A slowdown in Korean economic activity; interest rates remain unchanged in Japan: Economic wrap

A slowdown in Korean economic activity; interest rates remain unchanged in Japan: Economic wrap
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Updated 26 October 2021

A slowdown in Korean economic activity; interest rates remain unchanged in Japan: Economic wrap

A slowdown in Korean economic activity; interest rates remain unchanged in Japan: Economic wrap
  • Producer prices in Spain leaped by an annual rate of 23.6 percent in September

South Korea’s economy jumped by 4 percent year-on-year in the third quarter of 2021, slowing from the 6 percent increase it experienced in the prior period, a preliminary estimate by The Bank of Korea showed. 

Jumps in Covid-19 cases across the country have caused both private consumption and fixed investment to slow in this year’s third quarter. Meanwhile, government expenditure increased by 6.3 percent, up from last quarter's 5.3 percent growth rate.

In addition, the country’s GDP recorded a quarterly growth of 0.3 percent, dropping from 0.8 percent in the previous period, according to preliminary estimates.   

Rates to remain steady in Japan

Unlike other central banks that hiked their interest rates, the Bank of Japan is set to keep its rates on hold.

Japan has been experiencing high producer prices in the last period, yet consumer inflation remained at zero due to weak domestic demand.

The bank is expected to maintain its targets for short-term interest rate and 10-year bond yields at -0.1 percent and 0 percent respectively.

Producer prices in Europe 

Producer prices in Spain leaped by an annual rate of 23.6 percent in September, up from 17.6 percent in the previous month, official data showed. This is the highest rate since December 1977.

The hike in prices was driven by supply chain disruptions, energy shortages and last year’s low base effects.

Similarly, Sweden's producer prices soared to a record high of 17.2 percent on a yearly basis in September, expanding from 15.8 percent in August, Statistics Sweden said. 

Producer inflation has now risen for the eighth month in a row as costs of natural gas and crude oil helped fuel the increase in prices.

Singapore’s manufacturing

Singapore’s manufacturing output fell by 3.4 percent year-on-year in September, declining sharply from last month’s growth of 11 percent. Singapore Economic Development Board also said that a rise in the Delta variant cases contributed to the slip in production.

Biomedical manufacturing slumped by 35.9 percent while general manufacturing output declined by 2.7 percent in September, down from a growth rate of 6.4 percent in August. 

Manufacturing output also declined on a monthly basis in September, decreasing by 2.8 percent.


UAE’s foreign trade reaches $9.4tr over five decades

UAE’s foreign trade reaches $9.4tr over five decades
Updated 12 sec ago

UAE’s foreign trade reaches $9.4tr over five decades

UAE’s foreign trade reaches $9.4tr over five decades

JEDDAH: The total volume of the UAE’s foreign trade during five decades amounted to about 34.23 trillion dirhams ($9.4 trillion), according to the database of the UN Conference on Trade and Development.

During the period between 1971 and 2020, the state’s trade balance achieved a surplus of about 4.76 trillion dirhams.

UNCTAD data showed that the UAE’s foreign trade volume doubled 473 times, rising from 4.2 billion dirhams in 1971 to 2 trillion dirhams at the end of last year, according to a local newspaper.

The cumulative balance of foreign direct investment inflows in the country increased from 28 million dirhams in 1971 to about 73.46 billion dirhams by the end of 2020.

Over the past five decades, foreign trade was distributed among exports by 57 percent with a value of 19.5 trillion dirhams, and imports by 43 percent with a value of 14.7 trillion dirhams.

UAE exports multiplied 380 times, rising from 3.1 billion dirhams in 1971 to 1.17 trillion dirhams at the end of last year, and imports multiplied 730 times, rising from 1.13 billion dirhams to 828 billion dirhams by the end of 2020.

According to the data, foreign trade at the end of the first decade of the union’s founding doubled 28 times to 117.5 billion dirhams, 33 times at the end of 1991 to 140 billion dirhams, and 74 times at the beginning of the current millennium to 315 billion dirhams, and by the end of the fourth decade 462 times to 1.9 trillion dirhams.

And the year 2019 topped the list of the highest years in the volume of foreign trade, with a value of 2.4 trillion dirhams.


UK business group trims growth forecasts on supply chain woes: Economic wrap

UK business group trims growth forecasts on supply chain woes: Economic wrap
Updated 7 min 27 sec ago

UK business group trims growth forecasts on supply chain woes: Economic wrap

UK business group trims growth forecasts on supply chain woes: Economic wrap

RIYADH: The Confederation of British Industry on Monday revised the economic growth forecast for 2022 to  5.1 percent from the earlier estimate of 6.1 percent.

