Financial Markets…The yen appreciated today from nearly four-year lows versus the dollar, gaining 0.5% to 98.90, as the sell-off in the Japanese currency halted after a three-day slump of 6.4%. The yen has tumbled 22% in the past six months as the government pledged to increase monetary stimulus to boost the economy.
Fitch Rating downgraded China’s long-term local-currency rating to ‘A+’ from ‘AA-‘ on Tuesday, citing several “underlying structural weakness” in the country’s economy, including rapid credit expansion from both banks and non-bank institutions. But the rating agency kept the country’s foreign-currency rating unchanged at ‘A+.’
Developing-country stocks advanced for the first time in six days, with the benchmark MSCI index rising 0.5% from the lowest level since the end of November, as slower-than-expected inflation in China reduced pressures on the government to tighten monetary policy.
High-income Economies…Greece’s headline CPI index fell 0.2% (y/y) in March, the first annual decline recorded since May 1968, and reversing a 0.1% increase in February. Separately, industrial output dropped 3.9% (y/y) in February, after a rise of 4.2% in January. The economy is currently in its sixth year of recession.
Italy’s bank lending to the private sector fell for the seventh month in a row in February, down 1.3% (m/m) after easing 1.6% in the prior month.
The OECD warned in a report on Tuesday that Slovenia faces a “severe” banking crisis driven by excessive risk taking and weak corporate governance of state-owned banks.
UK industrial output rose by 1.2% (3m/3m saar) over the three months to February compared to a -4.0% drop in January supported by a recovery in manufacturing. Separately, the UK’s trade deficit widened in February led by declining non-EU exports and rising domestic demand for imports.
German exports shipments fell 1.5% (m/m sa) in February after rising 1.3% in January reflecting weak demand from within the Euro Area. However, the rate of decline has improved, with exports falling 3.2% (3m/3m saar) in the three months to February compared to a drop of 8.4% in January. German imports however fell at a slightly faster pace in February of 8.5% (3m/3m saar) compared to -8.2% in January.
Developing Economies…East Asia and Pacific: China’s inflation eased sharply in March after climbing to a ten-month high in February, as seasonal increases in food prices receded. The consumer price index rose 2.1 % (y/y), slower than the 3.2% rise in February. The producer price index fell 1.9 % (y/y) in March versus a 1.6% fall in February.
Latin America and the Caribbean: Mexico’s consumer price inflation increased to its highest level in five months in March to 4.25% (y/y) from 3.55 % in February led by rising fuel and fresh produce prices. Inflation is currently above the central bank’s target of 3% plus-or-minus one percentage point.
Middle East and North Africa: Syria’s exports fell by an unprecedented 97.4% in 2012 to just $185 million, from $7.21 billion registered in 2011. In 2010 exports were valued at $11.35 billion. Imports also fell sharply by 78.4% in 2012, dropping to a value of just $3.58 billion from $16.57 billion a year earlier according to state run media.
Thailand’s economic growth expected to return to 2019 levels in mid-2023
Although the economy would recover next year, the recovery is still substantially below potential level resulting in a large output loss and could affect Thailand’s potential economic growth in the future with the economy expected to return to 2019 levels in mid-2023.
The Siam Commercial Bank (SCB), one of Thailand’s largest commercial banks, said in its latest economic outlook report that the country’s economy may wait until the second semester of 2023 to return to 2019 growth levels.(more…)
World Bank cuts Thailand’s GDP growth outlook to 1% in 2021
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