Connect with us


Global economy 2023: what happens next with industrial action

With real wages in many countries having been stagnant for years, the inflation surge has brought unions back to life.



Worker unrest has been surging around the world. voy ager

This is the fifth instalment in our series on where the global economy is heading in 2023. It follows recent articles on inflation, energy, food and the cost of living.

Canada: assertive unions getting results

Jim Stanford, Economist and Director, Centre for Future Work, Australia Institute

Canada’s trade union movement is among the more resilient in the OECD, the club of developed countries. This is related to laws that prevent “free riding”, which is where workers can benefit from collective agreements without being union members.

Union density in Canada has been around 30% of workers since the turn of the century, although membership in the private sector is barely half that and slowly falling. In contrast, unionisation is high in public services (over 75%) and growing.

This relatively stability has left Canadian workers better prepared to confront the impact of inflation on their wages. Unions made higher wage demands than in recent decades, and more frequently went on strike (continuing a trend from 2021).

From January to October 2022, there were 145 strikes, and the final year tally will likely exceed the 161 in 2021 – itself a marked increase. A total of 1.9 million person-days of work were lost in strikes up to October (the highest in 15 years). Unlike in recent years, the majority were in the private sector.

A spring wave of strikes in construction in Ontario (Canada’s most populous province) symbolised the increased militancy. At peak, over 40,000 workers downed tools for higher wages, including carpenters, dry-wallers and engineers. Tentative agreements reached by officials were sometimes rejected by members, prolonging the strikes.

A second historic flash point came later in the year when Ontario’s right-wing government invoked a rarely used constitutional clause to override the right to strike for 55,000 education support workers. After unions in the public and private sector threatened a province-wide general strike, the government backed down.

Meanwhile, employer lockouts have virtually disappeared. This tactic, in which employers suspend operations until workers agree to terms being offered, had only been used eight times by October, compared to 60 per year a decade ago.

Annual wage growth increased modestly to an average of 5% by late in the year. That still lagged the 6.8% inflation, but closed the gap from 2021.

It remains to be seen whether this union pressure can be sustained in the face of rapid interest rate increases, a likely recession in 2023, and continued government suppression of union rights in some provinces.

United Kingdom: an olive branch for the health service?

Phil Tomlinson, Professor of Industrial Strategy, University of Bath

The UK’s latest winter of discontent is extending into 2023 as the country endures its largest wave of strikes in over 30 years. Most are in the public sector, where pay offers are well below inflation and significantly lag private companies.

The sense of grievance is high following the austerity and real-terms pay cuts of the 2010s. Strikes – estimated to have cost the UK economy £1.7 billion in 2022 – are being co-ordinated across different unions, adding to the public inconvenience.

The UK government has steadfastly refused to yield, however. It has hidden behind independent recommendations by public-sector pay review bodies, despite not always following them. They have also claimed that inflation matching public sector pay rises would cost each UK household an extra £1,000 a year, though this figure has been debunked.

The Treasury also echoes Bank of England concerns about setting off a wage-price spiral. Yet this is unlikely, given the current inflation is largely down to supply shocks (from COVID and the war in Ukraine), while average wage growth is well below inflation.

There is an economic case for a generous deal, especially in the National Health Service (NHS): with over 133,000 unfilled vacancies, better wages might help improve staff retention and recruitment. Of course, funding this in a recession involves tough choices.

Higher taxes would be politically difficult with the tax burden at a 70-year high. Higher government borrowing could aggravate inflation if accommodated by the Bank of England increasing the money supply through more quantitative easing.

Public opinion appears largely sympathetic to the strikes, especially in the NHS. But if the government relents in one sector, it sets a precedent for others, with potentially wider economic consequences.

For the NHS, it may instead bring forward public sector pay review body negotiations for 2023 to allow for an improved deal – possibly alongside a one-off hardship payment. Elsewhere it will probably hold firm and hope the trade unions lose their resolve.

