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India to remain fastest growing Asia-Pacific economy, says Moody’s

Fuelled by domestic demand growth, India is expected to remain the region’s fastest-growing economy in the Asia-Pacific region in the second half of the year 2024, said credit rating agency Moody’s Ratings. “India will remain the region’s fastest-growing economy, sustaining last year’s domestically driven momentum. We anticipate policy continuity after the general election, and a continued focus on infrastructure development and encouragement of private sector investment,” the credit rating agency said in its latest report. The report also noted that India, Indonesia, and the Philippines were the key growth outperformers ...

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Biden win would benefit bonds, Trump better for growth, says Morgan Stanley CIO

Bond markets would likely benefit if U.S. President Joe Biden is re-elected as his administration will try to raise taxes to offset some of the government spending, Morgan Stanley’s chief investment officer said on Wednesday. However, under the scenario that former President Donald Trump were to win the Nov. 5 election, it “would be better for growth but worse for bonds”, Morgan Stanley CIO Michael Wilson told the Reuters Global Markets Forum. Over the last 12 to 18 months, investors have favored high-quality large-cap stocks that have seen earnings revisions, ...

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China can divide-and-trade a less welcoming Europe

China is failing to contain its rivalry with the West to the United States. The European Union’s provisional tariffs on electric vehicles from the People’s Republic announced on Wednesday are a setback to Beijing’s relationship with the bloc. Yet President Xi Jinping will test the region’s ability to form a coherent policy towards the world’s second largest economy. Sentiment appeared to be improving in April when German Chancellor Olaf Scholz brought a delegation to China, including business leaders from Volkswagen VOWG_p.DE to BMW BMWG.DE. A month later, Xi was cosying ...

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UBS pushes back Fed rate cut forecast to December

UBS Global Research said it now expects the Federal Reserve to start cutting interest rates in December instead of September, while Goldman Sachs and Morgan Stanley continue to expect the first cut in September. The U.S. central bank on Wednesday pushed out the start of rate cuts to perhaps as late as December, and Fed officials reined in projections for how aggressively they would cut rates this year, from three 25 basis point rate cuts to just one. “The data is going to need to change a lot of minds ...

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Eurozone industry underperforms as tariff worries loom

Eurozone industry has been in a recessionary trend since early 2023 and the latest data shows no imminent sign of recovery. The economy has started to pick up since the start of the year, but industry is lagging the recovery. The April production data showed a small tick down, mainly driven by Ireland and Italy. Expectations of a recovery have been growing, but so far the data still doesn’t show much of it. This comes just as the European Commission has announced higher tariffs on Chinese electric vehicles as of ...

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G7 focus switches to China, Pope to lead AI discussions

Group of Seven leaders launched into a final day of talks at their annual summit on Friday, with China topping the agenda before Pope Francis puts in an historic appearance to discuss artificial intelligence. The pope will be joined by 10 other heads of state and government, including the prime minister of India and the king of Jordan, as the G7 throws open its doors to outsiders to show it isn’t an aloof, exclusive club. During the first day of their meeting in southern Italy, the G7 nations agreed on ...

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Soft US PPI and rising jobless claims keeps rate cuts on track

US weekly jobless claims rose substantially more then expected while PPI undershot by a significant margin, reinforcing the argument that the Fed will likely be in a position to start making monetary policy slightly less restrictive before the end of the year. We still look for a September start point for rate cuts and expect them to cut more than once. Rising jobless claims risks higher unemployment than the Fed is forecasting It has been a topsy-turvy 24 hours for financial markets. Treasury yields plunged in the wake of the ...

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Fed meeting, benign inflation keep soft landing hopes alive

Soft landing hopes that have powered U.S. stocks this year received a boost following encouraging inflation data and a nod from the Federal Reserve at progress made in fighting consumer prices. Expectations for a so-called soft landing, in which the Fed is able to tame inflation and eventually cut interest rates while growth remains resilient, have been a key factor in the ‘s march to record highs in 2024. A string of higher than expected inflation prints challenged that narrative earlier this year. Wednesday’s data, however, showed U.S. consumer prices ...

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The global economy in five charts

Global growth is projected to stabilize at 2.6 percent this year, holding steady for the first time in three years despite flaring geopolitical tensions and high interest rates. By 2025–26, growth is expected to edge up to 2.7 percent alongside modest expansions in trade and investment, according to the Global Economic Prospects Report. Reflecting continued inflationary pressures, central banks in both advanced economies and emerging market and developing economies (EMDEs) are likely to remain cautious in easing policy. As such, interest rates over the next few years are set to ...

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Yellen: US growth needs public, private investments, China subsidies excessive

U.S. Treasury Secretary Janet Yellen said on Thursday that U.S. public investments that attract private capital are crucial to promote sustainable and inclusive growth over the long term, but warned that China’s model of massive state industrial subsidies were unacceptable to the world. Yellen said in prepared remarks to the Economic Club of New York that the traditional Republican model of “supply-side economics” relies too heavily on tax cuts to spur investment and has failed to benefit enough workers. Yellen’s speech to top business executives and Wall Street leaders marked ...

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Greece must reform to protect tourism, ombudsman says

Greece needs to reduce rampant construction and protect water resources and coastal areas if it wants to maintain a healthy tourism industry across its mountainous mainland and beach-lined islands, the country’s ombudsman said in a report on Thursday. Some 33 million people visited Greece in 2023, 5 million more than a year earlier, drawn by its ancient archaeological sites, turquoise Mediterranean waters and reliably sunny weather. But in a report released on Thursday, the ombudsman warned of the growing environmental risks and called for urgent reform. “Our country’s economy relies ...

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German wholesale prices fall 0.7% in May

German wholesale prices fell by 0.7% in May compared with the same month last year, according to data released by the federal statistics office on Thursday. The office offers more detailed economic data on its website. Source: Reuters

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Key evolutions in trade and development over the decades

Developing economies have increased their share of world trade, becoming key players in global value chains. But rising emissions, persistent commodity dependence and growing public debt require urgent attention. As UN Trade and Development (UNCTAD) celebrates its 60th anniversary, we delve into key trends that have shaped global trade and development over the past decades and will continue to influence them. These trends include the increasing share of global trade by developing economies, the evolution of maritime trade, the rise of e-commerce, shifts in global emissions, the growing plastics trade, ...

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G7 leaders back deal to use interest from Russian assets for Ukraine

Leaders of the Group of Seven major democracies started their annual summit on Thursday, many of them under a cloud at home but determined to make a difference on the world stage as they seek to help Ukraine and counter China’s economic ambitions. Heading into two days of talks, diplomats said a deal had been agreed in principle on plans to issue $50 billion of loans for Ukraine using interest from Russian sovereign assets frozen after Moscow launched its invasion of its neighbour in 2022. Western nations were also unanimous ...

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US weekly jobless claims hit 10-month high; producer prices fall

The number of Americans filing new claims for unemployment benefits increased to a 10-month high last week, suggesting the labor market was losing momentum and keeping hopes of a September interest rate cut from the Federal Reserve alive. That was reinforced by other data from the Labor Department on Thursday showing producer prices unexpectedly falling in May. The largest decline in prices at the factory gate since last October followed news on Wednesday that consumer prices were unchanged in May. The U.S. central bank on Wednesday kept its benchmark overnight ...

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