There has been a lot of news about the possibility of raising minimum wages to higher and higher rates. However, stories about the definition of extreme poverty make news less frequently. In fact, most would probably be surprised to find just what the extreme poverty line is on a global level.
The Spanish economy expanded 0.8 percent due to such factors as increased demand and lower oil prices, notes Bloomberg Business. However, take the latest data with a grain of salt as momentum continues to slow compared to the previous quarter. A slowdown in the Chinese economy, a big factor, and overall volatility within the world economy will prevent substantial growth in the near term.
The World Bank is calling upon nations of the world to help the people of Palestine and upon Israel to improve relations with the Palestinian people. These calls come following data indicating that the Palestinian people are growing increasingly poor; a trend the World Bank believes could destabilize this population even further and spark off both conflict and a further humanitarian crisis.
Due to corruption and a tanking economy, recent polls show that President Dilma Rousseff is the most unpopular leader since Brazil’s reestablishment of democracy in 1985, according to the Associated Press. Brazil suffers from plunging consumer spending, record-high unemployment and a low-value currency. Brazil is suffering from economic slowdown not seen in 25 years.
Personal incomes and spending rose, but home sales fell significantly despite expectations of growth.
Pending home sales fell 1.4% in August compared to the prior month, while remaining 6.1% above the level of total pending home sales in August 2014. The National Association of Realtors released a report containing its Pending Home Sales Index, which the NAR says indicates a fall in total home sales is coming later in the year.
Junk bond yields have risen above 8% as investors’ fear a growing number of defaults are looming amidst weak sales and low commodity prices.
According to the Bloomberg World Bond Index, which measures high yield debt issued worldwide, the average yield of high-yield debt has risen to over 8%, while the yields on U.S. corporate bonds is nearing 8%. The yields on commodity-based company debt, particularly energy companies, is soaring the highest while bond prices fall.
Chancellor Angela Merkel and members of Germany’s business community seek to integrate masses of people coming from parts of the Middle East and Africa into German society, according to the New York Times. Germany expects 800,000 refugees and migrants for 2015, but some analysts expect one million. Germany has temporarily closed its southern border to stem the overwhelming tide of people flowing into the country.
While many Americans breathed a sigh of relief after the US Federal Reserve (Fed) announced that it would not be increasing the prime rate this month, the decision also had ramifications for other nations. As a result, the head of the World Bank praised the Federal Reserve’s decision, saying it will grant a temporary reprieve to developing nations and struggling economies around the world.
China and Europe are seeing lower manufacturing activity, with the sector declining in China and expanding weaker than expected in Europe.
According to the Caixin China purchasing managers’ index, demand for manufactured goods is shrinking. The PMI fell to 47, the lowest level in over six years. The Caixin PMI, which tracks small and mid-sized companies, is a crucial indicator of broader activity in the country, where small businesses are more susceptible to weakness in local aggregate demand.
Government Intervention, Analyst Downgrades
Before Chinese President Xi Jinping left China for the U.S., he had been attending the funerals of former officials, hoping to garner allies as China contends with a lagging economy, reports Reuters. The president maintains that China’s economy is stabilizing against the backdrop of a turbulent world economy. China has suffered through market instability, a declining yuan and lower domestic demand.
