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U.S. Consumer Spending Rose Ahead of Coronavirus Spread

Consumers boosted spending as personal incomes rose in February, a month when concerns about the coronavirus pandemic began to escalate in the U.S. Personal-consumption expenditures, or household spending, rose a seasonally adjusted 0.2% in February compared with January and personal income was up 0.6%, the Commerce Department reported Friday. Economists surveyed by The Wall Street Journal expected a 0.2% increase in spending and a 0.4% rise in personal income. The data are a sign of U.S. consumer strength prior to coronavirus’s spread across the U.S. Consumers had been buoyed by ...

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China’s outbound investment up 1.8 pct in first two months

China’s non-financial outbound direct investment (ODI) rose 1.8 percent year on year during the first two months, the Ministry of Commerce said. Non-financial ODI stood at 107.86 billion yuan (about 15.5 billion U.S. dollars) in the first two months, data showed. Chinese companies increased investment in countries participating in the Belt and Road Initiative during the first two months, adding a total of 2.72 billion U.S. dollars of new investment in 48 countries, up 18.3 percent year on year. China’s investment mainly went into sectors including leasing and business services, ...

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Around one in five German firms see themselves at risk of insolvency – survey

Almost one in five German companies sees itself at acute risk of insolvency due to the coronavirus crisis, a survey from the DIHK Chambers of Commerce showed, pointing to the heavy toll the coronavirus outbreak could take on Europe’s largest economy. “That should set all the alarm bells ringing – if we don’t take decisive action, we’ll see economic damage of historic proportions,” DIHK President Eric Schweitzer said of the survey published on Friday. The survey of 15,000 firms showed more than 80% of German companies expect revenues to decline ...

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Italy business and consumer morale plunge in March as coronavirus impact bites

Morale among Italian businesses and consumers plummeted in March, data showed on Friday, hit by a coronavirus outbreak that has decimated activity in the euro zone’s third largest economy. The first piece of significant economic data issued by statistics institute ISTAT since the outbreak emerged on Feb. 21 showed its manufacturing confidence index sank to 89.5 in March from 98.8 in February. That was slightly below a median forecast of 90.0 in a Reuters survey of eight analysts. ISTAT’s composite business morale index, combining surveys of the manufacturing, retail, construction ...

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Fed balance sheet tops $5 trillion for first time as it enters coronavirus war mode

The U.S. Federal Reserve’s balance sheet soared past $5 trillion in assets for the first time this week as it scooped up bonds and extended loans to banks, mutual funds and other central banks in its unprecedented effort to backstop the economy in the face of the global coronavirus pandemic. The Fed’s total balance sheet size exploded by more than half a trillion dollars in a single week, roughly twice the pace of the next-largest weekly expansion in the financial crisis in October 2008. As of Wednesday, the Fed’s stash ...

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Japan February factory output seen cooling, retail sales down for 5th month as virus hit deepens

Japan’s factory output likely slowed in February and retail sales dropped for a fifth straight month, a Reuters poll showed on Friday, as the coronavirus outbreak took an increasing toll on businesses and consumers. Japan has recorded 2,113 cases of the virus and 57 deaths so far as the disease races across the world, prompting the Bank of Japan to expand stimulus while the government works to nail down a support package that sources say will total at least $137 billion. While the stimulus likely won’t prevent the world’s third-largest ...

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Fitch Affirms United States at ‘AAA’; Outlook Stable

Fitch Ratings has affirmed the United States of America’s Long-Term Foreign-Currency Issuer Default Rating (IDR) at ‘AAA’ with a Stable Rating Outlook. KEY RATING DRIVERS The U.S. sovereign rating is supported by structural strengths that include the size of the economy, high per capita income and a dynamic business environment. The U.S. benefits from issuing the U.S. dollar, the world’s pre-eminent reserve currency, and from the associated extraordinary financing flexibility. Fitch considers U.S. debt tolerance to be higher than that of other ‘AAA’ sovereigns. However, high fiscal deficits and debt ...

