Wednesday, July 18 2018 | ASIA TODAY INTERNATIONAL - Reporting the Business that Matters in Asia
Updated: 10 hours 5 min ago
The IP grew by 6.4% yoy in calendar adjusted terms in May, above the market consensus of 5.5%. Despite the still positive trend, the highest monthly deterioration of 1.6% since September 2016 signals the increasing likelihood of a more rapid adjustment than expected. We expect GDP growth to come down to 3.8% in 2018.
Growth prospects deteriorate due to the financial volatility, the negative effects of exchange rate depreciation, doubts about whether the next government will face fiscal problems and the consequences of the recent truckers’ strike, among other factors. Thus the recovery process will be more gradual than expected
With US having abandoned the nuclear agreement with Iran, oil prices have rebounded amid expectations of a tightening supply. Paradoxically, the higher prices caused concern in the OPEC and amongst its partners. Whilst it is true that higher crude oil prices would lead to a windfall, it would also damage demand from their buyers, including India, China and US.
The Spanish economy is on a clear expansionary path. Activity and employment are recovering, but low levels of productivity persist, and this depresses competitiveness and long-term growth potential while keeping wages low. And yet this is nothing new.
ECB announces a series of measures for NPLs. ESRB and SRB issue their annual reports. ESMA consults on clearing obligations, and issues statement on Brexit. Spanish Ministry of Economy issues draft law for the sandbox regulation. UK government issues Brexit white paper. US Agencies issue joint statement on the application of EGRRCPA.
The stagnation of global trade and the retreat of globalization have become a key issue across the world over the recent years. Both critics and supporters of globalization have spread their stance on it in academic and policymaking speeches. China and the United States are among the countries where trade support has been negatively affected.
High growth and inflation will continue in 2018 & 2019. We now anticipate that the Fed will raise rates three times in 2019; for 2018, we maintain our baseline scenario of hikes in Sept. & Dec. Despite elevated volatility in the employment surveys we maintain our outlook for ongoing tightening in the labor market; unemployment rate to reach 3.7%.
After reviewing a number of methods which China could use in the escalating trade dispute with the US, we find that China’s policy options to counter the US tariff measures are actually limited. We expect that the authorities are unlikely to resort to methods of dumping US treasury bonds and guiding currency depreciation.
The economy of La Rioja grew by 1.8% in 2017, and will accelerate to 2.6% in 2018 and 2019. The region will create around 4,500 new jobs by the end of 2019, although the likelihood of some of the risk to this scenario has grown.
The ability to anticipate disruptive changes is key to business survival. Although it is impossible to predict the future, forecasting methods and techniques can help to identify such changes early on. BBVA Research has developed a methodology to spot potential future scenarios for the financial industry so that it can serve as a tool to support strategic decision-making.
The next government will be faced with major challenges on the fiscal front. First it has to be said that the fact that the future prime minister and his chosen finance minister made it clear in their first messages that they are going to propose fiscal years resulting in primary fiscal surpluses.
Between May 2017 and March 2018, the Central Reserve Bank of Peru (BCRP) cut the benchmark rate by 1.5% (from 4.25% to 2.75%), highlighting the expansive nature of the country's monetary policy. Nevertheless, we expect this rate reduction process to have concluded and that from the second half of 2019, the BCRP will begin to increase rates toward a more neutral level.
The recent European summit of Heads of State and Government focused on discussing the huge problem of illegal immigration to Europe, devoting very little time to discussing what just a few weeks ago was supposed to be the central theme of this meeting: the deepening of the monetary union.