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Unemployment rate in the OECD area falls further to 5.5% in November 2021

The monthly unemployment rate in the OECD area fell to 5.5% in November 2021, from 5.7% in October, extending the trend of reducing unemployment rates into a seventh consecutive month. However, it remained 0.2 percentage point above the pre-pandemic rate recorded in February 2020. The number of unemployed workers across the OECD area also continued to fall, by 1.1 million, reaching 36.9 million, which was still 1.5 million above the pre-pandemic level. The unemployment rate in the OECD area declined among both women (to 5.8%, from 5.9% in October) and ...

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Inflation in the OECD area continues to surge to 5.8% in November 2021, the highest rate in 25 years

Inflation in the OECD area surged to 5.8% in the 12 months to November 2021, compared with 5.2% in October, and just 1.2% in November 2020, reaching the highest rate since May 1996. The rise was particularly marked in the United States, where year-on-year inflation climbed from 6.2% in October to 6.8% in November, the highest rate since June 1982.1 In the euro area, inflation also increased strongly to 4.9% in November, from 4.1% in October and minus 0.3% a year earlier, although it remained lower than in the OECD ...

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Argentina’s strategy toward IMF deal hits a wall of doubt

Argentina’s insistence on its deficit spending plan is putting it on a fresh collision course with the International Monetary Fund, though analysts predict the country will be forced to change tack and clinch a deal to avoid a bigger crisis. The Argentine government and the IMF have been locked in talks for more than a year. Argentina is trying to avoid a default with the IMF as $19 billion in payments loom this year, part of a $45 billion debt that needs to be refinanced to help restore the South ...

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S. Korea’s economy expected to rank 10th largest for 3 straight yrs: IMF

South Korea’s economy is projected to continue to rank the 10th largest for three straight years in 2022 in terms of nominal gross domestic product (GDP), data from the International Monetary Fund have showed. South Korea’s nominal GDP is expected to amount to $1.82 trillion and $1.91 trillion for this year and next year, respectively, Yonhap news agency reported, citing the data. If the projections are realized, South Korea will continue to rank the 10th largest economy for three consecutive years since 2020. South Korea saw its economic ranking climb ...

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Higher Shipping Costs May Lift Asia’s Low Inflation

As the world economy recovers from the pandemic, inflation is mounting in advanced and emerging economies. Pent-up demand fueled by stimulus and pandemic disruptions is helping accelerate inflation, spread around the world through global factors like higher food and energy prices, and soaring shipping costs. The chart of the week shows how Asia’s inflation has been more moderate versus other regions, affording central banks room to keep interest rates low and support economic recovery. However, Asia’s tepid price gains may see greater momentum next year. The outlook remains uncertain, and ...

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EU proposes law to implement OECD deal on minimum global corporate tax

The European Commission proposed a law on Wednesday that would implement in Europe a global deal struck among the 20 biggest world economies (G20) on a minimum tax rate for companies. The Commission proposal includes a common set of rules on how to calculate the globally agreed 15% effective tax rate, so that it is consistently applied across the EU. “In October of this year, 137 countries supported a historic multilateral agreement to transform global corporate taxation,” EU Economic Commissioner Paolo Gentiloni told a news conference. “The directive we are ...

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OECD releases Pillar Two model rules for domestic implementation of 15% global minimum tax

The OECD today published detailed rules to assist in the implementation of a landmark reform to the international tax system, which will ensure Multinational Enterprises (MNEs) will be subject to a minimum 15% tax rate from 2023. The Pillar Two model rules provide governments a precise template for taking forward the two-pillar solution to address the tax challenges arising from digitalisation and globalisation of the economy agreed in October 2021 by 137 countries and jurisdictions under the OECD/G20 Inclusive Framework on BEPS. The rules define the scope and set out ...

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IMF board forms group to review data integrity after World Bank scandal

The International Monetary Fund’s Executive Board on Friday said it has formed a steering group to lead a review to improve institutional safeguards on data and governance after clearing IMF Managing Director Kristalina Georgieva of wrongdoing in a World Bank data-rigging scandal. The IMF board said in a statement that it aims to present the review by the next Spring Meetings in April 2022. The review has “the objective of helping to ensure the staff, Management, and Executive Board maintain the highest possible standards around internal governance, use of data, ...

