Skip to main content Skip to search

Archives for News

Sweden’s Central Bank Increases Interest Rate by 75 Bps

November 26, 2022

Inflation is still far too high. The high inflation undermines purchasing power for many people and makes it more difficult for households and companies to plan their finances. To bring down inflation and safeguard the inflation target, the Executive Board has decided to raise the policy rate by 0.75 percentage points to 2.5 per cent. The forecast shows that the policy rate will probably be raised further at the beginning of next year and then be just below 3 per cent. It is still difficult to assess how inflation will develop and the Riksbank will adapt monetary policy as necessary to ensure that inflation is brought back to the target within a reasonable time.

High global inflation and rising interest rates

High demand, combined with various disruptions in, for instance, production, transports and energy supply has pushed up the rate of price increase in the global economy. To bring down inflation, central banks around the world have raised their policy rates over the past year and communicated that they intend to continue to do so for some time to come. This has contributed to the imbalances between supply and demand having declined, which indicates that price and cost increases will slow down and inflation in the global economy will fall back.

Inflation in Sweden is too high

In Sweden, too, inflation is still too high. In October, CPIF inflation was 9.3 per cent. This was somewhat below the Riksbank’s forecast in September, but is entirely due to energy prices being lower than expected. Disregarding energy prices, inflation has instead been unexpectedly high, which indicates that inflationary pressures are somewhat higher than expected. The risk of the current high inflation will become entrenched is still substantial, and it is very important that monetary policy acts to ensure inflation falls back and stabilises around the target of 2 per cent within a reasonable time.

Higher policy rate to bring down inflation

The Executive Board assesses that monetary policy needs to be tightened more than was anticipated in September to bring inflation back to the target. To bring down inflation and safeguard the inflation target, the Executive Board has therefore decided to raise the policy rate by 0.75 percentage points to 2.5 per cent. The policy rate is expected to be raised further at the beginning of next year to then be just under 3 per cent. In line with previous forecasts, the Riksbank will from the start of next year allow its holdings of securities to decrease in line with maturities. This also entails some tightening of monetary policy.

Important that monetary policy acts when inflation is too high

Rising prices and higher interest costs are noticeable for households and companies, and many households will face significantly higher living costs. However, it would be even more noticeable for households and the Swedish economy in general if inflation remained at the current high levels. As the Riksbank is raising the policy rate more now, the risk of high inflation for a long time is reduced, as is the risk of even greater monetary tightening further ahead.

Forecast for Swedish inflation, GDP, unemployment and the policy rate*
2022 2023 2024 2025 2025 Q4**
CPI 8.3 (8.6) 9.3 (8.5) 3.0 (2.2) 2.4 2.2
CPIF 7.6 (7.8) 5.7 (5.1) 1.5 (1.6) 2.0 2.0
GDP 2.7 (2.7) −1.2 (−0.7) 1.0 (1.1) 1.7 2.0
Unemployment, per cent 7.4 (7.5) 7.9 (7.9) 8.3 (8.2) 8.3 8.2
Policy rate, per cent 0.7 (0.7) 2.8 (2.5) 2.8 (2.5) 2.8 2.8

* Annual percentage change, annual and quarterly averages respectively
Note. The assessment in the September 2022 Monetary Policy Report is shown in brackets.
** Calendar-adjusted GDP growth and seasonally adjusted LFS unemployment in 2025 Q4.
Sources: Statistics Sweden and the Riksbank

Forecast for the policy rate*
2022 Q3 2022 Q4 2023 Q4 2024 Q4 2025 Q4
Policy rate 0.83 (0.82) 2.00 (1.90) 2.84 (2.53) 2.84 (2.44) 2.84

* Per cent, quarterly mean values
Note. The assessment in the September 2022 Monetary Policy Report is shown in brackets.
Source: The Riksbank


Source: Sweden Central Bank
Legal Notice: The information in this article is intended for information purposes only. It is not intended for professional information purposes specific to a person or an institution. Every institution has different requirements because of its own circumstances even though they bear a resemblance to each other. Consequently, it is your interest to consult on an expert before taking a decision based on information stated in this article and putting into practice. Neither Karen Audit nor related person or institutions are not responsible for any damages or losses that might occur in consequence of the use of the information in this article by private or formal, real or legal person and institutions.


Read more

IMF: Spain is leading Eurozone growth and will avoid the recession

November 25, 2022

According to the International Monetary Fund, SPAIN will be one of a select few nations that will avoid a “technical recession” by the end of next year.

According to Alfred Kammer, the IMF’s director for Europe, the nation will experience “strong growth” in 2023, with a 1.2% increase in its Gross Domestic Product (GDP).