Australia and New Zealand: strikes remain rare despite inflation

Jim Stanford, Economist and Director, Centre for Future Work, Australia Institute

Strikes in Australia have become very rare in recent decades, thanks to restrictive labour laws passed since the 1990s. Despite historically low unemployment and wages lagging far behind inflation, these laws continue to short-circuit most industrial action.

In 2022, union density fell to 12.5% of employees, an all-time low. As recently as 1990, union density was over 50% of workers. Union members can legally strike only after negotiations, ballots and specific plans for action have been publicly divulged (thus fully revealing union strategy to the employer). Even when there are strikes, they tend to be short.

A total of 182 industrial disputes occurred in the year to September. (The statistics don’t distinguish between strikes and employer lockouts, which have become common in Australia.) This is similar to the pre-COVID years, following a drop in 2020, and only a fraction of 1970s and 1980s industrial action.

The only visible increase in strike action in 2022 was a series of one-day protest strikes organised by teachers and health care workers in New South Wales, the country’s most populous state. Having put up with a decade of austere wage caps by the conservative state government, they decided they had had enough as inflation picked up.

Most other workers have been passive despite Australia experiencing among the slowest wage growth of any major industrial country. Nominal wages grew just 2% per year over the decade to 2021. That rose to 3.1% by late 2022, but it’s still less than half the 7.3% inflation rate.

Australia’s newly elected Labor government did pass a series of important labour law reforms at the end of 2022, aimed at strengthening collective bargaining and wage growth. That might herald incremental improvement in workers’ bargaining power in the years ahead.

The industrial relations outlook in New Zealand is somewhat more hospitable for workers and their unions. Union density increased in 2021, to 17% of employees (from 14% in 2020). Average ordinary hourly earnings grew an impressive 7.4% in the latest 12-month period – helped by a 6% boost in the minimum wage by New Zealand’s Labour government.

Industrial action remains rare – perhaps in part because workers are successfully lifting wages via other means. No official strike data is available for 2022, but in 2021, just 20 work stoppages occurred, down sharply from an average of 140 per year in the previous three years.

Indonesia: anger against labour law reforms

Nabiyla Risfa Izzati, Lecturer of Labour Law, Universitas Gadjah Mada

A few weeks ago, the government replaced its controversial “omnibus law” with new emergency regulation. This was in response to the Indonesian constitutional court finding it unconstitutional in 2021.

Passed in late 2020, the omnibus law embodies President Joko Widodo’s ambition to attract foreign investors by slashing red tape at the cost of employees’ rights. It made it easier for businesses to lay off employees without prior notice.

It also lowered statutory severance pay and extended the maximum length of temporary contracts, while ignoring worker safety. In 2022, its new formula to determine the minimum wage also resulted in the lowest annual increase ever. The law attracted much criticism from workers, activists and civil society organisations.

The new emergency regulation is arguably even more problematic. The majority of its provision simply copies the omnibus law. Several changes and additional provisions are confusing and overlap with previous regulations, as well as leaving many loopholes that could be exploited in future.

Yet despite complaints from workers and trade unions that the new rules were passed suddenly and without consultation, strike action is out of the question. Strikes are not popular because they can only be organised with permission from the company in question. If labourers hold informal strikes, employers also entitled to get rid of them.

Public protests are the obvious alternative, though pandemic rules restricting mobility and mass gatherings have made these difficult. Nevetheless, thousands or perhaps even millions of workers staged protests in their respective cities in the second half of 2022.

The workers wanted the omnibus law revoked, and for the government to not use the minimum wage formulations stipulated in the law. The demonstrations got more intense as the government raised subsidised fuel prices in September, which boosted already high inflation due to rising food prices.

The government has since issued a separate regulation to determine the 2023 minimum wage, so the demands were successful, although both workers and employers are furious that the minimum wage rules have changed again under the emergency regulation.

