Australia received a warning from Standard & Poor's (S&P) this week that it is on downgrade watch. Although the nation presently enjoys a AAA rating, the downgrade warning signals that Australia will likely soon receive a reduced rating.
Initial previews of America’s job market indicate resurgence for workers, but economists remain wary. Jobless claims fell to their lowest point in three months last week, falling to 254,000 versus 270,000 the previous week. That is far below consensus expectations of flat jobless claims, as more Americans find new jobs and return to work.
Russia’s GDP failed to improve as lower oil prices and Western sanctions hamper growth. Oil prices increased in the past year, but not enough for Russia to secure economic prosperity. The Moscow Times notes that the ruble strengthened to over 60% compared to the dollar, but has failed to enhance the economy thus far.
The Chinese government has put a heavy focus on innovation as a means of driving its economy and improving its recent, flagging performance. Local governments have heard the call and have rushed to erect new infrastructure and buildings designed to support this movement.
Unfortunately, there appears to be a big problem with this plan as an economic driver: businesses are not on board and nobody is making use of these newly built spaces and services.
Federal Reserve chiefs are reversing course on America’s economy as the country’s trade deficit widens with foreign nations. In May, the trade balance deficit rose 9.9% to $41.1 billion, far above expectations as exports fell and imports rose. Total imports were up 1.6% from the prior month, indicating America’s continued dependence on foreign production to meet domestic demand.
Prime Minister Narendra Modi will begin a four-day tour throughout Africa, with his first stop in Mozambique, according to The Tribune. The prime minister has agreed to a Memorandum of Understanding with the southern African country to double the amount of legume imports by 2021. Mozambique’s economy has struggled due to such factors as corruption and decreased donor aid from the international community.