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The global economy has achieved only a fragile recovery from the depths of the coronavirus pandemic and many emerging economies are still suffering severe hardship, according to the latest Brookings-FT tracking index.

A broad-based and robust recovery does not appear on the horizon,” said Professor Eswar Prasad of the Brookings Institution…

“…the recovery in advanced economies is far from complete after a historic drop in the spring, and the situation in emerging markets is much worse with indicators still far removed from normal levels.”

https://www.ft.com/content/7ecf6885-68f7-44a9-b3de-e9ce7c8b2fb0


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The U.S. oil consumption recovery is getting worse, not better. U.S. oil consumption recovered to 65% of normal in July and has since decreased to 61%.

“It took 4 1/2 years for oil consumption to return to the five-year average after the 2008 Financial Collapse (Figure 4). The present collapse is far greater and September use was lower than all but the worst two months of the last recovery from 2009 to 2013…

“Why should we expect this recovery to proceed any faster than the last one?”

https://www.forbes.com/sites/arthurberman/2020/10/12/what-oil-recovery/#7e8acfb87c89


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UK employers are expected to slash 1.5 million jobs by Christmas, as the end of furlough triggers a fresh wave of layoffs despite the government’s new job support scheme.

“Stark new analysis suggests 1.2 million furloughed workers are “waiting in vain to return to jobs that no longer exist,” and will face redundancy by the end of the year.”

https://uk.finance.yahoo.com/news/uk-job-support-scheme-unemployment-hiring-vacancies-083340978.html


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There has been a surge in the number of UK children registering for free school meals, with an estimated 1 million pupils recently signing up for the first time, according to food poverty campaigners…

“…as many as 900,000 more children have sought free school meals, on top of the 1.4 million who were already claiming, as the Covid-19 crisis plays havoc with family incomes.”

https://www.theguardian.com/education/2020/oct/12/surge-in-number-of-uk-children-applying-for-free-school-meals


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The Bank of England (BOE) has written to banks on Monday to see how ready they are for zero or negative interest rates.

“In a letter from the BOE, deputy BOE governor Sam Woods said the central bank is “requesting specific information about your firm’s current readiness to deal with a zero Bank Rate, a negative Bank Rate…”

https://uk.finance.yahoo.com/news/bank-of-england-asks-banks-how-ready-they-are-for-negative-interest-rates-081409824.html


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Four years after Britain voted to leave the European Union Brexit can still seem abstract. But in the county known as the Garden of England, it is literally taking concrete form.

Just beyond the ancient oaks and yews that surround medieval St. Mary’s Church in the village of Sevington, bulldozers, dump trucks and cement mixers swarm noisily over a field. They are chewing up land to create part of Britain’s new border with the European Union — a customs clearance depot with room for up to 2,000 trucks.”

https://www.independent.co.uk/news/uk/brexit-news-uk-eu-trade-deal-latest-kent-garden-of-england-border-b985408.html


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Firms move €150bn of UK assets to France ahead of Brexit.

Banque de France says 31 entities – mainly investment firms – have applied for licences in France, moving €150bn of assets since September.”

https://www.telegraph.co.uk/business/2020/10/11/150bn-uk-assets-moved-france-ahead-brexit/


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European Union nations have begun “wargaming” plans for a no-deal Brexit that could see the resumption of talks next year…

Ahead of crunch talks in Brussels this week, a senior EU diplomat told The Telegraph that although there would be a “period of chaos” if no agreement is struck, “there is nothing that says that just because there is a no deal there can never be trade negotiations again”.”

https://www.theweek.co.uk/108341/why-the-eu-is-wargaming-no-deal-brexit


Now, for a Europe that has made managing rather than solving economic crises into an art form, the time for paying the piper is fast approaching.”

https://www.cityam.com/almost-unnoticed-europe-hurtles-into-decline/


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Anti-lockdown protests across Europe despite surge in cases:

As Covid-19 cases rise in Europe, protests against government restrictions and lockdowns are popping up across the continent.”

