Iran Nuclear deal: EU and Japan back Iran nuclear deal despite US

Despite the US decision to withdraw, the European Union and Japan reiterated on Thursday their support for the Iranian nuclear non-proliferation deal reached at UN-level in 2015. At a summit in Brussels, Japan's prime minister Abe and EU presidents Juncker and Tusk also committed to further develop the EU-Japan economic partnership agreement. It entered into force on 1 February bringing a third of the world's Gross Domestic Product together.

Read more: EU and Japan back Iran nuclear deal despite US

Glonal Economy: gloom forecast as IMF revises down world growth

Not surprisingly the International Monetary Fund has cut its global growth forecast for the next two years.
In October the IMF projected world growth of 3.8 percent for 2015 now revised down to 3.5 percent.
In 2016 growth will fail to meet the IMF’s initial 4 percent target and will hit the 3.7 percent mark.

The latest doom and gloom comes despite most countries benefiting from the low oil prices.

Olivier Blanchard is Chief Economist at the IMF: “For 2015, we have revised US growth up to 3.6 percent, but we have revised Eurozone growth down to 1.1 percent and Japan growth down to point six percent.”

The exception to the rule is the United States of America with the IMF saying Washington has well and truly put the financial crisis behind it.

The British economy is expected to bump along at 2.4 percent growth for 2016.

While Russia will see its economy contract by 3 percent this year and 1 percent next.

A Capital Market Advise for Close Brothers Seydler Bank is Oliver Roth: “America and Asia have stable growth, while the Europeans are still right in the middle of a debt crisis. The economy is going nowhere. So the global economy is being supported by two and not three pillars and that is a grave concern for the IMF. .

"The emerging markets are facing problems namely from high US interest rates and as growth steadies governments need to take prudent decisions for the well being of their economies."

Read more: Global gloom forecast as IMF revises down world growth | euronews, economy

Turkey’s troubles contagious due to bad policies in West - by Paul Krugman

Okay, who ordered that? With everything else going on, the last thing we needed was a new economic crisis in a country already racked by political turmoil. True, the direct global spillovers from Turkey, with its Los Angeles-sized economy, won’t be large. But we’re hearing that dreaded word “contagion” – the kind of contagion that once caused a crisis in Thailand to spread across Asia, more recently caused a crisis in Greece to spread across Europe, and now, everyone worries, might cause Turkey’s troubles to spread across the world’s emerging markets.

It is, in many ways, a familiar story. But that’s part of what makes it so disturbing: why do we keep having these crises? And here’s the thing: the intervals between crises seem to be getting shorter, and the fallout from each crisis seems to be worse than the last. What’s going on?

Before I get to Turkey, a brief history of global financial crises.

For a generation after the second World War, the world financial system was, by modern standards, remarkably crisis-free – probably because most countries placed restrictions on cross-border capital flows, so that international borrowing and lending were limited. 

In the late 1970s, however, deregulation and rising banker aggressiveness led to a surge of funds into Latin America, followed by what’s known in the trade as a “sudden stop” in 1982 – and a crisis that led to a decade of economic stagnation.

Latin America eventually returned to growth (although Mexico had a nasty relapse in 1994), but, in the 1990s, a bigger version of the same story unfolded in Asia: huge money inflows followed by a sudden stop and economic implosion. Some of the Asian economies bounced back quickly, but investment never fully recovered, and neither did growth.

Most recently, yet another version of the story has played out within Europe, with a rush of money into Greece, Spain and Portugal, followed by a sudden stop and immense economic pain.

As I said, although the outline of the story remains the same, the effects keep getting worse. Real output fell 4 per cent during Mexico’s crisis of 1981-83; it fell 14 per cent in Indonesia from 1997 to 1998; it has fallen more than 23 per cent in Greece.

Read more: Turkey’s troubles contagious due to bad policies in West - Economic News | Ireland & World Economy Headlines |The Irish Times - Tue, Feb 04, 2014