The Lastest Macroeconomic News
23.09.2016 10:59 Russian economy crumbles, according to official data
Russian consumers continue to struggle in the second year of a recession, with official data showing that the amount of real disposable income people had in August fell at the fastest pace in seven years. Official government statistics show that Russia`s economy shrank by 4.1 % during the third quarter of 2015 as a recession caused by low oil prices and Western sanctions over Russia`s role in Ukraine`s civil war continued to take its toll. Real disposable income has been falling since 2014 when Russia was hit by Western sanctions over its role in the Ukraine crisis, but the 9.3 % decline, in annual terms, was the steepest since August 2009, the aftermath of the global financial crisis. Real income, adjusted for inflation, also declined, by 1 %, after showing some positive signs earlier this summer, according to the data from the Federal Statistics Service, or Rosstat. With less money to spend, consumers also stayed away from shopping, with retail sales, a barometer of customer demand in Russia, down 5.1 % in August and following a 5.2 % decline in July.
21.09.2016 13:21 OECD: Low-growth trap set to continue; central banks creating market distortions
The world economy remains in a "low-growth trap" and weaker conditions in advanced economies will persist into 2017, the Organization for Economic Co-Operation and Development (OECD) warned on Wednesday. In its interim economic outlook, the OECD forecast that global gross domestic product (GDP) growth is projected to remain flat at around 3 percent in 2016 "with only a modest improvement projected in 2017." It predicts global growth to expand 2.9 percent this year and 3.2 percent in 2017, lifted by China and India. The forecast was largely unchanged since June 2016, the OECD noted, with weaker conditions in advanced economies, including the effects of the U.K.`s vote to leave the European Union (EU), "offset by a gradual improvement in major emerging market commodity producers." "The world economy remains in a low-growth trap with persistent growth disappointments weighing on growth expectations and feeding back into weak trade, investment, productivity and wages," it said.
19.09.2016 12:44 Russia`s economy heading to recovery
Russia`s economy is gradually emerging from contraction and heading to recovery, a global ratings firm says. Standard and Poor`s said in its latest report on the health of the Russian economy that the recession it has faced is coming to an end. It revised its assessment of Russia`s credit risk from negative to stable. “The outlook revision reflects our view that external risks have abated to a significant extent,” the rating agency said this weekend. “We expect the Russian economy and policy making will continue to adjust to the lower oil price environment and that the country will maintain its strong net external asset position and moderate net general government debt burden in 2016-2019,” it added in its report. Russia`s GDP contracted 1.2 per cent in Q1 2016 but that slowed to 0.6 per cent in Q2, according to data from the Rosstat federal statistics service. This is a marked improvement to its 3.7 per cent contraction in 2015; it contracted 3.8 per cent in Q4 in 2015.
16.09.2016 10:30 World Bank: Economic toll of air pollution may have cost India 8.5 % of GDP
For India, the economic toll of rising air pollution may be as high as 8.5% of its GDP in 2013 or more than $560 Billion, a World Bank Report has suggested. While air pollution has emerged as the deadliest form of pollution and the fourth leading risk factor for premature deaths worldwide, the economic burden it brings along is massive, a new study by a joint study of the World Bank and the Institute for Health Metrics and Evaluation (IHME) has suggested. The study, released on Thursday, says air pollution robs nations of significant potential to grow, which after being calculated through total "welfare losses" and loss in labour output, reaches a staggering amount especially for developing countries.
14.09.2016 11:52 Russia Economic Power Shrinking, Losing Market Share
Russia`s economic power is shrinking, and with the world’s oil and gas glut, its chief export is starting lose market share in Europe. A new government report on Russia`s economic output next year shows tepid growth in 2017, and not much to write home about for the next two years either. “We will continue to lose our share in the world economy and in fact be weaker,” says Kirill Tremasov, head of the Department of Macroeconomic Forecasting at the Ministry of Economic Development. Tremasov expects 2017 oil prices to average around $41 per barrel, hurting GDP growth but at least keeping inflation in check. Following negative growth this year, Tremasov expects growth of 0.7% in 2017, with an average growth rate between 2017-2019 of around 1.5%. “We need a growth rate of at least 3.5%,” Tremasov said.