Even if this projection is much more conservative than the previous one, which was 2%, Kammer demonstrates that Spain will still have the fastest-growing economy in the Eurozone in 2019.

Spain is one among the nations for which we do not anticipate a recession in 2019—a year in which it will see significant growth, according to Kammer.

Even then, Spain will continue to be constrained by “weakened demand” and “falling consumer confidence,” which began with the pandemic and have continued with the more recent price-driven inflation, fuel and supply crisis, and the conflict in Ukraine. These factors all started with the pandemic.

However, Petya Koeva Brooks, the IMF’s Department of Research’s sub-director, acknowledged that the 1.2% forecast for Spain’s growth was actually a little too cautious because it had been made before the GDP second-quarter results were released.

According to Ms. Koeva Brooks, Spain’s 1.5% GDP growth from April to June “exceeded expectations.”

“We would probably be releasing even higher figures if we were making these forecasts for 2023 now, in light of this new information,” she says.

until the beginning of 2024, the pandemic will affect activity.

Although anecdotal evidence and statistics by specific industries at the local and regional levels seem to show Spain is almost back to or even exceeding business volumes of 2019, the economy will take time to catch up.

Given its high exposure to “people presence” industries, such as tourism and hospitality, which were largely shut down that year and into part of 2021 as a result of lockdowns and restrictions on travel and movement, the nation suffered one of the biggest blows of all developed nations in 2020, according to Kammer.


Source: ThinkSpain.com
Legal Notice: The information in this article is intended for information purposes only. It is not intended for professional information purposes specific to a person or an institution. Every institution has different requirements because of its own circumstances even though they bear a resemblance to each other. Consequently, it is your interest to consult on an expert before taking a decision based on information stated in this article and putting into practice. Neither Karen Audit nor related person or institutions are not responsible for any damages or losses that might occur in consequence of the use of the information in this article by private or formal, real or legal person and institutions.


Read more

Why is the inflation in Hungary the worst in Europe?

November 25, 2022

Europe’s third-highest rate of inflation.

Hungary had the third-highest inflation in Europe across the board for all products. However, Hungary saw the biggest increases in food prices. Only Estonian and Lithuanian inflation, which rose by 21.9 percent, outpaced the price increase in Hungary, according to 24.hu. The countries with the smallest price increases were France (7.1%) and Spain (7.3 percent). Portfolio predicts that in November, inflation in Hungary may easily be the highest in all of Europe. The sharp rise in food prices is one of the main causes of Hungary’s extraordinarily high inflation rate. The price increase for processed food (44.6%) and unprocessed food (38%) was by far the biggest in Hungary in October.

Each nation’s national economic policies that use subsidies and regulations to divert pricing from the market have a significant impact on the inflation index. Additionally, efforts to control prices in the food, fuel, and energy sectors have a substantial impact on inflation. Because of this, the consumer price index cannot account for a nation’s high inflation rate. A filtered indicator that closely resembles the idea of core inflation was released by Eurostat. They don’t take energy or whole foods into account, according to this method. They merely focus on the price increase. The situation won’t improve, though, if we take the rise in the price of unprocessed food in Hungary out of the price index.

We need to go further to comprehend why Hungary’s inflation situation is so bad. Portfolio claims that domestic factors might also have a negative impact on inflation. For instance, import costs are increased by the weak forint. In addition, the distribution of votes contributed to an increase in prices on the demand side. Therefore, strengthening the exchange rate might be a solution. The central bank is optimistic that the rate of price growth will peak in the upcoming months before beginning to decline.


Source: Daily News Hungary
Legal Notice: The information in this article is intended for information purposes only. It is not intended for professional information purposes specific to a person or an institution. Every institution has different requirements because of its own circumstances even though they bear a resemblance to each other. Consequently, it is your interest to consult on an expert before taking a decision based on information stated in this article and putting into practice. Neither Karen Audit nor related person or institutions are not responsible for any damages or losses that might occur in consequence of the use of the information in this article by private or formal, real or legal person and institutions.


Read more

ECB: New supply constraints have arisen in the global economy owing to supply chain disruptions and Russia’s invasion of Ukraine

November 25, 2022

Speech by Christine Lagarde, President of the ECB, at the European Banking Congress

When the former British Prime Minister Harold Macmillan was asked what the greatest challenge was for a statesman, he is said to have replied: “Events, dear boy, events”. And indeed, as policymakers, we are constantly faced by unpredictable events and shocks.

