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- This weekly round-up brings you the latest stories from the world of economics and finance.
- Top economy stories: Eurozone inflation slows; Australian releases 40-year economic forecast; Warning over extreme poverty in developing Asia.
1. Eurozone inflation slows further
The latest data from Eurostat has shown that Eurozone inflation has continued to slow, dropping to 5.3% in July compared to 5.5% in June. It extends a downward trajectory that started late in 2022.
The European Central Bank has rapidly raised interest rates over the last 12 months to tackle high inflation. Rates were in negative territory, but have now hit 20-year highs.
Markets are still anticipating one more rate hike this year, though, Reuters reports. That would likely take Eurozone interest rates to 4%.
2. Australian economy set to slow
A new government report has warned that the Australian economy faces years of slower economic growth, largely as a result of an ageing population. This will put pressure on the country’s budget and raise national debt, the report projects.
Other factors set to shape the economy over the coming 40 years include digital technology, climate change and renewable energy.
The report projected that average annual growth would slow to just 2.2% by 2063, compared with 3.1% over the last 40 years.
And, while the population is set to increase, it will slow, and the population is set to become older. It predicts the number of Australians over 65 will double over the next four decades, while those aged over 85 will triple.
The report also warns that extreme climate change could cut $274 billion off the country’s GDP as a result of lost productivity.
3. News in brief: Stories on the economy from around the world
Gross domestic product has stalled in Norway after a year of growth. Mainland GDP, which doesn’t include the country’s offshore industry, was unchanged compared with the previous 3 months, over which it had grown 0.2%.
Singapore has reopened its 50-year green bond, with hopes to raise as much as $2.1 billion.
The Japanese government’s 10-year bond has reached a new nine-year high, with its yield increasing to 0.66% on Tuesday – the highest since 2014.
The interest rate on a 30-year mortgage in the United States has hit its highest level since 2000, helping send mortgage rates to a 28-year low.
Financial messaging service Swift reports that US dollar usage in global payments has risen to a record high.
Argentina’s economic activity fell 0.2% in June from a month earlier, its fourth straight month of contraction. It shrank 4.4% from a year earlier. It comes as the International Monetary Fund’s executive board approved a $7.5 billion disbursement to Argentina.
The Asian Development Bank has warned that a combination of the pandemic and the cost of living crisis has pushed an additional 68 million people in developing Asia into extreme poverty.
4. More on finance and the economy on Agenda
With 1.4 billion people worldwide remaining unbanked, how can we improve access to financial services and financial inclusion? Digital financial products have helped raise inclusion in Latin America – here’s what the world could learn.
“Wealth on paper” has increased consistently over the last two decades, rising far faster than gross domestic product. On the flip side, productivity and investment have dwindled, so the question is, how can we boost both?
Drought is causing delays at the Panama Canal, with implications for global trade and supply chains. Here’s what you need to know.
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