New York
INDUSTRIAL production in Japan climbed by the most on record, while South Korea’s factory output advanced solidly – signs that manufacturing is gathering pace as supply-chain woes ease.
Here are some of the latest developments in the global economy:
Asia
Japan’s industrial production jumped by a record in November, adding to evidence that a manufacturing recovery from supply chain snags was solidly underway before the Omicron variant started to spread. A bounce back in the car industry helped production climb 7.2 per cent from October’s level, the biggest gain in data back to 1978.
South Korea’s factory production jumped the most since mid-2020 last month, suggesting supply disruptions that hurt manufacturing in key industries were easing before an Omicron-triggered surge in global infections.
China’s manufacturing sector continued to expand in December, providing some relief to Beijing as the world’s second-largest economy continues to struggle with the ongoing property market slump.
United States
The US merchandise-trade deficit widened to a record in November as imports surged to an all-time high. The gap increased to US$97.8 billion from a revised US$83.2 billion during the prior month.
Europe
Europe never paid so much for electricity as in 2021. The average cost of power for delivery in the short-term soared to record levels, rising more than 200 per cent in Germany, France, Spain and the UK. In the Nordic region – where vast supplies of hydro power tend to cap prices – costs surged 470 per cent from a year earlier.
Two decades after euros were first minted and distributed across households in Europe, billions in cash denominated in the national currencies that were abandoned remains out there. How much will actually be swapped is unclear – as are the reasons why it hasn’t been so far.
Emerging markets
With global inflation soaring, central banks across emerging markets raised borrowing costs in 2021, with Brazil and Russia the major economies with the biggest interest rate increases. Brazil is predicted to continue that trend in 2022.
Poor rainfall over vast tracts of southern Africa has delayed crop plantings and prompted a presidential call for prayer, with drought conditions threatening the 2022 harvest and stoking risks of higher food inflation. Brazil’s unemployment rate fell more than expected in October, a boost for Latin America’s largest economy as it sludges through recession.
World
In the decade ahead, the world economy is expected to average annual growth of around 3.2 per cent, slightly below the average of 3.5 per cent in the period from 2010-2019, according to Bloomberg Economics. The situation in major economies will continue to shift: China will still outperform, though with growth on a slowing trajectory.
The combined fiscal and monetary stimulus efforts of the US, China, eurozone, Japan and eight other developed economies caused their aggregate money supply to increase by US$20 trillion over the course of 2020 and 2021 to a record US$100 trillion, according to data compiled by Bloomberg. BLOOMBERG
https://www.businesstimes.com.sg/government-economy/charting-global-economy-factory-output-improving-in-asia
https://www.bloomberg.com/news/articles/2022-01-01/charting-the-global-economy-factory-output-improving-in-asia
