Sunday, September 18, 2016

Russian central bank cuts interest rate further—down to 10 percent

Russia's central bank cut interest rates on Friday amid what analysts called more "aggressive" calls for monetary easing.
The central bank cut its key interest rate by 50 basis points to 10 percent on Friday, saying that it made the decision "given the inflation slowdown, in line with the forecast, decrease in inflation expectations and unstable economic activity."

Russia’s economic outlook revised to stable from negative

WASHINGTON (Sputnik) — US financial services company Standard and Poors (S&P) has upgraded Russia’s economic outlook to stable from negative, according to a release issued by the company on Friday.

"Russian Federation outlook revised to stable from negative on abating external risks; ratings affirmed," the release stated. S&P affirmed Russia’s foreign currency sovereign credit rating at ‘BB+’ and local currency rating at ‘BBB-’.

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10 must-read economics stories of the week

The Changing Trade Landscape: Trade Agreements, Globalization and Inequality

FDI statistics - June 2016

This article gives an overview of foreign direct investments (FDI) for the European Union (EU) in relation to year-end stocks, annual flows and income. The analysis mainly covers the period 2011–14 for the EU-28; note that the 2013 and 2014 figures are based on new methodological standards — Balance of Payments Manual, 6th edition (BPM6), and Benchmark Definition of FDI, 4th edition (BD4) — therefore, the statistics from 2013 onwards are not directly comparable with previous years.

"Helicopter money" - reality bites

Since the Great Financial Crisis, central banks in the major economies have adopted a whole range of new measures to influence monetary and financial conditions. The measures have gone far beyond the typical pre-crisis mode of operation - controlling a short-term policy rate and moving it within a positive range - and have therefore come to be known as "unconventional monetary policies." To be sure, some of these measures had already been pioneered by the Bank of Japan roughly a decade earlier in the wake of that country's banking crisis and uncomfortably low inflation. But no one had anticipated that they would spread to the rest of the world so quickly and become so daring, testing the boundaries of the unthinkable.

Tariffs Do More Harm Than Good at Home

A longstanding challenge for the global economy is the possibility that some countries compete for export markets through artificially low prices. Political leaders and pundits sometimes propose import tariffs to offset the supposed price advantages and exert pressure for policy changes abroad. What proponents often fail to realize is that such tariff policies, while certainly hurting their targets, can also be very costly at home. And surprisingly, the self-inflicted harm can be substantial even when trade partners do not retaliate with tariffs of their own.