It was a stark warning about the risks ahead for the global economy, even by the forthright standards of the boss of the Organisation for Economic Co-operation and Development. “The world economy is in a dangerous place,” Angel Gurria said as the OECD announced its latest, lower forecasts for growth on May 21. The source of his worry: the mounting trade tensions between the United States and China, which could hit the rest of the world much harder than they have to date. “Let’s avoid complacency at all costs,” Gurria ...

For years, China’s industrial heartland has been cloaked in smog, its waterways choked with pollution pumped from enormous clusters of factories churning out the mountains of cement and steel needed to build the Chinese economy. Aiming to tackle what has become a huge public health problem, the authorities have cracked down on polluting industries, targeting provinces like Henan, which has a population of 100 million people and hundreds of factory towns. According to interviews with factory and business owners, and consumers and workers across Henan, that crackdown – conducted with ...

The latest round of US tariffs on Chinese imports will cost the typical American household US$831 a year, according to researchers, as the Trump administration faces growing political pressure over its trade war with China. Washington this month increased existing tariffs on US$200 billion in Chinese goods from 10 per cent to 25 per cent, prompting Beijing to retaliate with its own levies on US imports, as talks to end a 10-month trade war between the world’s two largest economies stalled. Research published by the New York Federal Reserve Bank ...

Orders for long-lasting factory goods declined in April as business investment cooled while orders for civilian aircraft fell sharply amid problems with a major Boeing Co. airliner model. Orders for durable goods–products designed to last at least three years, such as cars and appliances–fell 2.1% from the prior month to a seasonally adjusted $248.4 billion in April, the Commerce Department said Friday. Economists surveyed by The Wall Street Journal had expected a 2% drop in the month. Orders for March were revised down to a 1.7% increase from a previous ...

The role of banks as providers of finance has started to erode in Europe and some other parts of the world, the Bank of Finland’s governor Olli Rehn said on Friday, calling for new central bank tools to safeguard financial stability. “In Europe, an increasing share of lending is provided by investment funds, insurance companies and the providers of consumer loans,” the European Central Bank policymaker said in a speech in Helsinki. Rehn, who is seen as a potential successor to ECB President Mario Draghi, dismissed as “theological” a debate ...

Japan’s net external assets grew to their second-largest amount on record last year, rebounding from the prior year’s decline and making it the top creditor nation for the 28th straight year, the Ministry of Finance (MOF) said on Friday. The net value of assets held by the government, businesses and individuals stood at 342 trillion yen ($3.10 trillion) at the end of 2018, up 3.7% from the year before, it said. It compared with a record 351 trillion yen in 2014. Japan’s net external assets were about 1.3 times those ...

Japan’s factory output likely picked up in April, reversing the decline seen in the previous month, a Reuters poll found on Friday, although the U.S.-China trade war is expected to prevent a more meaningful recovery in months ahead. Industrial production was forecast to rise 0.2% in April from the previous month after a 0.6% fall in March, the poll of 16 economists showed. The expected small gains in the data were supported by firms’ front-loading some production ahead of Japan’s 10-day holiday from late April to early May to celebrate ...

British retail sales were flat in April after several months of strong growth, as shoppers stayed away from the high street and instead sought out bargains online. Still, the figures were better than economists polled by The Wall Street Journal were expecting, reinforcing expectations that consumers will continue to power the U.K. economy during 2019 as uncertainty over the country’s departure from the European Union crimps business spending. Retail sales in April were flat compared with March, and 5.2% higher than a year earlier, the Office for National Statistics said ...

The solution to Europe’s next economic crisis might not lie with the European Central Bank — or whoever leads it after Mario Draghi. A future growth emergency risks proving overwhelming for the Frankfurt-based institution and its depleted monetary ammunition, potentially putting the onus on a fiscal response instead. That prospect of policy impotence may offer less glory to the central banker who replaces Draghi at the ECB’s helm — and less of an incentive for countries to win the job. That perspective is one backdrop to the impending tussle over ...

China’s commerce ministry said on Friday that more efforts should be made to achieve the goal of stabilising trade while improving its quality, adding that the trade environment is growing more uncertain and challenging. The domestic economy still faces downward pressure and some structural issues remain to be resolved, the ministry said in a statement summarizing the foreign trade trends for this year. The statement made no mention of the United States or China’s trade disputes with it. Source: Reuters (Reporting by Beijing Monitoring Desk; Editing by Richard Borsuk)

Premier Li Keqiang said on Friday China aimed to keep value-added taxes for the manufacturing industry at low levels and encourage companies to innovate, in comments coming at a time of a bitter trade dispute with the United States. Despite a good start in the first quarter, rising external challenges may still destabilise the Chinese economy, the second largest in the world, Li said in a statement on a government website. While addressing a tax symposium, Li said although cuts in taxes and fees would reduce fiscal revenue, they would ...

Goldman Sachs raised its probability of a no-deal Brexit to 15% from 10% on Friday as Prime Minister Theresa May’s resignation potentially opened the way for a more hardline politician to lead the UK to exiting the European Union. Goldman Sachs economist Adrian Paul said ratification of a Brexit deal would no longer be possible in the second quarter. “We pencil in an orderly EU withdrawal in late 2019 or early 2020, but our conviction is low,” he wrote. The new Prime Minister will face the same constraints May grappled ...

Many investors fear that the U.S.-China trade war will inflict long-lasting damage on the U.S., but economist A. Gary Shilling, president of economic consulting and forecasting firm A. Gary Shilling & Co., disagrees. “People say nobody wins trade wars. Yeah, in the short-run you don’t, but in the long-run…the U.S. will be better off,” Dr. Shilling asserted in an interview with Business Insider published this week. “When you’ve got plenty of supply in the world, and I think you do…it’s the buyer that has the upper hand not the seller. ...

The euro-area economy remains on track with European Central Bank projections that foresee an upturn later this year, policy maker Bostjan Vasle said. The ECB is gearing up for a meeting in Lithuania in two weeks that will include updates to its forecasts and discussions over how generous to make a new round of bank loans known as TLTROs. Its previous projections in March were followed by sometimes-conflicting economic reports showing troubled manufacturing, relatively resilient services and stubbornly low inflation. “I’m quite confident that the economy is on the right ...

Expected gains for populist eurosceptic parties in this week’s European Parliament elections could prompt a shift in the political balance of power in leading member states and stall moves towards deeper economic integration. Voting across the 28-nation EU runs from Thursday till Sunday and eurosceptic parties are forecast to do well, including in the three biggest countries of the euro zone, Germany, France and Italy. An exit poll in the Netherlands, which along with Britain voted on Thursday, showed mainstream pro-EU parties performing surprisingly well but analysts warned against reading ...