“An uneven economic rebound is complicating discussions among finance chiefs and central bank governors of the world’s biggest economies as they meet this week to navigate a fragile global recovery…
“Meanwhile, escalating tensions in Ukraine and the sharp increase in commodity prices pose fresh challenges for the global economy.”
“Central banks face a set of hard choices.
“…central banks face hard choices over how fast and far to raise rates. Move too early and they risk choking off growth, while doing nothing to counter cost pressures that are more to do with Covid-related bottlenecks and geopolitical tensions. Move too late and an even more aggressive approach may be required to tame inflation.”
https://www.ft.com/content/0d914f99-35f1-4074-b350-531943b77f48
“Supply chain breakdowns stoking inflation are inflicting “harm” on the global recovery from the Covid-19 crisis, the world’s economic watchdog warned today.
“Swelling costs fuelled by choking supply bottlenecks pose a serious risk to derailing the economic rebound by cutting households’ spending power, the IMF has warned.”
“Rising recession risk in the US may soon kill off global inflation.
““The Federal Reserve is tightening into a cyclical slowdown and the risks are rising,” said Lakshman Achuthan, head of the Economic Cycle Research Institute in New York. “Either the Fed will blink and give up on rate hikes or it will forge ahead until something breaks, meaning a stock market crash, or a recession, or both,” he said.”
“Wall St banks fear inflation, asset price deflation, even recession.
“Wall Street’s biggest banks sounded a warning over the year ahead on Thursday, citing high inflation, credit concerns, asset price depreciation and companies postponing deals due to market uncertainty.”
https://www.reuters.com/business/finance/wall-street-banks-cautious-inflation-economy-2022-02-17/
“The U.S. Will Be A Net Oil Importer In 2022.
“Higher net crude oil imports are set to make the United States a net petroleum importer this year again, as in 2021, after a historic shift of being a net petroleum exporter in 2020, the U.S. Energy Information Administration (EIA) said on Friday.”
https://oilprice.com/Latest-Energy-News/World-News/The-US-Will-Be-A-Net-Oil-Importer-In-2022.htm
“3.7 million kids slipped back into poverty after the Biden child tax credit expired — and Congress isn’t restoring it soon…
“An analysis from the Center on Poverty and Social Policy at Columbia University indicated that 3.7 million kids fell back into poverty once the expanded child tax credit ended last year. The child poverty rate rose to 17% in January from 12% in December — a 41% increase.”
https://www.businessinsider.com/child-poverty-biden-child-tax-credit-ended-congress-2022-2?r=US&IR=T
“Canada roped in banks to quell protests – now what? Trudeau’s Emergencies Act imposes measures that require banks to freeze accounts without court orders…
““It is framed in a very vague way … it’s a broad transfer of responsibility from the government to the private sector,” said Marius Zoican, assistant professor of finance at the University of Toronto.”
https://www.aljazeera.com/economy/2022/2/17/canada-called-on-banks-to-help-quell-protests-now-what
“Two more [UK] energy firms bite the dust as market crisis deepens.
“Whoop Energy and XCel Power have ceased trading today – affecting around 550 customers. Consumers from both energy firms will be designated a new supplier by market regulator Ofgem – through its supplier of last resort process.”
https://www.cityam.com/two-more-energy-firms-bite-the-dust-as-market-crisis-deepens/
“Italy makes fresh attempt at pension reform as debt worries mount.
“Italy is working on a reform to make it easier for workers to retire early without bloating what is already Europe’s second highest pensions bill, as rising borrowing costs fuel concerns over the country’s mammoth public debt.”
“Italy unveils €8bn energy package as economy hit by spiralling bills.
“Italy will spend €8bn to shield consumers, industry and local authorities from rising energy prices and support the auto industry, as spiralling electricity and gas bills threaten to undermine pandemic recovery.”
https://www.ft.com/content/5dd8563d-f286-49ff-91ab-c7b5c6df3299
“In Greece’s rural heartland, tractors have become a symbol of anxiety.
“For weeks, they have been parked along the country’s highways, their owners threatening to block traffic. Farmers are desperate for additional financial aid to cope with surging energy prices that are pushing up their costs for fuel and fertilizer, posing a sudden threat to their livelihoods.”
https://www.independent.co.uk/news/world/europe/europe-police-greek-athens-protesters-b2017230.html
“Switzerland will ask hydroelectric-dam operators to create power reserves and may build new gas-fired plants for use during peak demand surges to avoid blackouts.
“The Swiss Federal Council said the new hydro-power reserves will go online next year.”
“Finland joined other Nordic countries in announcing measures to help ease the burden from the rising energy costs on those mostly affected, with focus on transport and agriculture.
“In a key measure, Finland’s government will subsidize travel to work…”
“European Power Prices Could Spike in Spring Amid Nuclear Woes.
“European electricity prices could spike again in the coming months as French reactor outages and low hydropower stocks tighten the market, S&P Global Platts said.”
“Europe has just six weeks’ gas supply if Russia turns off taps…
“Germany’s economy would be hardest hit in a Russian energy supply freeze as Europe’s gas buffer would only last until April, according to analysts at Commerzbank. There are fears Moscow would restrict Europe’s gas supply if the West slaps tough sanctions on Russia following an invasion of Ukraine.”
