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Bank Indonesia May Hike Rates As Turkish Lira Crisis Adds Pressure On Rupiah

Indonesia may feel the biggest impact from the Turkish lira crisis, among Asian countries, as a high level of foreign currency debt makes it vulnerable to sharp falls in the rupiah, Capital Economics economist Gareth Leather said Monday. Consequently, the Bank Indonesia is likely to raise its key rate by 25 basis points during its scheduled meeting on Wednesday, the economist said. That would follow a cumulative 100 basis points hike in May and June to support the rupiah. For most Asian countries, the sharp falls in financial markets seem ...

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China-U.S. Trade Spat Is Just a Start to the Economic Cold War

China is not just another front in President Donald Trump’s war on trade. Unlike Mexico, Canada, Europe and other targets of the president, China will be a source of economic conflict for years to come, long after the tariff level on soybeans has been settled. Like the rivalry with the Soviet Union, economic competition with China may form a cold war that shapes American politics and economic policy for a generation or more. Until now, through flukes of timing, Americans have largely been distracted from China’s economic development. China joined ...

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7 Things to Keep in Mind About Turkey

The weekend gave Turkey and the world’s financial markets a much-needed breather after the country’s currency experienced a week of intense weakness and dizzying volatility But it also builds expectations among traders of a decisive policy initiative that, if it proves insufficiently impressive, could lead to even more market disorder and, with that, the potential for wider economic and financial dislocations. There are seven main issues that traders, investors, governments and central banks should keep in mind. No. 1. Beyond foreign exchange Even though the focus these days is on ...

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Bitcoin Investing Is Creating Tax Predicaments for Hedge Funds

Dozens of hedge funds investing billions of dollars in cryptocurrencies don’t know if they’re calculating their taxes correctly, which may be a problem now that U.S. authorities have said they’re going to be scrutinizing virtual currencies. Just like individual taxpayers, institutional investors that have plunged into Bitcoin, Ether and other digital currencies are finding there are few guidelines governing their holdings, and those that exist are murky. As a result, many funds have tried to minimize their liabilities without really knowing what the rules are. That could all come to ...

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Sweden Inflation Remains Stable In July

Sweden’s consumer price inflation held steady in July, after accelerating in the previous two months, data from Statistics Sweden showed Friday. Consumer prices climbed 2.1 percent year-over-year in July, the same rate of increase as in June. The expected inflation rate was 2.0 percent. On a monthly basis, consumer prices increased 0.5 percent from June, when it edged up by 0.2 percent. The inflation rate according to the CPI with a fixed interest rate was also remained stable at 2.2 percent, in line with expectations. Month-on-month, CPIF went up 0.5 ...

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China Faces Problem in Getting Its Banks to Lend More Money

The People’s Bank of China is tackling a problem it rarely had to worry about until recently — persuading banks to lend the money they have. Thanks to the central bank turning on the liquidity taps, the cost for banks to borrow from one another is now lower than the cost to borrow from the PBOC, but a large chunk of those funds is sitting idle. That money isn’t feeding into the wider economy, especially not to cash-strapped smaller firms, as lenders are unwilling to make loans or buy risky ...

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The promise of Korea peace for China

Northeast China has high stakes in North Korea. A durable peace on the Korean Peninsula could mean much needed jobs for China’s industrial rust belt. China’s northeast, historically known as Manchuria, was among the first to industrialise. The region’s plentiful reserves of iron ore and coal premised the rise of its heavy steel-based industry. At one time, Tsarist Russia’s advances, as well as the northeast’s occupation by imperial Japan before the Second World War, spurred the first phase of industrialisation. Food security that the region provided deepened the spread of ...

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Italian Bonds Slump as Shock Waves From Turkish Turmoil Spread

Italy’s bonds led losses among euro-area sovereign debt markets as the Turkish currency turmoil fueled fears of a contagion effect across riskier assets. Yields on two-year securities climbed to the highest levels in more than a week as stocks worldwide declined following a 29 percent tumble in Turkey’s lira this month. The Italian 10-year spread over German bunds hit the highest since May. Deputy Prime Minister Luigi Di Maio was reported as saying in an interview Monday that his country won’t be subject to an attack by speculators. “It’s just ...

