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16.05.2017 14:22 World Bank head says initiative good for world economy

The China-led Belt and Road Initiative serves as a constructive platform to help achieve common prosperity for regional economies and contributes to global development, World Bank President Jim Yong Kim said on Sunday. China`s growing influence can be applied through the initiative to help other countries work through their differences and foster the development of free trade and investment, Kim told China Daily on the sidelines of the ongoing Belt and Road Forum for International Cooperation in Beijing. The initiative consists of the Silk Road Economic Belt and the 21st Century Maritime Silk Road. Global and regional trade and investment still face many hurdles - "sometimes even within a single country", Kim said. Trade between states or provinces and another state or province "can be very complicated". "What is needed in terms of tackling these barriers is that you need to have convening power," he said. "You need to bring all the different parties together, and you need to get them to sit in a room and work out these kinds of differences.

14.05.2017 18:37 Annualized Inflation in Russia Expected to Decrease to 4% in May

Minister Maxim Oreshkin said that annualized inflation rate in Russia is expected to fall to 4 percent in May, two months sooner than the target set by the Russian Economic Development Ministry. The annualized inflation rate in Russia is expected to fall to 4 percent in May, two months sooner than the target set by the Russian Economic Development Ministry, Minister Maxim Oreshkin said Friday. "We expect that the rate of 4 percent will be already reached in May. The estimations for the year end are changing. In accordance with the basic scenario and under the condition of the weakening ruble, the inflation rate is expected to be 3.8 percent. If the ruble stands stable and the currency rate amounts to 56-57 rubles [per dollar], the inflation will amount to about 3 percent," Oreshkin told the Rossiya 24 broadcaster in an interview. According to Oreshkin, the situation is currently developing in accordance with the ministry`s forecast. "But it is very important that as soon as inflation trajectory starts following such an optimistic scenario, we will immediately see the reaction of the Central Bank," the minister added.

12.05.2017 11:38 Global Economy: Is growth optimism justified?

Daniel Ben-Ami finds that while there are signs that the global economy might be bouncing back, doubts are being raised by the weakness of the recovery. A mood of cautious optimism seems to have pervaded the financial markets recently. After a painful decade, which included a global financial crisis and a euro-zone crisis, many economic indicators appear to be pointing upwards. Fears of descent into a global slump are being superseded by hopes of a cyclical upturn in the world economy. Sometimes this shift is referred to as `global reflation`. The idea is that the economy is shifting from a deflationary period, when growth is running consistently below its trend rate, to an expansionary one. From this perspective, a rise in inflation is welcome, as it indicates a pick-up in consumption and growth. As long as there are no signs of runaway prices, the shift to moderate inflation would be read by many as a return of vibrant `animal spirits` to the economy.

10.05.2017 17:15 China credit squeeze dents global growth

The global economy has continued to expand at well above its trend growth rate since the beginning of 2017, but there have been some early signs of a slackening in recent weeks. According to the latest monthly results from the Fulcrum nowcasts, global growth is now running at 4.1 per cent (at PPP exchange rates), which is about half a percentage point lower than a month ago. This slowdown, which has been driven by the US and China, is well within the normal range of monthly fluctuations in the global nowcast, and it may be nothing more than a temporary blip. There are some legitimate reasons for concern about the slowdown in China, which seems to be connected to tighter credit polices. Fortunately, however, the Chinese economy seems in better shape to absorb this tightening than it was in 2013-15. Since the American Presidential election in November 2016, much of the attention of investors has been focused on the US economy, which is usually seen as the litmus test for the global reflation theme. The nowcasts have identified a strong surge in US growth, starting in September 2016 and peaking at over 4 per cent in March 2017.

08.05.2017 14:43 Western sanctions and languid Russian economy

Stringent international sanctions imposed on Russia for its role in the Ukraine conflict have sucked the momentum out of the Russian economy over the past couple of years. The nation`s growth prospects remain lethargic. Talks between German Chancellor Angela Merkel and Russian President Vladimir Putin on Tuesday in the Black Sea resort city of Sochi focused mainly on geopolitical and security problems, such as the sanguinary conflicts in Ukraine and Syria. It was Merkel`s first visit to Russia in two years. It was widely anticipated that Western economic sanctions against Russia would also figure in the talks between the two leaders. Merkel and Putin, however, did not explicitly bring up the sanctions issue at the press conference after their meeting, with the German chancellor simply saying she hoped some of the sanctions could be lifted if Moscow helped make significant progress in implementing the Minsk peace plan. The Russian leader only referred to economic ties between the two nations, stating that "our cooperation makes a significant contribution to stabilizing the world economy."

