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Chart of the WeekEconomic Indicators Signal Diminished Growth Momentum at Start of Year

The economic recovery continues, though the pace of the recovery has slowed. Notably, our global forecast was lowered in January to a still-healthy 4.4…

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By Tryggvi Gudmundsson

The economic recovery continues, though the pace of the recovery has slowed. Notably, our global forecast was lowered in January to a still-healthy 4.4 percent expansion this year. This was down from an October projection of 4.9 percent, amid reduced growth prospects for the United States and China, the two largest economies. Meanwhile, inflation has been higher than expected in many economies, while financial markets remain volatile as geopolitical tensions have increased.

High-frequency economic indicators offer evidence that the growth momentum has slowed going into 2022—in line with expectations of a weak start to the year, owing to the spread of the highly contagious Omicron variant and persistent supply-chain disruptions. In this respect, we project activity to pick up in the second quarter of the year as the variant’s impact fades.

As the Chart of the Week shows, composite gauges of manufacturing and service sector activity in many Group of Twenty economies highlight the recent softening. In some economies, the purchasing managers’ index indicated a slower pace of expansion in January compared with the prior two months. A few PMI gauges, including Australia and Spain, even swung below 50—the threshold signaling a contraction—although the declining effect of the Omicron variant will hopefully mean that the dip is short-lived.

In our recent report to the G20 , we examine these developments for G20 advanced and emerging market economies.

We note that advanced economies have experienced pandemic strains and mismatches between supply and demand that have continued to boost inflation and weigh on the recovery. Temporarily reduced mobility as a result of the rapid spread of the Omicron variant has put a damper on service sector activity, including in the euro area, Japan, and the United Kingdom. Continued supply disruptions have also weighed on activity in the euro area and United Kingdom. And while the recovery has been strong in the United States, the virus has dented consumer sentiment somewhat.

In emerging economies, pandemic curbs and reduced policy support are weighing on activity. In addition to the PMI declines, some other recent data point to softer momentum, such as lower industrial production in Brazil. In China, tighter mobility restrictions have resulted in weaker-than-expected retail sales, while a decline in real estate investment and tighter travel restrictions have also represented headwinds.

Meanwhile, inflation has been higher than expected in many economies, while financial markets remain volatile and geopolitical tensions have increased. Obstacles such as these, combined with reduced growth momentum, show why the world needs strong international cooperation to end the pandemic, navigate monetary tightening and shift focus to fiscal sustainability.

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China Auto Sales Jump 55% Year Over Year As Price Cuts Continue To Move NEV Metal

China Auto Sales Jump 55% Year Over Year As Price Cuts Continue To Move NEV Metal

Retail sales of passenger vehicles scorched higher in May,…

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China Auto Sales Jump 55% Year Over Year As Price Cuts Continue To Move NEV Metal

Retail sales of passenger vehicles scorched higher in May, with 1.76 million units sold, according to preliminary data from the China Passenger Car Association released this week. 

The sales figure represents 8% growth from the month prior. As has been the case over the last several years, new energy vehicles continue to grow disproportionately to the rest of the sector, driving sales higher.

Last month 557,000 NEVs were sold, growth of 55% year over year and 6% sequentially, according to a Bloomberg wrap up of the data. 

The sales boost comes as the country slashed prices to move metal throughout the first 5 months of the year. In late May we noted that China's auto industry association was urging automakers to "cool" the hype behind price cuts that were sweeping across the country. 

The price cuts were getting so egregious that the China Association of Automobile Manufacturers went so far as to put out a message on its official WeChat account, stating that "a price war is not a long-term solution". Instead "automakers should work harder on technology and branding," it said at the time.

Recall we wrote in May that most major automakers were slashing prices in China. The move is coming after lifting pandemic controls failed to spur significant demand in China, the Wall Street Journal reported last month. Ford and GM will be joined by BMW and Volkswagen in offering the discounts and promotions on EVs, the report says. 

At the time, Ford was offering $6,000 off its Mustang Mach-E, putting the standard version of its EV at just $31,000. In April, prior to the discounts, only 84 of the vehicles were sold, compared to 1,500 sales in December. There was some pulling forward of demand due to the phasing out of subsidies heading into the new year, and Ford had also cut prices by about 9% in December. 

