The International Monetary Fund on Tuesday downgraded the outlook for the world economy this year and next year, blaming Russia’s war in Ukraine for disrupting global commerce, pushing up oil prices, threatening food supplies and increasing uncertainty already heightened by the coronavirus and its variants. The 190-country lender cut its forecast for global growth to 3.6% this year, a steep falloff from 6.1% last year and from the 4.4% growth it had expected for 2022 back in January. It also said it expects the world economy to grow 3.6% again next year, slightly slower than the 3.8% it forecast in … Continue reading IMF cuts global growth forecast to 3.6%

Sri Lanka defaulted on its $51 billion foreign debt Tuesday as the island nation grapples with its worst economic crisis in memory and widespread protests demanding the government’s resignation. Acute food and fuel shortages, alongside long daily electricity blackouts, have brought widespread suffering to the country’s 22 million people in the most painful downturn since independence in 1948. Public anger has flared in recent weeks with crowds attempting to storm the homes of government leaders and security forces dispersing protesters with tear gas and rubber bullets.  Sri Lanka’s finance ministry said the country was defaulting on all external obligations, including … Continue reading Crisis-hit Sri Lanka defaults on all foreign debt

Canadian Prime Minister Justin Trudeau has proposed a two-year ban on some foreigners buying homes. The measure comes as the country grapples with some of the worst housing affordability issues in the world. Prices have jumped more than 20%, pushing the average home in Canada to nearly C$817,000 ($650,000; £495,000) – more than nine times household income. But industry analysts say it’s not clear a ban on foreign buyers will address the problem. Data on purchases by foreign buyers in Canada is limited, but research suggests they amount for a small fraction of the market. “I don’t think it’s going to … Continue reading Canada proposes foreign buyers home real estate ban

Sri Lankan police imposed curfew and fired tear gas at demonstrators protesting dire food, fuel and power shortages outside the president’s house. Agitated protesters stormed through barricades, and were accused of setting fire to a bus on Thursday night. President Gotabhaya Rajapaksa blamed the events on “extremist elements”. Sri Lanka is in the midst of a foreign exchange crisis that has crippled its economy. Faced with 13-hour power cuts, a lack of fuel, essential food items and medicines, public anger has reached a new high. The protest outside the President’s house began peacefully, but participants say things turned violent after … Continue reading Protest at Sri Lankan President Rajapaksa’s home turns violent

Fewer workers sought jobless benefits in the US last week than at any time since 1969. Just 187,000 people filed for unemployment, the Labor Department reported. That was down roughly 28,000 from the previous week. The figures show a stark turnaround in the job market in the US since the start of the coronavirus pandemic. The news sparked several historic comparisons on social media, with some sharing photos of Woodstock music fest. “The last time jobless claims fell this low was the same year we landed folks on the moon,” said Rep Ted Lieu, Democrat from California. “The last time … Continue reading US jobless claims at lowest level since 1969

China is considering offering a $1.5 billion credit facility to Sri Lanka and a decision is expected soon, a top Chinese official said on Monday, as part of efforts to help the island nation amid its worst economic crisis in decades. Chinese ambassador to Sri Lanka Qi Zhenhong told reporters the two sides were also discussing a separate loan of up to $1 billion which the Sri Lankan government had requested. He added that the South Asian nation was offered a loan of $500 million from the China Development Bank on March 18. Sri Lanka has to repay about $4 … Continue reading Sri Lanka in talks with China for $2.5 billion credit support

Russia’s central bank in Moscow Russia’s central bank has nearly doubled the country’s key interest rate from 9.5% to 20% as its currency, the ruble, hit a record low against the dollar on the back of a slew of new sanctions and penalties imposed on Russia by Europe and the U.S. for its invasion of Ukraine. The rate hike, the central bank said, “is designed to offset increased risk of ruble depreciation and inflation.” This follows the central bank’s order to halt foreigners’ bids to sell Russian securities in an effort to contain the market fallout. The ruble fell as … Continue reading Ukraine War: Russia central bank hikes interest rates to 20% from 9.5% to bolster ruble

Oil breached $100 a barrel for the first time since 2014 on Thursday as Russia moved troops into Ukraine, sparking concerns that a war in Europe could disrupt global energy supplies. Russia has launched a full-scale invasion of Ukraine and is targeting cities with weapons strikes, Foreign Minister Dmytro Kuleba said in a tweet. Brent crude hit a high of $101.34 a barrel in early Asia trade, the loftiest since September 2014, and was at $101.20 a barrel at 0423 GMT, up $4.36, or 4.5%. U.S. West Texas Intermediate (WTI) crude futures jumped $4.22, or 4.6%, to $96.32 a barrel, … Continue reading #Russianinvasion: Oil breaches $100 for first time since 2014 on Ukraine attacks

Sri Lanka is open to discussions with the International Monetary Fund (IMF) and other multilateral lenders for assistance, a cabinet spokesman said on Tuesday, as it faces its worst economic crisis in years. “Sri Lanka has sought IMF assistance multiple times in the past and we are still open to that option,” cabinet spokesman and Plantation Minister Ramesh Pathirana said. Sri Lanka’s foreign exchange reserves have plummeted to $2.36 billion, hitting imports of essential goods, including fuel, and inflation is quickening. The island nation of 22 million people also faces debt repayment obligations of about $4 billion this year, and … Continue reading Sri Lanka open to talks with IMF as economic situation worsens

China’s development banks provided $23 billion in financing for infrastructure projects in sub-Saharan Africa from 2007 to 2020, more than double the amount lent by such banks in the United States, Germany, Japan and France combined, a new study showed. The Center for Global Development think tank said a review of 535 public-private infrastructure deals funded in the region in those years showed that China’s investments dwarfed those of other governments and multilateral development banks. Nancy Lee, lead author of the paper and a senior policy fellow at the center, said overall public funding for projects in sub-Saharan Africa remained … Continue reading Chinese funding of sub-Saharan African infrastructure dwarfs that of West, says think tank

New Zealand’s annual inflation rate topped a three-decade high at the end of last year, official figures show. The consumers price index (CPI) rose by 5.9% for the last three months of 2021, the fastest rate since mid-1990. That was higher than expected and makes it almost certain that the Reserve Bank of New Zealand (RBNZ) will take further steps to curb rising living costs. In October, New Zealand became one of the first developed economies to raise rates since the start of the pandemic. “New Zealand is not alone, with many other OECD [Organisation for Economic Co-operation and Development] … Continue reading New Zealand inflation rises to a 30-year high

Shares of Chinese property developers have jumped in Hong Kong as China’s central bank cut a key mortgage rate for the first time in almost two years. The decision comes as concerns grow about a slowdown in the world’s second largest economy amid Omicron outbreaks. At the same time major Chinese property firms, like crisis-hit Evergrande, are struggling to make debt repayments. On Monday, China surprised markets by cutting rates on medium-term loans for the first time since April 2020. On Thursday, the People’s Bank of China (PBOC) cut its five-year loan prime rate, which is the reference rate used … Continue reading Property shares in Hong Kong jump after China cuts key mortgage rate