The group also trimmed the forecast for 2021 to 6.9 percent from an earlier 8.2 percent. It cited supply chain disruptions and a need for government support as reasons for the trimming of forecasts.

Household spending will account for 90 percent of growth in 2022 and two-thirds of that growth in the following year. This is attributed to a healthy job market and savings built up during the pandemic. On the other hand, exports will remain weak.

Moreover, it appears that business investment will grow by 8.2 percent next year, exceeding the pre-pandemic level.

Upbeat construction sector in Europe

The eurozone’s construction sector grew notably in November as its Purchasing Managers’ Index went up to 53.3 compared to 51.2 in the previous month, IHS Markit said.

This is the highest expansion in the sector since February 2018 and was attributed to stronger demand in the region. Home building activity continued its upward trend while commercial construction rose for the second month in a row. Civil engineering deteriorated, albeit at a weaker rate compared to before.

Similarly, UK output in the construction sector expanded at the highest rate in four months in November, according to the London-based firm.

Upswings in commercial work, following the opening of the economy, were mainly the reason for the growth in construction. 

The index reached 55.5 in November, the 10th consecutive month in which the indicator recorded above-50 levels. 

House building in the country also grew, yet at a slightly slower pace. 

Japanese economic growth

The Japanese government is contemplating a hike in its 2022 fiscal year growth forecast following its $490 billion stimulus package, according to Japanese broadcaster NHK on Monday.

The government predicts real gross domestic product to grow by about 2.2 percent for the fiscal year beginning in April 2022. 

Japan has stayed behind in recovering from the pandemic compared to other countries. This has forced the government to introduce generous spending plans.

Italy’s retail sales

Estimates of the seasonally adjusted index of retail trade in Italy increased slightly month on month by 0.1 percent in value and 0.2 percent in terms of volume for November, according to the country’s official statistics agency.

The value of sales increased by 1.4 percent in the three months ending in October compared to the previous three-month period while volume went up by 1 percent.


Dubai second best global tourist city in 2021: Euromonitor Internationals

Dubai second best global tourist city in 2021: Euromonitor Internationals
Updated 10 min 45 sec ago

Dubai second best global tourist city in 2021: Euromonitor Internationals

Dubai second best global tourist city in 2021: Euromonitor Internationals

RIYADH: Dubai has been ranked second in a list of top global cities for tourism by market research firm Euromonitor International.

The “Top 100 Cities as a Global Tourist Destination for 2021” Index sees Dubai as the only city belonging to an emerging country in the top 10.

Dubai is second in the world in terms of employment and employment levels, and fourth in the world in favorable demographic factors.

It was also in the top 10 for economic and commercial performance, where it ranked eighth.


Former UK TSB Bank chief driving force behind new money-sharing app 

Former UK TSB Bank chief driving force behind new money-sharing app 
Updated 27 min 6 sec ago

Former UK TSB Bank chief driving force behind new money-sharing app 

Former UK TSB Bank chief driving force behind new money-sharing app 

RIYADH: The former chief executive of Britain’s TSB Bank is launching a UK-based social networking app that allows friends to share money. 

Paul Pester has collaborated with Metro Bank and Atom Bank founder Anthony Thomson to set up Loop, Sky News reported. 

Loop has raised a seed funding round and is currently preparing for a larger Series A fundraising exercise to be held in early 2022. 

Informal money sharing has seen an increasing trend, valued at more than £12.5 billion ($16.6 billion) annually in the UK, Sky News reported, citing Pester and his co-investors. 

The trend has grown during the pandemic amidst the greater uncertainty in job markets. 


Egypt organizes trip to introduce tourist sites to Russian travel operators

Egypt organizes trip to introduce tourist sites to Russian travel operators
Updated 30 min 15 sec ago

Egypt organizes trip to introduce tourist sites to Russian travel operators

Egypt organizes trip to introduce tourist sites to Russian travel operators

RIYADH: The Egyptian Tourism Authority has arranged a trip for Russian travel and tour operators to introduce them to the opportunities available in the Egyptian tourism sector.

The trip called “Experience Egypt” will continue until Dec. 8 during which the Russian delegates will visit different tourist destinations in Hurghada, Luxor and Cairo.

A total of 130 Russian companies are part of the expedition, according to local media reports.

Amr El-Kady, CEO of the authority, told the local media that Egypt was ready to welcome tourists from all over the world.

During a meeting with the Russian tour operators, he also highlighted incentives Egyptian authorities offered in the sector to promote tourism, which was badly hit due to the COVID-19 pandemic.

El-Kady also highlighted the strong ties between Egypt and Russia in different fields particularly tourism.