### Summary
The US economy is forecasted to grow at a rate of 5.8%, causing concern for the Federal Reserve and those hoping interest rates will remain low.
### Facts
- 🔥 The US economy is predicted to grow by 5.8% according to the Federal Reserve Bank of Atlanta.
- 💸 Recent strength in retail sales, auto sales, housing starts, and industrial production have contributed to this economic forecast.
### Summary
The Russian stock market's recent gains are a facade and the country's economy is in decline, according to Yale researchers. Russia's frozen foreign assets and the depreciation of the ruble have artificially inflated stock market profits. Additionally, the economy is suffering from a loss of confidence, with people and money fleeing to neighboring countries.
### Facts
- 📉 The Russian stock market's recent gains are an illusion, masking the true state of the country's struggling economy.
- 🧊 Russia has frozen inflows and outflows of foreign assets, preventing investors from cashing out and propping up the stock market.
- 💸 The depreciation of the ruble has artificially inflated the value of Russian stocks, as the country's commodities are sold in foreign currencies.
- 💼 Workers, academics, and oligarchs are leaving Russia, taking with them technical and intellectual capital essential to the country's economy.
- 💔 Trust in President Vladimir Putin and confidence in the Russian economy have eroded, leading to a lack of domestic and foreign investment.
- 🌍 Neighboring countries like Armenia, Georgia, and Kyrgyzstan have become destinations for Russian money and talent fleeing the country.
- 📉 Experts warn that Russia's economy could continue to decline and the country may even become a failed state if the costly war in Ukraine persists.
### Summary
Russia's currency, the ruble, has plunged to a 16-month low, leading to surging prices of sushi due to the country's economic challenges and rift with the West.
### Facts
- 💰 Russia's currency, the ruble, hit a 16-month low last week, as the country's current account suffers from Western sanctions.
- 🍣 Local prices of sushi in Russia are expected to surge by as much as 30% in the coming weeks due to the weakened ruble and strained relations with the West.
- 📈 Russia's official inflation rate reached a five-month high of 4.3% in July, but some economists estimate it to be over 60%.
- 🍱 Restaurateurs in Russia are already facing increased costs of sushi ingredients, such as rice, fish, and seaweed, which are imported and dependent on the dollar exchange rate.
- 💸 The embattled ruble sank past 100 to the dollar, prompting the Russian central bank to raise interest rates significantly.
- 📉 Capital outflows, reduced reliance on Russian oil by European nations, and falling export revenues have added to Russia's economic challenges.
- 🇷🇺 President Vladimir Putin held an emergency meeting to discuss measures for stabilizing the exchange rate, including export restrictions and limits on foreign currency movement.
The Federal Reserve's long-held belief that the US economy had reached its long-term growth potential of 1.8% is being challenged as strong growth continues, driven by unexpected labor force growth, manufacturing construction, and potential improvements in productivity, prompting a larger conversation about the country's economic potential.
The economic troubles in Russia have led to increased investment from the United Arab Emirates (UAE) in Russian oil and gold markets, while wealthy Russians are flocking to the UAE, boosting its economy and causing a real estate boom.
Russia's stock market is performing well on the surface, but experts believe it is an illusion meant to hide the declining state of Russia's economy, which is likely to continue suffering as long as President Putin remains in power.
Investments in Russia's stock market are deceptive and likely to go nowhere as the country's economy spirals downwards under President Vladimir Putin's rule, according to Yale researchers.
The Russian economy is facing several major issues, including a labor shortage, soaring inflation, a tumbling ruble, the risk of recession, a real estate bubble, and the nationalization of foreign businesses, which could lead to stagnation and a fall in GDP growth in the long term.
Forecasters have decreased their growth expectations for China due to deflation, rising youth unemployment, and a property-market crisis, with GDP predicted to rise by only 5.1% in 2023 and 4.5% in 2024.
Italian Economy Minister Giancarlo Giorgetti believes that Italy can still achieve 1% economic growth this year, despite a contraction in output in the second quarter, as the government plans to maintain its economic growth forecast for 2023, although a rising deficit-to-GDP ratio and external variables are changing the picture.
Ukraine's economy grew by 2.2% in the first seven months of 2023, recovering from the impact of the Russian invasion in 2022, with the number of registered entrepreneurs surpassing pre-war levels.
The U.S. economy is expected to expand at a 2.2% annual rate in the current quarter, according to a real-time estimate from the New York Federal Reserve, which is lower than the Atlanta Fed's estimate of 5.6% growth; the strength of the economy will impact the Federal Reserve's decision on interest rates and inflation.
Mexico's finance ministry expects the country's economy to grow between 2.5% and 3.5% next year, with inflation slowing to 3.8%, according to a draft budget document released by the ministry.