A spokesperson for Ford called it a "stock clearance" at the time. 

Discounts at Volkswagen ranged from around $2,200 to $7,300 a car. Its electric ID series is seeing price cuts of almost $6,000. The company called the cuts "temporary promotions due to general reluctance among car buyers, the new emissions rule and discounts offered by competitors."

China followed suit, and thus, now we have the sales numbers to prove it...

Tyler Durden Wed, 06/07/2023 - 20:00

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World Bank: Global Economic Growth Expected To Slow To 2008 Levels

World Bank: Global Economic Growth Expected To Slow To 2008 Levels

Authored by Michael Maharrey via SchiffGold.com,

Most people in the mainstream…

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World Bank: Global Economic Growth Expected To Slow To 2008 Levels

Authored by Michael Maharrey via SchiffGold.com,

Most people in the mainstream concede that the economy is heading for a recession, but the consensus seems to be that downturn will be short and shallow. Projections by the World Bank undercut that optimism.

According to the World Bank, global growth in 2023 will slow to the lowest level since the 2008 financial crisis.

In other words, the World Bank is predicting the beginning of Great Recession 2.0.

You might recall that the Great Recession was neither short nor shallow.

In fact, World Bank Group chief economist and senior vice president Indermit Gill said, “The world economy is in a precarious position.”

According to the World Bank’s new Global Economic Prospects report, global growth is projected to decelerate to 2.1% this year, falling from 3.1% in 2022. The bank forecasts a significant slowdown during the last half of this year.

That would match the global growth rate during the 2008 financial crisis.

According to the World Bank, higher interest rates, inflation, and more restrictive credit conditions will drive the economic downturn.

The report forecasts that growth in advanced economies will slow from 2.6% in 2022 to 0.7% this year and remain weak in 2024.

Emerging market economies will feel significant pain from the economic slowdown. Yahoo Finance reported, “Higher interest rates are a problem for emerging markets, which already were reeling from the overlapping shocks of the pandemic and the Russian invasion of Ukraine. They make it harder for those economies to service debt loans denominated in US dollars.”

The World Bank report paints a bleak picture.

The world economy remains hobbled. Besieged by high inflation, tight global financial markets, and record debt levels, many countries are simply growing poorer.”

Absent from the World Bank analysis is any mention of how more than a decade of artificially low interest rates and trillions of dollars in quantitative easing by central banks created the wave of inflation that continues to sweep the globe, along with massive levels of debt and all kinds of economic bubbles.

If you listen to the mainstream narrative, you would think inflation just came out of nowhere, and central banks are innocent victims nobly struggling to save the day by raising interest rates. Pundits fret about rising rates but never mention that rates were only so low for so long because of the actions of central banks. And they seem oblivious to the consequences of those policies.

But being oblivious doesn’t shield you from the impact of those consequences.

In reality, central banks and governments implemented policies intended to incentivize the accumulation of debt. They created trillions of dollars out of thin air and showered the world with stimulus, unleashing the inflation monster. And now they’re trying to battle the dragon they set loose by raising interest rates. This will inevitably pop the bubble they intentionally blew up. That’s why the World Bank is forecasting Great Recession-era growth. All of this was entirely predictable.

After all, artificially low interest rates are the mother’s milk of a global economy built on easy money and debt. When you take away the milk, the baby gets hungry. That’s what’s happening today. With interest rates rising, the bubbles are starting to pop.

And it’s probably going to be much worse than most people realize. There are more malinvestments, more debt, and more bubbles in the global economy today than there were in 2008. There is every reason to believe the bust will be much worse today than it was then.

In other words, you can strike “short” and “shallow” from your recession vocabulary.

Even the World Bank is hinting at this.

Tyler Durden Wed, 06/07/2023 - 15:20

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DNAmFitAge: Biological age indicator incorporating physical fitness

“We expect DNAmFitAge will be a useful biomarker for quantifying fitness benefits at an epigenetic level and can be used to evaluate exercise-based interventions.”…

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“We expect DNAmFitAge will be a useful biomarker for quantifying fitness benefits at an epigenetic level and can be used to evaluate exercise-based interventions.”

Credit: 2023 McGreevy et al.