12.09.2016 13:22 ACRA: Russia`s Recession Continues, GDP to Shrink 1.5% in 2016
Russia`s recession has not yet ended and activity in a number of key sectors has declined over the past five months, the country`s Analytical Credit Rating Agency (ACRA) said Monday. "Economic statistics for January-July 2016 show that the recession de-facto has not ended. Current seasonally adjusted growth rates of the major sectors remain negative. The mining sector, retail, construction and other basic activities have been declining over the last five months," ACRA said in its latest forecast. Russia`s recession could last until early 2017, with growth rates likely to be restricted to less than 1.5 percent after that even in case oil prices rise, according to the forecast. Russia`s GDP is expected to fall 1.5 percent in 2016 and 0.1 percent next year before returning to growth and expanding 0.5 percent in 2018 and 0.7 percent in 2019.
10.09.2016 10:43 Globalization of the World Economy Hits a Wall
For the first time since early 2014, the dollar value of goods imported and exported by the G20 countries actually grew a little in the second quarter of this year, the Organization for Economic Cooperation and Development reported last week. This is probably just because oil prices bounced back a bit after hitting a 12-year low in the first quarter. The world trade volume index maintained by the Netherlands Bureau for Economic Policy Analysis fell 0.7 percent in the second quarter. (The bureau, which also goes by its Dutch initials, CPB, doesn`t actually go out and measure how big the things are that we`re trading with each other; it just adjusts for price and currency fluctuations to give a clearer picture of trade flows.) By this metric, global trade has been sputtering since early 2015, and the sputtering has been getting worse lately, not better. For those who have been following the shipping business, this surely isn`t a big surprise. As Bloomberg Gadfly`s David Fickling and Rani Molla put it Tuesday: "Of the top 15 container lines that were in operation nine months ago, four have gone out of business or are in the process of doing so." Much of the world seems to be in denial about this, though. Fickling and Molla again: "The global container fleet is still getting bigger."
08.09.2016 13:20 Japan revised data show GDP grew 0.7 pct in April-June
Japan`s economy expanded at a better-than-estimated 0.7 percent annualized pace in April-June, according to revised data showing private demand was stronger than earlier reported. An earlier estimate put annualized growth in the April-June quarter at 0.2 percent. The economy grew at a 2.1 percent annualized pace in January-March. The latest data showed business investment fell by a smaller margin than reported in August, while consumer spending was higher. But both remain much slower than hoped for given the government`s targets for growth. Prime Minister Shinzo Abe has proposed an extra set of stimulus measures to help prop up the economic recovery and spur more consumer and corporate spending, which are seen as crucial for sustaining growth. The Bank of Japan is also reviewing its own lavish monetary stimulus policies and is expected to step up its efforts to combat deflation, possibly later this month.
06.09.2016 18:56 1 Fact and 2 Forecasts for the Global Economy
Global economic growth is slowing. The world economy continues to expand, but at a smaller growth rate than in recent years. The outlook isn`t much better. In fact, the IMF keeps revising its forecast downwards, as do the forecasters tracked by FocusEconomics. It turns out that the expected growth isn`t much off than the historical average. Advanced economies are will not accelerate from current tepid growth, but emerging economies will gradually improve. The IMF forecast for world GDP in 2017 is 3.4 percent growth (inflation adjusted). The long-run average, calculated since 1970, is 3.6 percent. That`s not much different. It seems weak because previous forecasts had been up around 4.0 percent. We`ve had years with more than five percent growth. But the current forecasts are not that bad. Even if we take a narrower slice of history, say 1990 through 2015, we get just 3.6 percent growth. So maybe it`s not so bad. Population growth is lower than the long-run trend by about 0.3 percent a year (1.2 recently compared to 1.5 historically), so per capital GDP growth is not bad.
04.09.2016 16:50 Eurostat: EU is the largest contributor to world GDP
The EU generates almost a quarter of world GDP despite containing just 7 per cent of the world`s population, a new statistical analysis by Eurostat has revealed. In total, the 20 countries that make up the G20 account for a massive 85 per cent of global GDP. In a report comparing the 28-nation bloc to the 15 non-EU countries that form part of the G20, Eurostat noted that the EU average of 1.5 births per woman was the third-lowest among G20 countries. Only Japan (1.4) and South Korea (1.2) have a lower birth rate. The EU`s old-age dependency, measured as the ratio of the number of people aged 65 and over to the working age population, is the second-highest among G20 states, with its 28.1 per cent rate beating Canada, Australia and the United States.