Video:

https://edition.cnn.com/videos/world/2020/10/12/europe-anti-lockdown-protest-coronavirus-covid-19-soares-pkg-intl-hnk-vpx.cnn


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Driven by the economic fallout of the COVID-19 global pandemic, growth in Sub-Saharan Africa is predicted to fall to -3.3 percent in 2020…

“…pushing the region into its first recession in 25 years, according to the latest regional economic analysis.”

https://www.thesierraleonetelegraph.com/world-bank-confirms-economic-downturn-in-sub-saharan-africa/


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Drastic rise’ in Malawi’s suicide rate linked to Covid economic downturn:

Lack of specialist support and growing unemployment are factors in growing mental health crisis, doctors say.”

https://www.theguardian.com/global-development/2020/oct/12/drastic-rise-in-malawis-suicide-rate-linked-to-covid-economic-downturn


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Zambia has said it will resist pressure from Chinese creditors to make paying arrears a condition of pursuing debt relief talks, as the southern African nation battles to restructure $11bn of external debts.

“Africa’s second-biggest copper producer has become a test case for the ability of poor and indebted nations to find debt relief…”

https://www.ft.com/content/aa43fb1c-8f44-495a-a9b5-69a00c7db4a9


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South Africa won’t be able to meet its finance ministry’s debt targets and it may be undesirable for it to attempt to do so when the economy is being battered by the fallout from the coronavirus, according to an advisory panel appointed by President Cyril Ramaphosa.

“…the President’s Economic Advisory Council said spending cuts could hold back growth and have other adverse consequences.”

https://www.bloomberg.com/news/articles/2020-10-12/south-africa-won-t-meet-debt-targets-president-s-council-says


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Tens of thousands of Tunisians have lost their jobs in a worsening economic crisis exacerbated by efforts to stem rising cases of novel coronavirus, a key employers’ federation has warned.

““The first wave of the epidemic (March to June) resulted in the loss of 165,000 jobs,” Bechir Boujday, a member of the board of the employers’ federation UTICA, told AFP Friday night.”

http://north-africa.com/2020/10/tunisia-worsening-economy-risks-destabilizing-tunisia/


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People in Gaza are searching through rubbish to find food as Palestinians battle unprecedented levels of poverty, the head of the UN agency for Palestinian refugees has said.

Across Lebanon, Syria, Jordan, Gaza and elsewhere, Palestinian refugees are suffering at new depths because of the pandemic.”

https://www.theguardian.com/world/2020/oct/12/people-in-gaza-sifting-through-rubbish-for-food-un-head-says


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For many like Termos, facing an ongoing collapse in the value of the Lebanese currency, hyperinflation on the shelves, and mass unemployment, just scraping by is no longer an option.

““The issue is there is no hope of a turnaround,’’ said Rabiah Khaireddine, a musician from the Druze community. “The weeks since the explosion have made that clear. Everyone I know wants to leave.””

https://www.theguardian.com/world/2020/oct/11/there-is-no-hope-the-slow-disintegration-of-lebanon


Loan defaults in September [India] remained way above the pre-pandemic rates despite the loan moratorium having ended in August, indicating the prevailing economic distress and the continued effect of the six-month moratorium on repayment behaviour.”

https://www.livemint.com/industry/banking/loan-defaults-take-worrying-turn-11602465555603.html


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Indians are fast losing all confidence in the country’s economy.

For the third consecutive month, in September, consumers in the country said they were more pessimistic than before about India’s economic prospects, revealed the Reserve Bank of India’s Consumer Confidence survey. The consumer confidence index was at a record low of 49.9% in September compared to 53.8% in July.”

https://qz.com/india/1916172/indians-pessimistic-about-economy-jobs-incomes-says-rbi-survey/


India has been one of the worst hit countries in the world by coronavirus. And now a mental health crisis is threatening its development…”

https://www.independent.co.uk/independentpremium/long-reads/coronavirus-india-mental-health-crisis-suicide-modi-ptsd-b880708.html


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With debt relief measures set to expire this month, Thailand’s financial woes, brought on by the Covid-19 pandemic, might end up being worse that the 1997 Asian financial crisis, known in Thailand as the Tom Yam Kung crisis…

“…according to the Bangkok Commercial Asset Management.”

https://thethaiger.com/hot-news/economy/covid-19-could-lead-to-a-crisis-worse-than-the-1997-asian-financial-crisis


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More than seven in 10 young people in Thailand indicated that Covid-19 is affecting their mental health and causing stress, worry, and anxiety, according to a Unicef-led survey released in April.

