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      I.M.F. Says Inflation Fight Is Largely Over but Warns of New Threats

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      The International Monetary Fund said protectionism and new trade wars could weigh on growth.The global economy has managed to avoid falling into a recession even though the world’s central banks have raised interest rates to their highest levels in years to try to tame rapid inflation, the International Monetary Fund said on Tuesday.But the I.M.F., in a new report, also cautioned that escalating violence in the Middle East and the prospect of a new round of trade wars stemming from political developments in the United States remain significant threats.New economic forecasts released by the fund on Tuesday showed that the global fight against soaring prices has largely been won: Global output is expected to hold steady at 3.2 percent this year and next. Fears of a widespread post-pandemic contraction have been averted, but the fund warned that many countries still face a challenging mix of high debt and sluggish growth.The report was released as finance ministers and central bank governors from around the world convened in Washington for the annual meetings of the I.M.F. and the World Bank. The gathering is taking place two weeks ahead of a presidential election in the United States that could result in a major shift toward protectionism and tariffs if former President Donald J. Trump is elected.Mr. Trump has threatened to impose across-the-board tariffs of as much as 50 percent, most likely setting off retaliation and trade wars. Economists think that could fuel price increases and slow growth, possibly leading to a recession.“Fear of a Trump presidency will loudly reverberate behind the scenes,” said Mark Sobel, a former Treasury official who is now the U.S. chairman of the Official Monetary and Financial Institutions Forum. Mr. Sobel said global policymakers would probably be wondering what another Trump presidency would “mean for the future of multilateralism, international cooperation, U.S.-China stresses and their worldwide ripples, and global trade and finance, among others.”We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

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      China’s Lackluster Growth Continues, Signaling Why Beijing Acted on Economy

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      Falling prices, weak consumer spending and a housing market crash help to explain why the Chinese government is taking steps to stimulate the economy.The Chinese economy continued to grow at a lackluster pace over the summer, according to data released on Friday, underscoring the urgency of the government’s recent attempts to bolster the economy.Construction has slowed because of a housing market meltdown. Millions of young college graduates have been unable to find work. Many local governments have run out of money to build roads or even pay the salaries of teachers and other workers.Looming over it all are falling prices across the Chinese economy, from apartments to cars to restaurant meals. Broadly falling prices, a phenomenon called deflation, make it hard for companies and families to earn enough to pay their mortgages and other debts.China’s economy grew 0.9 percent in July through September over the previous three months, China’s National Bureau of Statistics said. When projected out for the entire year, the economy grew at an annual rate of about 3.6 percent in the third quarter.The growth in part reflected an official revision on Friday to show that the second quarter was even weaker than previously acknowledged. Growth then was at an annual pace of 2 percent, and not the previously reported pace of 2.8 percent.Beijing has announced a series of measures since Sept. 24 to address the lingering troubles that became clear in the numbers released on Friday. The central bank has cut interest rates and minimum down payments for mortgages. The finance ministry promised the sale of more bonds to raise money for local governments to pay municipal salaries and buy vacant apartments for conversion into affordable housing.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

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      Fitch Ratings Issues Warning About France’s Finances

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      A rating agency’s warning about the country’s ballooning debt comes as the prime minister tries to push an austerity budget through a divided Parliament.France has become one of the most financially troubled countries in Europe, with an outsize debt and deficit that are likely to keep ballooning despite efforts by a fragile new government to address the problem, the Fitch Ratings agency said on Friday.A day after France’s new prime minister, Michel Barnier, introduced a tough austerity budget aimed at mending the nation’s rapidly deteriorating finances, Fitch issued a negative outlook for France’s sovereign credit rating. The rating was left unchanged at an AA– level for now, but Fitch warned that it could be revised lower if the government’s budget plans fall apart.The outlook reflects greater financial risks that have swirled in France since President Emmanuel Macron dissolved the lower house of Parliament in June and took until last month to appoint a new government. The episode left Parliament deeply divided, split nearly evenly between warring political factions on the left, right and center, and leaving Mr. Barnier with no clear majority. That will make it harder to pass a belt-tightening budget and assuage nervous international investors at a time when France’s national debt has ballooned to more than 3 trillion euros ($3.28 trillion).In a statement late Friday after Fitch’s announcement, France’s economy minister, Antoine Armand, said the government was determined “to turn around the trajectory of public finances and control debt.”France is the second-largest economy among the 20 countries that use the euro currency, and as such, is considered too big to fail. European Union rules require members to have sound finances, including capping debt at 60 percent of economic output and not letting government spending exceed revenues by more than 3 percent.But France is now well in excess of both of those limits, drawing a formal rebuke recently from the European Union. France’s debt has spiraled to more than 110 percent of economic output, the worst in the bloc after Greece and Italy. Fitch warned that the debt could surge to more than 118 percent of gross domestic product by 2028 if nothing is done. The annual budget deficit is set to widen to 6.1 percent of gross domestic product this year, much higher than expected, and an increase of more than 10 percent from last year.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

