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Fuyuka Nakamura

India's GDP growth slows sharply - May. 31, 2012 - 2 views

  • sharply
    • Fuyuka Nakamura
       
      AD/AS changed in time fast
  • In the first quarter, the country's manufacturing sector contracted and its agricultural sector slowed substantially
    • Fuyuka Nakamura
       
      An aggregate demand and supply curve can be shown to demonstrate the decline in GDP, which resulted from the contraction in the agricultural sector/manufacturing sector. The supply curve can shift down to demonstrate how the economy is producing less.
  • due primarily to weakness in its manufacturing and agricultural sectors
    • Fuyuka Nakamura
       
      Reason for the decline in economic growth in India. Shift in AS.
  • ...8 more annotations...
  • Spending by both consumers and the government decelerated slightly.
    • Fuyuka Nakamura
       
      By spending to decrease, the demand curve will shift, as people demand/spend less on the good/service.
    • Fuyuka Nakamura
       
      Consumer confidence is affected by the high interest rates (mentioned below)
  • tighter monetary policy
    • Fuyuka Nakamura
       
      Monetary Policy can be described. The interest rate and supply of money can be described to show how goods/services can affect economic growth.
  • interest rates high for three years to battle rapid inflation
    • Fuyuka Nakamura
       
      As interest rates are high, the sectors will not want to borrow money, as they will be losing out on money. Consumers will also save their money rather than spend it, which then affects the aggregate demand curve. Which then affects the economic growth.
    • Fuyuka Nakamura
       
      Contrationary Monetary Policy, as the Gov is trying to fight the inflation. In other words they want to lower the price levels. They do this by rising the interest rate to decrease the supply of money.
  • lower that rate slightly to try to stimulate economic growth.
    • Fuyuka Nakamura
       
      Can talk about the effect of lowering the interest rates. How the consumers will start to spend rather than save and how the businesses (sectors) start to borrow money for investment, which then pumps up the economic growth.
  • lower rates further
    • Fuyuka Nakamura
       
      the Reserve Bank of India can impose Expansionary Monetary Policy, lowering the interest rates, increasing the money supply, encouraging new consumption and investments. This will shift the AD out, increasing India's GDP within time. This will be their solution.
  • economic growth
    • Fuyuka Nakamura
       
      About India's GDP It will involve AD and AS
  • sharply
  • India is the world's second most populous nation after China, and the 11th largest economy,
Adam Seldis

Kenya inflation slows to 12.2 pct in May | Reuters - 5 views

    • Adam Seldis
       
      This nicely allows some evaluation, as we can speculate on to what evaluate the government should change interest rates
    • Adam Seldis
       
      I could use this to introduce the relationship between interest rates and exchange rates. However that's more international economics so I might just ignore it. 
    • Adam Seldis
       
      This is a nice article that allows me to explain what inflation is and how Kenya has cost-push disinflation. I can easily show this in a diagram. What's more it also talks about monetary policy, so I can explain how the government has helped create this - the impact of interest rates on costs. There are also some really good evaluation opportunities, particularly as the article suggests the Kenyan government itself doesn't know what to do with interest rates. I can ignore exchange rates but instead focus on the possible impact on employment and general GDP growth, whilst not ignoring the ominous signs mentioned about future world commodity prices.
Tessa Jalink

Australian economy good enough to keep interest rates on hold | Television New Zealand ... - 2 views

  • out weaker commodity prices and the mining
  • mining boom
    • Tessa Jalink
       
      Concerns that mining boom is over. This would cause a reduction in GDP
  • hold off on another rate cut
    • Tessa Jalink
       
      Further reduction in RoI is not necessary
  • ...8 more annotations...
  • softness
    • Tessa Jalink
       
      Economy is unstable, possibly due to uncertainty in mining?
  • investment and exports
    • Tessa Jalink
       
      Increase in I + X, resulting in an increase in AD
  • interest rate cuts
    • Tessa Jalink
       
