Japan and China’s economies continue to deteriorate as more indicators signal a growth slowdown.
In Japan, industrial production failed to meet expectations in February as less Japanese consumers opened their purse strings and spent in the economy. The trend towards rising savings rates and falling consumer spending indicates that the Bank of Japan’s aggressive quantitative easing program is failing to stimulate growth.
Abenomics Stalls
The Federal Reserve is likely to raise short-term interest rates for U.S. Treasuries, despite fears such a move could hurt equities and kick start a recession.
Federal Reserve Chairwoman Janet Yellen again reiterated the central bank’s cautionary position on interest rates, suggesting that the Fed will begin to raise rates gradually later in 2015. “With continued improvement in economic conditions, an increase in the target range for that rate may well be warranted later this year,” she said on Friday at a meeting in San Francisco.
The Brazilian economy only grew 0.1 percent in 2014, barely keeping the country out of a recession. This marks the worst economic news for Brazil since 2009.
Brazil may have technically averted a recession, but other economists maintain that the nation already entered a recession last year, and other analysts say the country will enter a recession in 2015. Regardless of the differing views, many agree that Brazil’s current trajectory is unsustainable. The nation’s central bank forecasts a 0.5 percent decline this year.
Many know South Korea as one of the strongest economies in East Asia. They think of the wide array of Korean products in the electronics and auto markets as proof of this concept. In truth, the South Korean economy is crawling forward, raising concerns for both government officials and investors.
Smarting from sanctions leveled by the US and other western nations after its actions in Crimea and the Ukraine, Russia has begun trying to woo Latin and South American nations into more favorable trade arrangements. But, what will the Russians be trying to buy and sell in these nations, and what impact might this have on US economic and security interests?
The United States saw GDP growth of 2.2% in the fourth quarter of 2014, below expectations of 2.4% growth in a sign that the country’s economic recovery is stalling.
The Commerce Department reported that the second estimate for fourth quarter growth was 2.2%, driven by “positive contributions” from personal consumption expenditures (PCE), nonresidential fixed investment, exports, state and local government spending, private inventory investment, and residential fixed investment. Imports also rose in the fourth quarter.
Investors are nervous as Saudi Arabia and other Gulf nations commence air strikes in Yemen to combat Houthi rebels. Many fear the battle could affect crude supplies going forward.
American for-profit colleges are struggling financially. Several have shut their doors for good in recent years, and in 2013, nearly half of the debtors to default on student loans obtained them while attending for-profit schools. So, what is happening to these institutions and do these trends signal the end of this industry in America?
Slipping Revenues of For-Profit Schools
The central bank governor of Palestine noted that the West Bank is undergoing tremendous economic damage in the wake of the Israeli decision to keep $130 million a month in Palestinian income. This comes on the heels of Palestinians joining the International Criminal Court, which may charge Israel with war crimes.
Durable goods sales contracted in another sign that the U.S. recovery may be stalling.
Despite expectations of growth, durable-goods orders fell by 1.4% in February—the third decline in the last four months even as analysts expected a 0.2% increase in goods for the month. The Commerce Department also lowered estimates for durable goods orders in January, showing a 2% rise versus previous estimates of a 2.8% increase.
Transport Goods Plummeting
