EMerging Equity
Easing
China’s $370 Billion Margin Call
China’s stock markets tumbled on Friday to near bear territory further deepening the sell-off that started two weeks ago. The Shanghai Composite, down 7.4% on the day, has fallen 19% from its June 12 high wiping out $1.25 trillion in market cap. The smaller Shenzhen and ChiNet indices also has plunged 20% from its recent … Continue reading
Why China Should Get Rid Of The Renminbi-Dollar Peg
By Dr Guonan Ma The Chinese economy is simply too big to remain tied to the once useful monetary anchor of the renminbi–US dollar peg. It is time to let it go. The Chinese renminbi depreciated 2.5 per cent against the US dollar in 2014. It was the largest annual fall since 2005, when Beijing timidly … Continue reading
China Has Wide Range Of Policy Tools, Ready To Step Up Measures If Growth Slows: Premier Li
Despite an ease in economic growth, China still has a wide range of policy tools at the government’s disposal to boost economic growth, aiming to achieve a better-quality of economic development, Chinese Premier Li Keqiang said on Sunday following the conclusion of China’s annual parliamentary session, state-run Xinhua news agency reported. China has a lot of room to maneuver its … Continue reading
How China Can Avoid The Middle Income Trap
By Derek Scissors As China appears to be flirting with the middle income trap, the old development model is becoming increasingly unworkable. In its place, the ‘new normal’ is emerging as a valuable notion. But to work it needs increased corporate competition, integrated labour markets, sharper land rights for farmers, and much less debt accumulation. … Continue reading
Roubini: The Negative Way to Growth — Why Are So Many Investors Willing To Lose So Much Money?
By Nouriel Roubini Monetary policy has become increasingly unconventional in the last six years, with central banks implementing zero-interest-rate policies, quantitative easing, credit easing, forward guidance, and unlimited exchange-rate intervention. But now we have come to the most unconventional policy tool of them all: negative nominal interest rates. Such rates currently prevail in the eurozone, Switzerland, … Continue reading
Lessons Learned From Emerging Markets For Frontier Markets: Managing Capital Flows
By David Lipton, IMF Soon after the global financial crisis, with emerging market economies experiencing sizable inflows in the wake of quantitative easing, unconventional monetary policies, and widening growth differentials with advanced economies, the IMF embarked on a work program to help our member countries craft policy responses that would reap the benefits of financial … Continue reading
Global Debt: The Tip And The Bulk Of The Iceberg
By Valentin Katasonov Despite the chilling nature of global debt and individual country debt figures cited in the report — Debt and (not much) deleveraging — published by the well-known consulting firm McKinsey in February 2015, for the most part these figures are incomplete and underestimated. The situation is in fact far worse. This is clearly illustrated by … Continue reading
IMF Revises Down Global Growth Forecast For 2015-16, Despite Cheaper Oil
By IMF Even with the sharp oil price decline—a net positive for global growth—world economic outlook is still subdued, weighed down by underlying weakness elsewhere, says the IMF’s latest WEO Update. Global growth is forecast to rise moderately in 2015–16, from 3.3 percent in 2014 to 3.5 percent in 2015 and 3.7 percent in 2016 … Continue reading
Europe’s €500 Billion Plan To Save Itself From Economic Ruin
On Thursday, European Central Bank head Mario Draghi is expected to make good on his promise to “do whatever it takes” to save the deflating euro and sagging economy and introduce US-style quantitative easing to the tune of €500 billion in bond purchases. The sovereign bond purchases could inject €550 billion ($650 billion), according to … Continue reading
Raghuram Rajan: Bracing For Stagnation
By Raghuram Rajan As 2015 begins, the global economy remains weak. The United States may be seeing signs of a strengthening recovery, but the eurozone risks following Japan into recession, and emerging markets worry that their export-led growth strategies have left them vulnerable to stagnation abroad. With few signs that this year will bring any improvement, … Continue reading
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