“Global trade to GDP level nears 2008 crisis levels…
“The Russia-Ukraine war, the covid pandemic and trade tensions between the US and China dragged the trade-to-gross domestic product, or ‘trade openness’ ratio, to levels last seen during the 2008 global financial crisis, according to the World Bank’s recent policy research paper.”
“Major central banks were expected to pause rate hikes soon. Now it’s not so clear cut…
“With inflation continuing to prove stickier than the government and the central bank had hoped, now almost double the comparable rate in the U.S. and considerably higher than in Europe, traders increased bets that interest rates will need to be hiked further in order to curtail price rises.”
“Emerging markets warned against swift rate cuts until inflation is under control.
“Tight labour markets and loose fiscal policies will prolong inflation in some developing countries, warn analysts, with underlying price pressures remaining stubbornly entrenched even as food and energy prices fall from last year’s highs.”
https://www.ft.com/content/595d4403-7987-4072-8768-394b61cfe767
“The Frantic Push to Solve Sovereign Debt Crises Irks Wall Street…
“As government defaults rise to a record in the developing world, the debate is growing frantic over how to solve these debt crises. Restructuring talks are stalling, with some countries turning to old-school sweeteners and others calling to revamp the Group of 20’s Common Framework.”
https://finance.yahoo.com/news/frantic-push-solve-sovereign-debt-120000869.html
“Debt Deal Adds Brake on US Economy Already at Risk of Recession.
“The cap on government spending in Washington’s deal to raise the federal debt limit adds a fresh headwind to a US economy already burdened by the highest interest rates in decades and reduced access to credit.”
https://finance.yahoo.com/news/debt-deal-adds-brake-us-172829814.html
“Canada’s big banks log 13-fold rise in loan loss provisions… All of the big Canadian banks singled out elevated risks in North America’s commercial real estate (CRE) sector as a reason for ratcheting up credit loss reserves.”
https://www.ft.com/content/f32d0f08-b99b-4544-baf2-1dde22025d5b
“Ireland’s drug shortage is ‘worst yet’ as pharmacists sound alarm.
“A serious shortage of medicines, including a life-saving breast cancer drug, is the “highest it has ever been”, say industry experts across Ireland who have sounded the alarm over a “frightening” lack of critical supplies. The Sunday Times has learnt that more than 300 items are out of stock…”
https://www.thetimes.co.uk/article/ireland-drug-shortage-worst-yet-pharmacists-sound-alarm-fz56jgqqp
“Sunak urges supermarkets to cap prices of staple items as food inflation remains ‘worryingly high’ [UK]…
“The policy is not expected to be mandatory, with No10 saying that any proposals would be optional for UK supermarkets… food inflation remains “worryingly high” and at 19.1 per cent, it is close to reaching a record high.”
https://www.lbc.co.uk/news/sunak-urges-supermarkets-to-cap-staple-item-prices/
“The Bank of England is poised to intervene if last week’s chaos in the bond market persists – as beleaguered governor Andrew Bailey faces even more embarrassment.
“The Old Lady was forced to step in last autumn to save the pensions industry from collapse with the promise of a £65 billion package, following an earlier episode of bond market turmoil after Liz Truss’s ill-fated mini-Budget.”
“France in ‘close talks’ over debt rating.
“France is in “very close talks” with debt rating agency Standard and Poor’s, Prime Minister Elisabeth Borne said Sunday, after a downgrade from rival Fitch reignited government finance concerns in the EU’s second-largest economy.”
https://www.thelocal.fr/20230528/france-in-close-talks-over-debt-rating
“France cuts red tape for nuclear power despite cracks in reactors…
“The crack at Penly… is 155mm long – a quarter of the circumference of the pipe – with a maximum depth of 23mm. It means that if the circuit was ever used in an emergency, the pipe, holding mildly radioactive hot water under 50 bars of pressure, would be at risk of leaking.”
“Serbian border troops on high alert after ethnic clashes inside Kosovo…
“Kosovo police fired tear gas to disperse the crowd and let the new officials into the offices. Several cars were set ablaze. Kosovo Serb hospital officials said about 10 protesters were injured. Police said five officers were injured as protesters hurled stun grenades and other objects. A police car was burned.”
“Turkey’s lira sinks to near record low as Erdogan is re-elected…
““We have a pretty pessimistic outlook on the Turkish Lira as a result of Erdogan retaining office after the election,” Wells Fargo’s Emerging Markets Economist and FX Strategist Brendan McKenna told CNBC’s “Squawk Box Asia.””
https://www.cnbc.com/2023/05/29/turkeys-lira-sinks-to-near-record-low-as-erdogan-is-reelected.html
“‘I feel abandoned’: Lebanon’s elderly have few options to survive.
“Hekmat Skaff sits all day behind the counter of his grocery store in Achrafieh, a central district of Beirut. He knows the prices of all items by heart and, as clients walk in and out, adds them up on a piece of paper. At 80 years old, he simply cannot stop working.”
https://www.middleeasteye.net/news/lebanon-elderly-abandoned-few-options-survive
“Mass protests against Israeli government’s plans to change legal system enter 21st week…
“Organizers of grassroot protests bill them as a movement to save democracy. They say the government’s plans to weaken the Supreme Court would destroy the country’s system of checks and balances and compromise Israeli democracy.”
“Iran Tightens Gasoline Rationing Amid Shortages.
“An Iranian official said Sunday that in addition to a limit on cheap gasoline for citizens, more expensive fuel will also be rationed, and limited to 150 liters per month. Gasoline and other fuels are heavily subsidized in Iran, which coupled with refining limitations, has led to shortages this year according to the government.”
https://www.iranintl.com/en/202305281714
“In a shocking turn of events, Pakistan’s per capita income has witnessed a staggering decrease of $198 in the current fiscal year, reaching a record-breaking low.
