Latest news with #centralbank
Arab News
12 hours ago
- Business
- Arab News
Pakistan weekly inflation down by 0.81% as prices of essential items remain largely stable
ISLAMABAD: Short-term inflation, measured by the Sensitive Price Index (SPI), lowered by 0.81% in Pakistan, the country's statistics bureau said this week, as prices of most essential items remained stable. The SPI, which comprises 51 essential items collected from 50 markets in 17 cities, is computed on a weekly basis to assess the price movement of essential commodities at a shorter interval of time to review the price situation in the country. While the SPI for the week ending on May 29 decreased 0.81% on a week-on-week basis, it recorded an increase of 0.41% when compared to the same week last year, according to the Pakistan Bureau of Statistics (PBS). 'During the week, out of 51 items, prices of 14 (27.45%) items increased, 10 (19.61%) items decreased and 27 (52.94%) items remained stable,' the PBS said. A decrease was observed in the prices of electricity charges for Q1 (10.10%), chicken (8.51%), LPG (2.67%), sugar (0.25%), powdered milk (0.20%), vegetable ghee 2.5Kg (0.17%), wheat flour (0.09%), rice (0.07%), garlic (0.05%) and pulse moong (0.01%). The items whose prices increased during the week included tomatoes (4.54%), potatoes (2.94%), eggs (2.19%), onions (2.17%), gur (0.77%), bananas (0.73%), mustard oil (0.34%), pulse mash (0.22%), pulse gram (0.17%), pulse masoor (0.14%) and basmati rice (0.12%). Pakistan's annual inflation rate fell to 0.3% in April, well below the Ministry of Finance estimate of 1.5% to 2%. The central bank forecasts average inflation to be in the range of 5.5% to 7.5% for the fiscal year ending June. Also, the Pakistan Stock Exchange (PSX) recorded a 7.5% gain in May on a month-on-month basis, according to the Karachi-based Topline Securities. 'This gain can be attributed to cut in policy rate by 100bps by SBP,' it said in its monthly review, citing improvement in inflation outlook and approval of first review of Pakistan's $7 billion International Monetary Fund (IMF) program as well as the approval of another $1.4 billion under the IMF's Resilience and Sustainability Facility. 'Average daily traded volume and value during the month stood at 566 million shares and PKR28 billion.'
Malay Mail
17 hours ago
- Business
- Malay Mail
Trump's hubris will deliver the hammer blow to the US and the world — Phar Kim Beng
MAY 31 — In a recent and poignant Time article, economist Richard S Grossman reminds us that when political leaders ignore economists and elevate personal pride over empirical analysis, economic catastrophe is not a possibility — it is a pattern. Grossman draws sharp historical comparisons: President Andrew Jackson's assault on America's nascent central bank and Winston Churchill's ill-fated return to the gold standard. Both decisions were rooted in ideological conviction and personal pride, not evidence or consensus. Now, in the second term of Donald J Trump, history threatens to repeat itself — only this time, on a global scale. Trump's self-referential style of governance risks destabilising not just the US economy but the very foundations of global economic interdependence. His actions echo Jackson and Churchill — but they are also amplified by a kind of hubris unique to this media-saturated age, where policy is shaped more by image than substance, by ego rather than expertise. Jackson's Bank War: Populism at the expense of stability In the early 1830s, President Andrew Jackson waged war against the Second Bank of the United States. Chartered in 1816, the Bank had functioned as a quasi-central institution, restraining inflation and regulating credit. Jackson, however, viewed it as a tool of elite corruption and vetoed its recharter in 1832, allowing it to collapse by 1836. His Specie Circular of 1836, which mandated payment for government land in gold or silver, drained the economy of liquidity and triggered the Panic of 1837. As chronicled by economic historian Peter Temin, this crisis caused GDP to contract by up to 30 per cent, and unemployment skyrocketed. It took nearly a decade for the economy to recover. Jackson's decision, made in defiance of economic logic, delivered a populist victory — and a national calamity. US President Donald Trump speaks with the media after a trip to Pennsylvania, at Joint Base Andrews, Maryland, US May 30, 2025. — Reuters pic Churchill's gold standard gambit: Pride in decline Fast forward to 1925. Winston Churchill, then Chancellor of the Exchequer, committed