      Interest rates have been cut over the past year. 
    • Tessa Jalink
       
      This should cause an increase in C, resulting in an increase in AD. 
  • potential for rises
    • Tessa Jalink
       
      Very positive outlook.
  • growth and inflation
    • Tessa Jalink
       
      Inflation & GDP growth is expected
    • Tessa Jalink
       
      Caused by previous RoI cuts.
  • mining boom.
    • Tessa Jalink
       
      Concerns about mining boom, global uncertainty caused business confidence to decrease.
    • Tessa Jalink
       
      Resulted in a decrease in I
  • mining
  • employment.
    • Tessa Jalink
       
      Increase in employment caused rise in business conditions.
Yihan Li

BBC News - Australia cuts interest rates in a bid to boost growth - 0 views

  • The bank cut its key rate to 3.5% from 3.75%.
    • Yihan Li
       
      Australia's central bank cut its interest rate, which is a monetary policy. This is intended to increase consumption and investment, thus the aggregate demand   
  • At the same time, domestic demand has also been stagnant despite efforts to spur consumption.
  • At the same time, domestic demand has also been stagnant despite efforts to spur consumption.
  • ...14 more annotations...
  • At the same time, domestic demand has also been stagnant despite efforts to spur consumption.
  • At the same time, domestic demand has also been stagnant despite efforts to spur consumption.
    • Yihan Li
       
      Both monetary and fiscal policies are used to stimulate the consumption, thus AD. However this has not worked. 
  • There have been concerns that Australia's resources-led boom may be hurt by falling demand due to a slowdown in global growth.
  • There have been concerns that Australia's resources-led boom may be hurt by falling demand due to a slowdown in global growth.
  • There have been concerns that Australia's resources-led boom may be hurt by falling demand due to a slowdown in global growth.
  • There have been concerns that Australia's resources-led boom may be hurt by falling demand due to a slowdown in global growth.
  • ere have been concerns that Australia's resources-led boom may be hurt by falling
  • ave been concerns that Australia's resources-led boom may be hurt by falling
  • There have been concerns that Australia's resources-led boom may be hurt by falling demand due to a slowdown in global growth.
    • Yihan Li
       
      Main component of Australia's GDP growth was export of natural resources. Due to unstable international economy, foreign companies manufacture less good, so less Australia's resources will be demanded. Thus GDP growth slows down.
    • Yihan Li
       
      AD-AS curves can be used 
  • In China, one of the biggest markets for Australian commodity exports, both the manufacturing and non-manufacturing sectors have seen the pace of growth slow in May, raising concerns about a slowdown in its economy.
    • Yihan Li
       
      Since China is Australia's biggest exporter, stagnation of Chinese economy will reduce the export, thus AD
  • Meanwhile there have been fears about the recovery in the US economy losing its pace after it reported weaker-than-expected jobs data for May.
    • Yihan Li
       
      Low consumer and business confidence, which may reduce consumption and investment 
  • However, there has been a slew of weak economic data that has come out since then.
  • accommodative stance
    • Yihan Li
       
      accommodative stance = looser monetary policies
  • The country's housing market has seen prices fall and continues to remain subdued despite earlier cuts to the cost of borrowing
    • Yihan Li
       
      House is most people's biggest asset. The decrease in its price will reduce people's disposable income, thus consumption and AD 
  •  
    Interest Rate and Macroeconomy  
Emily Hoshi