Germany is predicted to experience a prolonged recession this year, making it the only major European economy to contract in 2023, according to the European Commission, with its growth expectations also being cut for 2024; this is attributed to struggles following Russia's invasion of Ukraine and the need to end energy dependency on Moscow.
The West needs to increase pressure on Russia's economy by intensifying sanctions and implementing stricter controls on Russian exports, oil price caps, and financial transactions, while also uncovering hidden stashes of money and putting Russia under a full financial embargo.
China's economy is expected to grow less than previously anticipated due to struggles in the property market, leading economists to predict further downgrades and posing risks to both the domestic and global economy.
Russia's economy ministry has raised its 2023 inflation forecast from 5.3% to 7.5% due to the impact of the war in Ukraine, and President Putin has acknowledged that high inflation is causing difficulties for businesses.
The Central Bank of Russia has raised its key lending rate to 13% in an effort to combat inflation and stabilize the struggling ruble, which has weakened significantly against the dollar due to decreased exports and increased imports. The country also faces challenges with low unemployment and a brain drain of talent to other former Soviet states. However, the Russian government remains optimistic about economic growth forecasts for 2023.
The Chief of Defence Intelligence of Ukraine believes that if the war of aggression against Ukraine continues, the Russian economy will only hold out until 2025 and their arms supply will dry up in 2026 or earlier.
Russia's economy is facing stagnation due to poorly timed interest rate hikes and high inflation, according to economists, despite President Putin's claims that the country's financial problems are manageable.
Double-digit interest rates and the possibility of further hikes are hitting the Russian economy hard, as the impact of higher industrial production and rising defense spending fade, leading to stagnation or decline in household consumption and investment.
Despite facing Western sanctions, Russia has managed to sustain its economy through increased military spending, but questions remain about the long-term viability of this militarization.
China's economy is still expected to grow 5% this year, despite outsized expectations and challenges such as a bloated property sector and demographic issues.
Russia's economic resilience, fueled by demand from the global south, is surprising analysts and oligarch Oleg Deripaska, who had previously predicted Russia would run out of money next year due to sanctions.
Russian billionaire Oleg Deripaska believes that the economy has not collapsed as much as he initially predicted under the weight of Western sanctions in response to Russia's expansion in Ukraine, and argues that countries like China and India are reluctant to sever economic ties with Russia due to their own practical reasons and need for Russian resources. Additionally, Deripaska suggests that Russia is content to maintain the status quo in the conflict, rather than escalate it further.
Germany's economy, the largest in the EU, is expected to contract by 0.6% this year due to a slowdown in exports and years of under-investment in infrastructure and technology, posing long-term challenges for growth and requiring significant investment and reforms to address them.
Russia is planning to increase its defense spending by 30%, suggesting that it is preparing for the war in Ukraine to continue for years and hoping that Western support for Ukraine will decrease.
China's economic growth this year may be as low as 2 percent, half of what the International Monetary Fund predicts, due to problems in the property sector, weak foreign direct investment, and other structural issues, according to Daniel Rosen of the Rhodium Group. The IMF has forecasted 5.2 percent growth for China, but Rosen believes growth above 3 percent is unlikely in the medium term. Additionally, concerns are rising that China's economic challenges could hinder global growth.
The Chinese economy is predicted to grow about 5.7 percent in the fourth quarter, surpassing the 5 percent annual growth target, driven by unleashed services consumption potential, accelerated infrastructure investment, and growth in high-tech and private manufacturing investment, according to the BOC Research Institute.
Russia's economy is being increasingly structured around war, with nearly one-third of the country's spending next year devoted to defense, redirecting funds from sectors like health care and education; however, the economic impacts of the war, including inflation and a weakened ruble, are causing concerns for citizens and the government alike.
The IMF predicts that the world economy will grow at a slower pace of 2.9% in 2024 due to ongoing risks from higher interest rates, the war in Ukraine, and the eruption of violence in the Middle East, highlighting the need for tight monetary policy to combat inflation.
Germany's government expects the country's economy to shrink by 0.4% this year due to the energy price crisis and global economic weakness, contrasting the previous forecast of 0.4% growth.
Germany faces a contraction in economic growth, with the economy expected to shrink by 0.4 percent in 2023, making it the only major world economy to post negative growth figures this year, due to factors including the energy price crisis and weakening global economic partners.
A further increase in military spending in Russia is likely to lead to inflationary pressure, financial strain on Russian businesses, and a reduction in spending on education and healthcare, according to UK intelligence.
The U.S. economy has defied expectations by experiencing faster growth, with a projected GDP increase of 4% to 5% in the third quarter, but concerns remain about a potential recession in the near future due to factors such as limited income growth, cautious business behavior, and economic restraints.
The U.S. economy is expected to have grown by more than 4% in the third quarter, thanks to increased spending by households, businesses, and the government, along with a strong job market and pandemic savings, though there are concerns that higher borrowing costs and various uncertainties could slow growth in the coming months.
