Beijing will likely stick with a ~5% GDP growth target for 2026, but policy remains cushioning over lifting. We expect a flat initial fiscal envelope, a continued focus on tech and public capex, and reactive guardrails for consumption and property – keeping reflation a slow burn. February 24, 2026 12:16 PM GMT China Musings | Asia Pacific NPC Preview: Policy Continuity, Not a Pivot Key Takeaways A 5% national GDP growth target to stay: Two thirds of provinces have trimmed 2026 growth targets, triggering spe ...

By Leika Kihara TOKYO, Feb 18 (Reuters) - The International Monetary Fund urged Japan to keep raising interest rates and avoid loosening fiscal policy further, warning that trimming the consumption tax would erode its capacity to ‌respond to future economic shocks. The recommendation came as dovish Prime Minister Sanae Takaichi's landslide election win heightens ‌market attention to whether she will push back against further rate hikes by the central bank. It also follows Takaichi's pledge to suspend by ...

Currency Market Overview - The yen has gained nearly 3% for the week, marking its largest advance since November 2024, currently steady at 152.86 per dollar [1][10] - The yen is poised for a 2.3% weekly jump against the euro and approximately 2.8% against the British pound, indicating strong performance [10] Political Impact - The election of Japanese Prime Minister Sanae Takaichi is seen as a potential end to political instability, leading to unwinding of short-yen positions [1][10] - Takaichi's administration is expected to be a responsible steward of fiscal policy, which has boosted confidence in Japanese government bonds (JGBs) and reduced yen-volatility risk [4][10] Broader Market Context - Other currencies are mostly rangebound ahead of U.S. inflation data, with the euro at $1.1869 and sterling at $1.3618 [5][10] - The U.S. dollar is set to fall close to 0.8% for the week, influenced by strength in other currencies and doubts about the U.S. economy's robustness [6][10] Employment Data Insights - Recent U.S. job growth data showed unexpected acceleration, but the overall breadth of job creation remains narrow, with significant contributions from healthcare, social assistance, and construction [8][10] - Traders are pricing in approximately two Federal Reserve rate cuts this year, with the first anticipated in June [8][10]

Naomi, we're seeing a little bit of downside for the Japanese yen, but it doesn't seem to be at least catastrophic for now, when it comes to the pace of potential losses that we could have seen with the supposed Takaichi trade. What are your expectations now that you've seen the outcome of the elections. Well, what's interesting is that even though Takaichi won quite a lot of popular support, markets haven't voted yet.And so I think it's sensible to to give Takaichi the benefit of the doubt because after al ...

Close inspection of Nigel Farage’s proposal to stop paying interest on reserves held at the Bank of England shows it to be fiscal fool’s gold https://t.co/vnxOXvIzds ...

Pro-criminal, anathema. But thanks to our local authorities in the state, just three months into the job, Prime Minister Sonny Takeuchi dissolved Japan's lower house, calling a fresh vote for February 8th to invoke Kazan of coming from a string of election setbacks for the ruling Liberal Democratic Party. Takeuchi is aiming to capitalize on high public support and increase her majority in the more powerful lower House.Some recent polls show an approval rating of more than 60%. I think Takeuchi is really in ...

