Chapter 1. The Home Economy

1989 ◽  
Vol 127 ◽  
pp. 7-25
Keyword(s):  
Exchange Rate ◽  
Interest Rates ◽  
Balance Of Payments ◽  
Medium Term ◽  
Short Term ◽  
Regional Pattern ◽  
Economic Cycles ◽  
The Past ◽  
Alternative Scenarios

On this occasion we have adopted a rather different format for this chapter from the customary one. Part One begins with an analysis of some of the most important developments of the past few years, with notes on the deterioration in the balance of payments, on the fall in the savings ratio and on the acceleration of inflation. Next we discuss some of the problems associated with economic forecasting. We analyse the errors made last year and compare them with the error margins normally associated with short-term forecasts of this kind. We look at the behaviour of the economy at the corresponding stage of previous economic cycles. And we consider the best way of forecasting GDP when there are discrepancies between the measures of its growth in the past. Our central forecasts for 1989 and 1990 are described briefly in the text of Part Two, and more fully set out in the usual tables. We end in Part Three with a discussion of alternative scenarios for the medium term, with particular reference to their implications for interest rates and the exchange rate. An appendix describes the regional pattern of unemployment and the way it has changed since the early 1980s.

scholarly journals Nigeria

2020 ◽  
Vol 20 (142) ◽  
Author(s):  
Keyword(s):  
Exchange Rate ◽  
Health Spending ◽  
Flexible Exchange Rate ◽  
Balance Of Payments ◽  
Fiscal Consolidation ◽  
Medium Term ◽  
Short Term ◽  
Financing Gap ◽  
Fiscal Space ◽  
The Impact

This paper presents Nigeria’s Request for Purchase Under the Rapid Financing Instrument (RFI). The authorities’ immediate actions to respond to the crisis are welcome. The short-term focus on fiscal accommodation would allow for higher health spending and help alleviate the impact of the crisis on households and businesses. Steps taken toward a more unified and flexible exchange rate are also important and unification of the exchange rate should be expedited. Once the coronavirus disease 2019 crisis passes, the focus should remain on medium-term macroeconomic stability, with revenue-based fiscal consolidation essential to keep Nigeria’s debt sustainable and create fiscal space for priority spending. Implementation of the reform priorities under the Economic Recovery and Growth Plan, particularly on power and governance, remains crucial to boost growth over the medium term. The emergency financing under the RFI will provide much needed liquidity support to respond to the urgent balance of payments needs. Additional assistance from development partners will be required to support the government’s efforts and close the large financing gap.

Nigerian central bank faces short-term debt hazards

2019 ◽  
Keyword(s):  
Exchange Rate ◽  
Central Bank ◽  
Interest Rates ◽  
Foreign Currency ◽  
Capital Controls ◽  
Financial Inclusion ◽  
Medium Term ◽  
Short Term ◽  
Content Type ◽  
Double Digit

Significance Emefiele has vowed that the CBN will significantly increase financial inclusion, recapitalise banks and help the economy achieve double-digit growth over his second term. However, the significant amount of CBN bills in circulation, a key but costly component of the Bank’s recent exchange rate strategy, poses serious medium-term risks. Impacts The CBN's continued focus on exchange rate stability leaves limited space for reducing interest rates over the short term. Effective foreign currency yields of over 10% are appealing for portfolio investors, but a sudden naira slide would prompt major losses. Significant divestment by foreign portfolio investors may make the CBN resort to temporary capital controls to limit damage to the naira.

scholarly journals Effect of some economic indicators on external debt in Sudan from 2002-2017: أثر بعض المؤشرات الاقتصادية على الدين الخارجي في السودان للفترة 2002-2017

2019 ◽  
Vol 3 (12) ◽  
Author(s):  
Gosay Mahgoub mohammedsalih Baba,  Abdulazim Suliman Almahal
Keyword(s):  
Exchange Rate ◽  
Financial Crisis ◽  
Interest Rates ◽  
Current Account ◽  
South Sudan ◽  
External Debt ◽  
Balance Of Payments ◽  
Independent Variables ◽  
High Interest ◽  
Paris Club