But what makes the situation we face today especially challenging is that we are not only facing a sequence of ill-fated events – the pandemic, the energy crisis, Russia’s unjustifiable invasion of Ukraine and high inflation – but that as a result, the environment around us is also changing.

Some of the major trends that characterised the past few decades are shifting or even reversing. In particular, we can no longer assume, at least in the near future, that global supply will gradually expand or that global demand will act as a shock absorber.

And this has implications for the focus of macroeconomic policy in the years to come.

Today I will argue that three themes will matter: ensuring price stability as the different shocks play out; lifting constraints on growth in the areas where they have emerged; and safeguarding a resilient financial sector which can support the transitions we will face.

For the ECB, displaying our commitment to our mandate is vital to ensure that inflation expectations remain anchored while inflation is high. We are committed to bringing inflation back down to our medium-term target, and we will take the necessary measures to do so.

But in order to overcome the ongoing challenges, other public and private players will need to help accelerate the transition to a greener, more digital and more productive economy.

The changing environment

One of the most important macroeconomic stories of the past 30 years has been the rising interconnectedness of the global economy and its implications for global supply and demand.

China’s entry into the global economy led to a massive increase in global labour supply. Global supply chains became more unbundled and efficient, lowering inventory levels and reducing costs. And energy markets changed fundamentally as new producers emerged, notably US shale oil and gas, making global oil and gas supply significantly more elastic.[1]

At the same time, globalisation allowed growth to become less beholden to swings in domestic demand, as countries could rotate demand towards the rest of the world when faced with domestic slumps. This proved especially valuable for Europe in the wake of the sovereign debt crisis: between 2010 and 2014, external demand as a share of euro area GDP more than doubled.[2]

These two forces meant that inflation became unusually low and stable. A floor under demand meant that major busts in domestic demand resulted in less volatile inflation. And elastic supply meant that major booms, such as the one we saw before the great financial crisis, did not produce serious inflationary pressures.

But now we are facing a new environment.

New supply constraints have arisen in the global economy owing to supply chain disruptions, zero-COVID policies, energy production cuts, and Russia’s invasion of Ukraine. And in this context, swings in demand caused by the closing and reopening of the economy have “hit a wall”. Rather than quantities increasing to match demand, prices have surged instead. That is a key reason why – alongside rising energy prices – inflation has returned so fiercely.

Some of these constraints will fade over time. We are already seeing, for example, shipping costs declining and delivery times shortening. But other changes may well be more persistent. The shocks triggered by the pandemic and the war are creating what I have called a “new global map” of economic relationships.[3] And in this environment, it is uncertain whether a seamless expansion of supply will continue and how global demand will be affected.

Indeed, the new global map is characterised by two key shifts.

The first is from efficiency to security in global supply chains.

This is reflected in new industrial policies that in recent years have prioritised geopolitical goals over efficiency concerns. Many advanced economies are coming to see their past de-industrialisation as a vulnerability, leading to a push to “re-shore” or “friend-shore” industries seen as strategic. That is likely to increase costs and affect production while supply chains are adjusting.

At the same time, this shift could question China’s role as a source of global demand, depressing investment and equity values for European firms. Recent policy choices to focus more on domestic demand, coupled with US export controls on semiconductors and trade restrictions on key technologies owing to cyber risks, could affect China’s place in the global economy.

The second shift is from dependence to diversification, especially in energy markets.

Europe is experiencing, painfully, the costs of over-dependence on a single supplier. And the process of diversifying our energy supply will have ramifications for years to come. For instance, we may have to pay a premium for some time to attract uncontracted liquified natural gas to replace Russian gas.

In the longer term, the need to diversify is also likely to accelerate the green transition in Europe, and massive investment in renewables will boost both energy supply and aggregate demand over time. But during the transition phase, we face uncertain effects on both sides of the economy.

We could see lower investment in oil and gas production, putting upward pressure on fossil fuel prices while demand for those fuels still remains high. At the same time, writing off existing carbon-intensive capital might produce a negative wealth effect and lower aggregate demand.[4]

As a result, all of the main forces that drove expanding supply over the past decades and cushioned global demand – the role of China, supply chains, abundant energy – are changing. And the net effect on aggregate supply and aggregate demand will only become clear in time.

In this context, the three themes I mentioned at the beginning are crucial: ensuring price stability as the different shocks play out; lifting constraints on growth in the areas where they have emerged; and safeguarding a resilient financial sector which can support the transitions we will face.

Ensuring price stability

For monetary policy, this changing environment creates considerable challenges.

Inflation in the euro area is far too high, having reached double digits in October for the first time since the start of the monetary union. And with inflation likely to remain high for an extended period, we need to monitor the evolution of inflation expectations very carefully. Additionally, although recent data on GDP growth have surprised on the upside, the risk of recession has increased.