Summary of Key Points from the Conference Call Industry Overview - The report discusses macroeconomic forecasts and trends affecting global markets, particularly focusing on GDP growth and inflation rates across various regions including the US, Euro area, and China [4][5]. Core Insights and Arguments - **Global GDP Growth**: Expected to be 2.9% year-over-year in 2026, driven by fading US tariffs and rising real income growth [4][5]. - **US Economic Outlook**: Anticipated real GDP growth of 2.5% on a Q4/Q4 basis in 2026, supported by tax cuts and easing financial conditions, despite trade policy uncertainties [4][5]. - **Inflation Trends**: Core PCE inflation in the US is projected to decline to 2.1% year-over-year by the end of 2026, as tariff impacts diminish and wage/shelter inflation trends improve [4][5]. - **Federal Reserve Policy**: The Fed is expected to implement two 25 basis point cuts in 2026, leading to a terminal rate range of 3-3.25% [4][5]. - **Euro Area Growth**: Projected real GDP growth of 1.2% year-over-year in 2026, with inflation expected to decline to 1.8% due to lower energy prices and a stronger Euro [4][5]. - **China's Economic Performance**: Forecasted real GDP growth of 4.8% year-over-year in 2026, bolstered by resilient export growth and government policy easing, despite sluggish domestic demand [4][5]. Additional Important Insights - **Geopolitical Risks**: Ongoing geopolitical tensions, including US-China relations and developments in Venezuela and the Middle East, pose significant risks to economic stability [5]. - **Commodity Price Forecasts**: LME aluminum price forecasts have been raised to $3150/$2965/$2435 per metric ton for 3/6/12 months, reflecting a balanced global market that supports high prices without rapid production increases [1]. - **Unemployment Rates**: The unemployment rate in the US is expected to stabilize at 4.5% by the end of 2026 [4][5]. This summary encapsulates the key points from the conference call, highlighting the macroeconomic outlook and potential investment implications across various regions and sectors.

Investment Rating - The report does not explicitly provide an investment rating for the industry. Core Insights - The global economy is expected to expand at a reasonable pace in 2026, supported by easing monetary policy, fiscal stimulus, and the ongoing AI boom, although the backdrop remains fragile and volatile due to heightened uncertainty and geopolitical risks [14][20][35]. Section Summaries Section 1: Prospects for the Global Economy in 2026 - The global economy is projected to grow at just over 3% in 2026, with the World Bank forecasting 3.1% and the IMF 3.3% [35][41]. - The US economy is expected to be the strongest performer among major advanced economies, with growth supported by fiscal stimulus and the AI boom, while growth in the UK and euro area is likely to remain sluggish [15][55]. - China is expected to moderate its growth to 4.4%, while India is projected to remain the fastest-growing major economy at 6.5% [19][69]. Section 2: Interview with Former IMF Chief Economist Ken Rogoff - Ken Rogoff describes the global economy as solid but cautions about significant uncertainty not reflected in financial markets, predicting a potential stock market fall in the next three years [20][81]. - He highlights the risks associated with President Trump's policies, particularly regarding trade and immigration, which may have long-term negative consequences for the US economy [84]. Section 3: Key Events in 2026 - Key political events include the US mid-term elections in November, which could impact President Trump's policy maneuverability [21][99]. - Developments in Europe, particularly regarding right-wing populist parties, will also be closely monitored, alongside significant elections in Japan and Brazil [102][107]. Section 4: Three Key Trends to Watch in 2026 - The report identifies three key trends: developments in AI, advanced economy bond markets, and global trade [22]. - The impact of AI on productivity and market sentiment will be crucial, as will the potential for rising government bond yields to negatively affect financial markets [22]. Section 5: Perspectives from Business Leaders - Business leaders express concerns about economic uncertainty and the need for resilience and adaptability in their respective regions [23]. - Wu Chen emphasizes a two-speed global economy, while Mike Fowler highlights the lack of a pro-business agenda in the UK [23]. Ebrima Sawaneh focuses on the importance of decarbonization and digital reliability for African economies [23].

Accessible version Global Economic Weekly Geopolitics takes over Davos Global Letter: Geopolitics takes over Davos While it is too early to tell, the current geopolitical order may be evolving significantly. Traditional US allies like Canada seem to be considering a diversification and risk management strategy for US relations. In our view, amid higher geopolitical tensions, influence over strategic resources and geographies, especially choke points, is at stake. Greenland tariffs were suspended, and the us ...

Andy Burnham had been widely tipped to succeed Sir Keir Starmer as Labour Party leader - Ian Vogler/WPA Pool UK government borrowing costs have fallen after Sir Keir Starmer blocked leadership rival Andy Burnham from standing as an MP. The yield on benchmark 10-year gilts, as UK government bonds are known, fell as low as 4.47pc early on Monday, compared to a high of 4.51pc on Friday in the wake of the Gorton and Denton by-election announcement. Labour’s ruling National Executive Committee (NEC) blocked ...