BBC News - China inflation growth dims hopes of interest rate cut - 0 views

  • inflation
    • Emily Hoshi
       
      definition for inflation 
  • interest rate
    • Emily Hoshi
       
      definition for interest rate
  • costs pushed up
    • Emily Hoshi
       
      definition for cost push inflation
  • ...15 more annotations...
  • Consumer prices grew by 3.6% in March from a year earlier, up from 3.2% in February. Analysts had forecast an increase of 3.3%.
    • Emily Hoshi
       
      graph showing the increase in consumer prices 
  • set a target of 4% for 2012.
    • Emily Hoshi
       
      the effect of setting a 4% inflation (?) --> graph and show
  • central bank to hold back on monetary policy easing for now.
    • Emily Hoshi
       
      the reason why (?)
  • stronger-than-expected inflation could slow down the pace of monetary policy relaxin
  • China's economy grew by 8.9% in the three months
    • Emily Hoshi
       
      giving reasons to it why their economy is slowing down 
  • slowest pace of growth in more than two years.
  • markets such as the US and eurozone.
  • slowing demand for its exports
    • Emily Hoshi
       
      point this in the graph 
  • China's central bank has been easing its monetary policy in recent months.
  • sustain its pace of growth
  • boost
  • cut the amount of money banks must keep in reserve
  • sustain economic growth
  • speculation that the central bank may cut the cost of borrowing in a further attempt to boost growth.
  • money at low rates may push consumer prices higher.
  •  
    Mr. Seldis: Is this okay for my IA2?
Yihan Li

BBC News - Federal Reserve to buy more debt to boost US economy - 0 views

  • buy "additional agency mortgage-backed securities at a pace of $40bn (£25bn) per month".
    • Yihan Li
       
      Buying the securities increases the supply of money in the market
    • Yihan Li
       
      Increase in supply of money is used to expand aggregate demand
    • Yihan Li
       
      (evaluation) talk about the merits and demerits of increase in AD
  • nterest rates in the US have been close to zero for several years now, and the Fed again kept them at below 0.25% on Thursday.
    • Yihan Li
       
      Low interest rate keeps aggregate demand high -> more spending and investment 
    • Yihan Li
       
      Draw interest rate vs quantity of money diagram
  • quantitative easing
    • Yihan Li
       
      quantitative easing = A monetary policy used to increase the money supply by buying government securities or other securities from the market
  • ...7 more annotations...
  • "We doubt it will be enough to get the economy on the right track. It's only a matter of time before speculation begins as to when the Fed will raise its purchases from $40bn a month."
    • Yihan Li
       
      (evaluation) not enough money is spent by Federal Reserve 
  • the central bank buys bonds to keep the long-term cost of borrowing down.
    • Yihan Li
       
      Increase in supply of money keeps cost of borrowing (long-term interest rate) low
  • The unemployment rate in the US has been above 8% since January 2009, but the current 8.1% is down from the recent high of 10% in October 2009.
    • Yihan Li
       
      high unemployment = the economy is not doing well. 
    • Yihan Li
       
      The main reason why Fed implemented the policy 
  • US presidential election.
    • Yihan Li
       
      The decision is influenced by political factors 
  • Ben Bernanke also lowered the Fed's growth forecast for the US economy to 2% this year, down from the 2.4% it predicted in June
    • Yihan Li
       
      Fed decided to implement the policy because economy is not growing quickly enough 
    • Yihan Li
       
      Draw a AD-AS diagram to explain the results of AD shift on economy 
  • "The committee is concerned that, without further policy accommodation, economic growth might not be strong enough to generate sustained improvement in labour market conditions,
    • Yihan Li
       
      Without Fed's help, unemployment may increase or be stagnant. Maybe talk about Okun's law, which states that 3% increase in output corresponds to a 1% decline in the rate of unemployment
  • Federal Reserve to buy more debt to boost US economy
    • Yihan Li
       
      Why using monetary policy, not using fiscal policy? What are other options?  
Nayana Devadas

Business - Bank of England holds key interest rate at 0.50% - 1 views

    • Nayana Devadas
       
      Monetary policy
    • Nayana Devadas
       
      Interest rates- macro economics- monetary policy
  • main interest rate
  • ...2 more annotations...
  • The economy shrank 0.3
    • Nayana Devadas
       