At the same time, historical experience suggests that a recession is unlikely to bring down inflation significantly, at least in the short run. In this setting, displaying commitment to our mandate is vital to ensure that inflation expectations remain anchored and second-round effects do not take hold.

That is why we have been raising rates at our fastest pace ever – by 200 basis points in our last three policy meetings. These rate increases help us to withdraw support for demand more quickly. And they send a clear signal to the public of our determination to bring down inflation, which will help anchor expectations.

We expect to raise rates further – and withdrawing accommodation may not be enough. Ultimately, we will raise rates to levels that bring inflation back down to our medium-term target in a timely manner. As I explained recently, how far we need to go, and how fast, will be determined by the inflation outlook. This is forward-looking and incorporates all the different forces we are facing: the outlook for the economy, the persistence of the shocks, the reaction of wages and inflation expectations, and the transmission of our policy stance.[5]

Interest rates are, and will remain, the main tool for adjusting our policy stance. But we also need to normalise our other policy tools and so reinforce the impulse from our rate policy.

That is why we recently decided to amend the terms and conditions of our targeted longer-term refinancing operations (TLTRO-III). The TLTRO addressed the need for significant stimulus during the pandemic, strengthening the transmission of rates to the economy via banks. But now the environment has changed completely – and we need to ensure that the lower cost of funding the TLTRO created for banks does not impede monetary transmission when policy normalisation is required.

Similarly, large-scale asset purchases were necessary to expand the policy stance when interest rates were close to the lower bound. But in the current environment, and acknowledging that interest rates remain the most effective tool for shaping our policy stance, it is appropriate that the balance sheet is normalised in a measured and predictable way.

In December we will lay out the key principles for reducing the bond holdings in our asset purchase programme portfolio. In parallel, our tools for preserving the orderly transmission of monetary policy − notably flexible reinvestments under the pandemic emergency purchase programme and the new transmission protection instrument − will remain in place.

Lifting constraints

Monetary policy will ensure a timely return of inflation to our medium-term target. But the economic outlook will also depend on the alignment between monetary policy and other actors.

In the short term, the stance of fiscal policy is important. In the current environment of high inflation, fiscal policy needs to be temporary, targeted and tailored. It should be temporary, so that it does not push up demand too much over the medium term; targeted, so that the size of the fiscal impulse is limited and benefits those who need it most; and tailored, so that it does not weaken incentives to cut energy demand.

Looking further ahead, while monetary policy can steer demand, it cannot remove existing constraints on economic growth. Other policy areas will need to act. Removing these constraints will not only rebuild supply that has been impaired by the recent shocks. It will also, over time, strengthen domestic demand in a world where external demand is becoming less predictable.

A drive to speed up three key transitions will determine our future: towards cleaner energy, greater economic security and a more digital and productive economy.

First, we urgently need to step up investment in clean energy to counterbalance lower investment in fossil fuels and falling Russian supply. This is not only about increasing domestic energy production, but also about developing new technologies that will help us solve the intermittency and storage challenges of renewables. And in the short term, reforming Europe’s energy markets will be critical so as to avoid recurring volatility in energy prices while we diversify away from Russian gas.

Second, Europe’s “strategic autonomy” agenda will be pivotal in making growth more resilient to the changing nature of globalisation. In a world fragmenting into blocs, it will allow us to retain access to critical technologies and resources, both through reshoring strategic industries[6] and securing strategic alliances. And that will in turn underpin the energy transition, which is highly resource-intensive. Electric vehicles, for example, use around six times more minerals than conventional cars.[7]

Third, to cope with shrinking global labour supply, as well as our own ageing societies, we will have to start producing more with less – that is, addressing Europe’s chronically low productivity growth by boosting our rate of innovation. This will require the rapid digitalisation of the economy in terms of skills and technologies. Consider that only around half of EU firms innovated or adopted new technologies in 2021, compared with close to two-thirds in the United States.[8]

Collectively, these transitions will require significant investment. The European Commission has estimated that climate-related investment needs alone will amount to almost half a trillion euro on average per year until 2030.[9] And more than €100 billion per year will be needed to close the digital gap and upskill the labour force to manage the digital transition.

The €750 billion Next Generation EU fund, with its focus on green and digital spending, is a good tool for ensuring that investment flows where it is needed over the next few years. But this will ultimately need to be matched by higher investment elsewhere – not only by the private sector, but also by national governments. According to one estimate, the public sector will need to fund between a quarter and a fifth of climate-related investment.[10]

This means that, when the time comes for national governments to consolidate their fiscal policies, it will make a difference whether they do so by reducing transfers and public consumption and raising taxes or by cutting public investment. If they opt for the latter method, as they did after the great financial crisis, there is a risk that supply will not be rebuilt and constraints on growth will continue to bind.

