The rebound comes as government spending cuts and improved revenue combine to narrow the fiscal deficit, just as global investor appetite for risk revives https://t.co/DomyLDY0nC ...

Economic performance so far has been promising. Inflation and the fiscal deficit are down; exports are up. But this rosy picture may not be the whole story https://t.co/BiLBRpckkI ...

Malaysia will likely miss its fiscal deficit target this year, as spending is seen exceeding projections and revenue may fall, according to Fitch Solutions' BMI https://t.co/8fP9okHdfA ...

It was one in the morning when Trump was still watching the vote on the "Big, Beautiful" bill in the White House . This was to stop the "Big, Beautiful" bill. The Democratic leader Hakim spoke for 8 hours and 44 minutes in the House of Representatives until his voice was hoarse. "(I hope my Republican colleagues) can come to a conclusion" "That is, we serve the American people." After a fierce game, the bill was finally passed . Trump got what he wanted with "218 to 214 votes." "Motion passed", what exactly ...

Core Viewpoint - Federal Reserve Governor Christopher Waller suggests a potential interest rate cut later this year, driven by expected increases in unemployment and temporary inflation due to tariffs [1] Group 1: Inflation and Tariffs - Waller anticipates tariffs will raise inflation in the coming months, but believes that as long as inflation expectations remain stable, short-term price increases can be overlooked [1] - He outlined two scenarios regarding trade policy: a "large tariff" scenario with an average 25% tariff and a "small tariff" scenario with an average 10% tariff, with the latter expected to decrease over time through negotiations [2] - Waller expects the impact of tariffs on inflation to be temporary, estimating a 15% trade-weighted tariff on imported goods [3] Group 2: Employment and Economic Risks - Waller predicts that tariffs will lead to an increase in unemployment, although in the "small tariff" scenario, layoffs may be moderate [3] - He expresses concerns about economic activity and employment facing downward risks by the second half of 2025, while inflation faces upward risks, closely tied to trade policy developments [3] Group 3: Fiscal Deficit and Long-term Yields - Waller attributes the recent rise in long-term Treasury yields to growing concerns over the increasing U.S. fiscal deficit, which is expected to remain around $2 trillion, approximately 6% of GDP [4] - He notes that if debt issuance exceeds market expectations, it could lead to lower prices for bonds, affecting investor demand [4] Group 4: Stablecoins and Payment Systems - Waller views stablecoins as potential tools for introducing competition into the payment system, suggesting they could help reduce costs, especially for small and medium-sized enterprises in cross-border transactions [5]

Core Viewpoint - Moody's downgraded the U.S. government's credit rating from "Aaa" to "Aa1," marking it as the last major credit rating agency to do so, following S&P Global and Fitch [1][2] Group 1: Credit Rating Downgrade - The downgrade reflects concerns over growing fiscal deficits and elevated total debt, with the U.S. running over a $1.8 trillion deficit in fiscal year 2024 and having over $36 trillion in total debt [3][4] - Moody's indicated that the U.S. fiscal performance is likely to deteriorate compared to its past and other highly rated sovereigns, with expectations of larger deficits as entitlement spending rises [3][4] Group 2: Future Projections - Fiscal deficits could reach 9% of GDP by 2035, up from the current 6.4%, while total debt is projected to rise to approximately 134% of GDP, surpassing levels seen during World War II [4] - Annual interest payments on the debt, which accounted for 18% of revenue in 2024, are expected to increase to 30% by 2035 [4] Group 3: Legislative Impact - House Republicans' proposal to make temporary tax cuts permanent could add an estimated $4 trillion to the fiscal deficit over the next decade, excluding interest payments [6] Group 4: Market Reactions - Historical responses of the S&P 500 to previous credit downgrades show initial sell-offs followed by recoveries, indicating that the market may not react severely to the downgrade [7][10] - The muted market response to the recent downgrade may be attributed to prior warnings from Moody's and the established understanding of the U.S. debt situation [11]

