The global economy has a growing chance of pulling off a soft landing, finance chiefs said in a draft of the G20’s closing statement at this week’s meeting in Brazil, citing faster-than-expected disinflation as one of the risks.
“We note that the likelihood of a soft landing in the global economy has increased,” said the draft communique dated Feb. 23, seen by Bloomberg News. “Risks to the global economic outlook are more balanced. Upside risks include faster-than-expected disinflation.”
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The text isn’t final and wording is subject to intensive negotiations in Sao Paulo, before the arrival of finance ministers on Wednesday. The G20 gathering has already been marked by sharp divisions, especially over the wars in Ukraine and Gaza that are roiling global politics. The draft text refers to “conflicts in many regions of the world” among the challenges, without naming them, as well as “geoeconomic tensions.”
The statement reflects a relatively upbeat view of a global economy that’s struggled in recent years to overcome the impact of the pandemic, soaring inflation and a sharp increase in interest rates.
“Inflation has receded in most economies, thanks in large part to appropriate monetary policies, the easing of supply chain bottlenecks” and moderating commodity prices, the G20 draft said.
At a press conference in Sao Paulo on Tuesday, Treasury Secretary Janet Yellen emphasized the U.S. role, saying that “America’s path to a soft landing has underpinned global growth.”
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Yellen acknowledged risks to the outlook including prolonged conflicts in Ukraine and the Middle East, which pushed commodity prices up and disrupted supply chains, and debt troubles plaguing low-income nations. She noted that “inflation has been coming down in many countries,” while stopping short of suggesting that interest-rate cuts might now be appropriate.
It’s on the language to describe military conflicts like Russia’s invasion of Ukraine, which has also hit economies worldwide, that the G20 officials have struggled. The group includes Russia and China, as well as the U.S. and Western allies. A preliminary session Monday saw a day of haggling over how to refer to the economic effects and risks of war.
Ministers are expected to try and bracket off some of the contentious topics in order to stop them from swamping other matters. Brazil, hosting the session in Sao Paulo’s iconic Bienal centre amid lush parkland, is pushing an agenda that includes poverty, sustainable development, and the reform of global institutions.
It’s unclear how much of that agenda will make it through the meeting amid all the divisions. The final communique is typically where ministers outline their consensus view of the world economy and the challenges ahead.
— With assistance from Viktoria Dendrinou and Christopher Anstey.
OTTAWA – Statistics Canada says the country’s merchandise trade deficit narrowed to $1.3 billion in September as imports fell more than exports.
The result compared with a revised deficit of $1.5 billion for August. The initial estimate for August released last month had shown a deficit of $1.1 billion.
Statistics Canada says the results for September came as total exports edged down 0.1 per cent to $63.9 billion.
Exports of metal and non-metallic mineral products fell 5.4 per cent as exports of unwrought gold, silver, and platinum group metals, and their alloys, decreased 15.4 per cent. Exports of energy products dropped 2.6 per cent as lower prices weighed on crude oil exports.
Meanwhile, imports for September fell 0.4 per cent to $65.1 billion as imports of metal and non-metallic mineral products dropped 12.7 per cent.
In volume terms, total exports rose 1.4 per cent in September while total imports were essentially unchanged in September.
This report by The Canadian Press was first published Nov. 5, 2024.
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