Clearly the protesters did not see the rest of the rules in the omnibus law removed. Some workers have been protesting on social media. This might not induce the government to change the law, but a few viral tweets have pushed several businesses to change abusive practices.

The controversy is likely to continue in 2023 and into the election year of 2024, especially amid possible massive layoffs in the midst of a global recession.

United States: worker protest showing signs of life

Marick Masters, Professor of Business and Adjunct Professor of Political Science, Wayne State University

US workers organised and took to the picket line in increased numbers in 2022 to demand better pay and working conditions, leading to optimism among labour leaders and advocates that they’re witnessing a turnaround in labour’s sagging fortunes.

Teachers, journalists and baristas were among tens of thousands of workers who went on strike. And it took an act of Congress to prevent 115,000 railroad employees from walking out as well.

In total, there have been at least 20 major work stoppages involving upwards of 1,000 workers each in 2022, up from 16 in 2021, plus hundreds more that were smaller.

Workers at Starbucks, Amazon, Apple and dozens of other companies also filed over 2,000 petitions to form unions during the year – the most since 2015. Workers won 76% of the 1,363 elections that were held.

Historically, however, these figures are tepid. The number of major work stoppages has been plunging for decades, from nearly 200 as recently as 1980.

As of 2021, union membership was at about the lowest level on record, at 10.3%. In the 1950s, over one in three workers belonged to a union.

The deck is still heavily stacked against unions, with unsupportive labour laws and very few employers showing real receptivity to having a unionised workforce. Unions are limited in how much they can change public policy. Reforming labour law through legislation has remained elusive, and the results of the 2022 midterms are not likely to make it easier.

Nonetheless, public support for labour is at its highest since 1965, with 71% saying they approve of unions, according to a Gallup poll in August. And workers themselves are increasingly showing an interest in joining them.

In 2017, 48% of workers polled said they would vote for union representation, up from 32% in 1995, the last time the question was asked.

Future success may depend on unions’ ability to tap into their growing popularity and emulate the recent wins in establishing union representation at Starbucks and Amazon, as well as the successful “Fight for $15” campaign, which since 2012 has helped pass US$15 minimum wage laws in a dozen states and Washington DC.

The odds may be steep, but the seeds of opportunity are there if labour can exploit them.

This is an excerpt from an article published on January 5 2023.

France: militant unions risk going too far

Stéphanie Matteudi-Lecocq, Chercheuse au LEREDS, Directrice practice Chez Alixio, Université de Lille

France in 2022 saw new industrial protests, from blockades of oil refineries, to unprecedented strikes at EDF’s nuclear power plants, to rail workers staying at home on public holidays.

TotalEnergies announced “super profits” in the second quarter of 2022 and increased CEO Patrick Pouyanné’s salary by 52% to €5,944,129. In September the militant CGT union demanded a 10% salary increase for workers and called for a strike at the group’s refineries.

Five of Total’s refineries went on strike, joined by two owned by ExxonMobil subsidiary Esso. Esso was already talking to its unions about a pay deal, but Total had only planned to open negotiations in November.

The strikes in the refineries threatened to bring France to a standstill, and the CGT used its power over this key resource to demand that discussions begin more quickly with Total (in the end, the company negotiated earlier and pay deals were done, ending the strikes by early November).

The strike at EDF’s nuclear power stations similarly gave the company’s workers the balance of power because it made it impossible for France to build up energy reserves (since fossil fuels had to be burned to make up for the lack of nuclear power). In the end, the company signed deals with the unions in October.

Unions may have succeeded in both cases, but they are arguably endangered by these kinds of practices. Too many trades union leaders remain stuck in their old militant ways.

There’s a fragile balance between negotiation and protest, and such ransom tactics might damage unions’ public image, making dialogue more difficult in future. In 50 years, the rate of unionisation in France has already halved from over 20% to around 10%.