    aim to determine the type and tracks of the correlation between variables of deficit of government budget، current account deficit of the balance of payments، exchange rate، Gross Domestic Product(GDP) on the total external debt and clarify the impact of separation or independence of South Sudan in September 2011،also the financial crisis in 2008 on variables of paper، the hypotheses included a positive correlation & impact between the independents variables deficit variables in the general budget and the deficit in the current account of balance of payments، GDP on dependent variable external debt of Sudan as the inverse correlation & impact between the exchange rate with total external debt for the period 2006-2017،used historical approach to describe reasons and evolution of the external debt problem of Sudan causes، in addition، analytical descriptive method by correlation test between the independent variables and the dependent variable to determine the relationship type، also used multiple regression model in measuring and estimating the effect of independent variables on the dependent. The results outcome،the cumulative value of bilateral debt and high interest rates (contractual interest and delayed interest) significantly affect the accumulation of Sudan's total foreign debt،،maintain both the deficits in budget and in current account also GDP values a positive correlation of statistical significance and a degree of impact on Sudan's external debt، with Reverse correlation exchange rate، caused from Both of the world financial crisis and the independence of South Sudan in 2011 the، indirect impact on the external debt through its effect of increasing the value of the dollar with a decline of local currency and increasing the budget deficit and its impact on external debt، However، refers the weakness of impact in current account due to growth of gold exports in the period under study. Also the high ratio of bilateral debt owed to non-members of the Paris Club and its high interest rates it is complicated possibility of a solution through the HIPC and others initiatives، The necessary of structural reforms in economic policies by focusing on supporting national production elements as to overcome the obstacles of domestic investment and the abolition of taxes and customs on Alumni projects، microfinance projects، exporters projects as well as trying to follow a rational economic policy using foreign loans in the narrowest limits، and focus on loans on concessional terms،necessary to create an economic partnership between Sudan and creditors countries focus of largest proportion of debts، which is the official bilateral debt (non-members of the Paris Club)، to promote and facilitate the position of Sudan in negotiation of initiative of the HIPC or With regard of interest rate because it is largest and most significant obstruction in Sudan external debt.    

scholarly journals Remittances and exchange rate - Empirical evidence from emerging economies

2016 ◽  
Vol 19 (1) ◽  
pp. 39-51
Author(s):  
Canh Phuc Nguyen
Keyword(s):  
Exchange Rate ◽  
Panel Data ◽  
Emerging Markets ◽  
Interest Rates ◽  
Emerging Economies ◽  
Global Financial Crisis ◽  
Balance Of Payments ◽  
The Exchange Rate ◽  
Remittance Flows ◽  
Macroeconomic Risks

The exchange rate plays an important role to trade, investment and macroeconomic risks of open economies. There are many factors that affect the exchange rate such as inflation, interest rates, balance of payments where remittance flows receive more and more attention of economists due to their increase in their values, particularly in emerging economies. This study uses data from 21 countries which are classified as emerging markets in the period between 2001 and 2013 to investigate the impacts of remittances on exchange rate. Through panel data estimations, we found that remittances increase the value of the local currencies, which is not altered by the 2008 global financial crisis.

Interest Rates and Business Returns

2007 ◽  
Vol 201 ◽  
pp. 4-7
Author(s):  
Martin Weale
Keyword(s):  
Interest Rate ◽  
Interest Rates ◽  
Rate Increase ◽  
Yield Curve ◽  
Current Level ◽  
Short Term ◽  
The Past ◽  
Financial Options ◽  
Very High ◽  
Business Returns

The July interest rate increase has taken the Bank of England's Base Rate to the highest value for six years. In figure 1 we show the forward estimates for the nominal short-term interest rate taken from the Bank of England's yield curve tables for both government debt and liabilities of commercial banks. These are in effect market forecasts of the short-term rate produced in the past. The graph shows that the market has been taken somewhat by surprise by rising short-term interest rates. Two years ago the market was forecasting a rate of around 4 per cent per annum for July 2007. Nor were the probabilities the market gave to an interest rate of 5.75 per cent per annum very high. Twelve months ago the market in financial options implied that the chance of the rate exceeding 5.66 per cent per annum was only 15 per cent. Even in January of this year the chance of it reaching its current level or higher was put at less than 25 per cent. The National Institute cannot claim a substantially better record at forecasting interest rates. We normally use market expectations, as calculated from the yield curve, to provide exogenous forecasts as input into our model in the short term.

scholarly journals Analysis of The Effect of Gross Domestic Product, Exchange Rate, and Inflation on Balance of Payments in Indonesia

