GLOBAL NEWS-
The U.S.-China trade war poses the biggest risk to global stability and fiscal stabilisation is needed to respond to economic shocks in Europe, IMF First Deputy Managing Director David Lipton said on Monday.“Obviously, this is not a matter for Europe alone. The United States needs to get its fiscal house in order as well. U.S.-China trade tensions pose the largest risk to global stability,” Lipton said during a conference in Lisbon.The trade dispute, which began some eight months ago, has affected the flow of billions of dollars of goods between the biggest and second biggest economies in the world.
The U.S. Federal Reserve should consider raising the proportion of short-term Treasury bonds it holds to give itself more options to respond to economic pullbacks, a top policy maker said on Tuesday.Speaking at a conference in Hong Kong, Eric Rosengren, president of the Federal Reserve Bank of Boston, offered a hard-line defense for one of policy makers’ most controversial responses to the 2008 global financial crisis: bond buying.He is the third Fed policymaker in two days to weigh in on exactly what bonds the Fed should keep and why, following speeches by his counterparts in Chicago and Philadelphia.
Pakistan’s economic growth is set to slow to between 3.5-4.0 percent in the 2019 fiscal year from 5.2 percent in 2018, with a fiscal deficit of 6.0-7.0 percent, the State Bank of Pakistan said in its latest quarterly economic report on Monday.The government, which has been holding discussions with the International Monetary Fund over a possible bailout, had been targeting growth of 6.2 percent, but there have been growing expectations among economists of a slowdown.“Real GDP growth during FY19 is likely to moderate significantly, mainly due to slowdown in the growth of the agriculture sector and stabilization measures taken to preserve macroeconomic stability,” the central bank said.
China imported 4.35 million tonnes of liquefied natural gas (LNG) in February, down from the previous month’s record level, the General Administration of Customs said on Saturday, as demand eased towards the end of the peak winter heating season.But the amount of LNG China bought last month remained 9.7 percent more than the same month a year earlier, according to the customs data.
China’s imports of soybeans from the United States in February surged from January as the cargoes booked following a truce in the trade war between the two countries arrived.China brought in 907,754 tonnes of U.S. soybeans in February, up from 135,814 tonnes in January, the General Administration of Customs said.However, that was just a fraction of the 3.35 million tonnes imported in February 2018 as Beijing’s hefty tariffs on U.S. shipments curbed purchases.China, the world’s biggest oilseed importer, agreed to resume some U.S. soybean purchases after U.S. President Donald Trump and Chinese President Xi Jinping agreed on Dec. 1 to a 90-day truce in their trade dispute.
Singapore’s core inflation rate eased to a nine-month low in February, reinforcing expectations that the central bank will keep monetary policy unchanged when it meets next month.The core inflation rate was 1.5 percent on a year-on-year basis, data showed on Monday, its lowest since May 2018, and below the median forecast in a Reuters poll for a 1.7 percent rise.“The lower than-expected inflation print basically reinforces our call for MAS to stay unchanged (in April),” UOB economist Barnabas Gan said, referring to the Monetary Authority of Singapore, the city-state’s central bank.
Asian shares bounced back on Tuesday after two days of losses as U.S. 10-year Treasury yields edged higher, but the outlook remained murky as investors weighed the odds of whether the U.S. economy is in danger of slipping into recession. MSCI’s broadest index of Asia-Pacific shares outside Japan rebounded 0.3 percent after losing 1.4 percent in the previous session.Australian shares were flat, while Japan’s Nikkei jumped 1.8 percent after recording its biggest drop since late December on Monday.China’s blue-chip CSI300 and Hong Kong’s Hang Seng Index also rose, by 0.3 percent and 0.5 percent, respectively.Wall Street shares were little changed on Monday with the S&P 500 ending with a small loss of 0.08 percent.U.S. stock futures rose, with E-Minis for the S&P 500 tacking on one-third of a percent.
Sanctions on Venezuela’s oil industry have made winners out of Gulf of Mexico offshore heavyweights Royal Dutch Shell Plc and BP Plc as U.S. refiners in need of substitutes are scooping up oil produced in the region.The two major oil companies produce notable amounts of crude oil that refiners have settled on as the immediate replacement for the heavy Venezuelan crude that U.S. refiners relied on for years. Trading volumes in these grades of oil have surged to the highest in months, and prices touched five-year peaks since U.S. sanctions were imposed late in January.U.S. production has surged to a record 12 million barrels per day, but less than 5 percent of that is heavy oil. The sanctions have hamstrung refineries in the United States, as many giant Gulf Coast facilities need heavier oil to produce high-margin refined products like diesel and jet fuel.
German business morale improved unexpectedly in March after six consecutive drops, a survey showed on Monday, suggesting that Europe’s largest economy is likely to pick up in the coming months after it narrowly avoided a recession last year.The growth outlook for Germany’s export-reliant economy has been clouded by trade disputes triggered by U.S. President Donald Trump’s ‘America First’ policies and the risk of Britain crashing out of the European Union without an agreement.The Munich-based Ifo economic institute said its business climate index rose to 99.6 from an upwardly revised 98.7 in the previous month. This beat a consensus forecast for a reading of 98.5.
Theresa May rejected a plan, backed by Labour leader Jeremy Corbyn, for there to be a public vote on her deal once it is passed by Parliament. She was responding after MPs repeatedly referred to the march by more than a million people through central London on Saturday demanding a second referendum.“It’s in the best interests of this house to agree to deliver Brexit and do it in a smooth and orderly way but not to go down the route of either a second referendum or an election,” May said.
Gold prices were steady on Tuesday and hovered near one-month high hit in the previous session, as demand for safe-haven assets improved after treasury yields and equities fell on possible U.S. recession and global growth concerns.Spot gold was unchanged at $1,321.74 per ounce as of 0123 GMT, after touching its highest since Feb. 28 at $1,324.33 in the previous session.U.S. gold futures were also down 0.1 percent at $1,320.70 an ounce.Asian shares were shaky on Tuesday after U.S. Treasury yields sank to their lowest since late 2017, further below short-term interest rates and adding to fears of a U.S. recession.
Oil prices firmed on Tuesday, pushed up by ongoing supply cuts led by producer club OPEC and by U.S. sanctions on Iran and Venezuela, but analysts warned that signs of a sharp economic slowdown could soon drag on crude markets.Brent crude oil futures were at $67.46 per barrel at 0110 GMT, up 25 cents, or 0.4 percent, from their last close.
U.S. West Texas Intermediate (WTI) futures were at $59.31 per barrel, up 49 cents, or 0.8 percent, from their last settlement.Oil prices have been supported for much of 2019 by efforts by the Organization of the Petroleum Exporting Countries (OPEC) and non-affiliated allies like Russia, who have pledged to withhold around 1.2 million barrels per day (bpd) of supply this year to prop up markets.Prices have also been driven up by U.S. sanctions on oil exporters and OPEC-members Iran and Venezuela.