It’s telling that two of the major strikes at the end of 2022, first by train workers and then by general practitioners, were initiated by groups independent from the unions. They both started spontaneously through social media and the unions found out very late.

In 2023 the unions have an opportunity to improve their influence if they manage to prevent the government from passing its unpopular bill on pensions, which seeks to raise the full pensionable retirement age from 62 to 64 or 65.

The unions have already announced their strong opposition to the bill. With major demonstrations due to take place after the full bill is presented today, January 10, it will be interesting to see their tactics.

This is based on an excerpt from an article published in October 2022.

Spain: unequal support measures could cause trouble

Rubén Garrido-Yserte, Director del Instituto Universitario de Análisis Económico y Social, Universidad de Alcalá

Global inflation is triggering a global economic slowdown and interest rates raised to levels not seen since before 2008. Interest rates will continue to rise in 2023, especially affecting economies as indebted as Spain.

It will undermine both families’ disposable income and the profitability of companies (especially small ones), while making public debt repayments more expensive. Meanwhile, inflation is expected to cause a sustained increase in the cost of the shopping basket in the medium term.

Government measures have partially mitigated this loss of purchasing power so far. Spain capped power prices, subsidised fuel and made public transport free for urbanites and commuters.

There were agreements with banks to refinance mortgages for the most vulnerable families. Plus there have been increases in pensions and public salaries and there are plans to raise the minimum wage.

However, many of these measures must necessarily be temporary. The danger is that they come to be seen as rights that should not be renounced. They also distort the economy and create problems with fairness by excluding or insufficiently supporting some groups. Private salaries will not rise enough to cover inflation, for instance.

The government’s measures have been such that there has been very little industrial action in response to the cost of living crisis. The danger is that they create a scenario where today’s calm may be the harbinger of a social storm tomorrow.

This article is part of Global Economy 2023, our series about the challenges facing the world in the year ahead. You might also like our Global Economy Newsletter, which you can subscribe to here.

Phil Tomlinson currently receives funding from the Engineering and Physical Sciences Research Council (EPSRC) for Made Smarter Innovation: Centre for People-Led Digitalisation, and the Economic and Social Research Council (ESRC) for an Interact project on UK co-working spaces and manufacturing.

Jim Stanford, Marick Masters, Nabiyla Risfa Izzati, Rubén Garrido-Yserte, and Stéphanie Matteudi-Lecocq do not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and have disclosed no relevant affiliations beyond their academic appointment.

Read More

Continue Reading


New IRS Report Provides Fascinating Glimpse Into Your “Fair Share”

New IRS Report Provides Fascinating Glimpse Into Your "Fair Share"

Authored by Simon Black via,

Every year the IRS publishes…



New IRS Report Provides Fascinating Glimpse Into Your "Fair Share"

Authored by Simon Black via,

Every year the IRS publishes a detailed report on the taxes it collects. And the statistics are REALLY interesting.

A few weeks ago the agency released its most recent report. So this is the most objective, up-to-date information that exists about taxes in America.

This is important, because, these days, it’s common to hear progressive politicians and woke mobsters calling for higher income earners and wealthier Americans to pay their “fair share” of taxes.

But this report, directly from the US agency whose job it is to tax Americans, shows the truth:

The top 1% of US taxpayers paid 48% of total US income taxes.

And that’s just at the federal level, not even counting how much of the the local and state taxes the wealthy paid.

Further, the top 10% paid nearly 72% of total income taxes.

Meanwhile, the bottom 40% of US income tax filers paid no net income tax at all. And the next group, those making between $30-$50,000 per year, paid an effective rate of just 1.9%.

(Again, this is not some wild conspiracy theory; these numbers are directly from IRS data.)

But the fact that 10% of the taxpayers foot nearly three-fourths of the tax bill still isn’t enough for the progressive mob. They want even more.

The guy who shakes hands with thin air, for example, recently announced that he wants to introduce a new law that would create a minimum tax of 25% on the highest income earners.

