Chapter 5 September 12th Financial News
[Quick Facts]
1. Russia will return to the Black Sea grain deal once all Moscow's conditions are met, says Russian Foreign Minister.
2. Fumio Kishida announces date for cabinet reshuffle.
3. Americans' views of August inflation are mostly stable.
4. EU Commission cuts EU and euro area growth forecasts for this year and next.
[News Details]
Russia will return to the Black Sea grain deal once all Moscow's conditions are met, says Russian Foreign Minister
Russia will return to the Black Sea grain deal 'the same day' as Moscow's conditions for export of its own grain and fertilizers to the global markets are met, Russian Foreign Minister Sergei Lavrov said on Sunday in his speech at the G20 summit.
Russia quit the deal in July, complaining that its own food and fertilizer exports faced obstacles and that insufficient Ukrainian grain was going to countries in need.
Fumio Kishida announces date for cabinet reshuffle
Japanese Prime Minister Fumio Kishida will reshuffle his Cabinet and the ruling Liberal Democratic Party's leadership as early as Sept. 13. Minister of Economy, Trade and Industry Nishimura Yasutoshi and Digital Minister Taro Kono, among others, are expected to remain in the new cabinet, Japanese political sources revealed.
Kishida declined to answer when asked about the specifics of the personnel adjustments. Among the current Cabinet, Nishimura Yasutoshi, Taro Kono, Minister in Charge of Economic Security Sanae Takaichi, and Minister of Land, Infrastructure, Transport and Tourism Tetsuo Saito are expected to stay on. Chief Cabinet Secretary Minister Hirokazu Matsuno is likely to stay on, or may also take up other key positions in the new Cabinet or at the top of the LDP. In addition, Kishida is considering increasing the number of female cabinet members.
Americans' views of August inflation are mostly stable
The New York Federal Reserve reported on Monday that Americans' overall views of inflation in August changed little, predicting higher prices for rent, housing and food, while views on personal finances were revised downward. Respondents saw inflation at 3.6%, 2.8% and 3% in one year, three years and five years, respectively (compared with data of 3.5%, 2.9% and 2.9% in July).
They expected price increases for gasoline, food, rent, medical expenses and college tuition. Home prices were expected to rise 3.1%, the highest since July 2022.
Respondents were more pessimistic about access to credit and their current and future financial situation. They predicted household income to increase by 2.9%, the lowest since July 2021. A record number of households said credit would be harder to obtain. At the same time, respondents were becoming less optimistic about the job market.
EU Commission cuts EU and euro area growth forecasts for this year and next
The European Commission released its economic outlook report for the summer of 2023 on Sept. 11, deciding to lower EU and euro area economic growth forecasts for this year and next.
The report showed that the European Commission cut the EU 2023 economic growth forecast to 0.8% from 1.0% in spring, 2024 to 1.4% from 1.7%. It cut the euro area 2023 economic growth forecast to 0.8% from 1.1%, 2024 to 1.3% from 1.6%.
The report expected EU inflation to fall to 6.5% this year and 3.2% next year; euro area inflation will be 5.6% this year and 2.9% next year.
The latest data suggested that economic activity in the EU was subdued in the first half of 2023. Prices of most goods and services remain high and are still rising, resulting in weak domestic demand. Survey indicators suggested that economic activity would remain slow over the summer and in the coming months, with continued weakness in industry and services. However, the EU economy is expected to rebound moderately next year with easing inflation, a stronger labor market and rising real incomes.
[Focus of the Day]
UTC+8 14:00 U.K. ILO Unemployment Rate (Jul)
UTC+8 17:00 Eurozone ZEW Economic Sentiment Index (Sept)
UTC+8 22:00 Bank of England monetary policy member Mann delivers a speech
