china us rate hike loom over global finance summit
Last Updated : GMT 06:23:15
Arab Today, arab today
Arab Today, arab today

China, US rate hike loom over global finance summit

Arab Today, arab today

Arab Today, arab today China, US rate hike loom over global finance summit

An investor reacts in front of a digital board showing stock market movements
Washington - AFP

Clouds are gathering over the world's economic leaders ahead of a meeting in Peru to confront the fallout of a China-sparked commodity price crash that has rocked once-powerful emerging markets.

The impending prospect of a US interest rate hike, the first in nine years, further darkens the horizon for the world's finance ministers and central bank governors who meet in the Peruvian capital of Lima next week.

There is "reason to be concerned", International Monetary Fund managing director Christine Lagarde said in the run-up to the October 9-11 meetings of the IMF and World Bank.

"The prospect of rising interest rates in the United States and China’s slowdown are contributing to uncertainty and higher market volatility," the IMF chief added.

"There has been a sharp deceleration in the growth of global trade. And the rapid drop in commodity prices is posing problems for resource-based economies."

The IMF is to release new forecasts for the world economy on Tuesday, likely to reflect the gloom hovering most of all over emerging-market economies, whose woes have overshadowed crises in debt-troubled Greece and Ukraine.

"It is difficult to gauge the possible negative confidence effects on the other emerging-market economies and the global economy as a whole," said Andreas Dombret, a member of the executive board of the Bundesbank, Germany's central bank.
Coupled with the woes in Russia, the bottom line appears clear: After driving growth in the global economy during the 2008-2009 crisis, the major emerging economies, with the exception of India, are sputtering.

That was the conclusion of the Organisation for Economic Cooperation and Development when it slightly lowered its forecasts for global growth in mid-September.

"Economic recovery is progressing in the world's advanced economies, but stagnating world trade and deteriorating conditions in financial markets are curbing growth prospects in many of the major emerging economies," the OECD said.

Emerging economies also face risks from the US Federal Reserve's plan to raise interest rates, probably this year, for the first time since 2006, an issue expected to be discussed at length in Peru.

The prospect of a US rate rise, which would boost returns on US investments, has raised concerns at the IMF and World Bank, worried that it could lure investors to switch funds out of emerging economies and into the United States.

Besides the flight of capital from emerging economies, a shift of capital into the United States could further strengthen the dollar, the currency in which the debt of many companies is based.

Companies in emerging economies, where corporate debt has quadrupled in the past 10 years, according to the IMF, could pay a steep price, forced into bankruptcies that hit banks and public finances. "A vicious cycle," Lagarde said.

"They would do well to buckle their seat belts in case the ride gets bumpy," the World Bank has warned.
Despite the clouds, finance leaders may find reasons for comfort in Peru, the first South American country to host the annual IMF-World Bank meetings in nearly 50 years.

The United States, the largest economy, seems to be doing modestly well, while two major international issues could see advances during the 188-nation meetings on October 9-11, which will include multiple forums, conferences and news conferences.

Two months ahead of the Paris global climate summit, the finance chiefs may provide details on their $100 billion (90-billion-euro) annual contribution, pledged in Copenhagen in 2009, to fight against global warming.

"Has that pledge been met and how is that calculated, that will be a big topic," said Jennifer Morgan, director of the climate program at the World Resources Institute, a non-governmental organisation.

In Lima, the G20 finance officials also are expected to approve a broad action plan aimed at battling multinationals' strategies to reduce their tax burdens and shelter profits in tax havens.

These tax dodges are "a form of corruption that hurts the poor" by depriving their countries of public revenues, World Bank President Jim Yong Kim said Thursday.

The G20 agreement would be finalised in November in Turkey at a summit of the leaders of the major advanced and emerging economies.

arabstoday
arabstoday

Name *

E-mail *

Comment Title*

Comment *

: Characters Left

Mandatory *

Terms of use

Publishing Terms: Not to offend the author, or to persons or sanctities or attacking religions or divine self. And stay away from sectarian and racial incitement and insults.

