Weekly Roundup: Italy Teeters on the Edge of a Debt Crisis and Other News
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Here’s a weekly look at the top business, finance and world economy news.
Here’s a weekly look at the top business, finance and world economy news.
Table of Contents
World Economy
The Euro-zone debt crisis could claim yet another victim and this time it’s one of the region’s larger economies — Italy. Italy may be the third-largest economy in Europe, but it looks increasingly likely that they could be suck into a similar quagmire as Greece. Italy’s borrowing costs shot up by 71 percent in a single day this week on concerns that it may struggle to raise financing to service its €1.6 trillion debt. At about 120 percent of its GDP, most of Italy’s debt is held within the country by domestic savers, though German and French banks hold nearly US$150 billion in Italian debt while US investors, including big banks, hold US$36.7 billion in Italian debt.
Clearly the Italians are worried. Italy has replaced Greece as the most pessimistic nation on our real-time Consumer Confidence Index.
Check out our Real-Time Consumer Confidence Index for up-to-the-minute data.
Related: Italy Economy
Related: Italy Economic Forecast
Industries & Businesses
The digital music industry is set for record-breaking growth this year as sales for digital-based albums rose by 19 percent compared to the previous year, while digital song downloads also increased by 11% (compared to 2010) in the first six months of this year. The top digital music album so far this year is 21 by Adele followed by Lady Gaga’s Born This Way, and Mumford & Sons’ Sign No More. The top digital music single thus far has been Katy Perry’s E.T. (featuring Kanye West) – selling over 4.1 million copies online. Coming in a close second was Adele’s Rolling Into the Deep with just over 4 million copies sold online.
Companies and Investment
According to BBC News, Foreign direct investment (FDI) into China has slowed as the government attempts to cool down the economy. In June, foreign investment grew by 2.8 percent to US$12.86bn, down from May’s 13.4 percent. However, during the first six months of the year, China still managed to attract investments worth US$60.9bn, up by 18.4 percent from a year ago. On Wednesday, Chinese officials announced that the economy had grown by 9.5 percent in the second quarter.
Related: Is China Heading For an Economic Slowdown?
Related: China’s Economy
Personal Finance
Consumer spending in Christchurch, New Zealand, has gone down by nearly 10 percent since the February 22 earthquake – damaging retailers and costing the local economy hundreds of millions of dollars. The data that was gathered did not include the effects of the June 13 quakes though Earthquake Recovery Minister Gerry Brownlee expressed optimism for future findings.
Related: IMF: NZ Quakes More Costly Than Japanese Disasters
“June’s event was a setback for Cantabrians and I’m sure future data will show that in some sectors, but I still get a sense of great resilience and positivity from those on the ground,” Brownlee said. Central City Business Association manager Paul Lonsdale also said that considering the amount of devastation in Canterbury, the 5 to 10 percent fall in retail spending could have been a lot worse.
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