Britain to returning to the gold standard at its pre-World War I parity — despite explicit warnings from economists like John Maynard Keynes. The move drastically overvalued the pound, making British exports uncompetitive and forcing deflationary wage cuts across industry. The economic damage was severe. Between 1921 and 1929, while the United States and France saw GDP gains of 40–50 per cent, Britain lagged behind with under 20 per cent. The North of England sank into chronic unemployment. The General Strike of 1926 and other labour uprisings signalled deep unrest. Churchill, clinging to imperial nostalgia and fiscal orthodoxy, stayed the course until 1931 — when a full-blown crisis forced Britain off the gold standard. Trump's economic nationalism: Narcissism over institutions Trump's second term is shaping up to be a repetition of these self-inflicted traumas. But while Jackson and Churchill made costly decisions for their nations, Trump's impact is transnational. His economic worldview is transactional, driven by an obsession with trade deficits and a conviction that tariffs will restore American greatness. This belief contradicts decades of economic research. Trade deficits are not inherently harmful, nor do tariffs reduce them. They tend to raise prices for consumers and provoke retaliatory measures from trading partners. Yet Trump persists, seemingly convinced that personal instincts are superior to expert counsel. He routinely undermines institutions like the Federal Reserve, publicly attacks international economic bodies such as the WTO, and treats trade as a zero-sum game. His policies, lacking in consistency and long-term logic, have already begun to erode global trust in American reliability — both as a trade partner and as a steward of global finance. From trade policy to global shockwave The world's largest economy cannot afford this kind of unpredictability. In contrast to Jackson and Churchill — whose economic errors had localised effects — Trump's decisions ripple through complex global supply chains, rattle markets, and stoke geopolitical tensions. His tariff wars have hit not just China but also traditional allies like the European Union, Canada, and Japan. The result? A deeply fragmented global trade environment. Allies no longer assume continuity in American policy. Investment flows hesitate. Emerging markets, many of them reliant on exports, suffer. Trump's economic strategy — fuelled by bravado and nostalgia — is incompatible with the integrated global system the US itself helped create. The theatre of strength, the reality of retreat Richard S Grossman rightly points out that Trump's view of tariffs is rooted in a misunderstanding of history. He romanticises the 19th-century Gilded Age, a time of high tariffs, while overlooking its accompanying instability, monopolism, and deep inequality. Trump's policies risk bringing back that era — not as triumph, but as cautionary tale. What truly binds Jackson, Churchill, and Trump is not simply error, but ego — the conviction that personal willpower can override economic complexity. But in Trump's case, this ego is magnified by media spectacle and a disdain for dissent. His economic policy is crafted not through consultation or deliberation, but through impulse. The coming hammer blow The most dangerous consequence of Trump's economic hubris is not just stagflation or market volatility — it is the collapse of global trust. Trust is the glue of the international economic system. When nations can no longer rely on US commitments, the temptation grows to seek alternatives — whether in digital currencies, alternative trade blocs, or parallel security arrangements. This erosion of trust could mark the twilight of US economic leadership. While the dollar remains dominant and American markets deep, overreach can accelerate decline. The American century — once built on openness, innovation, and stable leadership — now risks ending in retreat, with tariffs not as tools of power but as symbols of decline. Trump's economic nationalism, then, is not just policy. It is performance. And like all performances, it ends. The question is whether the final curtain will fall on American economic primacy — or whether institutions, allies, and economists can intervene in time to prevent the hammer blow from becoming permanent. * Phar Kim Beng, PhD, is professor of Asean studies at the International Islamic University Malaysia. ** This is the personal opinion of the writer or publication and does not necessarily represent the views of Malay Mail.
