UK Chancellor of the Exchequer George Osborne may have little choice but to announce further spending cuts and tax rises during next week’s national budget statement, warned a leading economic think-tank on Sunday, as the nation’s net debt continues to climb amid weak economic forecasts.
Federal Reserve Chairman Ben Bernanke has said that the United States could enjoy a “good year” in 2013 if the fiscal cliff is resolved. Failing to avoid the cliff, he said, would pose a “substantial threat” to economic recovery.
Uncertainty about the fiscal cliff and the debt ceiling appears to be weighing on the economic climate in the US, said Fed Reserve Chairman Ben Bernanke in a speech in New York on Tuesday.
China’s currency regulator has announced it will loosen rules and reduce red tape for foreign direct investment, the latest step in efforts to buoy slowing inflows.
China’s State Administration for Foreign Exchange announced yesterday that it would ease the complex review procedures related to capital flows and currency quotas of foreign enterprises.
What are the odds of the renminbi displacing the dollar, and does China want the yuan to become an international reserve currency? Besides the fact that being a major reserve currency would require the complete liberalisation of the capital account and a flexible financial system largely independent of government control, with clear and enforceable rules, it would also put China’s economy at the mercy of countries that want to turbo-charge growth by running large trade surpluses. Beijing, it appears, isn’t eager to accept any of these conditions.
Individual Americans have donated nearly $8 million this year – outside of federal taxes – to try and pay off part of the nation’s public debt, said a report by CNN Money on Tuesday, with the sum collected thus far already more than double what was received in 2011.
A Qatari sovereign wealth fund will invest up to 1 billion euros in Italian industries over the next four years, as part of a strategy to manage the fund’s estimated $60 billion of assets. Its partner, Fondo Strategico Italiano, will match the amount of planned investment, bringing the total amount to up to 2 billion euros.
In a joint statement, both parties said the fund will be managed equally and will start with 300 million euros of capital to be invested in sectors such as food, fashion and luxury, furniture and design, as well as tourism and leisure.
Equity markets around the world have begun on to fall once more – after enjoying a brief rally that started in July – as consumers, firms, and investors become more cautious and risk-averse. Given the seriousness of the downside risks to growth, the latest correction may prove to be a bellwether of worse to come for the global economy and financial markets in 2013.
The Philippines government may attempt to revive a hugely unpopular 2009 bill that aimed to levy a tax for all mobile phone text messages, claimed a report by the Philippine Daily Inquirer on Monday, with a new ‘sin tax’ on alcohol and tobacco also expected to be passed as early as next week.
Germany and the Jewish Claims Conference have signed a new accord that will increase the monthly pension benefits for Jewish Holocaust survivors as well as make payments to victims who still have not been compensated nearly 70 years after the collapse of the Nazi regime.
The amended accord was signed by German Finance Minister Wolfgang Schaeuble and Julius Berman, chairman of the Jewish Claims Conference, to mark the treaty’s 60th anniversary.
The re-election of Barack Obama as the President of the United States has been met with mixed reactions among China’s business community. While some welcome the continuity it brings to US-China trade relations, others fear that more bilateral economic disagreements may arise in Obama’s second term.
With President Barack Obama winning a second term at the White House, some China exporters are breathing a sigh of relief.
But should they?
The consensus, at least at first glance, is yes.
