more companies to join the movement, sending a clear signal that ...

Read More »

Taiwanese businesses look to India as alternative to China

Taiwan is pitching India as a potential business destination to its tech, auto, renewable energy and farm sector firms as the United States’ trade war with China has pushed its companies to look for newer markets, two officials said. More than 10,000 Taiwanese companies, including Apple suppliers Foxconn and Wistron have massive operations in China, thanks to its tax incentives, organised supply chain and logistics, efficient business parks as well its cultural ties to the island. But a trade war between Washington and Beijing has led to higher tariffs on ...

Read More »

U.S., China held ‘productive’ talks, still plan October meeting – USTR

U.S. and Chinese deputy negotiators held “productive” talks in Washington this week aimed at improving their trade relationship, the U.S. Trade Representative’s office said on Friday without offering further details. “These discussions were productive, and the United States looks forward to welcoming a delegation from China for principal-level meetings in October,” USTR said in a brief statement. Source: Reuters (Reporting by David Lawder)

Read More »

Why it is insane to want the Federal Reserve to slash interest rates to 0%

Believe this to be true stock market bulls: you don’t want 0% interest rates from the Federal Reserve. Or as they say in some wonky circles on Wall Street: “Negative Interest Rate Policy (NIRP).” Sure, it’s enticing to think about the prospect of buying momentum stocks such as Netflix (NFLX), Amazon (AMZN), Salesforce (CRM) and Beyond Meat (BYND) on cheap credit to juice the prospect for robust returns. But if you think about it, none of those often high-flying stocks would likely be hot trades in the world of NIRP ...

Read More »

Here’s what one top economist sees ahead for the Fed and US-China trade

There’s a lot for investors to watch as stocks inch towards all-time highs. But the “big unknown” that matters most is the ongoing trade dispute between the United States and China, particularly as it relates to the U.S. economic layout, says Benn Steil, director of international economics and senior fellow at the Council on Foreign Relations. “We are seeing some softening in the labor market. We are seeing a weakening in earnings,” he said Thursday on CNBC’s “Futures Now.” “The big unknown — and Chairman Powell keeps emphasizing this — ...

Read More »

U.S.-Japan trade talks will bring peace of mind to farmers, automakers – Motegi

Japanese foreign minister Toshimitsu Motegi said trade talks with the United States will bring peace of mind to farmers and automakers, according to an interview with public broadcaster NHK aired on Sunday ahead of a key bilateral meeting this week. Motegi handled talks with U.S. Trade Representative Robert Lighthizer under his previous role as economy minister and is expected to meet him ahead of a summit between U.S. President Donald Trump and Prime Minister Shinzo Abe. “(We) have been holding negotiations on the basis of trust,” Motegi told NHK in ...

Read More »

Trump Says He Wants ‘Complete Deal’ With China

President Trump rejected suggestions that the U.S. would accept a partial trade agreement with China, saying his administration is “‘looking for a complete deal.” Speaking to reporters on Friday at a press conference with Australian Prime Minister Scott Morrison, Mr. Trump said China’s plan to boost purchases of U.S. agriculture exports alone isn’t enough to compel his administration to sign a deal. Intellectual-property theft, he added, remains an issue that must be resolved. Mr. Trump dismissed the trade war with China, widely cited as an important factor in the global ...

Read More »

Negative Rates Just Got Real for a Record Group of Bank Clients

In the country with the longest history of negative interest rates, a commercial bank just decided to share the cost of the monetary policy with the largest group of retail clients yet. Jyske Bank A/S, which recently made headlines by offering the first 10-year mortgage at negative coupons, said it had no choice but to drag more retail depositors into its negative-rate plight after Denmark’s central bank cut its policy rate to minus 0.75%. Analysts were quick to point out that the development will help central bank policy feed through ...

Read More »

US corporate sector hails India’s move to cut income tax rate for companies

The US’ corporate sector has lauded the Indian government for substantially slashing the income tax rate to 25.17 per cent, saying the move will reverse the economic slowdown and will allow global companies a “good option” for growing their manufacturing base in the country. The government on Friday slashed the income tax rate for companies by almost 10 percentage points to 25.17 per cent and offered a lower rate to 17.01 per cent for new manufacturing firms to boost economic growth rate from a six-year low by incentivising investments to ...

Read More »

Americans Are Saving More, and That Isn’t Necessarily Good

From the 1980s through 2007, household saving followed a predictable pattern. It typically rose after a recession as people paid down debt and rebuilt balance sheets, then declined as they grew more optimistic — and spendthrift. That hasn’t happened during the current expansion. The personal-saving rate, the portion of after-tax income that consumers don’t spend, rose from 3.7% in 2007, at the height of the housing bubble, to 6.5% in 2010, the year after the recession ended. But since then, rather than falling, it has drifted up, to an average ...

Read More »

September Fed Meeting: Divisions Over the Path of Policy

Weakness in the U.S. economy leaves it vulnerable to shocks. We think the Fed will respond with additional easing this year. As expected, the Federal Open Market Committee (FOMC) reduced the fed funds range by another 25 basis points to 1.75%–2.00% at its September meeting, making this the second cut since the Federal Reserve stopped hiking interest rates last December. However, we see two bigger takeaways from Wednesday’s meeting. First, Fed officials remain divided on the appropriate near-term path for interest rates; and second, the Fed could announce a change ...

Read More »

Hopes for trade breakthrough fade as China cancels U.S. farm visits

A U.S.-China trade deal appeared elusive after Chinese officials unexpectedly cancelled a visit to farms in Montana and Nebraska amid two days of ongoing talks in Washington. Chinese officials were expected to visit U.S. farmers next week as a goodwill gesture, but cancelled to return to China sooner than originally scheduled, agriculture organizations from both states told Reuters. The cancellations come after the United States lifted tariffs overnight on over 400 Chinese products. The Chinese Embassy and the U.S. Department of Agriculture did not immediately respond to requests for comment. ...

Read More »

Recent Videos

Hellenic Shipping News Worldwide Online Daily Newspaper on Hellenic and International Shipping