In mid-June, Cambria Africa announced that its Zimbabwe-based subsidiary—the payment-services provider Payserv—had suspended its service to its bank customers in Zimbabwe. According to Cambria, the suspension was due to a “collective refusal to pay historical and contracted pricing to Payserv Africa in US dollars
The United States will soon break a record: the longest period of economic expansion, last set in the 1990s. But some don’t see this growth continuing much longer; they expect a recession, or even a depression, to extinguish the growth trajectory the world’s largest economy has been following for nearly a decade. Are these fears justified? Or are there as many reasons to expect the economy to continue to soar, shattering all records?
At the end of August, leading ratings agency Moody’s downgraded 18 banks and two finance companies in Turkey. According to the agency, the downgrades “primarily reflect a substantial increase in the risk of a downside scenario, where a further negative shift in investor sentiment could lead to a curtailing of wholesale funding”.
The good news is that economic growth globally is strong, with a few exceptions, as the world shakes off the effects of the Great Recession. But economists are uneasy about troubling undercurrents, such as protectionist trade policies, that could whip up into a global trade war. Most are hoping that trade relationships can be repaired, acknowledging that the time is now to rebuild rather than burn bridges.
With economic growth returning to the developed world, the end of years of quantitative easing and easy monetary policy is in view; inflation concerns are reviving, guaranteeing rising interest rates along with tightening liquidity. Emerging markets in Latin America are benefiting from higher commodity prices, and despite some political tensions are proving to be an increasingly attractive destination for investor funds.
Prospects for Southeast Asia’s largest economy, Indonesia, are looking much brighter, especially after recent raises in the sovereign credit rating. Although the government has set an ambitious growth goal that is unlikely to be achieved, the country is still outshining its neighbours and receiving its just rewards in the form of increased foreign capital inflows and lower borrowing costs, to name a few.
The developed world’s economy has decelerated since the great financial crisis (GFC) of 2008, and despite the efforts of governments and central banks, growth rates have stagnated while inflation remains well below target.
Earlier this year, the European Central Bank (ECB) decided to cut its deposit rate to -0.4 percent and its benchmark refinancing rate to zero.