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      China Stocks Surge After Government Measures to Boost Economy

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      The government has fired up investors by encouraging banks to lend more to buyers of stock and real estate, but economists say more stimulus is needed.Share prices surged as trading resumed on Tuesday in mainland China following a weeklong national holiday, as investors rushed in to make bullish bets that Beijing’s leaders are committed to providing stimulus for the faltering Chinese economy.Before the break, the Chinese government jolted stock markets sharply higher with a package of measures aimed at halting the cycle of falling real estate prices and weakening consumer confidence.The central bank and other top financial agencies announced on Sept. 24 that they were cutting interest rates, reducing the minimum down payments for mortgages, and encouraging banks to lend more money for investors to buy shares.Two days later, the ruling Politburo issued an uncommonly blunt call for more to be done to help the economy. Several municipal governments soon followed by trimming or dismantling their restrictions on real estate purchases as a way to stabilize the housing market in their cities.

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      China’s CSI 300 Index
      As of Oct. 8, 2024 9:43 a.m. local time.Source: FactSetBy The New York TimesThe CSI 300, an index of large companies traded in Shanghai and Shenzhen, soared 25 percent in heavy trading over the five sessions before the holiday. Market operators tested their systems on Monday in anticipation of another influx of activity.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

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      Fears of a Global Oil Shock if the Mideast Crisis Intensifies

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      The threat of an escalating conflict between Israel and Iran has created an “extraordinarily precarious” global situation, sowing alarm about the potential economic fallout.As the world absorbs the prospect of an escalating conflict in the Middle East, the potential economic fallout is sowing increasing alarm. The worst fears center on a broadly debilitating development: a shock to the global oil supply.Such a result, actively contemplated in world capitals, could yield surging prices for gasoline, fuel and other products made with petroleum like plastics, chemicals and fertilizer. It could discourage investment, hiring, and business expansion, threatening many economies — particularly in Europe — with the risk of recession. The effects would be potent in nations that depend on imported oil, especially poor countries in Africa.The possibility of this calamitous outcome has come into focus in recent days as Israel plots its response to the barrage of missiles that Iran unleashed last week. Some scenarios are seen as highly unlikely, yet still conceivable: An Israeli strike on Iranian oil installations might prompt Iran to target refineries in Saudi Arabia or the United Arab Emirates, both major oil producers. Iranian-supported Houthi rebels claimed credit for an attack on Saudi oil installations in 2019. The Trump administration subsequently pinned the blame on Iranian forces.As it has done before, Iran might also threaten the passage of tankers through the Strait of Hormuz, the critical waterway that is the conduit for oil produced in the Persian Gulf, the source of nearly one-third of the world’s oil production. Such a move could entail conflict with American naval ships stationed in the region.That, too, is currently considered to be improbable. But the upheaval in the region in recent months has pushed out the parameters of possibility, rendering imaginable scenarios that were once dismissed as extreme.As Israel plots its next move, it has other targets besides Iranian oil installations. Iran would have reason for caution in crafting its own retaliation. Broadening the war to its Persian Gulf neighbors would invite a punishing response that could push Iran’s own economy — already bleak — to the brink of collapse.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

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      Stocks Tumble in Japan After Party’s Election of New Prime Minister

