Sunday, September 23 2018 | ASIA TODAY INTERNATIONAL - Reporting the Business that Matters in Asia
Updated: 2 hours 55 min ago
Consumer prices increased 2.3% (mom) in August slightly higher than our estimate and market consensus (2.0% vs. 2.2%), leading the annual figure to rise to 17.90% from 15.85% in July. Annual core inflation accelerated to 17.2% in August from 15.1% on top of strengthening exchange rate pass-thru and climbing cost-push factors.
Labour’s share of national income has dropped in most of the developed countries and emerging economies in the past few decades. However, this trend is not common across industries: the share of income accounted for by wages has seen an increase in the service industry, while it has recorded a fall in the rest of industries.
The US Federal Reserve closed the summer with its famous annual symposium at Jackson Hole, where renowned economists delve into topics of key importance to monetary policy. The meeting addressed one of the growing concerns about digitisation, namely the ever greater concentration of economic activity in a small number of large companies.
We present a new Bayesian DSGE model with a banking sector for the Spanish economy, designed to evaluate structural reforms and to decompose the main macroeconomic aggregates into structural shocks. Our analysis highlights the fundamental role of financial conditions during the Great Recession and the subsequent recovery of the Spanish economy.
This year's symposium at Jackson Hole focused on the changes to market structures (i.e. competition, concentration... among others) brought by new technologies. Showcasing research insights from leading academics, it centered on the evidence, causes and implications to the economy and future monetary policy.
BCBS publishes amendments on Pillar 3 requirements. EBA issues three different consultations on supervisory reporting (for NPEs, STS and LCR). ECB issues opinions on prudential treatment of investment firms and covered bonds directive. OCC consults on proposal to modernise the CRA. FRB and FDIC extend submission deadline for some resolution plans.
The estimated MREL deficit for European banks based on three subordination scenarios would be 195 billion euros under the recommendation of the EBA, 301 billion euros according to the compromise text of the Council and 526 billion under a full subordination scenario. Therefore, the subordination requirement will be crucial in the future MREL requirement of European banks.
The presidents of Mexico and the US have announced a preliminary bilateral commercial agreement. If congresses in each country approve it, this accord will replace the North American Free Trade Agreement (NAFTA) that has been in place since 1994.
In June 2018 the nominal annual growth rate of traditional bank deposits (demand + term) was 11.8% (6.9% real), higher than that observed in May (11.3%), and 1.7 percentage points above the nominal rate registered in March 2017.
In the past few weeks Turkey has been through bouts of significant financial turbulence. The Turkish lira has depreciated by 22% in August and by about 60% so far this year. An event of this nature in an emerging economy usually has effects on other emerging economies.
Exchange rates over the past few years have had a positive impact on the real estate sector, yet recent currency upheaval has given rise to a considerable deterioration in accessibility conditions. Even so, the slowdown should prove to be only fleeting and there is not likely to be any huge increase in the supply of properties that might prompt a downward price correction.
There is growing concern about inequality in the developed economies. Now that we are seeing a recovery in the Spanish property sector, it is worth reflecting on the role that trends in the housing market have played and may play in widening or narrowing differences among people’s income and wealth.
The brief history of Trump’s protectionism has been an eventful one. In the first year of his term the US focused on the renegotiation of NAFTA, which is currently on hold. In his second year concentrated efforts above all on measures and threats against China, which have intensified to the point where he has threatened to extend the measures to all imports from the China.
Powell’s speech at Jackson Hole Symposium sets policy course for current normalization cycle.