      Macro
J Hwang

China cuts interest rates - 1 views

  •  
    -macroeconomics -Monetary Policy - China's central bank decided to decrease interest rates -however, the lending rate is still much higher than that in USA, Europe and Japan. -recently China decreased the reserved ratio as well. -Eurozone crisis - decrease in demand for exports - damaging to Chinese economy -previously, China raised interest rates to decrease inflation --> however led to a slowdown in economics growth
Edward Pearson

Lost in inflation: the trap of focusing solely on the consumer price index | The Japan ... - 3 views

  • interest rate policy since February 1999
    • Edward Pearson
       
      -Increase borrowing and decreasing savings -however, real interest rates are positive due to deflation 
  • the government's fiscal policy options are starting to run out
    • Edward Pearson
       
      Increase in budget deficit as spending increases and tax revenue decreases - along with debt of 215% of GDP
  • This is reflected by globalized Japan's descent into its first trade deficit since 1980
    • Edward Pearson
       
      GDP=C+!+G+X-M  demand for domestic products decrease because foreign products are relatively cheaper - increase in M and decrease in X, so AD decreases and GDP decrease causing deflation
  • ...4 more annotations...
  • prices in Japan remain very high by international standards.
    • Edward Pearson
       
      Lack of factors of production - mainly land need for importing from foreign countries possible solutions- Free trade
  • This is one factor behind Japan's high prices.
  • cannot pin their hopes on wage increases
    • Edward Pearson
       
      should be a decrease in wages as revenue decreases - sticky wages 
  • They should step back and take a look at the big picture, including Japan's abnormally high prices,
    • Edward Pearson
       
      deflation possibly could be advantages - increase in spending power, international competitiveness etc 
Adam Seldis

Kenya inflation slows to 12.2 pct in May | Reuters - 3 views

  • inflation slows to 12.2 pct in May
  • fall in
    • Adam Seldis
       
      This response will be about falling inflation. So I'm hoping to find some information on perhaps why it is falling, to what extent the government played a part, and what might the consequences be?
  • ...6 more annotations...
    • Adam Seldis
       
      This explains why there was the fall. So it is a cost-push disinflation. I can explain this using a diagram.
    • Adam Seldis
       
      I can now bring in monetary policy and explain not only why a government may wish to lower interest rates (to boost AD) but also how a lowering of inflation might allow this situation.
    • Adam Seldis
       
      I can use this data in my diagrams
    • Adam Seldis
       
      So I can use this to explain how the government has been using interest rates to lower inflation and what the relationship is between them.
    • Adam Seldis
       
      Could also do some evaluation to suggest that cost-push disinflation is better to have than demand-pull disinflation, as with cost-push disinflation you still get GDP growth.
    • Adam Seldis
       
      I can use this to explain what might happen in the future. What might be the impact of high international commodity prices.
Isabella Yamamoto

Paul Krugman attacks Britain's austerity drive as 'deeply destructive' | Business | gua... - 2 views

  • increasing it by 2% of GDP
    • Isabella Yamamoto
       
      I can talk about the multiplier effect and how increasing in spending can lead to a boost in AD
  • austerity policy as "deeply destructive"
    • Isabella Yamamoto
       
      I can look at the argument made for increasing spending during a recession, and look at the argument made against.
  • to do so would be to admit its mistake
    • Isabella Yamamoto
       
      Perhaps I could look at how political interests can mean that policies do not always pass policies that are in the best interest of a countries economy.
  • ...1 more annotation...
  • 30% of unemployed people having been out of work for 52 weeks or more, compared with 9.5% in 2008.
    • Isabella Yamamoto
       
      How austerity measures reduce spending in public + private sectors. How that leads to more jobless. Can also look at structural unemployment and how AD will continue to fall because of lower income per capita.
Erica Nozawa