05.05.2017 14:55 Russia`s GDP Is Back to Positive Territory

Russia is currently surrounded by political turmoil with Syria and Ukraine, which has led to Western sanctions. The sanctions and lower oil prices have been impacting Russia`s market performance since 2014. However, the recovery of oil prices in the latter half of 2016 has helped the Russian economy to recover from negative growth in 4Q16. Recently, the International Monetary Fund also upgraded its forecast for Russia`s gross domestic product growth from 1.1% to 1.4% in 2017 and from 1.2% to 1.4% in 2018. The Russian economy advanced 0.3% in 4Q16 as compared to a 0.4% contraction in 3Q16. The Russian economy recorded its first expansion in 4Q16 since 4Q14. The main driver of the positive performance in 4Q16 was its net external demand. Its exports rose 3.7% in 4Q16 as compared to 4.2% in 3Q16. The household spending and investments also contracted at a slower pace in 4Q16 as compared to 3Q16. The 2017 and 2018 growth forecasts have been revised up for Russia, reflecting stronger economic activity mainly due to oil price recovery in 2016. According to the IMF report, the resilient financial markets and a cyclical recovery in manufacturing and trade are likely to improve Russian economic growth in 2017. The recovery in commodity prices has also helped reduce the likelihood of deflation on a global level in 2017. However, if the geopolitical tension between Russia and the US escalates, it could spook the market in 2017.

03.05.2017 00:02 Informal economy in Russia grows to record levels

In 2016, employment in the informal sector of Russia`s economy set a record level for the last 10 years, reports Rosstat, the Russian Statistics Agency (the information was published (in Russian) by the RBC business daily in mid-April). Rosstat believes that the informal employment category consists of those people who work in enterprises that are not registered as a legal entity, that is, the self-employed, farmers, individual entrepreneurs, and people whom they hire. Family members who help the family business or a business belonging to a relative are also included. The informal economy employed 15.4 million people in 2016. This is 21.2 percent of the total number of people employed in Russia. The informal sector has been growing rapidly since 2011 and in this period has increased by four million people, according to RBC`s calculations, which are based on Rosstat`s statistics. However, the Russian Presidential Academy of National Economy and Public Administration estimates that the informal labor market in Russia consists of 30 million people, 21.7 million of whom either combine official employment with informal earnings, or receive a part of their salary unofficially, "in envelopes." According to the Russian Finance Ministry, the volume of informal salaries in the country is estimated at 12 trillion rubles ($200 billion), which is 10-13 percent of the GDP.

01.05.2017 23:07 Philippines` GDP growth to hit 6.9% in 2017 and 7.0% in 2018

Higher infrastructure spending and remittances from overseas Filipino workers would make Philippine economy the third-best performer in Southeast Asia until next year, according to the United Nations Economic and Social Commission for Asia and the Pacific (Unescap). In the 2017 Economic and Social Survey of Asia and the Pacific, Unescap said Philippine GDP could grow by 6.9 percent this year and 7 percent next year. This will make the Philippines the third-best performer in the region where average growth is projected to settle at only 4.7 percent this year and 4.8 percent next year. Higher oil prices would help boost economic activities in the Middle East, which hosts many Filipino overseas workers. In addition to higher workers` remittances, fiscal support would support household consumption, Unescap said.

29.04.2017 15:05 The Russian central bank lowered interest rate on steady inflation decline

The Russian central bank lowered its key interest rate by half a percentage point to 9.25 percent on Friday, citing the alleviation of inflationary pressure. Inflation is moving toward the target of 4 percent for 2017 and the economy is recovering, said the bank in a statement. The bank cut its interest rate by half a percentage point to 10.5 percent in June 2016 in a first reduction since August 2015, and further cut the rate to 10 percent in September 2016 and to 9.75 percent last month. In the statement, the bank said it expects Russia`s inflation to decline to 4 percent before the end of 2017 and stay around this level in 2018-2019. Inflation fell to 4.3 percent in March from 4.6 percent in February, while it was estimated at 4.2-4.3 percent as of Monday, the bank said. The rate began to steadily decline last year from a peak of 17.0 percent in January 2015.

27.04.2017 13:38 President Trump`s economy isn`t bursting out of the gates.

All signs are that it is starting 2017 with more of the same sluggish growth the U.S. experienced during President Obama`s term. But as with the final years of Obama`s presidency, there`s reason to be optimistic about the current state of the economy under Trump. The government will publish the first report of economic growth in the Trump era on Friday. The Atlanta Federal Reserve is predicting 0.5% annual growth in the first three months of the year; private economists are forecasting 1.1%. The Trump administration isn`t really responsible for the slow growth yet. The reason: Many of his policies haven`t become law, and none of them have had enough time to work through the economy. "What happened in the first quarter of the year is entirely beyond credit or blame of the Trump administration or the 115th Congress," says Joseph Brusuelas, chief economist at RSM, an accounting firm. "That`ll be a 2018 story."

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