I agree with the Terms of Use

Security Code*

china us rate hike loom over global finance summit china us rate hike loom over global finance summit

 



Name *

E-mail *

Comment Title*

Comment *

: Characters Left

Mandatory *

Terms of use

Publishing Terms: Not to offend the author, or to persons or sanctities or attacking religions or divine self. And stay away from sectarian and racial incitement and insults.

I agree with the Terms of Use

Security Code*

china us rate hike loom over global finance summit china us rate hike loom over global finance summit

 



Arab Today, arab today
Arab Today, arab today Jordanian woman reveals her project

GMT 00:46 2017 Saturday ,11 November

Jordanian woman reveals her project
Arab Today, arab today Japanese regulators raid Airbnb

GMT 00:44 2017 Monday ,20 November

Japanese regulators raid Airbnb
Arab Today, arab today Keep kids busy at Thanksgiving gatherings

GMT 11:14 2017 Friday ,10 November

Keep kids busy at Thanksgiving gatherings
Arab Today, arab today Saudi, Bahrain target Iran

GMT 00:48 2017 Monday ,20 November

Saudi, Bahrain target Iran
Arab Today, arab today Europe turns on Facebook, Google

GMT 02:26 2017 Monday ,20 November

Europe turns on Facebook, Google
Arab Today, arab today
Arab Today, arab today
Arab Today, arab today Australian academic's book pulled

GMT 15:20 2017 Monday ,13 November

Australian academic's book pulled
Arab Today, arab today May under Brexit pressure at EU reform summit

GMT 02:14 2017 Saturday ,18 November

May under Brexit pressure at EU reform summit
Arab Today, arab today Delhi half-marathon to go ahead

GMT 03:51 2017 Saturday ,18 November

Delhi half-marathon to go ahead
Arab Today, arab today The history of solar eclipses

GMT 05:16 2017 Sunday ,20 August

The history of solar eclipses
Arab Today, arab today Driverless, electric future just round

GMT 02:45 2017 Monday ,20 November

Driverless, electric future just round
Arab Today, arab today Tesla unveils its all-electric semi truck

GMT 02:59 2017 Saturday ,18 November

Tesla unveils its all-electric semi truck
Arab Today, arab today Hanan Metawe denies apology for “Major Treason”

GMT 12:22 2017 Thursday ,16 November

Hanan Metawe denies apology for “Major Treason”
Arab Today, arab today paObama climate envoy slams Trump's rejection

GMT 16:04 2017 Friday ,17 November

paObama climate envoy slams Trump's rejection

GMT 08:06 2017 Wednesday ,15 November

Ayten Amer happy for “The Flood” success

GMT 11:15 2017 Thursday ,16 November

Angola oil boss sacked by father's protege

GMT 18:41 2017 Friday ,20 October

Designer Aql Faqih aspires to innovation

GMT 11:38 2017 Wednesday ,15 November

Unloved vultures fight for their survival

GMT 11:49 2017 Thursday ,17 August

Egyptian artist presents new collection of designs

GMT 02:28 2017 Saturday ,18 November

Anti-drug operation nets 4 tonnes

GMT 01:34 2017 Friday ,17 November

Banyan Tree Phuket Takes Festive Season

GMT 17:12 2017 Monday ,07 August

Al-Shawaifi reveals secrets of total solar eclipse

GMT 16:53 2017 Tuesday ,05 September

Youssra depended on colored foam
Arab Today, arab today
Arab Today, arab today
 
 Arab Today Facebook,arab today facebook  Arab Today Twitter,arab today twitter Arab Today Rss,arab today rss  Arab Today Youtube,arab today youtube  Arab Today Youtube,arab today youtube
arabstoday arabstoday arabstoday arabstoday
arabstoday arabstoday arabstoday
arabstoday
بناية النخيل - رأس النبع _ خلف السفارة الفرنسية _بيروت - لبنان
arabstoday, Arabstoday, Arabstoday