“Ukraine rebels order full mobilisation as Putin oversees missile launch drills.
“Separatist leaders in eastern Ukraine have ordered a full military mobilisation, further escalating tensions in the region after Washington said Moscow would invade within days, and Ukraine’s president headed to Europe to drum up support.”
“China central bank warns of default risks after climate stress test.
“China’s banks face rising default risks as a result of higher climate-related costs in carbon-intensive sectors like thermal power, steel and cement, Liu Guiping, vice governor of the central bank, said in comments published on Friday (Feb 18).”
“Chinese Developer Is In Fresh Trouble Months After Debt Swap – Yango Group didn’t pay $27 million before end of grace period.
“A Chinese developer failed to make overdue interest payments on two dollar bonds months after winning a reprieve from debt investors, the latest hit to the country’s deeply troubled offshore bond market.”
“Venezuela grapples with endless crisis.
“An oil producer hard hit by the slump in global prices, Venezuela has seen its economy gradually deteriorate over the past decade, with international economic sanctions aggravating the crisis.”
https://www.france24.com/en/tv-shows/revisited/20220218-venezuela-grapples-with-endless-crisis
“After a 12-hour blackout, Trinidadians wonder if their power supply is a shot in the dark.
“…electricity wasn’t the only thing that needed to be restored. The outage had a ripple effect, with citizens left without internet and access to data, with many not even being able to make phone calls. Just as distressing was the fact that water supply was also affected…”
“Shortages, inflation frustrate Cubans struggling to get by.
“Grocery shopping has become an increasingly costly and arduous struggle for many people in a country where the pandemic, inefficient production, government controls and U.S. economic sanctions have aggravated an economic crisis.”
https://www.independent.co.uk/news/shortages-adoption-donald-trump-pork-life-b2017486.html
“‘They’re fed up’: Workers in Puerto Rico take to the streets.
“Shrill whistles mixed with drums, tambourines and the clacking of spoons on pots as public employees shut down streets in Puerto Rico’s capital Friday to demand better pay and pensions. The crowd shimmied and clapped as demonstrators held up signs reading, “Fair wages now!””
https://www.aljazeera.com/economy/2022/2/18/theyve-fed-up-workers-in-puerto-rico-take-to-the-streets
“Tunisia to raise electricity and fuel prices.
“Tunisia plans to lower electricity and fuel subsidies to reduce a budget deficit driven by high oil prices, Tunisian Industry and Energy Minister Naila Nouira told newspaper Assabah on Friday, in a key reform asked for by international lenders.”
“Egypt: How Sisi is running a pyramid scheme.
“Egypt’s national debt has quadrupled to $370bn since 2010, but key structural issues, such as the devastated public education sector and low-quality public health system have yet to be addressed. Egypt’s labour force participation rate has decreased to 42 percent…”
https://www.middleeastmonitor.com/20220217-egypt-how-sisi-is-running-a-pyramid-scheme/
“Turkey’s producers face tough choices after staggering energy hikes.
“Massive price hikes on electricity and other energy items have dominated Turkey’s public agenda for weeks, aggravating costs in an economy that was already grappling with soaring inflation fueled by the sharp depreciation of the Turkish lira.”
“Iraqis queue for petrol in Mosul amid shortages.
“For the past week, long lines have formed at petrol stations in Mosul and the rest of Nineveh province, AFP journalists reported.
“Soldiers were deployed in some stations to contain any violence, as tempers flared among motorists over the petrol shortage.”
https://www.al-monitor.com/originals/2022/02/iraqis-queue-petrol-mosul-amid-shortages
“Sri Lanka’s state-run petroleum company has run out of cash to buy oil, and fuel shortages across the country could get worse, the energy minister said Friday.
“Udaya Gammanpila said the loss-making Ceylon Petroleum Corporation continued to haemorrhage cash and was out of money to procure supplies from abroad.”
“Shortage of Suzuki car mirrors reflects Sri Lanka’s growing economic crisis.
“The scramble for the humble product highlights rising economic risks for the South Asian country as imports slump, foreign exchange reserves plummet and a potential sovereign default looms.”
“Electrolyser supply crunch hangs over India’s hydrogen ambitions.
“A global supply crunch of electrolysers needed to produce green hydrogen and a lack of domestic manufacturers to make them pose a major challenge to India’s ambitious targets to use the zero-carbon fuel, a government official told Reuters.”
“Afghan Economy Further Imperiled by U.S. Move to Split Assets.
“The Biden administration’s decision to effectively seize the Afghan central bank’s foreign reserves is likely to deepen Afghanistan’s already devastating economic crisis, according to Afghan bankers and economists and international aid workers.”
“From Ukraine and North Korea to Covid-19 and climate change, global crises leave us feeling helpless…
“According to a statement by the summit organisers, we are living in an “era of successive and interconnected disruptions in which a permanent sense of crisis has become the new normal”.”
You can read the previous ‘Economic’ thread here. I’ll be back on Monday with a ‘Climate’ thread.
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