Tuesday, 10 September 2019

Global Economy

Global Economy

Global Economy


Exports surged and propelled Canada’s Q2 GDP 1.1 percent from the first quarter and 3 percent from a year ago. Statistics. Canada’s jobless rate in July declined to 7.2 percent, 0.1 percent less than June, and 0.4 percent below July 2003. Canada Statistics said the employment picture featured more factory and private sector jobs.

Brazil’s July unemployment rate dropped to 11.2 percent, a 0.5-percent drop from June. July marked the third straight month of decreasing unemployment. pushing the bank closer to hiking interest rates. The bank expected an inflation rate of 5.5 percent in 2004 and 4.5 percent in 2005.

Brazil’s Central Bank announced its July account surplus The high prices of iron ore and soymeal exports help. Canada’s trade surplus surpassed $8.6 billion, marking a new June high. Exports rose for the fifth straight month, gaining 4.4 percent, while imports fell 3.7 percent compared to May’s record high.


South Africa’s GDP in Q2 jumped 8.6 percent compared to a year earlier. In its annual economic report, growth-supportive fiscal policy stance and higher international sumer confidence and was translated into higher real output. Nevertheless, the ratio of fixed investment to gross domestic other developing countries and to investment levels needed to
obtain high growth.”


France’s economy grew by 0.8 percent in Q1, as household consumption expenditure and total Gross Fixed Capital Formation — government and business expenditures on buildings, engineering construction and machinery and equipment — contributed the most to the growth.

France’s jobless rate in July was 9.8 percent, a decrease of 0.1 percent from June, but unchanged from July 2003.  Germany’s Q2 GDP rose by 0.8 percent compared to the previous quarter and by 3.2 percent compared to Q2 2003.

The United Kingdom’s 4.8 percent jobless rate in July The hike of 0.25 percentage points on Aug. 5 set the interest rate at 4.75 percent.

As expected, the European Central Bank on Aug. 5 left interest rates unchanged at 2 percent, possibly paving the way for the eurozone’s economic recovery despite surging oil prices.


Australia’s jobless rate rose to 5.7 percent in July, an increase of 0.1 percent from June’s rate and a 0.5-percent the decrease from July 2003.

Preliminary GDP figures for Hong Kong show a 2.6-percent increase at constant 2000 prices in the previous quarter and an 8.9-percent increase compared to the same quarter in 2003, not seasonally adjusted. Real private consumption expenditure surged by 11.0 percent in Q2 compared to the same period in 2003. Real total exports — re-exports and domestic exports — grew a robust 18.7 percent, while real imports increased by 20.3 percent.

Hong Kong’s unemployment rate for July, which had fallen 1.7 percentage points since July 2003, stayed at 6.9 percent.

Japan’s preliminary Q2 GDP figures, at constant 1995 prices, posted a 0.4-percent rise compared to the previous quarter, but a 0.6-percent decline (not seasonally adjusted) when compared to the same period a year ago.

The July jobless rate for Japan rose to 4.9 percent, a 0.3-percent gain from June but a decrease of 0.4 percent from a year ago.

Singapore’s non-seasonally adjusted GDP for Q2 increased by five percent compared to Q1 and by 12.5 percent compared to Q2 2003. “During the quarter, growth of external demand rose to 26.3 percent, up from 15.2 percent a quarter earlier. During the three-month period, exports of both goods and services rose significantly. The latter largely reflected the impact of increased visitor arrivals on receipts from travel and transportation services.”

Singapore’s unemployment stayed unchanged at 4.5 percent for the third straight quarter.  The negative effects of climbing oil prices are less of a concern now but still require close monitoring, said Hiroshi Watanabe, Japan’s Vice Finance Minister for International Affairs, in late August. Watanabe said he expects Japan’s economy to grow 4 percent for the fiscal year ending in March 2005, a forecast .5 percent higher than the government’s projection.

Japan’s July trade surplus rose 44.2 percent from a year ago, according to the Finance Ministry. Sales of flat-panel TVs, steel, cars and digital cameras helped boost exports 14.3 percent compared to the previous year, but exports declined for the second straight month.

China posted a $2 billion trade surplus for the third straight month in July. Exports grew 34 percent over the same month in 2003, as more foreign firms have moved production to the Asian country because of its low wages. Increased consumption of raw materials, machinery and other components have driven a rise in imports. However, the growth rates have slowed down compared to the first half of 2004, where exports rose 46.4 percent and imports by 51 percent.

Conditions are not yet optimal for the central bank to consider ways to ease of out of its super-loose monetary policy, said Toshihiko Fukui, governor of the Bank of Japan. “Even if
we need to change our policy in the future, what is different from the United States is that Japan needs to consider a monetary policy from both sides of reducing ample liquidity and the issue of interest rates,” he said in a press conference.


While the International Monetary Fund (IMF) concedes China has cut the risk of an overheating economy, the international lender says an economic soft landing isn’t certain, as
stated in the IMF’s annual review of China. “Going forward, [IMF] directors agreed on the need for continued vigilance, and cautioned against a premature relaxation of the policy, noting in particular that significant excess liquidity remains in the banking system,” the review said.

Japan’s price deflation should end in 2005 and its real GDP should see the growth of 4.5 percent in 2004, said the IMF. The IMF upgraded its GDP forecast from its April prediction of 3.4 percent. Possible threats to GDP growth include a potential sharp rise in global interest rates, economic slowdowns of key trading partners and Japan’s high public debt, added the IMF.

IMF head Rodrigo Rato encouraged countries in Central Africa to tame their dependence on oil if they want financial assistance and debt relief support. “The sub-regions main challenge is to promote economic diversification, including in many countries reducing the strong dependency on oil resources,” Rato said.

The IMF approved of Nigeria’s homegrown economic strategies in early August, after the African country pulled out of the IMF adjustment program in August 2002. IMF agreed to review the program on a quarterly basis, which may influence other countries to help relieve some of Nigeria’s almost $30 billion debt. The reforms aim to inject more discipline in an economy plagued by poverty, inconsistent growth and oil price dependence.


The eurozone — Belgium, Germany, Greece, Spain, France, Ireland, Italy, Luxembourg, the Netherlands, Austria, Portugal, and Finland — saw GDP growth of 0.5 percent in Q2, based on 1995 constant prices estimate. The eurozone GDP decelerated by 0.1 percent compared to the previous quarter, said Eurostat in a press release. The EU25, which added 13 countries to the European Union since May 2004, posted 0.6 percent GDP growth, equal to Q1.

The eurozone’s unemployment rate remained at 9 percent in July, unchanged from June or from most of the year. The jobless rate for the EU25 was 9 percent, down 0.1 percent point from the previous month.


U.S. light crude oil reached a record high of $49.40 a barrel on Aug. 20, but lowered closer to $43 in early September. OPEC aims to lower prices to $30 a barrel. Total OPEC production, including Iraq, may approach 30 million barrels per day after August.


Latin America’s economy should see accelerated growth this year, possibly reaching a 4.5-percent increase based on strong demand for the region’s exports, said the United Nations’ Economic Commission for Latin America and the Caribbean in its economic survey of the region. “For [2004], inflation in Latin America and the Caribbean is projected to be lower than in 2003 (8.5 percent) and almost four percentage points lower than in 2002 (12.1 percent),” added the ECLAC.


The World Bank increased its loan to India’s new government by about $1 billion in August, earmarking the money for the country’s poorest four states. India will receive the raised loan allotment, equal to $3 billion a year, from 2005 to 2008.




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