What is worrying youngsters the most is the uncertainty of their family’s financial status, followed by worry about their education and future employment opportunities.”

https://www.bangkokpost.com/life/social-and-lifestyle/2000623/pandemic-of-the-mind


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This has been brewing for a while:

China’s customs authorities have told several Chinese state-owned steelmakers and power plants to stop importing Australian coal, according to two industry newswire services.”

https://www.google.com/amp/s/amp.theguardian.com/australia-news/2020/oct/12/china-orders-halt-to-imports-of-australian-coal


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The coronavirus pandemic has wiped out thousands of jobs across Australia, with up to 27 per cent of positions erased in some towns.

One in every 30 jobs in New South Wales have been eliminated since March due to COVID-19 lockdowns. And on Lord Howe Island, a holiday paradise off the east coast of NSW, almost 30 per cent of jobs have disappeared.”

https://www.dailymail.co.uk/news/article-8829173/Employment-apocalypse-27-jobs-disappeared-one-12-gone-Victoria.html


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Japanese wholesale prices fell 0.8% in September from the same month a year earlier, data showed on Monday…

“…marking the seventh straight month of year-on-year declines and heightening the risk the country will slide back into deflation.”

https://uk.finance.yahoo.com/news/japan-september-wholesale-prices-slump-020350873.html


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“…while banks’ capital and liquidity positions are more robust on the whole vis-à-vis 2008, it remains decidedly difficult to ascertain just how much they will eventually rack up in toxic debt as the coronavirus continues to shutter economic activity.

“As such, the liquidity phase of the crisis will soon give way to the solvency phase as liabilities start to flare up.

“…banks are now potentially staring down the barrel of a wave of collapses should conditions continue to deteriorate.”

https://internationalbanker.com/banking/is-covid-19-about-to-trigger-a-2008-style-banking-collapse/


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An economic crisis is always followed by a financial collapse somewhere:

Rising unemployment? Check. Soaring government deficits? Check. Corporate collapses? Check. So far the Covid-19 recession, one of the worst on record, has followed the script for a major economic downturn in every respect.

“Except this one: a financial crash. So far, the banks seem to be doing fine, so do the hedge funds, and the bond markets and the asset managers. Even the insurers seem OK.

“There are two potential explanations for that. It is possible the regulators and central banks have done such a fantastic job of managing the crisis that they have been able to steer us through the downturn without a collapse. Or else it is just a matter of time.

“Sure, it could be the former but somehow the second explanation is more convincing.”

https://www.telegraph.co.uk/business/2020/10/12/covid-financial-crisis-surely-matter-time/


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The global economy could shed more than 1% of output if international talks to rewrite cross-border tax rules break down and trigger a trade war, the OECD said on Monday

“…countries agreed to keep up negotiating to mid-2021.”

https://www.reuters.com/article/us-oecd-tax/collapse-of-global-tax-talks-could-cost-100-billion-oecd-says-idUSKBN26X11Q


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One-fifth of the world’s countries are at risk of their ecosystems collapsing because of the destruction of wildlife and their habitats, according to an analysis by the insurance firm Swiss Re…

“More than half of global GDP – $42tn (£32tn) – depends on high-functioning biodiversity, according to the report, but the risk of tipping points is growing.”

https://www.theguardian.com/environment/2020/oct/12/fifth-of-nations-at-risk-of-ecosystem-collapse-analysis-finds


You can read the previous ‘Economic’ thread here and visit my Patreon page here. I’ll be back with a climate update tomorrow.

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