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Zimbabwe to More Than Double Spending in 2023 to Revive Economy

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(Bloomberg) — Zimbabwe more than doubled its spending plans for 2023 as it seeks to revive an economy that exited a recession last year.

The plan presented by Zimbabwe’s Finance Minister Mthuli Ncube projects expenditure will increase by 121% to 4.2 trillion Zimbabwe dollars ($6.5 billion) budget.

The bulk of the funds will be spent on social services and infrastructure projects with a key focus on the mining, energy and agricultural sectors to jolt economic growth, he said in a budget presentation to lawmakers at the new Chinese-built Parliament in Mount Hampden, 23 kilometers (14 miles) north of the capital.

Gross domestic product growth is estimated to slow to 3.8% next year from 4% forecast for 2022, he said.

Economic growth globally is being crimped by tightening financial conditions as central bankers including Zimbabwe’s try to temper high inflation, adding to the damage from the war in Ukraine and China’s slowdown. The southern African nation’s benchmark interest rate is at 200%, while annual inflation is at 269%.

The IMF last month cut its forecast for global growth next year to 2.7%, from 2.9% and sees Zimbabwe’s economy expanding at 2.8%.

Other Highlights

  • Mthuli expects Z$21.8 trillion in revenue
  • About Z$76 billion was allocated toward next year’s general elections in which President Emmerson Mnangagwa is seeking re-election
  • Budget deficit to GDP is forecast at 1.5%
  • To plug the funding gap, the government plans a bond issuance on the Victoria Falls Stock Exchange

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S&P/TSX composite rises, U.S. markets also make gains Monday

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TORONTO – Canada’s main stock index posted modest gains Monday, while U.S. markets also rose near the end of the day to kick off the week in the green.

Stocks were down earlier in the afternoon in part because of comments from U.S. Federal Reserve chair Jerome Powell, said Anish Chopra, managing director at Portfolio Management Corp.

Powell said Monday that more interest rate cuts are coming, but not quickly.

“We’re looking at it as a process that will play out over some time,” he said at a conference in Nashville, Tenn.

“It’ll depend on the data, the speed at which we actually go.”

The Fed isn’t in a hurry to cut its key interest rate, said Chopra, as it weighs the upside risks to inflation and the downside risks to the job market.

“Inflation could go up, it could go down, but they believe that if the data remains consistent with what they’ve seen, there will be two more rate cuts coming, but they will be smaller,” said Chopra.

Though the central bank has already signalled it expects to make two more quarter-percentage-point cuts this year, market watchers had been hoping for another outsized cut before the end of the year, he said.

“So I think Powell’s comments from this afternoon disappointed the markets and investors in the sense that if they were anticipating bigger rate cuts, that’s not the news they got.”

In New York, the Dow Jones industrial average was up 17.15 points at 42,330.15. The S&P 500 index was up 24.31 points at 5,762.48, while the Nasdaq composite was up 69.58 points at 18,189.17.

The S&P/TSX composite index closed up 41.31 points at 23,998.13.

At the end of this week, markets will get the latest report on the U.S. labour market, perhaps the most closely watched economic data right now after a couple of softer-than-expected reports prompted fears that higher rates were having too hard an impact on jobs.

If the report is weaker than expected this time, that could change the Fed’s thinking around its interest rate trajectory, said Chopra.

However, the Fed’s next rate decision is in November, he noted, so there’s still another labour report after this week’s release for the central bank to weigh.

Overseas, Asian markets had a frenzied start to the week, with Japanese markets down 4.8 per cent while stocks in China saw their best day in almost 16 years.

Japanese markets sank because investors are questioning whether the new government will be supportive of higher interest rates, said Chopra.

Meanwhile, Chinese markets rallied on the news of more stimulus to the country’s economy, he said.

The Canadian dollar traded for 73.93 cents US, according to XE.com, compared with 74.08 cents US on Friday.

The November crude oil contract was down a penny at US$68.17 per barrel and the November natural gas contract was up two cents at US$2.92 per mmBTU.

The December gold contract was down US$8.70 at US$2,659.40 an ounceand the December copper contract was down five cents at US$4.55 a pound.

— With files from The Associated Press

This report by The Canadian Press was first published Sept. 30, 2024.

Companies in this story: (TSX:GSPTSE, TSX:CADUSD)

The Canadian Press. All rights reserved.

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S&P/TSX composite down as base metal stocks fall, U.S. stock markets mixed

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TORONTO – Canada’s main stock index fell in late-morning trading, weighed down by losses in base metal stocks, while U.S. stock markets were mixed to start the trading week.

The S&P/TSX composite index was down 44.33 points at 23,912.49.

In New York, the Dow Jones industrial average was down 101.56 points at 42,211.44. The S&P 500 index was down 0.67 points at 5,737.50, while the Nasdaq composite was up 3.97 points at 18,123.56.

The Canadian dollar traded for 74.04 cents US compared with 74.08 cents US on Friday.

The November crude oil contract was up 66 cents at US$68.84 per barrel and the November natural gas contract was up two cents at US$2.93 per mmBTU.

The December gold contract was down US$14.90 at US$2,653.20 an ounce and the December copper contract was down seven cents at US$4.53 a pound.

This report by The Canadian Press was first published Sept. 30, 2024.

Companies in this story: (TSX:GSPTSE, TSX:CADUSD)

The Canadian Press. All rights reserved.

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Tentative deal reached in Metro Vancouver grain strike, federal minister says

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VANCOUVER – Canada’s labour minister says striking grain terminal workers in Metro Vancouver and their employers have reached a tentative labour deal.

Steven MacKinnon announced the agreement between Grain Workers Union Local 333 and the Vancouver Terminal Elevators’ Association in a post on social media platform X, but provided no other details.

The union confirmed the tentative deal in a statement on Facebook, saying its members will conduct the ratification vote by Oct. 4.

The notification from the union also says picket lines were to be removed Saturday and members will return to work pending ratification, ending the strike that had paralyzed grain shipments from Metro Vancouver’s port.

The dispute had previously led to picket lines going up at six Metro Vancouver grain terminals on Tuesday as about 600 workers went on strike.

Canadian grain producers had urged a resolution in the dispute, noting about 52 per cent of the country’s grains moved through Metro Vancouver terminals last year en route to being exported.

Farmers say the strike, happening during crop harvesting, would result in as much as $35 million per day in lost exports.

The Western Grain Elevator Association said on Friday that talks had stalled after two days of negotiations this week, with the employer saying it had increased its offers to settle “outstanding issues.”

The employers group had said they’ve reached the end of their “financial ability to conclude an agreement that industry can absorb” with the last offer, and it was up to the federally appointed mediator to report the results to MacKinnon for the next steps.

MacKinnon says in his tweet that both parties put in “the work necessary to get a deal done.”

This report by The Canadian Press was first published Sept. 28, 2024.

The Canadian Press. All rights reserved.

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