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IMF warns of interest rate risks as global debt hits US$226 trillion

Global debt surged to US$226 trillion last year, its biggest one-year jump since World War Two, and will be put at risk if global interest rates rise faster than expected and growth falters, the International Monetary Fund said. In a blog posting , IMF officials said the COVID-19 pandemic caused debt to hit 256per cent of global GDP in 2020, an increase of 28 percentage points. Government borrowing accounted for slightly over half of the US$28 trillion increase, but private debt among non-financial corporations and households also hit new highs. ...

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China cbank injects 500 bln yuan via medium-term loans, rate unchanged -statement

China’s central bank injected funds into the financial system through medium-term loans on Wednesday, while keeping the interest rate unchanged for the 20th month in a row. The People’s Bank of China (PBOC) said it was keeping the rate on 500 billion yuan ($78.5 billion) worth of one-year medium-term lending facility (MLF) loans CNMLF1YRRP=PBOC steady at 2.95%. The PBOC’s earlier decision to lower banks’ reserve requirement ratio (RRR) also came into effect on Wednesday, freeing up 1.2 trillion yuan worth of long-term funds, the central bank said in an online ...

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IMF warns Bank of England against inaction on inflation

The International Monetary Fund warned the Bank of England on Tuesday to avoid an ‘inaction bias’ in its approach to combating price pressures as it said inflation in Britain was likely to hit a 30-year high of 5.5% next year. In an annual review of Britain’s economy, the IMF said the country had recovered more strongly than expected from the COVID-19 pandemic, although the latest Omicron variant was likely to cause a “mild slowdown” over the next three months. The BoE has said that interest rates will need to rise ...

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G20 GDP growth accelerates in the third quarter of 2021

Gross domestic product (GDP) of the G20 area grew by 1.7% between the second and the third quarter of 2021, up from a moderate quarter-on-quarter growth rate of 0.4% in the second quarter, according to provisional estimates. This is in contrast with the slowing trend recorded in the OECD area over the same period (from 1.7% in Q2 to 1.1% in Q3). The relatively strong growth of the G20 area in the third quarter of 2021 reflects a rebound in India, where GDP rose by 12.7% in Q3, after a ...

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IMF, 10 countries simulate cyber attack on global financial system

Israel on Thursday led a 10-country simulation of a major cyber attack on the global financial system in an attempt to increase cooperation that could help to minimise any potential damage to financial markets and banks. The simulated cyber attack evolved over 10 days, with sensitive data emerging on the Dark Web along with fake news reports that ultimately caused chaos in global markets and a run on banks. The simulation featured several types of attacks that impacted global foreign exchange and bond markets, liquidity, integrity of data and transactions ...

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Unemployment rate falls slightly in the OECD area, reaching 5.7% in October 2021

The unemployment rate in the OECD area fell for the sixth consecutive month in October 2021, to 5.7% (from 5.8% in September), but at a slower pace than in previous months. It remained 0.5 percentage point above the pre-pandemic rate recorded in February 2020. The number of unemployed workers across the OECD area also continued to fall (by 0.2 million), reaching 38.3 million, still 2.8 million above the pre-pandemic level. The unemployment rate in the OECD area was stable among women (at 6.0%) and declined slightly among men (to 5.5%, ...

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IMF chief economist sees inflationary pressures, risks from Omicron

Central banks do not have the space to keep monetary policy loose and interest rates low, the International Monetary Fund’s chief economist said on Thursday, also warning that the pandemic could turn out far more costly than estimated. Gita Gopinath, IMF chief economist, said that it had estimated that a more transmissible SARS-CoV-2 variant such as Omicron could cost the global economy a further $5.3 trillion, in addition to the current projected loss of $12.5 trillion. She was speaking to an event organised by the World Health Organization (WHO) which ...

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