BBC News - India inflation rate rises faster than expected - 0 views

  • India inflation rate rises
  • Higher food prices
  • mainly behind the rise
  • ...7 more annotations...
  • decide interest rate policy.
  • central bank policymakers with a "tricky call".
  • government cut fuel subsidies, which will force up prices.
  • The fundamentals don't justify a rate cut at this point of time because the inflationary expectations are still quite high.
  • The quantitative easing in the US is also likely to push up global commodity prices and add to inflation
  • needs a boost from lower interest rates
  • industrial output rose by just 0.1%
  •  
    My Macro Economics IA article.
Graeme Lorimer

BBC News - China cuts key interest rates to boost growth - 0 views

  • attempt to boost its slowing growth
    • Graeme Lorimer
       
      GPL vs. GDP curve higher price levels reduces spending and GDP
  • higher rates to savers and lower rates to borrowers.
    • Graeme Lorimer
       
      Encourage spending of money rather than "keeping it under the mattress"
  • more competition
    • Graeme Lorimer
       
      Good for consumers - more competition -> lower rates and more borrowing so there will be more spending and the GDP will rise
  • ...3 more annotations...
  • t's a first step in rate liberalisation
  • curb lending
  • slowdown around the world
    • Graeme Lorimer
       
      China controls everything
Aili Saito

U.S. economy picks up speed but doubts surround 2012 outlook - Jan. 27, 2012 - 1 views

  • seasonal trends
    • Aili Saito
       
      GDP can vary due to seasons - similar to seasonal unemployment
  • business investment
    • Aili Saito
       
      will lead to a decrease in AD
  • The United States economy picked up speed
    • Aili Saito
       
      GDP increase = could express this on an AD/AS graph where the AD shifts to the right as well as AS shifts to to the right (both increase) - also leads to inflation
  • ...7 more annotations...
  • their inventories
    • Aili Saito
       
      production increased
  • consumers increased their spending
    • Aili Saito
       
      consumption increased (leads to a shift in AD to the right)
  • overall weakness
    • Aili Saito
       
      could possibly lead to a recession in the future
  • businesses building up their stock of goods
    • Aili Saito
       
      main reason of increase in GDP is the increase of production and increase of stock (AS related)
  • confidence
    • Aili Saito
       
      consumer/business confidence will lead to an increase in AD
  • the report showed GDP grew only 0.8% in the fourth quarter, compared with 3.2% in the third.
    • Aili Saito
       
      there is a decrease in GDP growth - could possibly lead to a recession (negative GDP growth)
  • too weak to warrant higher interest rates any time soon
    • Aili Saito
       
      as interest rates increase, it will lead to an increase in government revenue/profit for banks but also, a decrease in AD
Emily Hoshi

Gasoline Pushes Consumer Prices to 10-Month High - NYTimes.com - 0 views

    • Emily Hoshi
       
      What can the government do to prevent the inflation? - what policies are there? monetary and fiscal but in this case monetary policy is the one to change the interest rates. --> however, this can lead to an increase in unemployment rate. WHY? 
  • Consumer prices rose
  • Surging gasoline prices hurt consumer confidence
  • ...29 more annotations...
  • as the cost of gasoline spiked,
  • Consumer Price Index rose 0.4 percent in February after advancing 0.2 percent
  • Gasoline accounted for more than 80 percent of the rise.
  • Consumer purchasing power
  • going to remain pressured by rising gasoline prices,
  • he said a trend toward lower inflation was still in place.
  • Consumer prices rose 2.9 percent last month from the same period a year ago, unchanged from January but down from a peak of 3.9 percent in September.
  • The core index was up 2.2 percent over the 12 months through February, down from 2.3 percent in January.
  • Consumer expectations for inflation
  • did not expect the steep climb in gasoline costs to last.
  • $4 gasoline has lost its shock value,
  • among lower-income households
  • Investor expectations of inflation
  • also been on the rise
  • Production at the nation’s mines, factories and utilities held steady last month after a 0.4 percent gain in January
  • expand moderately
  • Manufacturing output rose 0.3 percent
  • automakers cut production by 1.1 percent after two big monthly gains
  • Carmakers had raised production to meet demand for popular models in short supply
  • The consumer price report showed gasoline prices soared 6 percent last month, the largest increase
  • risen 0.9 percent
  • cushion against rising gas prices at the pump, salaries are not keeping up.
  • strengthening jobs market is providing
  • arnings, adjusted for inflation, fell 0.3 percent last month after slipping 0.1 percent in January
  • Food costs held steady
  • some price relief for households.
  • , airline tickets and used cars and trucks.
  • declines in the prices of tobacco
  • motor vehicle prices recorded their first increase
Ayaka Matsumura

