- This weekly round-up brings you the latest news from the world of economics and finance.
- Key economic stories: US economy slows in second quarter, China’s recession deepens; Central bank chiefs reaffirm policy tightening bias.
1. US economy stagnates in Q2
The US economy grew more than previously estimated in the first quarter And the latest indicators show that the economic slowdown is likely to persist. This has increased expectations that the Federal Reserve will raise interest rates again.
Gross domestic product in the first three months of the year rose 2.0% from the same period last year, the Commerce Department said on June 29 in its third estimate of first-quarter gross domestic product.
The upward revision from the 1.3% estimate reported in May reflects improvements in consumer spending and exports in the world’s largest economy. Economists polled by Reuters had expected first-quarter gross domestic product growth to pick up slightly to a 1.4% pace.
The latest reading suggests a milder-than-expected slowdown from fourth-quarter growth of 2.6% and the economic slowdown appears to have been maintained.
Continued labor market strength continues to boost economic growth as wages rise. At the same time, it will continue to boost inflation, most likely prompting the central bank to raise rates again in July.
According to Scott Hoyt, senior economist at Moody’s Analytics in West Chester, Pennsylvania: „As the economy struggles to respond to the Fed’s actions … slower growth will reduce inflation without triggering a recession,” Reuters reported.
2. China’s economic recession deepens
China’s economy continues to face problems Factory activity contracted for the third straight month in JuneFollowing on from other lackluster polls this week.
That’s increasing pressure on policymakers to boost growth in the world’s second-largest economy, which has been flat after an initially strong post-Covid rebound in the first quarter.
„The June PMI reflects a number of imbalances and weaknesses, namely: continued contraction of domestic and external demand, a rapid slowdown in small business activity, and continued mounting pressure on the private economy,” said Chief Economist Bruce Pang. and head of Greater China research at Jones Lang LaSalle, according to Reuters.
„This indicates an urgent need for more robust policy measures to ensure the annual growth targets,” he added.
The government has set a GDP growth target of around 5% for this year after missing its 2022 target.
3. News Briefs: Economic stories from around the world
The heads of top central banks, the US Federal Reserve, the European Central Bank (ECB) and the Bank of England, reaffirmed on June 28 that further policy tightening should be reined in. Persistently high inflation. But they believe this can be achieved without triggering an outright recession.
Eurozone inflation rate continued to fall Fuel prices fell in June. Prices in the 20 countries that share the euro rose 5.5% this month, down from 6.1% in May, the seventh decline in eight months. Still, it’s almost triple ECB’s 2% price stability target.
The second mandate of the International Monetary Fund, Geeta Gopinath cautioned that the financial community may be too optimistic The cost and difficulty of controlling inflation raises the risk of economic instability.
Unemployment rose in Germany, Europe’s largest economy More than expected in June. Federal Labor Office data showed the number of unemployed rose by 28,000 to 2.61 million on a seasonally adjusted basis. Analysts had expected the figure to rise to 13,000, according to a Reuters poll.
Britain’s economy grew by just 0.1% in the first quarter of this year. According to the Office for National Statistics. The figure is unchanged from the initial estimate and the country’s output is 0.5% lower than in the final quarter of 2019 before the Covid-19 pandemic.
of Mexico Financial System Stability Committee The country’s economic outlook remains uncertain on Thursday, given persistent risks to economic activity stemming from a complex external environment.
Unemployment among Saudi citizens has increased The Saudi General Authority for Statistics said on Thursday that it will be 8.5% in the first quarter of 2023 and 8% in the fourth quarter of 2022.
Vietnam’s economic growth accelerated In the second quarter, Driven by the service sector. According to the Office for General Statistics, gross domestic product grew by 4.14% from a year earlier, faster than the 3.28% expansion in the first quarter.
4. More about finance and economics on the agenda
Life expectancy is increasing worldwide, people are living longer and a 100-year life is now a real possibility for many. A New World Economic Forum and Mercer report on people’s responses to longevity and retirement prospects found „longevity literacy” and attitudes toward retirement beyond financial security.
In a world of disruption, organizations must take risk management seriously. This means understanding risk from all angles and from all areas of the business. Responsible innovation is about managing risk in line with a core set of values.
China’s extensive coastal and marine resources position it as a key market for „blue finance” projects that balance economic growth and environmental protection. Blue Finance investments aim to protect the $3 trillion marine economy and support activities such as restoration of marine ecosystems, sustainable tourism, shipping and marine renewable energy.
„Oddany rozwiązywacz problemów. Przyjazny hipsterom praktykant bekonu. Miłośnik kawy. Nieuleczalny introwertyk. Student.