Supporting the transitions

But to support these transitions, we also need a resilient financial sector.

The situation for banks has changed dramatically since the great financial crisis, when they were part of the problem. During the pandemic, they were part of the solution − not least because, thanks to tougher regulation, they had stronger capital and liquidity positions.

Now, we need banks to continue being part of the solution. But undermining the solid foundation we have built would not help bring this about. We are facing a fast-changing world characterised by multiple shocks and profound uncertainty. In this setting, over-diluting regulation would leave banks more exposed to shocks and less able to support the transitions on which our future growth will depend. And that would neither be in the interests of the sector, which would be less profitable, nor the economy, which would lack the financing it needs.

At the same time, the nature of financial intermediation is changing, and we must ensure that this contributes to, rather than threatens, the sector’s resilience.

First, the digitalisation of payments is spreading rapidly, which could pose new types of risk as new players and products enter the market. But central banks are responding by advancing the development of central bank digital currencies. These currencies could give banks a tool to offer improved products and services, built on the stable foundation of digital public money.

Second, the role of non-bank finance is growing, with its share in overall credit from financial institutions to real economy companies rising from around 15% to 26% since 2009.[11] This has to be reflected in a stronger macroprudential framework for non-banks. Specifically, we need a framework that focuses on building resilience ex ante, rather than relying on ex post measures.

Conclusion

Let me conclude.

We are entering a new environment where the forces that created a sustained expansion of global supply, and allowed global demand to act as a shock absorber, are changing.

The effects of this shift are uncertain, but the duty of monetary policy is not. The ECB will ensure that a phase of high inflation does not feed into inflation expectations, allowing too-high inflation to become entrenched. We have acted decisively, raising rates by 200 basis points, and we expect to raise rates further to the levels needed to ensure that inflation returns to our 2% medium-term target in a timely manner.

But if we want to rebuild our supply capacity and strengthen domestic sources of growth, other policy areas need to refocus. Most importantly, they need to direct investment towards the transitions that will define our future – and the financial sector needs to be able to actively support these transitions.

Consistency between public policy areas remains important in a post-pandemic world. If we respond separately to today’s challenges, we risk standing in each other’s way. But if we act together, we can rise to those challenges and ensure that our objectives are met.


Source: European Central Bank
Legal Notice: The information in this article is intended for information purposes only. It is not intended for professional information purposes specific to a person or an institution. Every institution has different requirements because of its own circumstances even though they bear a resemblance to each other. Consequently, it is your interest to consult on an expert before taking a decision based on information stated in this article and putting into practice. Neither Karen Audit nor related person or institutions are not responsible for any damages or losses that might occur in consequence of the use of the information in this article by private or formal, real or legal person and institutions.


Read more

What are the world’s worst countries for workers?

November 25, 2022

2022 ITUC  Global Rights Index

The world’s worst countries for workers – Executive Summary

The breakdown of the social contract between workers, government and business saw the number of countries which exclude workers from their right to establish or join a trade union increase from 106 in 2021 to 113 in 2022. Workers were excluded from workplace representation in Afghanistan, Burkina Faso, Myanmar, Tunisia and Syria.

In a climate of increasing levels of violence and attacks on workers, the number of countries which expose workers to physical violence increased from 45 in 2021 to 50 in 2022. The Asia-Pacific region saw a significant increase in countries where workers faced violence, rising from 35 per cent of countries in 2021 to 43 per cent of countries in 2022. In Europe, the number of countries where workers faced violence doubled from 12 per cent in 2021 to 26 per cent of countries in 2022.

The ninth edition of the ITUC Global Rights Index ranks 148 countries on the degree of respect for workers’
rights. The 2022 ITUC Global Rights Index has an interactive website where cases of violated rights and national ratings can be viewed by country and region.

A comprehensive review of workers’ rights in law in 148 countries provides the only database of its kind. As consumers and investors demand increasing accountability regarding which companies to trust and which countries to operate in, the nine-year data trends analysed in the 2022 Global Rights Index expose attacks on the right to strike and the right to establish and join a trade union as well as on the registration of unions; arbitrary arrests and detentions; and restrictions on access to justice.

Eighty-seven per cent of countries violated the right to strike. Strikes in Belarus, Egypt, India and the
Philippines led to prosecution of union leaders. In Sudan and Myanmar, strikes to oppose military rule
were met with brutal repression.

