Europe:
Euro Economy Is Heading Towards a Golden Period
Europe is no longer the sick man of the world economy. The 19-nation euro-zone bloc is already enjoying the strongest growth in a decade and now economists at Credit Suisse Group AG and Oxford Economics are declaring that it’s heading toward a golden period of low-inflationary expansion. The turnaround is striking for a region that plunged from the global financial crisis into its own sovereign debt turmoil, record unemployment and near-deflation that threatened the very survival of the currency union. While still to make up most of the ground lost in the dark years, and with productivity still weak, the upturn at least holds out the hope that some scars will start to heal. “This is euro-area growth at its best,” said Nathan Sheets, a former international economist at the Federal Reserve and U.S. Treasury. “Our friends on the continent should enjoy it, it’s been a long famine.”
IMF says Europe’s growth more durable, warns of ‘disruptive’ Brexit threat
Europe’s economy is now hitting its stride, the International Monetary Fund said on Monday, but a disruptive Brexit could result in “appreciably” lower growth for both Britain and the euro zone. The IMF’s latest Regional Economic Outlook, which looks at more than 40 countries from Germany and the UK to Turkey and Russia, said the current recovery looks increasingly assured. It is partly driven by central bank stimulus and low interest rates, but also by improving fundamentals, as evidenced by a pick-up in investment across a broad range of economies. “This recovery looks increasingly durable,” the deputy director of the IMF’s European Department, Joerg Decressin, told Reuters at a presentation of the report published on Monday. “Growth in the euro area has been positive for 18 quarters, lately around 2.5 percent. Many countries in eastern Europe have seen growth around or above 3 percent for some time already. So this recovery has not only become broader but also stronger.”
U.S.:
U.S. to promote ‘universal access’ to fossil fuels at climate talks
The United States hopes to promote wider use of fossil fuels at a global meeting on climate change next week, a White House official said, reflecting the gaping divide between Washington and the rest of the world on the issue of global warming. President Donald Trump’s administration has envoys at the U.N.-sponsored talks in Bonn, Germany, even though the United States has derided the Paris Agreement climate accord and has begun a years-long process to withdraw from it. The meeting, the Conference of Parties 23, is intended to hammer out the details of the Paris Agreement’s efforts to fight climate change. While a small State Department team has been on the ground for technical negotiations since the talks opened last week, the administration is sending another delegation for the second week that will include senior White House advisers. One of the three main priorities for the administration will be promotion of “universal access to affordable, reliable energy, including highly efficient fossil fuels,” the official told reporters in a briefing.
Asia:
China Oct new yuan loans hit one-year low as debt curbs weigh
China’s new loans fell more than expected in October to their lowest in a year as banks tightened mortgage lending and corporates continued to shun bank loans, amid a continuing clampdown on risky shadow lending activities. Chinese authorities are walking a fine line by seeking to contain riskier types of financing and slowing an explosive build-up in debt without stunting economic growth. Banks extended 663.2 billion yuan ($99.83 billion) in net new yuan loans in October, data from the People’s Bank of China (PBOC) showed on Monday, falling to the lowest since October last year. Analysts polled by Reuters had predicted new yuan loans to drop to 780 billion yuan, from September’s 1.27 trillion yuan. “The upshot is that tighter monetary conditions have driven a meaningful slowdown in credit growth in recent quarters and we think the economy is set to feel the negative effects of this before long,” said Julian Evans-Pritchard, China economist at Capital Economics.
OPEC Boosts 2018 Demand Forecast, Signaling Faster Rebalancing
OPEC boosted forecasts of demand for its crude in 2018, signaling that the rebalancing of the global market could gather pace. The Organization of Petroleum Exporting Countries raised estimates for the amount it will need to pump to meet demand next year by 400,000 barrels a day to 33.4 million a day, according to a monthly report from the group. As that’s about 670,000 a day more than OPEC produced in the third quarter, global inventories would diminish further in 2018 if the group and its allies continue to keep supplies restrained. OPEC and Russia have been leading a worldwide coalition of oil producers this year in production cuts aimed at ending a glut that has weighed on prices and battered their economies since 2014. They’ll meet on Nov. 30 in Vienna, where they may decide to prolong the measures beyond their scheduled end in March. Output cuts are the “only viable option” for completing the rebalancing of the market, OPEC Secretary-General Mohammad Barkindo said in Abu Dhabi on Monday. Last week he said that no producers opposed continuing the accord and the only question was the duration of the extension.