Investment Rating - The fiscal deficit is expected to be 5.5 percent of GDP in FY2024/25, slightly up from 5.4 percent in FY2023/24, indicating a challenging fiscal environment [17][26]. Core Insights - Total revenue is estimated to have declined to 19.9 percent of GDP in FY2023/24 from 21.3 percent a year earlier, projected to rise to 22.2 percent in FY2024/25 [19][34]. - Public debt is expected to remain elevated at about 62 percent of GDP in FY2024/25 [19]. - Spending is budgeted to rise to 27.4 percent of GDP in FY2024/25 from 25.0 percent in FY2023/24, driven by rising costs associated with civil service payroll, MSME development, and higher defense spending [20][47]. - Inflation-adjusted spending on public health is estimated to have declined by 46 percent between FY2019/20 and FY2024/25, significantly impacting healthcare demands [20][68]. - Inflation-adjusted spending on education has declined by 35 percent between FY2019/20 and FY2024/25, reflecting the adverse effects of the pandemic and military coup [21][78]. - Social protection spending has decreased from 0.13 to 0.05 percent of GDP between FY2019/20 and FY2024/25, indicating a shift in government priorities [23][99]. Public Finance Trends - The fiscal deficit is projected to increase slightly to 5.5 percent of GDP in FY2024/25, driven by higher expenditure projections [17][26]. - Non-tax revenue accounted for about two-thirds of total revenue in FY2023/24, with significant contributions from State-owned Economic Enterprises, particularly in oil and gas [18][35]. - Total spending is revised to increase to 27.4 percent of GDP in FY2024/25, largely due to recurrent spending [47]. - The wage bill is expected to yield a 0.1 percentage point increase in the wage bill, up to 1.8 percent of GDP [47]. Sectoral Analysis Health Sector - The Ministry of Health's spending is projected to remain low at around 0.6 percent of GDP in FY2024/25, contributing to a decline in the overall resilience of Myanmar's healthcare system [61][67]. - The real value of Ministry of Health spending has significantly declined, limiting the public health sector's capacity to provide essential services [68]. Education Sector - The Ministry of Education's spending as a percentage of GDP has steadily declined from 2.1 percent in FY2019/20 to around 1.6 percent in FY2024/25 [77][78]. - The budget for the School Improvement Support Program has decreased, reflecting the broader impact of escalating conflict across the country [90]. Social Protection Sector - Social protection spending has declined significantly, with real spending by the Ministry of Social Welfare, Relief, and Resettlement dropping by 66 percent between FY2019/20 and FY2024/25 [107]. - The share of the population receiving any type of cash assistance has reduced from 8.7 percent in 2017 to 5 percent in 2023, indicating a decrease in social support [108].

Investment Rating - The report maintains a cautious outlook on the fiscal situation in China, expecting further fiscal easing ahead due to ongoing economic challenges [1][9]. Core Insights - Fiscal revenue growth improved to +0.3% year-on-year in March from -1.6% in January-February, driven by stronger-than-expected activity data [2][5]. - Fiscal expenditure growth rose to +5.7% year-on-year in March from +3.4% in January-February, primarily due to increased spending in energy saving, environmental protection, and agriculture [6]. - The ongoing property downturn continues to negatively impact local government funding, with land sales revenue declining by -16.3% year-on-year in March [7][8]. Summary by Sections Fiscal Revenue and Expenditure - On-budget fiscal revenue growth was +0.3% year-on-year in March, a recovery from -1.6% in January-February, with tax revenue contraction narrowing to -2.2% [2][5]. - Fiscal expenditure growth increased to +5.7% year-on-year in March, up from +3.4% in January-February, driven by specific sectors [6]. Property Sector Impact - Property-related government revenue remained weak, with land sales revenue down -16.3% year-on-year in March, indicating continued pressure from the property market [7][8]. - The contraction in property-related tax revenue narrowed to -0.1% in March from -11.4% in January-February, suggesting some stabilization [7]. Augmented Fiscal Deficit (AFD) - The AFD metric narrowed to -10.9% of GDP in March from -11.6% in February on a 3-month moving average basis, while it widened slightly on a 12-month moving average basis [3][8]. - The forecast for the AFD metric is expected to widen by 4.1 percentage points of GDP to 14.5% in 2025, indicating a shift in fiscal policy from a growth drag to a potential driver [9].

Core Viewpoint - The article highlights the trend of proactive fiscal spending in the early months of the year, with a significant focus on social welfare and public services, despite a decline in overall fiscal revenue growth. Group 1: Fiscal Revenue and Expenditure - In the first two months, general public budget revenue reached 4.4 trillion yuan, showing a year-on-year decline of 1.6%, which is below the previous year's growth of 1.3% and the budget target of 0.1% [3] - The general public budget expenditure was 4.5 trillion yuan, with a year-on-year growth of 3.4%, slightly lower than the previous year's growth and the target of 4.4% [5] - The broad fiscal deficit reached 621.7 billion yuan, marking a historical high for the same period, indicating significant expenditure pressure amid declining revenue [2] Group 2: Focus on Social Welfare - There was a notable increase in the proportion of expenditure directed towards social welfare, education, and employment, while infrastructure spending saw a decrease [6] - The central government's expenditure growth rose to 8.6%, while local government expenditure growth fell to 2.7% [5] - Personal income tax revenue showed a rebound with a growth rate of 26.7%, reflecting marginal improvements in residents' income [4] Group 3: Government Fund Performance - Government fund revenue growth recorded a decline of 10.7%, falling short of the initial budget target of 0.7% [7] - Government fund expenditure growth decreased to 1.2%, which is below the initial target of 23.1% but higher than the previous year's growth of 0.2% [7]