2019 ◽  
Vol 6 (10) ◽  
pp. 361-374
Author(s):  
Muammar Rinaldi ◽  
Shinta Arida Hutagalung ◽  
Muhammad Fitri Rahmadana
Keyword(s):  
Exchange Rate ◽  
Gross Domestic Product ◽  
Error Correction ◽  
Balance Of Payments ◽  
Domestic Product ◽  
Short Term ◽  
Independent Variables ◽  
Distributed Lag ◽  
The Exchange Rate

This study aims to analyze the effect of the short and long term gross domestic product, exchange rate, and inflation on Indonesia's balance of payments. The data used in this study are secondary data which is obtained indirectly with the period of 1995 to 2015. Data sources were obtained from Bank Indonesia and the Central Bureau of Statistics. The data collection method used in this study with the indirect method is documentation through recording or copying data from Bank Indonesia and the Central Bureau of Statistics. The analysis model used is Error Correction Mechanism (ECM). The results of this study indicate that the regression model of the Autoregressive Distributed Lag Model (ARDL) for the long term and Error Correction Model (ECM) regarding the effect of independent variables such as Interest Rates, Gross Domestic Product and Inflation Against the Dependent dependent variable in Indonesia, then it can some conclusions are presented, namely from several independent variables that are tried and included in the savings equation in Indonesia using the Autoregressive Distributed Lag Model (ARDL) for the long term and Error Correction Model (ECM) for the short term, namely the gross domestic product variable, the inflation rate, and exchange rate. In the long run there are 2 (two) significant variables, namely gross domestic product and the exchange rate. While inflation is not significant. For the short term, there is 1 (one) significant variable, namely the exchange rate. Thus, only exchange rate variables are significant in both the short and long term. With only 1 (one) significant independent variable both in the long term and short term, it can be concluded that the exchange rate in the long term and short term is the main determining factor that affects the Balance of Payments in Indonesia. In the long run, Independent variables such as Gross Domestic Product and the exchange rate on the dependent variable Balance of Payments in Indonesia have a significant effect on the dependent variable Balance of Payments. Whereas in the short run, the exchange rate variable has a significant effect, and for other independent variables such as the GDP variable and the inflation rate does not have a significant effect.

Angolan oil sector reform will require innovation

2018 ◽  
Keyword(s):  
Exchange Rate ◽  
Foreign Exchange ◽  
Oil Price ◽  
Structural Reforms ◽  
Medium Term ◽  
Short Term ◽  
Sector Reform ◽  
Content Type ◽  
Oil Sector ◽  
Oil Company

Subject Sonangol priorities. Significance Early structural reforms by new President Joao Lourenco and more positive economic projections for 2018 suggest a potential uptick in Angola’s fiscal fortunes. Since assuming power in September, Lourenco has overhauled the leadership of state-owned oil company Sonangol and dismissed several prominent officials associated with his predecessor Jose Eduardo dos Santos. Separately, Lourenco has moved to tackle the overvalued kwanza. While this will raise debt-servicing costs, this will be partly ameliorated by the recent oil price of over 60 dollars per barrel. Impacts Scrapping the dollar currency peg will help ease the foreign exchange crisis and end payment constraints in the aviation and oil sectors. A more realistic exchange rate will fuel inflation in the short term but will likely improve medium-term economic prospects. Urban support for the People's Movement for the Liberation of Angola (MPLA) could decline further if reforms remain elite-focused.

Czech vote may raise chances of new ANO-led government

2018 ◽  
Keyword(s):  
Monetary Policy ◽  
Interest Rates ◽  
Household Consumption ◽  
Capacity Constraints ◽  
Consumer Confidence ◽  
Structural Reforms ◽  
Medium Term ◽  
Short Term ◽  
Public And Private ◽  
Content Type

Significance Now that Zeman has successfully retaken the presidency with 152,000 more votes than his pro-Western rival Jiri Drahos after a campaign that was dominated by domestic issues, attention will focus once again on forming a majority government after the largest parliamentary party, ANO 2011, lost a vote of confidence on January 16. Impacts Consumer confidence may strengthen in the short term as the old ANO-CSSD government’s policies take effect, providing an economic boost. Robust household consumption and public- and private-backed investment may also contribute to stronger GDP this year. Although monetary policy is set to tighten, in response to signs of overheating, interest rates will remain at historic lows. The outlook for the economy in the short term is upbeat, with a strong outturn expected for the fourth quarter of 2017. Structural reforms will be required over the medium term to reduce the risk of capacity constraints, especially in industry.

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