Economic News Round-Up

The password is: Shrinkage.

BusinessweekIreland's Economic Growth Rate to Halve in 2012, ESRI Says: "Ireland's economic growth rate will more than halve next year as exports slow amid a deepening euro-region debt crisis, the Economic & Social Research Institute said. ... 'There has been a significant deterioration in the outlook for the world economy in recent months stemming from the uncertainty about the euro zone debt crisis,' the ESRI said."

Reuters—Brazil Poised for 3rd Rate Cut as Inflation Slows: "Brazil is seen likely to cut interest rates a third straight time on Wednesday, ramping up a bet that the euro zone debt crisis and a fragile world economy will brake inflation in Latin America's biggest country. ... A worsening debt crisis in Europe is clouding the global economy, inflation has begun to ease in Brazil, and recent indicators show the country's economy may have contracted in the third quarter."

AFP—China Eases Credit Controls Amid Slowing Growth: "China said Wednesday it will cut the bank reserve requirement ratio by 50 basis points, as it seeks to boost lending and spur growth in the world's second largest economy. The move, which takes effect on December 5, is the strongest signal yet that the government wants to ease tight credit restrictions put in place to curb surging inflation and property prices."

Bloomberg—South Africa Economy Expands Less Than Forecast at 1.4% as Exports Slump: "South Africa's economy, the biggest in Africa, expanded at an annualized 1.4 percent in the third quarter, less than economists forecast, as manufacturing and mining output slumped. ... South Africa is struggling to meet employment and economic growth targets as the debt crisis in Europe, which buys about a third of South African manufactured goods, pushes that region close to recession."

BusinessweekEgypt's Rulers Face Unrest, Crumbling Economy as Vote Begins: "The unrest in Egypt has hurt the economy, as tourists have shunned the country and industrial production has been hit by strikes. Gross domestic product grew 1.8 percent in the fiscal year through June, the slowest in at least a decade. The country's long-term foreign sovereign credit rating was cut one level to B+, four levels below investment grade, at Standard & Poor's on Nov. 24."

Reuters—India's Economy Slows to Weakest Pace in More Than Two Years: "India's economy grew at its weakest pace in more than two years in the quarter that ended in September, revealing the heavy toll that stubborn inflation, rising interest rates and crisis-hit global capital markets are having on Asia's third-biggest economy. ... The economy has been hit by a confluence of factors. Inflation has been persistently high all year, policy inertia has hurt investment and industrial output and, now, capital outflows have pushed the rupee to new lows."

Bloomberg—Denmark's Economy Shrank More Than Estimated Last Quarter: "Denmark's economy contracted in the third quarter, after households spent less and the government cut expenditure, threatening to delay the nation's recovery as twin housing and bank crises persist."

BusinessweekGerman Economy to Shrink 0.2% in Fourth Quarter, Institute Says: "The German economy, Europe's biggest, may slide into a 'technical' recession at the end of the year as domestic and foreign orders drop, the DIW economic institute said. The economy will shrink 0.2 percent this quarter, led by a slump in industrial production, and may contract again in the first three months of 2012, the Berlin-based institute said today in an e-mailed statement. 'The euro crisis is affecting the German economy more and more,' DIW economist Ferdinand Fichtner said in the statement."

Bloomberg—Slovenian Economy Unexpectedly Contracted in the Third Quarter: "Slovenia's economy unexpectedly contracted in the third quarter from a year earlier as industrial output and export growth lost pace."

Etc. Shockingly, European confidence in the economic outlook has fallen to a two-year low. Huh. Go figure.

In good news, Poland, Canada, and Sweden have done slightly better than expected. And USians are inexplicably more confident about their economy, up 15 points to 56.0 from October's low of 40.9. Well aren't we the eternal optimists!

In other economic news...

CNN Money—Fed, ECB Offer Aid for Global Financial System: "The Federal Reserve, acting with five other central banks, took further steps Wednesday to make it cheaper for banks around the world to trade in U.S. dollars. The Fed—along with central banks of the eurozone, England, Japan, Switzerland and Canada—announced a coordinated plan to lower prices on dollar liquidity swaps beginning on December 5, and extending these swap arrangements to February 1, 2013. The effort is meant to 'ease strains in financial markets and thereby mitigate the effects of such strains on the supply of credit to households and businesses and so help foster economic activity,' the Federal Reserve said in a press release."

The GuardianWorld Central Banks Launch Co-Ordinated Action to Fight Financial Crisis: "Federal Reserve, ECB, Bank of England, the Bank of Japan, the Bank of Canada and the Swiss Central Bank act to prevent liquidity drying up in the financial system." Live coverage will continue throughout the day at the link.

CNN—Study: Cyber Monday Was Biggest Online Shopping Day Ever in US: "Analysts have begun providing their final tallies for Cyber Monday sales, which found that people piled more in their virtual shopping carts than ever before. Monday was the highest-grossing online shopping day in U.S. history, with spending reaching $1.25 billion, according to market research firm comScore. That's up 22% from the previous record, which was last year's Cyber Monday."

The GuardianOccupy Protests: Police Clear Activists from LA and Philadelphia Camps: "Hundreds of police officers are clearing protesters from Los Angeles and Philadelphia, arresting those refusing to leave and dismantling tents. ... [T]here were 200 arrests in Los Angeles alone, according to police. In Los Angeles around 1,400 officers wearing riot gear and biohazard suits were moving members of Occupy Los Angeles after they ignored a Monday deadline to leave the area. ... In Philadelphia, police began pulling down tents at about 1:20am (EST) after giving demonstrators three warnings that they would have to leave, which nearly all of the protesters followed. Dozens of demonstrators then marched through the street until they were stopped by police."

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