Pakistan’s Tehreek-e-Insaf (PTI) government is planning to present another mini-budget next month to counteract the widening fiscal deficit. This will be the second mini-budget that the PTI has presented in the four months since winning a majority in the general election this July. The dailyReport Must-reads from across Asia - directly to your inbox Immediately after taking charge in September, the government tabled revised budget estimates in the national assembly and claimed that the fiscal crisis was over. Through these measures, the government cut spending on development projects to free up funds for defense and debt-service liabilities. Economic analysts say Prime Minister Imran Khan’s government does not have a long-term economic strategy and is merely taking temporary steps to counteract growing economic problems. A cash injection of $3 billion from Saudi Arabia has done little to halt the deterioration of foreign exchange reserves, which are under constant … [Read more...] about Pakistan considers another mini-budget as economic crisis looms
Global economic crisis
All eyes are on the Turkish lira. Its decline has been precipitous – it has already lost more than 40% of its value against the US dollar this year. For Turkey, which has relied on the inflow of foreign credit, this poses terrible risks. Enormous debt coupled with a vicious attack for political reasons on the Turkish economy by the US government has pushed Turkey toward the precipice. Will Turkey’s descent take Europe with it and then, certainly, other middle-income countries? Is this the harbinger of a new global financial crisis that would be far more dangerous than the one in 2007-08? The dailyReport Must-reads from across Asia - directly to your inbox Financial instability The credit crisis of 2007-08 has not really ended. The problems posed by the collapse of the US housing market and the subsequent debt problems in world banking have not been fixed. Sober recommendations from the Basel Committee on Banking Supervision as well as from the International … [Read more...] about Could Turkey trigger the next global financial crisis?
Turkish currency, Lira has nosedived over 50 per cent in last 12 months amid US sanctions and rising inflations. In fact, Lira plunged one-fifth against the dollar last week. So, is the downfall of the Turkish currency, which is sending shock waves in the global markets, sudden? Looking at the numbers, the downfall is not sudden. Lira was the worst performing currency across the world in the past 12 years. What is the reason behind this downfall of the Turkish currency and is that going to affect you?? Let's find out. Why is Lira plummeting? The Turkish economy is going through a very bad phase since a long time. The country is facing huge Current Account Deficit (CAD) in public as well as private sectors. Foreign funding has a huge role to lay in the country's financial system. High level of debt has resulted in Inflation reaching an annual rate of 15.9 per cent in July as the government has taken huge loans in the foreign currency. The default of loans in the construction sector is … [Read more...] about What is Turkish economic crisis?
By The Canadian Press Fri., Aug. 10, 2018 Canada’s main stock index was down in late morning trading as most sectors slipped and concerns over Turkey’s economic crisis rattles global markets. The Toronto Stock Exchange’s S&P/TSX composite index was down 102.64 points at 16,314.34 after roughly 90 minutes of trading. Most sectors including materials, energy and health care were down, but gold was up slightly. In New York, the Dow Jones industrial average was down 180.59 points at 25,328.64. The S&P 500 index was down 14.71 points at 2,838.87 and the Nasdaq composite index was down 36.052 points at 7,855.73. The Canadian dollar was at 76.39 cents, up from Thursday’s average of 76.69 cents U.S. The September crude contract was up 94 cents at $67.75 (U.S.) per barrel and the September natural gas contract was down two cents at $2.93 per mmBTU. Article Continued Below The December gold contract was up $3.80 at $1,223.70 an ounce and the … [Read more...] about TSX, global markets down amid Turkey economic crisis
The developed economies, mainly the US and in Europe, have yet to see a full recovery from the global financial crisis. US economic prospects have continued to lag behind even the most pessimistic early predictions. The average growth rate of the US economy between 2008 and 2017 was only around 2%. All the financial measures put in place by the US Federal Reserve and the European Central Bank in the form of bailouts, quantitative easing and lowering of interest rates have not been able to deliver sustainable growth in their respective economies. Unsustainable levels of growth have led to sick recoveries that feed on themselves, further impacting the rate of employment growth and creating an excellent case for secular stagnation. The dailyReport Must-reads from across Asia - directly to your inbox The case for new secular stagnation In the Great Depression era, secular stagnation was considered to be a condition where an economy endured negligible or no growth, low employment, and … [Read more...] about The three headwinds to global economic growth