Seventy-nine per cent of countries violated the right to collective bargaining. In all regions, collective bargaining is being eroded in both public and private sectors. Extreme government control over collective bargaining was seen in Tunisia, where no negotiation can take place with unions without the authorisation from the head of government.

Seventy-four per cent of countries excluded workers from the right to establish and join a trade union. Migrant workers, public sector workers, and workers in export processing zones were blocked and excluded from labour protection. While Qatar and Saudi Arabia have undertaken major reforms to end the kafala system, the UAE continued to deny migrant workers collective representation.

The ten worst countries for workers in 2022 are the following: Bangladesh, Belarus, Brazil, Colombia, Egypt, Eswatini, Guatemala, Myanmar, the Philippines and Turkey.

Eswatini and Guatemala are new entries in 2022. Brutal repression of pro-democracy protests and a systematic ban on demonstrations and strikes pushed Eswatini into the ten worst countries.

Endemic anti-union violence, together with impunity for the perpetrators of violence, set back progress in Guatemala. Armenia, Australia, Burkina Faso, Guinea, Jamaica, Lesotho, the Netherlands, Tunisia and Uruguay all saw their ratings worsen in 2022. Afghanistan increased to category 5+, No guarantee of rights, due to the breakdown of the rule of law.

Three countries saw their ratings improve: El Salvador, Niger and Saudi Arabia.

Trade unionists were killed in thirteen countries: Bangladesh, Colombia, Ecuador, Eswatini, Guatemala, Haiti, India, Iraq, Italy, Lesotho, Myanmar, the Philippines and South Africa.

Freedom of speech and assembly was denied or constrained in 41% of countries, with extreme cases reported in Hong Kong and Myanmar.

The number of countries where authorities impeded the registration of unions increased from 59 per cent of countries in 2014 to 74 per cent of countries in 2022, with state repression of independent union activity in Afghanistan, Belarus, Egypt, Jordan, Hong Kong, Myanmar and Sudan.

Workers had no or restricted access to justice in 66 percent of countries, with severe cases reported in Belarus, Guatemala and Kazakhstan. Africa saw the greatest regional increase in restrictions on access to justice from 76 per cent of countries in 2021 to 95 per cent of countries in 2022.

Workers experienced arbitrary arrests and detentions in 69 countries. Trade union leaders from Cambodia, Hong Kong and Myanmar were among those who faced high-profile arrests and ongoing detention in 2022.


Source: ITUC Global Rights Index
Legal Notice: The information in this article is intended for information purposes only. It is not intended for professional information purposes specific to a person or an institution. Every institution has different requirements because of its own circumstances even though they bear a resemblance to each other. Consequently, it is your interest to consult on an expert before taking a decision based on information stated in this article and putting into practice. Neither Karen Audit nor related person or institutions are not responsible for any damages or losses that might occur in consequence of the use of the information in this article by private or formal, real or legal person and institutions.


Read more

During the first ten months of 2022, number of newly established companies in Türkiye increased by 24,9%

November 25, 2022

During the first ten months of the year 2022 the number of newly established Companies and the number of cooperatives in Türkiye increased by 24,9% and 30,5% while the number of sole proprietorships decreased by 4,1% with respect to the same period of the year 2021.​

During the first ten months of the year 2022 the number of closed Companies, the number of closed cooperatives and the number of closed sole proprietorships  increased by 55,9%  19,5% and 6,7% respectively according to the same period of the year 2021.

-The number of newly established companies increased by 33,3% with respect to the same month of the previous year.

During October 2022 the number of newly established companies, the number cooperatives and the number of sole proprietorships increased by 33,3% , 48,8% and  6,4% respectively according to the month of October 2021.

During October 2022 the number of closed companies and the number of closed sole proprietorships increased by 13,8% and 26,5% while the number closed cooperatives decreased by 7,0% according to the month of October 2021.

-The number of newly established Cooperatives increased by 13,2% in October 2022 with respect to previous month.

The number of newly established companies and the number of sole proprietorships decreased by 4,5% and 14,9% while the number cooperatives increased by 13,2% according to the previous month.

The number of closed companies decreased by 14,1% while the number of closed cooperatives and the number of closed sole proprietorships increased by 17,7% and  37,6% according to the previous month.


Source: The Union of Chambers and Commodity Exchanges of Türkiye
Legal Notice: The information in this article is intended for information purposes only. It is not intended for professional information purposes specific to a person or an institution. Every institution has different requirements because of its own circumstances even though they bear a resemblance to each other. Consequently, it is your interest to consult on an expert before taking a decision based on information stated in this article and putting into practice. Neither Karen Audit nor related person or institutions are not responsible for any damages or losses that might occur in consequence of the use of the information in this article by private or formal, real or legal person and institutions.


