JERUSALEM — Bank of Israel Governor Amir Yaron said on Thursday it would need a significant economic slowdown for policymakers to lower short-term interest rates.
“There has to be a more significant deterioration in economic activity,” Yaron told reporters after the Bank of Israel held its benchmark interest rate at 0.25% at a policy meeting, as widely expected amid a stable shekel and solid economic growth.
“Risks of a marked deterioration in the global economy declined and growth is expected to improve in 2021,” he said.
Yaron pointed to both the U.S. Federal Reserve and European Central Bank as currently stopping any further easing as well as a rate hike in Sweden.
In an updated forecast, the bank’s own economists reiterated a view that the key rate would either remain unchanged or fall to 0.1% this year, with a gradual rise in the rate towards the end of 2021.
Yaron and other monetary policy committee (MPC) members have made it clear that they would prefer to leave the rate unchanged and use other tools like foreign exchange intervention to prevent a further shekel appreciation, which has already helped trigger a sharp drop in inflation to an annual rate of 0.3% in November.
“The committee is taking additional steps as necessary to make monetary policy more accommodative,” Yaron said, declining to elaborate.
Since the previous rate decision on Nov. 25, the Bank of Israel has bought more than $3.5 billion of foreign currency, which has led to a stabilization of the exchange rate.
The shekel gained 8.3% versus a basket of currencies of main trading partners in 2019, “a development that continues to make it difficult to return inflation to the target range,” the bank said in a statement.
Yaron noted that the strength was beyond what would expect as a result of a healthy economy and partly blamed some of the gains to “short-term financial factors.” He declined to specify what these factors were but analysts believe they are speculators.
Israel’s economy grew an estimated 3.3% last year but the central bank’s staff projects a slowdown to 2.9% in 2020 – with 0.3 percentage points of that coming from the start of natural gas production at the Leviathan field.
Yaron said the weaker growth will stem from a markedly contractionary fiscal effect in the first half of 2020 in the absence of an approved 2020 budget, given the year-long political stalemate and the current caretaker government’s limited ability to act. A third election in less than a year is slated for March 2.
“There is uncertainty regarding the fiscal policy that will prevail after the elections, as it is likely to be contractionary as well, should necessary steps to deal with the rising deficit be taken,” he said. “As long as the political and fiscal uncertainty continues, it sharpens the need to keep monetary policy accommodative in order to support growth.”
(Reporting by Steven Scheer and Ari Rabinovitch; Editing by Tova Cohen and Susan Fenton)
Top economists call for radical redirection of the economy to put Health for All at the centre in the run-up to G20 – World Health Organization
The COVID-19 Pandemic has brought into focus the stark reality of the large and growing inequities across the globe in access to health care and health products: for every 100 people in high-income countries, 133 doses of COVID-19 vaccine have been administered,
while in low-income countries, only 4 doses per 100 people have been administered.
Yet, to date, the world continues to follow the same economic paradigm that doesn’t change the underlying finance structure and applies outdated thinking on economic development, which stands in the way of Health For All. As the G20 Summit approaches
in Rome from 29-31 October, where, first, health and finance ministers, and then heads of state and government, come together, there is a window of opportunity for a radical redirection from health for the economy to the economy for health for all.
The critical challenge is both to increase the magnitude of the finance available for health and to govern it in a more directed and effective manner.
The World Health Organization (WHO) Council on the Economics of Health For All (WHO Council on the Economics of Health For All) calls now, more than ever, for clear, ambitious goals to mobilize and focus investments towards health, considering financing for health as a long-term investment and not
a short-term cost. The Council’s new brief on Financing Health for All prioritizes two key dimensions: more finance and better finance and lays out the way forward through three pathways to action:
- Creating fiscal space by easing artificial constraints imposed by outdated economic assumptions and reversing the harmful effects of reforms that lead to big health cuts, allowing spending and investments towards Health For All to
- Directing investments to ensure Health for All becomes the central purpose of economic activities, and increase public leadership and dynamic state capabilities to create a conducive regulatory, tax, industrial policy and investment
- Governing public and private finance by regulating the functioning and financing of private health markets through measures that crowd in and direct private finance towards improving health outcomes globally and equitably.