But the government’s own statistics show that the highest income earners in America— those earning more than $10 million annually— paid an average tax rate of 25.5%. That’s higher than Mr. Biden’s 25% minimum.

So he is essentially proposing an unnecessary solution in search of a problem.

I bring this up because whenever you hear the leftist Bolsheviks in government and media talking about “fair share”, they always leave out what exactly the “fair share” is.

The top 1% already pay nearly half the taxes. Exactly how much more will be enough?

Should the top 1% pay 60% of all taxes? 80%? At what point will it be enough?

They never say. They’ll never commit to a number. They just keep expanding their thinking scope.

Elizabeth Warren, for example, quite famously stopped talking about the “top 1%” and started whining about the “top 5%”. And then the “top 10%”.

She has already decided that the top 5% of wealthy households should not be eligible for student loan forgiveness or Medicare.

And when she talks about “accountable capitalism” on her website, Warren calls out the top 10% for having too much wealth, compared to the rest of households.

Soon enough it will be the “top 25%” who are the real problem…

Honestly this whole way of thinking reminds me of Anthony “the Science” Fauci’s pandemic logic on lockdowns and mask mandates.

You probably remember how reporters always asked “the Science” when life could go back to normal… and he always replied that it was a function of vaccine uptake, i.e. whenever enough Americans were vaccinated.

But then he kept moving the goal posts. 50%. 60%. 70%. It was never enough. And there was never a concrete answer.

This same logic applies to what the “experts” believe is the “fair share” of taxes which the top whatever percent should pay.

They’ll never actually say what the fair share is. But my guess is that they won’t stop until 100% of taxes are paid by the top 10% … and the other 100% of taxes are paid by the other 90%.

Tyler Durden Wed, 03/29/2023 - 11:25

Read More

Continue Reading


Financial Stress Continues to Recede

Overview: Financial stress continues to recede. The Topix bank index is up for the second consecutive session and the Stoxx 600 bank index is recovering…



Overview: Financial stress continues to recede. The Topix bank index is up for the second consecutive session and the Stoxx 600 bank index is recovering for the third session. The AT1 ETF is trying to snap a four-day decline. The KBW US bank index rose for the third consecutive session yesterday. More broadly equity markets are rallying. The advance in the Asia Pacific was led by tech companies following Alibaba's re-organization announcement. The Hang Seng rose by over 2% and the index of mainland shares rose by 2.2%. Europe's Stoxx 600 is up nearly 1% and US index futures are up almost the same. Benchmark 10-year yields are mostly 1-3 bp softer in Europe and the US.

The dollar is mixed. The Swiss franc is leading the advancers (~+0.3%) while euro, sterling and the Canadian dollar are posting small gains. The Japanese yen is the weakest of the majors (~-0.6%). The antipodeans and Scandis are also softer. A larger than expected decline in Australia's monthly CPI underscores the likelihood that central bank joins the Bank of Canada in pausing monetary policy when it meets next week. Most emerging market currencies are also firmer today, and the JP Morgan Emerging Market Currency Index is higher for the third consecutive session. Gold is softer within yesterday's $1949-$1975 range. The unexpectedly large drop in US oil inventories (~6 mln barrels according to report of API's estimate, which if confirmed by the EIA later today would be the largest drawdown in four months) is helping May WTI extend its gains above $74 a barrel. Recall that it had fallen below $65 at the start of last week.