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We are not crashing the economy over coronavirus, Britain says

The British government is not crashing the economy with its multi-billion pound schemes to help businesses and workers as both companies and citizens needed support to survive the coronavirus crisis, its business minister said on Friday. “I don’t think we are crashing the economy,” British Business Minister Alok Sharma told Sky News. “I hope the downturn, if I can put it like that, and the impact on the economy will be short term.” “This is a global issue that is affecting countries across the world and we are providing support, ...

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ECB tells banks to be prudent on dividends, avoid capital hole later

Euro zone banks struggling with the consequences of the coronavirus outbreak should be prudent when deciding whether to pay a dividend so as to avoid needing fresh capital later, the European Central Bank said on Friday. “Banks should be prudent when deciding about dividends and have a forward-looking view on risks to avoid a situation where capital needs would arise,” an ECB spokeswoman said in a statement. Source: Reuters (Reporting By Francesco Canepa; Editing by Balazs Koranyi)

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Small Businesses in Limbo as They Await Coronavirus Assistance

Small businesses are trying to defer bills and secure emergency loans to stay afloat amid the coronavirus scourge as they await relief earmarked specifically for them in the $2 trillion stimulus package working its way through Congress. The bill, approved by the U.S. Senate Wednesday and now awaiting action in the House of Representatives, also would provide an infusion of capital to small businesses deserted by clientele or shuttered as a result of lockdowns aimed at slowing the advance of the virus. “We’re nervous,” said Maurice Brewster, chief executive of ...

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IMF says global output to contract in 2020, exploring financing options

International Monetary and Financial Committee Chair Lesetja Kganyago and International Monetary Fund Managing Director Kristalina Georgieva issued the following statement following today’s conference call of the International Monetary and Financial Committee. “We are in an unprecedented situation where a global health pandemic has turned into an economic and financial crisis. With a sudden stop in economic activity, global output will contract in 2020. Member countries have already taken extraordinary actions to save lives and safeguard economic activity. But more is needed. Priority should be afforded to targeted fiscal support to ...

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OECD updates G20 summit on outlook for global economy

Efforts to contain virus and save lives should be intensified, and governments should plan stronger, more coordinated measures to absorb growing economic blow Increasingly stringent containment measures needed to slow the spread of the Coronavirus (Covid-19) will necessarily lead to significant short-term declines in GDP for many major economies, according to new OECD projections. OECD Secretary-General Angel Gurría, in preparation to the G20 Virtual Summit that took place yesterday, unveiled the latest OECD estimates showing that the lockdown will directly affect sectors amounting to up to one third of GDP ...

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Coronavirus impact: Once pandemic ends, businesses may take 6 months to get up and running normally, says CFO survey

The biggest task facing the world right now is stopping the spread of the coronavirus. But even when the global public health crisis is under control and global supply chain disruptions caused by COVID-19 end, many large companies expect that business will not return to normal for between three to six months. That’s according to the latest CNBC Global CFO Council survey, in which 40% of companies that already have or expect supply chain issues said it could take between three and six months to get business back to normal ...

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EU relaxes financial reporting rules due to epidemic

The European Union has offered breathing space for companies grappling with deadlines for financial statements and annual shareholder meetings in the wake of the coronavirus crisis, as Germany approved its own measures on Friday. The bloc’s markets watchdog, the European Securities and Markets Authority (ESMA), said national regulators across the EU should “apply forbearance powers towards issuers who need to delay publication of financial reports beyond the statutory deadline”. Listed companies must publish an annual financial report within four months of the end of their financial year. For those whose ...

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China Jan-Feb Industrial Profit Plunged

Profits of China’s large industrial firms fell sharply in the first two months, weighed by falling producer prices and increased costs due to the coronavirus pandemic, the National Bureau of Statistics said Friday. China’s industrial profits tumbled 38.3% in the January-February period from a year ago, according to official data. In the first two months of 2020, China’s state-owned enterprises posted a 32.9% on-year decline in profits, while private firms reported a 33.6% fall. Factory-gate prices for the automobile, electronics, chemical and electrical machinery sectors all declined, falling between 66.4% ...

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