Free Malaysia Today
a day ago
- Business
- Free Malaysia Today
India records more than 6% annual growth
India's national statistics office said March-quarter growth was helped by a surging construction sector. (AP pic) MUMBAI : India's economy grew by 6.5% in the fiscal year that ended in March, official data showed today, among the world's top performers but still sluggish compared with its recent track record. The rise in gross domestic product (GDP) was well below the 9.2% recorded in the previous financial year. The world's most populous nation grappled with a weaker manufacturing sector, tight monetary policy and muted urban consumer sentiment for most of the past year. While the economy has rebounded over the past two quarters, helped in part by strong agricultural output, US President Donald Trump's tariff blitz poses risks to a sustained recovery. New Delhi, which was slapped with 26% so-called reciprocal tariffs, is currently negotiating a trade deal with Washington that it hopes will spare it the worst of Trump's trade push. Analysts believe the annual growth figures, along with cooling inflation data, will convince India's central bank to continue its interest rate easing cycle at its review meeting next week. The GDP figures released today were a little above analyst expectations of 6.3% but matched the government's own projections of 6.5% year-on-year growth. The data for the January-March quarter was brighter, with GDP growing 7.4% year-on-year – the fastest this fiscal year and beating analyst estimates of 6.8% growth. The national statistics office said in a media release that growth in the March quarter was helped by a surging construction sector. Nearing Japan AdChoices ADVERTISING While India is still the fastest-growing major economy, the 2024-2025 fiscal year growth figures remain below the 8% pace that experts say New Delhi needs to create enough well-paying jobs and generate economic prosperity. The slowdown in economic activity over the past year pushed Prime Minister Narendra Modi's government into delivering US$12 billion in income tax cuts this year, a move aimed at putting more money in the hands of millions of consumers. The Reserve Bank of India also cut interest rates in February for the first time in nearly five years and delivered another reduction in April. More recently, public debate over the country's economic ascent was triggered after a government official claimed India had surpassed Japan to become the world's fourth-largest economy. Projections by the International Monetary Fund, however, indicate that the switch will not happen until the end of this year. The claim nevertheless prompted swift self-praise from bosses of Indian companies and ruling party lawmakers. Critics on social media responded by noting that the milestone, whenever it happened, would be largely symbolic because India's current per capita GDP is still a fraction of Japan's. Experts also warned that the timeline for India beating out Japan could be delayed by fluctuations in exchange rates. 'Our forecasts suggest that India will overtake Japan by the middle of 2026,' Shilan Shah of Capital Economics said in a note this week. 'But the big picture is that India was always going to overtake Japan – and also Germany – given its positive demographics and scope for continued productivity gains,' Shah said.
Reuters
a day ago
- Business
- Reuters
Czech growth helped by investment, exports, tariffs cloud outlook, central bank says
PRAGUE, May 30 (Reuters) - Czech Republic's 2.2% year-on-year economic expansion in the first quarter was above the central bank's forecast of 2.1% mainly thanks to more resilient investments and exports, but the uncertainty over the impact of U.S. tariffs cloud the outlook, the central bank said on Friday. The bank said increase in household consumption -- which is the overall growth driver -- was lower at 2.5% than its forecast of 3.3%. Investment dropped year-on-year but less than expected and grew in quarterly terms, while exports were also more resilient than expected, the bank said. "For both investment and exports, however, the question is how much the positive developments were due to one-off stockpiling by firms ahead of an expected rise in trade barriers," the bank said. It said that while investments and exports would be the first to be hit by large tariff barriers, continued strong household spending should put full-year 2025 growth at around 2%.
Reuters
a day ago
- Business
- Reuters
China's central bank injects 700 bln yuan of outright reverse repos in May
SHANGHAI, May 30 (Reuters) - China's central bank has injected 700 billion yuan ($97 billion) into its banking system during May through an outright reverse repurchase tool, the bank said on Friday. The operations, conducted with tenors of three and six months, were aimed at maintaining "reasonably ample liquidity" in the banking system, the PBOC said in a statement. With 900 billion yuan in outright repos expiring this month, the data suggests a net withdrawal of 200 billion yuan from the system via the tool. In a separate statement, the PBOC said on Friday that it had refrained from buying or selling Chinese government bonds in open market operations for the fifth consecutive month in May. Market participants are closely watching for signals on when the PBOC will resume purchases of its own government bonds. "Amid rising risks of U.S.-China decoupling, there is growing urgency to resume government bond trading to increase the central bank's holdings of sovereign debt," analysts at Caitong Securities said in a note on Thursday. The analysts expect the PBOC to resume bond buying as early as July or August, amid concerns that a potential end to the tariff truce between China and the United States could weigh on economic sentiment. ($1 = 7.1947 Chinese yuan renminbi)