BBC News - China inflation rate dips to a 30-month low in July - 0 views

  • inflation
  • Consumer
  • dips to a 30-month low
  • ...24 more annotations...
  • rose by 1.8%
  • down from a 2.2%
  • 3% rise
  • spur domestic consumption
  • domestic consumption
  • domestic consumption
  • many Asian economies
  • Rising consumer prices
  • China's economy grew at its slowest pace in three years in second quarter.
  • 18.7%
  • and 6.1%
  • key drivers of the slowdown in the rate of inflation.
  • China's economy grew at an annual rate of 7.6%
  • slowing global demand for its exports.
  • down from an 8.1% expansion
  • boost stimulus measures
  • world's second-largest economy may slow further
  • Beijing has taken various measures to spur growth.
  • the People's Bank of China, has cut its key interest rates twice since the start of June.
  • benchmark lending rate down to 6%
  • more money to lend to consumers and businesses
  • slowdown in the growth of consumer prices may see policymakers introduce further measures to boost growth
  • more room for policy easing
  • rate of inflation was "likely be below the official 4% percent target for the year, so the policy focus for the government can stay clearly on growth
  •  
    China's inflation dipped to a 30-month low in July, giving policymakers a bigger cushion to boost stimulus measures to spur economic growth. Consumer prices rose by 1.8% in July, from a year earlier. That was down from a 2.2% growth rate in June and a 3% rise in May.
Tessa Jalink

Exclusive: Brazil mulls raising Mexico car trade quota - sources | Reuters - 0 views

  • quota
    • Tessa Jalink
       
      Quota's  Related to protectionism
  • $350 million
    • Tessa Jalink
       
      Change in the value of the quota. Good for axes. 
  • was used up in the first six months
    • Tessa Jalink
       
      The quota was obviously not large enough.  They filled the annual quota in just 6 months.
  • ...7 more annotations...
  • tariffs
    • Tessa Jalink
       
      Additional tariff if the quota is exceeded.  Make an interesting additional graph.
  • $300 million and $500
  • $300 million and $500
    • Tessa Jalink
       
      Quota increased by 300-500$ million
  • $1.55 billion
    • Tessa Jalink
       
      Old quota was 1.55$ billion
  • jumped around 70 percent
    • Tessa Jalink
       
      Reason for the initial reduction in the quota
  • to raise the quota
    • Tessa Jalink
       
      If the quota were to be raised it would not happen until after December.
  • Mexican exports to Brazil rose by 135 percent to some 109,000 units in the first six months of 2012. In dollar terms, this was a rise of around 112 percent to nearly $1.6 billion.
    • Tessa Jalink
       
      This doesn't make sense... shouldn't the percentages be the same...?
Tomomi Nakamura

Economist urges Taiwan to depreciate currency to boost exports|Economy|News|W... - 1 views

  • depreciate its currency to boost its slumping exports
  • Taiwan's exports in the January-July period declined 5.8% from the same period a year earlier to US$171.6 billion, and the depreciation of the Taiwan dollar could help reverse that trend
  • Asked if such a depreciation would contribute to higher inflation in Taiwan, Hsu said the central bank could use interest rate adjustments to keep inflation at bay.
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