The Council believes that a new paradigm must be pursued that avoids macroeconomic policies and assumptions that move us away from Health For All. This means designing policies to reach health for all now and in the long-term and realigning finance from
all sectors and sources through conditionalities that fuel symbiotic gains in the public interest. Not only more financing of the health sector, but better-quality finance is crucial to deliver Health For All, which must be equitable and ensure a
sustainable impact on peoples’ lives.
The challenge is to change mindsets within countries that impose internal constraints on spending and to transform externally-imposed conditionalities that hinder spending on what matters for health and promote Health For All. Changing the rules of the
game is a fundamental priority of any strategy to deliver Health For All, and policymakers have the ability to rethink finance now.
“The COVID-19 pandemic has demonstrated that the financing of health systems needs to change radically to protect and promote the health of all people,” said Dr Tedros Adhanom Ghebreyesus, Director-General of WHO. “The latest report
by the Council on the Economics of Health For All makes a clear and compelling argument for the need for sustained financing to be directed to achieving health for all people, and for investments to be understood as long-term gains for national and
“While health systems are under-resourced, more finance is not the only solution. The work of the Council stresses the need to reform and redirect finance in radical ways so that the objective is Health For All is designed into the financial structures,
the conditionalities and the partnerships between business and the state,” said Professor Mariana Mazzucato, Chair of the Council.
By way of background, the WHO Council on the Economics of Health For All was established in November 2020 by WHO Director-General Dr Tedros Adhanom Ghebreyesus. The Council’s core mission is to rethink how value in health and wellbeing
is measured, produced, and distributed across the economy. It will recommend a new way to shape the economy with the objective of building healthy societies that are just, inclusive, equitable, and sustainable. Made up of ten of the world’s
most eminent economists and health experts, the Council works on four areas on how to rethink measurement of economic development, financing, capacity, and innovation with the aim of achieving Health for All. Briefs in each of these areas, and a comprehensive
final report to be produced in 2023, will be used to build momentum amongst finance ministers, heads of state/government, as well as other decision makers such as other financial authorities and international development authorities, towards changing
the structure of economic activity in favor of Health For All.
The members of the Council are Professor Mariana Mazzucato (Chair), Professor Senait Fisseha, Professor Jayati Ghosh, Vanessa Huang, Professor Stephanie Kelton, Professor Ilona Kickbusch, Zelia Maria Profeta da Luz, Kate Raworth, Dr Vera Songwe and Dame
Marilyn Waring (see bottom of page: WHO Council on the Economics of Health For All).
Swiss National Bank Warns of Risks With Green Economy Push – Bloomberg
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Actively pushing for a green transformation of the economy could undermine the effectiveness of the Swiss National Bank’s monetary policy, Governing Board Member Andrea Maechler said.
UBS logs surprise 9% rise in Q3 net profit
UBS posted a 9% rise in third-quarter net profit on Tuesday, as continued trading helped the world’s largest wealth manager to its best quarterly profit since 2015.
Its third-quarter net profit of $2.279 billion far outpaced a median estimate of $1.596 billion from a poll of 23 analysts compiled by Switzerland’s largest bank.
“Our business momentum, our focus on fueling growth, on disciplined execution and on delivering our full ecosystem to clients – all of this led to another strong quarter across all of our business divisions and regions,” Chief Executive Ralph Hamers said in a statement.
In each of the last four quarters, UBS saw double-digit percent gains in net profit as buoyant markets helped it generate higher earnings off of managing money for the rich.
From July through September, favourable market conditions, and higher lending and trading amongst its wealthy clientele, unexpectedly helped raise earnings over the bumper levels reported in the third quarter of last year.
(Reporting by Oliver Hirt and Brenna Hughes Neghaiwi; Editing by Michael Shields and Edwina Gibbs)
COVID-19 Update: Four Alberta doctors launch lawsuit over vaccine policy | 1,592 cases, 25 deaths reported over three days | Sask. won't impose more restrictions – Calgary Herald
Social media giants YouTube, TikTok, Snap questioned at Senate hearing over kids’ safety – Global News
Aberdeen Asia-Pacific Income Investment Company Limited Announces Timing of Re-Domiciliation, Return of Par Value and Change in Investment Policies – Yahoo Finance
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