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Norway Inflation Accelerates For Second Month

Norway’s consumer price inflation accelerated for the second straight month in July, figures from Statistics Norway showed Friday. Consumer prices climbed 3.0 percent year-over-year in July, faster than the 2.6 percent rise in June. Meanwhile, economists had expected the inflation to remain stable at 2.6 percent. Moreover, this was the highest inflation since December 2016, when prices had grown 3.5 percent. Utility costs grew 6.4 percent annually in June and transport charges rose by 3.6 percent. On a monthly basis, consumer prices increased 0.7 percent in July versus the expected ...

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Ireland Consumer Sentiment Strengthens In July

Ireland’s consumer confidence strengthened in July as warm weather boosted buying climate, survey results from the Economic and Social Research Institute and KBC Bank showed Monday. The KBC Bank Ireland/ESRI consumer confidence index rose to 107.6 in July from 102.1 in June. This was the strongest monthly increase since January and raised the index to its best level since March. The largest change was in consumers’ perceptions of the buying climate. The indicator for major purchases advanced to 143.7 in July from 131.9 a month ago. The index of current ...

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Argentina’s President Faced a Crisis. Now a Scandal Shields Him.

Not long ago, Argentine President Mauricio Macri couldn’t get off the nation’s front pages — for all the wrong reasons. From April to June, he faced withering criticism as Argentina’s currency plunged, growth sputtered and inflation surged. The coverage only got worse when Macri ultimately sought aid from the International Monetary Fund, an institution blamed by Argentines for causing the country’s 2001 economic crisis. On top of that, Macri’s political coalition, Cambiemos, came under scrutiny for alleged illegal campaign financing. Macri’s approval rating hit an all-time low. Jump forward six ...

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China’s fiscal revenue up 6.1 pct in July

China’s fiscal revenue rose 6.1 percent year on year to 1.75 trillion yuan (255 billion U.S. dollars) in July, official data showed Monday. The growth quickened from the 3.5-percent gain in June, according to the Ministry of Finance website. The central government collected 860.7 billion yuan in fiscal revenue last month, up 1.2 percent year on year, while local governments saw fiscal revenue expand 11.4 percent to 885.4 billion yuan. In the first seven months of the year, fiscal revenue went up 10 percent year on year to 12 trillion ...

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Iran’s Khamenei rejects Trump offer of talks, chides government over economy

Iran’s Supreme Leader on Monday rejected U.S. President Donald Trump’s offer of unconditional talks to improve bilateral ties and he also accused the Iranian government of economic mismanagement in the face of reimposed U.S. sanctions. Washington reimposed the sanctions last week after pulling out of a 2015 international deal aimed at curbing Iran’s nuclear programme in return for an easing of economic sanctions. Trump has also threatened to penalise companies that continue to operate in Iran. “I ban holding any talks with America… America never remains loyal to its promises ...

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Bank of Israel : The Monetary Policy Report for the first half of 2018

Monetary policy: This report reviews the first five interest rate decisions made in 2018-on January 10, February 26, April 16, May 28, and July 9. In these five decisions, the Monetary Committee left the interest rate at the historic low of 0.1 percent that was set in March 2015, continuing the accommodative monetary policy. The decisions were set against the background of low inflation, accommodative monetary policy in most leading economies, the relative stability of the effective exchange rate of the shekel, moderation in the housing market, and improved economic ...

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Italy Inflation Accelerates As Estimated In July

Italy’s consumer price inflation accelerated as initially estimated in July, latest figures from the statistical office Istat showed Monday. Consumer prices climbed 1.5 percent year-over-year in July, faster than the 1.3 percent rise in June. That was in line with the flash data published on July 31. The acceleration of inflation was mainly due to higher prices of regulated energy products. Core inflation that excludes energy and unprocessed food, eased to 0.7 percent from 0.8 percent. On a monthly basis, consumer prices increased 0.3 percent in July, confirming the preliminary ...

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