Read more

Unemployment rate in Bulgaria was 3.7%; 0.9 percentage points lower compared with the third quarter of 2021

November 24, 2022

Main labour market indicators in the third quarter of 2022 in Bulgaria

The activity rate of the population aged 15 – 64 was 74.7%, or 1.8 percentage points higher compared with the third quarter of 2021.

The employment rate of the population aged 15 – 64 increased by 2.4 percentage points in comparison with the same quarter of 2021 and stood at 71.9%.

The unemployment rate was 3.7%, or 0.9 percentage points lower compared with the third quarter of 2021. There were 50.8 thousand discouraged persons aged 15 – 64, representing 4.6% of the economically inactive population in the same age group.

Employment

In the third quarter of 2022, there were 3 215.6 thousand employed persons, of whom 1 717.6 thousand men and 1 498.0 thousand women. Compared with the third quarter of 2021, the number of employed persons increased by 2.6%. The employment rate for the population aged 15 years and over was 55.4%, 61.8% for men and 49.5% for women.

In the third quarter of 2022, the majority of employed persons worked in the service sector – 2 007.9 thousand (62.4%), followed by those in the industry sector – 975.0 thousand (30.3%) and in agriculture, forestry and fishing – 232.7 thousand (7.2%).

Of all employed persons, 4.0% (130.1 thousand) were employers, 7.0% (224.9 thousand) were self-employed persons without employees, 88.5% (2 845.5 thousand) were employees and 0.5% (15.1 thousand) were unpaid family workers. Of all employees, 2 213.1 thousand persons (77.8%) worked in the private sector, while 632.4 thousand (22.2%) worked in the public sector. Of all employees, 139.6 thousand persons (4.9%) had а temporary job (with limited duration).

In the third quarter of 2022, the employment in specific age groups was as follows:

There were 3 114.6 thousand employed persons aged 15 – 64. The employment rate for the same age group was 71.9% (75.5% for men and 68.1% for women).
The employment rate for the age group 15 – 29 was 39.9% (44.8% for men and 34.7% for women). The employment rate for the age group 20 – 64 was 77.2%, 81.2% and 73.2% for men and women, respectively. In comparison with the third quarter of 2021, this rate registered an increase of 2.7 percentage points, the same for men and women.

There were 633.0 thousand employed persons aged 55 – 64, representing 69.9% of the population in the same age group (75.3% of men and 64.9% of women). In comparison with the third quarter of 2021, the employment rate for the age group 55 – 64 increased by 3.7 percentage points.


Source: National Statistical Institute of Bulgaria
Legal Notice: The information in this article is intended for information purposes only. It is not intended for professional information purposes specific to a person or an institution. Every institution has different requirements because of its own circumstances even though they bear a resemblance to each other. Consequently, it is your interest to consult on an expert before taking a decision based on information stated in this article and putting into practice. Neither Karen Audit nor related person or institutions are not responsible for any damages or losses that might occur in consequence of the use of the information in this article by private or formal, real or legal person and institutions.


Read more

Business confidence in the Netherlands slightly negative in Q4 2022

November 24, 2022

At the start of Q4 2022, entrepreneurial confidence in the Netherlands was negative for the first time since early 2021. Sentiment turned particularly in accommodation and food services and in mining and quarrying. Within 6 of the 11 sectors, the confidence indicator did remain positive despite a decline. Entrepreneurs in all sectors were anticipating a deterioration of the economic climate. Entrepreneurs who saw profitability decline were in the majority across all sectors, except for construction. This is reported by Statistics Netherlands (CBS), the Dutch Chamber of Commerce (KvK), the Economic Institute for Construction and Housing (EIB), the Dutch Organisation for Small and Medium-Sized Enterprises (MKB-Nederland) and the Dutch Employers’ Organisation (VNO-NCW) on the basis of the Netherlands Business Survey (COEN).
The data for this survey were collected in early October.At the start of Q4 2022, the sentiment indicator stood at -0.9, i.e. 9 points lower than in the previous quarter. Business confidence was down at that time as well, but remained positive for the sixth consecutive quarter. In Q2 2020, the coronavirus crisis caused an unprecedented decline in entrepreneurial confidence. The confidence indicator was positive again as of Q2 2021, but continued to fluctuate.