Asia Pacific

The US dollar is knocking on the upper end of its band against the Hong Kong dollar, raising the prospect of intervention by the Hong Kong Monetary Authority. It appears to be driven by the wide rate differential between Hong Kong and dollar rates (~3.20% vs. ~4.85%). Although the HKMA tracks the Fed's rate increases, the key is not official rates but bank rates, and the large banks have not fully passed the increase. Reports suggest some of the global banks operating locally have raised rates a fraction of what HKMA has delivered. The root of the problem is not a weakness but a strength. Hong Kong has seen an inflow of portfolio and speculative capital seeking opportunities to benefit from the mainland's re-opening.  Of course, from time-to-time some speculators short the Hong Kong dollar on ideas that the peg will break. It is an inexpensive wager. In fact, it is the carry trade. One is paid well to be long the US dollar. Pressure will remain until this consideration changes. Eventually, the one-country two-currencies will eventually end, but it does not mean it will today or tomorrow. As recently as last month, the HKMA demonstrated its commitment to the peg by intervening. Pressure on the peg has been experienced since last May and in this bout, the HKMA has spent around HKD280 defending it (~$35 bln).

The US and Japan struck a deal on critical minerals, but the key issue is whether it will be sufficient to satisfy the American congress that the executive agreement is sufficient to benefit from the tax- credits embodied in the Inflation Reduction Act. The Biden administration is negotiating a similar agreement with the EU. The problem is that some lawmakers, including Senator Manchin, have pushed back that it violates the legislature's intent on the restrictions of the tax credit. Manchin previously threatened legislation that would force the issue. The US Trade Representative Office can strike a deal for a specific sector without approval of Congress, but that specific sector deal (critical minerals) cannot then meet the threshold of a free-trade agreement to secure the tax incentives. 

The Japanese yen is the weakest of the major currencies today, dragged lower by the nearly 20 bp rise in US 10-year yields this week and the end of the fiscal year related flows. Some dollar buying may have been related to the expirations of a $615 mln option today at JPY131.75. The greenback tested the JPY130.40 support we identified yesterday and rebounded to briefly trade above JPY132.00 today, a five-day high.  However, the session high may be in place and support now is seen in the JPY131.30-50 band. Softer than expected Australian monthly CPI (6.8% vs. 7.4% in January and 7.2% median forecast in Bloomberg's survey) reinforced ideas that the central bank will pause its rate hike cycle next week. The Australian dollar settled near session highs above $0.6700 in North America yesterday and made a margin new high before being sold. It reached a low slightly ahead of $0.6660 in early European turnover. The immediate selling pressure looks exhausted and a bounce toward $0.6680-90 looks likely. On the downside, note that there are options for A$680 mln that expire today at $0.6650. In line with the developments in the Asia Pacific session today, the US dollar is firmer against the Chinese yuan. However, it held below the high seen on Monday (~CNY6.8935). The dollar's reference rate was set at CNY6.8771, a bit lower than the median projection in Bloomberg's forecast (~CNY6.8788). The sharp decline in the overnight repo to its lowest since early January reflect the liquidity provisions by the central bank into the quarter-end.


Reports suggest regulators are finding that one roughly 5 mln euro trade on Deutsche Bank's credit-default swaps last Friday, was the likely trigger of the debacle. The bank's market cap fell by1.6 bln euros and billions more off the bank share indices. Then there is the US Treasury market, where the measure of volatility (MOVE) has softened slightly from last week when it rose to the highest level since the Great Financial Crisis. While the wide intraday ranges of the US two-year note have been noted, less appreciated are the large swings in the German two-year yield. Before today, last session with less than a 10 bp range was March 8. In the dozen sessions since, the yield has an average daily range of around 27 bp. The rapid changes and opaque liquidity in some markets leading to dramatic moves challenges the price discovery process. The speed of movement seems to have accelerated, and reports that Silicon Valley Bank lost $40 bln of deposits in a single day.

