This is is a guest post from Philip Pilkington, a writer and research assistant at Kingston University.
Well, it seems that everyone is talking about Japan’s Shinzo Abe’s so-called “Fourth Arrow” in his economic recovery program. That is, a plan to raise the consumption tax to eight per cent next year followed by a hike to ten per cent in October 2015. Can we tell anything about the likely consequences of such a move from Japan’s rather colourful macroeconomic history of the past twenty years? Yes, we can. Read more
From a very dovish Mario Draghi’s press conference following the European Central Bank’s decision to keep its key rates on hold (with our emphasis):
Based on our regular economic and monetary analyses, we decided to keep the key ECB interest rates unchanged. Incoming information has confirmed our previous assessment. Underlying price pressures in the euro area are expected to remain subdued over the medium term. In keeping with this picture, monetary and, in particular, credit dynamics remain subdued.
That’s sterling off 1.2 per cent at pixel… with the weaker currency and generally loose tone of the statement below pushing the Footsie up some 2 per cent.
Here’s the statement that started the dive (our emphasis): Read more
Live markets commentary from FT.com
Senior judge Adli Mansour to be sworn in as Egypt president || US reacts cautiously to Morsi’s ouster || Peripheral bond yields jump || China considers dramatic relaxation of its capital controls || Chinese money rates return to normal levels || Rupert Murdoch dismisses investigations into phone hacking || Zynga chief lured from Microsoft with $50m pay package || NTT DoCoMo weighs overseas acquisitions || Sprint Nextel-Softbank deal said to meet FCC approval || US investigates ConAgra and CHS flour merger || Russian oil shipments to Europe slump to a 10-year low Read more
Be it Abe’s fourth arrow or simply a part of the fiscal one, the plan to hike Japan’s consumption tax to 8 per cent by April next year, and then 10 per cent by October 2015, represents a cheery contradiction.
Abe et al are keen on ending deflation — but they are going to hinder that push with a fiscal tightening. No tension there, then. Read more
We assume someone must have breached the RNS statement submission security system to do this, but nevertheless there’s a joke release doing the rounds suggesting that Gulf Keystone Petroleum has appointed Simon Murray as chairman.
It’s quite a professional job. See: Read more
Elsewhere on Thursday,
– The most influential business thinkers are increasingly… economists.
– Pop goes the Krugman?
– China is rebalancing and it’s going to be awesome. Read more
Asian stocks ex-Japan higher after ADP data || US reacts cautiously to Morsi ouster || Interviews to find new RBS chief begin || Sprint Nextel-Softbank deal said to meet FCC approval || Russian oil shipments to Europe slump || Murdoch comments over hacking incident broadcast || Should Abe hold off on tax rises? Read more
The Reserve Bank of Australia’s deputy governor has been speaking on Thursday. Sadly there were no jokes but Philip Lowe did attempt to explain his boss’s side-splitting gag.
RTRS – RESERVE BANK OF AUSTRALIA DEPUTY GOV LOWE SAYS BOARD DID DELIBERATE FOR VERY LONG TIME, BUT ALWAYS DOES Read more
Kevin Rudd 2.0 has been quick to highlight the dangers posed by slowing Chinese growth since he was returned as Australia’s prime minister.
For example: Read more