“The Federal Bureau of Statistics has released a report revealing that the per capita income for Pakistan stood at $1,568, compared to the previous fiscal year’s $1,766, marking an alarming 11.38% decline in just one year.”
“[Indian state of] Kerala borrowing limit halved: CPI(M) says Centre trying to suffocate state; CM calls it ‘sadistic approach’.
“Following the Union government halving Kerala’s borrowing limit, leaders of the ruling CPI(M) — including Chief Minister Pinarayi Vijayan — have criticised the decision saying it was an “attempt to suffocate the state” financially by any means necessary.”
“At least 40 killed in clashes with troops in India’s Manipur.
“The far-flung states of northeast India – sandwiched between Bangladesh, China and Myanmar – have long been a tinderbox of tensions between different ethnic groups. New Delhi rushed thousands of paramilitary and army troops to the state of 3.2 million people. It imposed a curfew…”
https://www.aljazeera.com/news/2023/5/29/dozens-killed-in-clashes-with-troops-in-northeastern-india
“Humanitarian crisis worsens as fighting in Myanmar’s civil war ramps up…
“The Civil War in Myanmar intensified this week as resistance fighters attack the governing military hunta’s forces. The United Nations estimates that nearly 18 million people need humanitarian aid as a result of the fighting, which is now entering its third year.”
“The Norwegian Refugee Council (NRC) is warning that an extensive new cut in food rations for Rohingya refugees in Bangladesh will have a deadly impact.
“According to the World Food Program (WFP) the UN agency has been forced to make additional cuts to the already decreasing food assistance due to critical funding gaps.”
“China’s economy loses steam as concerns mount over Covid recovery…
“Industrial production and profits, property sales and credit growth have all fallen short of analysts’ projections in April and early May, recent data showed, sapping confidence in the growth prospects for the world’s second-largest economy.”
https://www.ft.com/content/e2aaaa56-5dee-41be-9ed4-181496de6bf3
“Chinese Stocks in Hong Kong Extend Slump, Approach Bear Market.
“A gauge of Chinese shares traded in Hong Kong inched closer to bear-market territory as a wobbling economic recovery, intensifying geopolitical tensions and a weaker yuan keep investors away… As losses deepen, Chinese equities are losing their bullish strategist calls.”
“China’s Wuhan finance regulator urges hundreds of firms to repay debt, local media report…
“The rare action from Wuhan’s finance bureau on Friday comes as local governments in China become increasingly pressed by higher debt and expenses… Like most places in China, Wuhan government’s revenue has taken a big hit in recent years…”
“Argentina Economic Chief to Fly to China for Swap Line Talks…
“Facing inflation over 100%, Argentina’s central bank has no liquid cash reserves left, according to local economists’ estimates. With the official peso exchange rate down 25% so far this year, one of the government’s last-resort tools to prevent a more severe peso devaluation is Argentina’s existing China swap line worth 130 billion yuan ($18.4 billion).”
“Brazilian Households Default Grow Amid High Interest Rates.
“Brazilians are struggling to pay their debts on time, with four out every ten adults facing default, as central bankers keep monetary policy tight in an effort to bring inflation back to their target… Household debt in Brazil has lingered around all-time highs for months, according to data from the central bank…”
https://uk.finance.yahoo.com/news/brazilian-households-default-grow-amid-150545160.html
“South Africa Braces for Winter With Severe Power Outages…
“The persistent blackouts across the country affect not only homes. The power crisis is a main contributor to South Africa teetering on the brink of recession, as not only heavy industries but also agriculture, forestry, mining and fishing have had to limit their work.”
https://allafrica.com/stories/202305290032.html
“‘They set us on fire and took everything’: The harrowing stories inside Chad’s refugee camps as thousands flee Sudan [Brutal heat in these regions currently, too].
“Around 90,000 people have fled Sudan’s West Darfur state into eastern Chad seeking safety from regional violence fuelled by the war between the army and paramilitary Rapid Support Forces. Many have fled brutal violence and each has their own story of survival.”
“Why do more than 800 million people live in hunger?
“Hunger levels are rising around the world. As many as 828 million people – or 10 percent of the world’s population – go to bed hungry each night, 46 million more than the previous year, according to the United Nations Food and Agriculture Organization.”
https://www.aljazeera.com/news/2023/5/28/why-is-global-hunger-on-the-rise-2
“Global Investment in Coal to Increase by 10 Percent: IEA…
“Investment in global coal production and supply in 2023 is expected to increase by about 10% from the $135 billion spent in 2022, the International Energy Agency said. IEA, in its World Energy Investment 2023, said nearly 90% of this investment will likely be in the Asia-Pacific region, notably in China and India…”
“End Times by Peter Turchin review – can we predict the collapse of societies?
“…In the US, he suggests – and by association the UK – these “factors started to take an ominous turn in the 1970s… The data pointed to the years around 2020 when the confluence of these trends was expected to trigger a spike in political instability. And here we are.””
“We asked Google Bard if a global economic collapse will occur in 2023…
“The tool emphasized that determining the likelihood of a collapse, specifically in 2023, remains uncertain but highlighted several factors that could contribute to such a scenario… According to Bard, key indicators of a potential collapse encompass high inflation, the ongoing war in Ukraine, and the upward trajectory of interest rates…”
https://finbold.com/we-asked-google-bard-if-a-global-economic-collapse-will-occur-in-2023/
You can read the previous “Economic” thread here. I’ll be back tomorrow with a “Climate” thread.
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