Italy's Meloni government will tap into a 21 bln euro reserve in the budget to give a three-month extension of help to low-income families cope with higher energy bills but eliminate it for others. It is projected to cost almost 5 billion euros. The energy subsidies have cost about 90 mln euros. Most Italian families are likely to see higher energy bills, though gas will still have a lower VAT. Meloni also intends to adjust corporate taxes to better target them and cost less. Separately, the government is reportedly considering reducing or eliminating the VAT on basic food staples. Meanwhile, the EU is delaying a 19 bln euro distribution to Italy from the pandemic recovery fund. The aid is conditional on meeting certain goals. The EU is extending its assessment phase to review a progress on a couple projects, licensing of port activities, and district heating. These are tied to the disbursement for the end of last year. The EU acknowledged there has been "significant" progress. Italy has received about a third of the 192 bln euros earmarked for it. Despite the volatile swings in the yields, Italy's two-year premium over Germany is within a few basis points of the Q1 average (~46 bp). The same is true of the 10-year differential, which has averaged about 187 bp this year. 

After slipping lower in most of the Asia Pacific session, the euro caught a bid late that carried into the European session and lifted it to session highs near $1.0855. The session low was set slightly below $1.0820 and there are nearly 1.6 bln euros in option expirations today between two strikes ($1.0780 and $1.0800). Recall that on two separate occasions last week, the euro be repulsed from intraday moves above $1.09. A retest today seems unlikely, but the price actions suggest underlying demand. Sterling has also recovered from the slippage seen early in Asia that saw it test initial support near $1.2300. Yesterday, it took out last week's high by a few hundredths of a cent, did so again today rising to slightly above $1.2350. However, here too, the intraday momentum indicators look stretched, cautioning North American participants from looking for strong follow-through buying.


What remains striking is the divergence between the market and the Federal Reserve. On rates they are one way. Fed Chair Powell was unequivocal last week. A pause had been considered, but no one was talking about a rate cut this year. The market is pricing in a 4.72% average effective Fed funds rate in July. On the outlook for the economy this year, they are the other way. The median Fed forecast was for the economy to grow by 0.4% this year. The median forecast in Bloomberg's survey anticipated more than twice the growth and projects 1.0% growth this year. As of the end of last week, the Atlanta Fed sees the US expanding by 3.2% this quarter (it will be updated Friday). The median in Bloomberg's survey is half as much. 

The US goods deficit in February was a little more than expected and some of the imports appeared to have gone into wholesale inventories, which unexpectedly rose (0.2% vs. -0.1% median forecast in Bloomberg's survey). Retail inventories jumped 0.8%, well above the 0.2% expected and biggest increase since last August. Given the strength of February retail sales (0.5% for the measure that excludes autos, gasoline, food services and building materials, after a 2.3% rise in January), the increase in retail inventories was likely desired. FHFA houses prices unexpectedly rose in January (first time in three months, leaving them flat over the period). S&P CoreLogic Case-Shiller's measure continued to slump. It has not risen since last June. The Conference Board's measure of consumer confidence rose due to the expectations component. This contrasts with the University of Michigan's preliminary estimate that showed the first decline in four months. Moreover, when its final reading is announced at the end of the week, the risk seems to be on the downside, according to the Bloomberg survey. Meanwhile, surveys have shown that the service sector has been faring better than the manufacturing sector. However, the decline in the Richman Fed's business conditions, while its manufacturing survey improved, coupled with the sharp decline in the Dallas Fed's service activity index may be warning of weakness going into Q2.

The US dollar flirted with CAD1.38 at the end of last week is pushing through CAD1.36 today to reach its lowest level since before the banking stress was seen earlier this month. The five-day moving average has crossed below the 20-day moving average for the first time since mid-February. Canada's budget announced late yesterday boosts the deficit via new green initiatives and health spending, while raising taxes, including a new tax on dividend income for banks and insurance companies from Canadian companies. The market appears to be still digesting the implications. Today's range has thus far been too narrow to read much into it. The greenback has traded between roughly CAD1.3590 and CAD1.3615. On the other hand, the Mexican peso has continued to rebound from the risk-off drop that saw the US dollar surge above MXN19.23 (March 20). The dollar is weaker for fifth consecutive session and seventh of the last nine. It finished last week near MXN18.4450 and fell to about MXN18.1230 today, its lowest level since March 9. However, the intraday momentum indicators are stretched, and the greenback looks poised to recover back into the MXN18.20-25 area. Banxico meets tomorrow and is widely expected to hike its overnight target rate by a quarter-of-a-point to 11.25%.



