Growth to rebound, tips top Japan banker

Bank of Japan Gov. Haruhiko Kuroda said the global economy is ‘stabilising somewhat,’ but warned of risks from the US-China trade war. (Reuters)
Updated 09 June 2019

Growth to rebound, tips top Japan banker

  • Bank of Japan governor sees global economy recovering in the latter half of this year
  • Widening fallout from the US-China trade war will test the resolve of G20 finance leaders

FUKUOKA, Japan: Bank of Japan Gov. Haruhiko Kuroda on Saturday maintained his view the global economy will recover in the latter half of this year, but warned that uncertainties remain as fallout from the Sino-US trade war deepens.

Kuroda said the global economy is “stabilizing somewhat” from its weakness late last year, as central banks maintain supportive policies and China takes stimulus measures to prop up growth.

“There’s no change to the view the global economy will pick up in the latter half of this year,” Kuroda told reporters ahead of the Group of 20 finance leaders’ meeting to be held in the southern Japanese city of Fukuoka. “But uncertainties remain, particularly those regarding trade,” he added.

Kuroda’s view on global risks is important because the BOJ’s forecast on the Japanese economy is based on the assumption global growth will rebound in the latter half of this year.

Global investors’ hopes for a pick-up in the second half of the year have been thrown into doubt by last month’s sudden escalation in the US-China trade war and a slew of weak data from major economies that threaten to further weigh on business and consumer confidence.

Widening fallout from the US-China trade war will test the resolve of G20 finance leaders to show a united front at their two-day gathering ending on Sunday, as investors worry if they can avert a global recession with dwindling policy ammunition.

The BOJ is among major central banks that could come under pressure to ramp up its already massive stimulus program, as the trade dispute raises fears of a global recession.

Kuroda praised US President Donald Trump’s decision to put off imposing tariffs against Mexico after the two countries reached a deal to contain the migration of immigrants crossing the southern US border.

“It’s a very good outcome not just for the US and Mexico, but for the global economy,” Kuroda said.


S&P downgrades trio of Dubai developers as pandemic hits property and retail

Updated 10 July 2020

S&P downgrades trio of Dubai developers as pandemic hits property and retail

  • Gulf states are being hit hard by the coronavirus pandemic that has come at a time of weak oil prices

RIYADH: The credit ratings of three Dubai property companies were downgraded by S&P as the coronavirus pandemic hits confidence in the retail and real estate sectors.
S&P Global Ratings reduced the credit ratings for the real estate developer Emaar Properties as well as Emaar Malls to +BB from -BBB with a negative forward outlook, adding that it sees a “weakening across all its business segments” in 2020. S&P also cut its rating for DIFC Investments to +BB from -BBB, while keeping a stable outlook.
Gulf states are being hit hard by the coronavirus pandemic that has come at a time of weak oil prices, heaping pressure on governments, companies and employees.
The ratings agency expects the emirate’s economy to shrink by 11 percent this year
“The supply-demand imbalance in the realty sector appears to have been exacerbated by the pandemic. We now expect to see international demand for Dubai’s property to be subdued, and the fall in residential prices to be steeper than we had expected, lingering well into 2021” S&P reported.
Despite easing restrictions and the opening of the economy, S&P said that overall macroeconomic conditions remained challenging.
Global travel restrictions and social distancing constraints “significantly weigh on Dubai’s tourism and hospitality sectors” the rating agency reported.
Still, Dubai’s tourism chief was upbeat on the emirate’s prospects when international tourism resumes.
“Once we do get to the other side, as we start to talk about next year and later on, we see very much a quick uptick. Because once things normalize, people will go back to travel again,” Helal Al-Marri, director general of Dubai’s Department of Tourism and Commerce Marketing told AFP in an interview.