“We expect DNAmFitAge will be a useful biomarker for quantifying fitness benefits at an epigenetic level and can be used to evaluate exercise-based interventions.”

BUFFALO, NY- June 7, 2023 – A new research paper was published in Aging (listed by MEDLINE/PubMed as “Aging (Albany NY)” and “Aging-US” by Web of Science) Volume 15, Issue 10, entitled, “DNAmFitAge: biological age indicator incorporating physical fitness.”

Physical fitness is a well-known correlate of health and the aging process and DNA methylation (DNAm) data can capture aging via epigenetic clocks. However, current epigenetic clocks did not yet use measures of mobility, strength, lung, or endurance fitness in their construction. 

In this new study, researchers Kristen M. McGreevy, Zsolt Radak, Ferenc Torma, Matyas Jokai, Ake T. Lu, Daniel W. Belsky, Alexandra Binder, Riccardo E. Marioni, Luigi Ferrucci, Ewelina Pośpiech, Wojciech Branicki, Andrzej Ossowski, Aneta Sitek, Magdalena Spólnicka, Laura M. Raffield, Alex P. Reiner, Simon Cox, Michael Kobor, David L. Corcoran, and Steve Horvath from the University of California Los Angeles, University of Physical Education, Altos Labs, Columbia University Mailman School of Public Health, University of Hawaii, University of Edinburgh, National Institute on Aging, Jagiellonian University, Pomeranian Medical University in Szczecin, University of Łódź, Central Forensic Laboratory of the Police in Warsaw, Poland, University of North Carolina at Chapel Hill, University of Washington, and University of British Columbia develop blood-based DNAm biomarkers for fitness parameters including gait speed (walking speed), maximum handgrip strength, forced expiratory volume in one second (FEV1), and maximal oxygen uptake (VO2max) which have modest correlation with fitness parameters in five large-scale validation datasets (average r between 0.16–0.48). 

“These parameters were chosen because handgrip strength and VO2max provide insight into the two main categories of fitness: strength and endurance [23], and gait speed and FEV1 provide insight into fitness-related organ function: mobility and lung function [8, 24].”

The researchers then used these DNAm fitness parameter biomarkers with DNAmGrimAge, a DNAm mortality risk estimate, to construct DNAmFitAge, a new biological age indicator that incorporates physical fitness. DNAmFitAge was associated with low-intermediate physical activity levels across validation datasets (p = 6.4E-13), and younger/fitter DNAmFitAge corresponds to stronger DNAm fitness parameters in both males and females. 

DNAmFitAge was lower (p = 0.046) and DNAmVO2max is higher (p = 0.023) in male body builders compared to controls. Physically fit people had a younger DNAmFitAge and experienced better age-related outcomes: lower mortality risk (p = 7.2E-51), coronary heart disease risk (p = 2.6E-8), and increased disease-free status (p = 1.1E-7). These new DNAm biomarkers provide researchers a new method to incorporate physical fitness into epigenetic clocks.

“Our newly constructed DNAm biomarkers and DNAmFitAge provide researchers and physicians a new method to incorporate physical fitness into epigenetic clocks and emphasizes the effect lifestyle has on the aging methylome.”
 

Read the full study: DOI: https://doi.org/10.18632/aging.204538 

Corresponding Authors: Kristen M. McGreevy, Zsolt Radak, Steve Horvath

Corresponding Emails: kristenmae@ucla.edu, radak.zsolt@tf.hu, shorvath@mednet.ucla.edu 

Keywords: epigenetics, aging, physical fitness, biological age, DNA methylation

Sign up for free Altmetric alerts about this article: https://aging.altmetric.com/details/email_updates?id=10.18632%2Faging.204538

 

About Aging-US:

Launched in 2009, Aging publishes papers of general interest and biological significance in all fields of aging research and age-related diseases, including cancer—and now, with a special focus on COVID-19 vulnerability as an age-dependent syndrome. Topics in Aging go beyond traditional gerontology, including, but not limited to, cellular and molecular biology, human age-related diseases, pathology in model organisms, signal transduction pathways (e.g., p53, sirtuins, and PI-3K/AKT/mTOR, among others), and approaches to modulating these signaling pathways.

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