Read More

Continue Reading

Spread & Containment

Candida auris: what you need to know about the deadly fungus spreading through US hospitals

A drug-resistant fungus is a threat to human health.




A fungal superbug called Candida auris is spreading rapidly through hospitals and nursing homes in the US. The first case was identified in 2016. Since then, it has spread to half the country’s 50 states. And, according to a new report, infections tripled between 2019 and 2021. This is hugely concerning because Candida auris is resistant to many drugs, making this fungal infection one of the hardest to treat.

Candida auris is a yeast-type fungus that is the first to have multiple international health alerts associated with it. It has been found in over 30 countries, including the UK, since it was first identified in Japan in 2009.

It is related to other types of yeast that can cause infections, like Candida albicans which causes thrush. However, Candida auris is very different to these other fungi and in some ways, highly unusual.

First, it can grow, or “colonise”, human skin. Unlike many other Candida species that like to grow in our guts as part of the microbiome, Candida auris does not grow in this environment and seems to prefer the skin. This means that people who are colonised with Candida auris can shed lots of yeast from their skin, and this contaminates bed clothes and surfaces with the fungus. This can lead to outbreaks.

It is unusual for a fungal infection to spread from person to person, but that seems to be how Candida auris infections spread. Outbreaks can happen with this fungus, especially in intensive care units (ICU) and nursing homes where people are at a higher risk for getting fungal infections generally.

The fungus can live on surfaces for several weeks, and getting rid of it can be difficult. Enhanced cleaning and hand washing is needed to try and limit the spread of the fungus and exposure to patients who get ill from it.

Most people who are colonised with Candida auris will not get ill from it, or even know it is there. It causes infections when it gets into surgical wounds or the blood from an intravenous line. Once it gets into the body, it can infect organs and the blood causing a very serious and potentially fatal disease.

The mortality rate for people infected (as opposed to colonised) with the fungus is between 30 and 60%. But a precise mortality rate can be hard to pin down as people who are infected are often critically ill with other conditions.

Diagnosing an infection can be difficult as there can be a wide range of symptoms including fever, chills, headaches and nausea. It is for this reason that we need to keep a close eye on Candida auris as it can easily be confused with other conditions.

In the last few years, new tests to help identify this fungus accurately have been developed.

Candida auris can get into the body via an infected IV line. Tyler Olson/Shutterstock

The first Candida auris infection was reported in the UK in 2013. However, there may have been other cases before this – there is evidence that some early cases were misidentified as unrelated yeasts.

The UK has so far managed to stop any major outbreaks, and most cases have been limited in their spread.

Most patients who have become ill from Candida auris in the UK had recently travelled to parts of the world where the fungus is more common or has been circulating for longer.

Spurred by COVID

Rising numbers of Candida auris infections are thought to be partially linked to the COVID pandemic. People who become very ill from COVID may need mechanical ventilation and long stays in the ICU, which are both risk factors for Candida auris colonisation and infection.

It will take some time to figure out exactly how the pandemic has affected rates and numbers of fungal infections around the world, but these are important questions to answer to help predict how Candida auris cases might fluctuate in the future.

As for most life-threatening fungal infections, treatment is difficult and limited. We have only a handful of antifungal drugs to fight these infections, so when a species is resistant to one or more of these drugs, the options for treatment are extremely limited. Some Candida auris infections are resistant to all three types of antifungal drug.

Healthcare professionals must remain vigilant to this drug-resistant fungus. Without close monitoring and enhanced awareness of this infection, we could see more outbreaks and serious disease associated with Candida auris in the future.

Rebecca A. Drummond receives funding from the Medical Research Council.

Read More

Continue Reading