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      Stocks dropped after Japan’s governing party chose Shigeru Ishiba, a critic of the country’s longstanding ultralow interest rates, as its leader.Stocks in Japan fell sharply after the country’s governing party chose a leader some view as hawkish on interest rates, underlining how central bank decisions continue to set the course of the world’s fourth-largest economy after decades of easy money policy.On Friday, Japan’s Liberal Democratic Party elected Shigeru Ishiba, a proponent of raising interest rates to help curb inflation, as Japan’s next prime minister.Mr. Ishiba narrowly defeated Sanae Takaichi, a disciple of Shinzo Abe, who remains committed to the former prime minister’s longstanding policies aimed at strengthening Japan’s economy by maintaining ultralow interest rates.Japan’s benchmark Nikkei 225 index fell more than 4 percent in early trading on Monday.Some economists said the decline, which they described as the “Ishiba Shock,” was caused by the unwinding of stock trading that reflected expectations that Ms. Takaichi would be elected.The market jitters show how the recent L.D.P. election came at a pivotal moment for the Japanese economy.Following a recent surge of inflation, the Bank of Japan has raised interest rates twice this year. The bank’s governor, Kazuo Ueda, has indicated he plans to continue increasing rates, though it is unclear how quickly that might happen.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

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      $50 Billion in Aid to Ukraine Stalls Over Legal Questions

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      U.S. and European officials are struggling to honor their pledge to use Russian assets to aid Ukraine.A long-awaited plan to help Ukraine rebuild using Russian money is in limbo as the United States and Europe struggle to agree on how to construct a $50 billion loan using Russia’s frozen central bank assets while complying with their own laws.The fraught negotiations reflect the challenges facing the Group of 7 nations as they attempt to push their sanctions powers to new limits in an attempt to punish Russia and aid Ukraine.American and European officials have been scrambling in recent weeks to try to get the loan in place by the end of the year. There is added urgency to finalize the package ahead of any potential shifts in the political landscape in the United States, where support for Ukraine could waver if former President Donald J. Trump wins the presidential election in November.But technical obstacles associated with standing up such a loan have complicated matters.Group of 7 officials grappled for months over how to use $300 billion in frozen Russian central bank assets to aid Ukraine. After European countries expressed reservations about the legality of outright seizing the assets, they agreed that it would be possible to back a $50 billion loan with the stream of interest that the assets earn.The solution was intended to provide Ukraine with a large infusion of funds without providing more direct aid from the budgets of the United States and European countries. It also allowed western allies to make use of Russia’s assets without taking the step of actually spending its money, which many top officials in Europe believed would be illegal.But differences in the legal systems in the United States and in Europe, which both plan to provide the money up front, have made it difficult to structure the loan.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

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      In Pennsylvania, Wary Voters Wonder if Harris Can Deliver

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      Economic issues including soaring rents, student loan debt, supply chain issues and a stagnant minimum wage are on their minds.In a packed college gym in downtown Wilkes-Barre, Pa., on Friday evening, Vice President Kamala Harris closed out a long, successful week by elaborating on her vision for “an opportunity economy,” a centerpiece of her presidential campaign: Three million new homes. A pledge to take on “corporate price gouging.” Tax cuts for more than 100 million Americans.About a mile away, Judith Johnson was watching Ms. Harris’s rally on television in her apartment. A registered Republican, Ms. Johnson, 54, thought Ms. Harris had been “wonderful” in the debate on Tuesday; she was eager to learn more, especially about the economy.But Ms. Johnson’s vote, at least for now, remains with former President Donald J. Trump. “He’s a businessman,” she said. “And I think he sees what’s going on.”Ms. Johnson exemplifies the challenge facing Ms. Harris in Pennsylvania and in other critical battleground states. People like her say they are open to switching their vote. But they want to know: An opportunity economy — how? And for whom?Wilkes-Barre, a former industrial city, is seat of Luzerne County, which Mr. Trump has won handily, twice. While Democrats tend to do best in the Philadelphia and Pittsburgh regions, they see narrowing the gap in places like Wilkes-Barre as key to winning the state. In 2020 President Biden, who was born in nearby Scranton, ate into Mr. Trump’s margin there by several points, part of a wave of support that lifted him to victory in the state.Polls suggest Ms. Harris may struggle to replicate that success. Despite her modest upbringing and her emphasis, on the campaign trail, on the needs of “middle-class, working people,” as she put it on Friday, she is still laboring to persuade many voters that she understands them, or that she can deliver on her promises.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More