“Relations between the US and China are crumbling rapidly. Against a backdrop of an escalating trade war between the two countries, Washington has continued to push Beijing’s buttons on flashpoints, stoking fears on whether Donald Trump’s end goal is aimed at containing China.
“On Monday, the US began taxing $200 billion in imports from China, the biggest round of tariffs to take effect in the trade conflict. The US also approved a $330 million arms sale to Taiwan, an island nation China claims sovereignty over whose ties with the US have long concerned Beijing.
“Just last week, Washington ordered Chinese state media to register as foreign agents and slapped sanctions on the Chinese military for buying weapons equipment from Russia. And over the summer, the US barred China from participating in the biennial Pacific Rim military exercises.
“Washington’s reasoning runs the gamut – rebalancing bilateral trade, targeting Russia with China as mere collateral damage – all falling under Trump’s line of “America First.” But the quick succession of these changes has worried Beijing that the ultimate end is about arresting China’s growth and influence at the very moment it seeks to make a splash on the world stage…”
“The [US] federal government could soon pay more in interest on its debt than it spends on the military.”
“History shows us that Emerging Markets often are the “canary in a coal mine” that tips the market’s hand that there are real concerns about the global economy. In turn, these concerns can lead to investors “voting with their feet” and eventually taking all global equity markets down… The eventual decline in the S&P 500 will be more than just another “correction” or “bear market” by the time it is done.”
“The president of Argentina’s central bank has resigned amid negotiations with the International Monetary Fund (IMF) to bail the South American country out of its volatile economic crisis.
“Luis Caputo abruptly quit on Tuesday after just a few months in the position, with a statement from the bank saying it was for “personal reasons”.”
“Shops across Argentina were shuttered and the streets in the capital, Buenos Aires, were quiet on Tuesday after the country’s largest union called a 24-hour strike to protest President Mauricio Macri’s handling of the economy, which has been racked by runaway inflation. Argentina’s main agricultural port of Rosario was closed by the strike, as were public transport services and private freight shippers, unions said.”
“Nearly 13 million [Brazilians] – or more than the entire population of Greece – are out of a job, with the unemployment rate hovering between 12 percent to 14 percent since 2016. As a result, unemployment is among voters’ top concerns ahead of next month’s election. The desperate search for work amid a string of political graft scandals and rising violence has soured the mood, polarizing debate and distracting from the country’s underlying fiscal challenges.”
“U.S. President Donald Trump suggested on Tuesday that Venezuela’s leader Nicolas Maduro could be easily toppled in a military coup as his administration slapped the socialist president’s inner circle with fresh sanctions.
“Trump declined to respond to questions about whether a U.S.-led military intervention in the crisis-stricken country was possible, saying he doesn’t reveal military strategy.”
“The business cycle in South Africa, where the economy entered its first recession in almost a decade in the second quarter, is in its longest downward phase since records started in 1945. It entered a 58th straight month of declines in September, central bank data showed Tuesday. The regulator monitors about 200 indicators representing economic processes such as production, sales, employment and prices to determine the direction of the trend.”
“The monetary policy committee of the Central Bank of Nigeria says the economy’s exit from recession may be under threat. While reading out the outcome of the two-day meeting of the committee to reporters on Tuesday, Godwin Emefiele, CBN governor, said: “The Committee was concerned that the exit from recession may be under threat as the economy slowed to 1.95 and 1.50 per cent in Q1 and Q2 2018, respectively.”
“The Gaza Strip’s economy is in “free fall”, a report from the World Bank warned on Tuesday, calling for urgent action by Israel and the international community to avoid “immediate collapse”. According to the report, Gaza’s economy contracted by 6 percent in the first quarter of 2018. The report also stated that the unemployment rate is now over 50 percent – and stands at more than 70 percent among Gaza’s youth.”
“Under President Recep Tayyip Erdogan, this country embarked on a building spree that remade its urban skylines and public infrastructure, often making life easier for average Turks. The booming economy, which relied heavily on borrowing from foreign banks, grew last year by a robust 7 per cent, according to the International Monetary Fund. Now the frenzy is crashing to a halt as Turkish companies’ heavy foreign debts come due and the boom’s excesses surface.”
“The US sanctions will have a serious impact on Iran in 2018-19, pushing its economy into recession for two consecutive years due to a drop in oil exports, forecasts a new report released on Tuesday… Unemployment in Iran could rise to above 14 per cent, Iradian said, adding that the sharp depreciation of the rial has made imports, particularly intermediate and capital goods, very expensive in local currency, leading to cancelling contracts and a drop in industrial production.”
“India’s stellar economic growth of the past two decades may not have meant much for its citizens. “Employment generation has remained weak, and India has struggled to convert high rates of economic growth into good jobs, particularly for its educated youth,” a report by the Bengaluru-based Azim Premji University’s Centre for Sustainable Employment has said. Even as GDP growth rates have risen, the relationship between growth and employment generation has grown weaker over time, the report said. This gap has increased even further over the years.”
“For the most hawkish central banks in Asia, Thursday’s choice is less about whether to raise interest rates than by how much. After Turkey and Russia surprised with strong policy action this month, the focus shifts to Indonesia and the Philippines this week as emerging markets struggle to contain a rout in their currencies. Pressure is building with the U.S. Federal Reserve expected to tighten monetary policy again on Wednesday, adding to risks of capital outflows.”
“Germany’s BDI industry association said on Tuesday it had lowered its 2018 growth forecast for Europe’s largest economy…
“…citing weaker demand for German goods due to increased business uncertainty and U.S. President Donald Trump’s trade policies.”
“Denmark has bolstered defenses against shocks to its financial system after a risk-assessment body said the sector’s stability could be threatened by the Danske Bank money laundering scandal. Danske Bank’s CEO resigned last week after an inquiry revealed that 200 billion euros ($235 billion) of payments had been moved through its Estonian branch over a period of eight years, many of which the bank said were suspicious.”
“Delays of only half an hour at UK ports and the Irish border would risk one in 10 British firms going bankrupt, according to a report laying bare the severe risk to the economy from no-deal Brexit. According to the Chartered Institute of Procurement and Supply, failure to reach a deal with Brussels before March could trigger massive queues of trucks at British borders from a vast increase in paperwork and checks to clear customs.”
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