Sharp turn in sentiment particularly in accommodation and food services

Business confidence declined almost across the board and was negative in five of the eleven sectors. In the previous quarter, the mood among entrepreneurs in each sector was still positive. The strongest decline was seen in accommodation and food services. Entrepreneurs in this sector are mainly negative about the economic climate over the past three months. The decline was also substantial in mining and quarrying, which recorded the most negative business confidence of all sectors. Entrepreneurs in this sector were particularly pessimistic about future output. Only in car trade was the mood more positive than in the previous quarter.

Declining profitability

At the start of Q4 2022, on balance 13 percent of entrepreneurs saw a decline in profitability over the past three months, adjusted for seasonal effects. This was 4 percent in the previous quarter. With the exception of construction, the balance deteriorated across all sectors compared to the third quarter of 2022. Entrepreneurs in mining and quarrying and in information and communication saw their profitability increase on balance, despite the deterioration. Retailers and entrepreneurs in the agricultural sector had the most negative opinions about profitability. The mood in accommodation and food services was also predominantly negative, whereas it was still the most positive of all sectors in the previous quarter.

Pessimism about the economic climate growing further

At the beginning of Q4 2022, on balance 24 percent of entrepreneurs foresaw a deterioration of the economic climate in the next three months. Pessimism about the economic climate prevailed across the board and was higher than in the previous quarter, except in the information and communication sector. In accommodation and food services, on balance 38 percent of entrepreneurs anticipated a deterioration, against 4 percent in the previous quarter. A deterioration was also expected in the culture sector, where entrepreneurs were still predominantly optimistic in Q3. The sector agriculture, forestry and fisheries was the most negative, with 3 percent of entrepreneurs expecting an improvement and 45 percent expecting a deterioration.

More turnover, staffing and investments in 2023

On balance, 14 percent of entrepreneurs anticipate higher turnover in 2023 than in 2022. This optimism for the coming year is lower than it was in the preceding eight years. Expectations for turnover abroad were less optimistic as well compared to previous years; on balance, 10 percent anticipate an improvement. The Business Survey does not contain any questions regarding expectations on the volume of sales (turnover adjusted for price changes). Due to price increases in recent months, the on balance positive turnover expectations are unlikely to translate one-to-one into more positive expectations about volume.

For 2023, 24 percent expect an increase in staffing levels, while 8 percent anticipate a decline. Incidentally, more and more entrepreneurs are being hampered by staff shortages. At the beginning of Q4 2022, more than 36 percent indicated they were predominantly hampered by staff shortages in their business operations. This was still 30 percent one year previously. In terms of investment, more entrepreneurs anticipate an increase than a decrease for 2023; 3 percent, on balance.


Source: Statistics Netherlands (CBS)
Legal Notice: The information in this article is intended for information purposes only. It is not intended for professional information purposes specific to a person or an institution. Every institution has different requirements because of its own circumstances even though they bear a resemblance to each other. Consequently, it is your interest to consult on an expert before taking a decision based on information stated in this article and putting into practice. Neither Karen Audit nor related person or institutions are not responsible for any damages or losses that might occur in consequence of the use of the information in this article by private or formal, real or legal person and institutions.


Read more

Belgium’s inflation rate based on CPI for October stood at 12.3%

November 24, 2022

  • Belgium’s inflation rate based on the European harmonised index of consumer prices (HICP) stood at 13.1% in October compared to 12.1% in September and 10.5% in August.
  • Core inflation (inflation without energy and unprocessed food) was 6.3% in October compared to 5.8% in September.
  • The inflation rate based on the consumer price index (CPI) for October stood at 12.3% compared to 11.3% in September.
  • The sub-indices with the largest upward effect on inflation were electricity, gas, domestic heating oil and motor fuels.
  • The sub-indices with the largest downward effect on inflation this month were housing rent, telecommunication, restaurants and cafés, clothing, nursing in hospitals, furniture and tobacco.
  • The harmonised index of consumer prices of October for the EU Member States will be published by Eurostat on 17 November.

The inflation rate based on the European harmonised index of consumer prices (HICP) was running at 13.1% in October compared to 12.1% in September and 10.5% in August. The inflation rate based on the harmonised index of consumer prices at constant tax rates (HICP-CT) was running at 14.8% in October, compared to 13.2% in September. The difference in inflation between the HICP and the HICP-CT is largely due to the temporary VAT reduction for electricity and gas. These price changes are not taken into account in the HICP-CT.

Core inflation, which does not take into account price evolutions of energy products and unprocessed food, stood at 6.3% in October, compared to 5.8% in September and 5.4% in August. Inflation without energy has increased to 6.5% in October compared to 6.0% in September and 5.5% in August.

Inflation for food products stands at 13.2% this month, compared to 11.3% last month. This inflation for food has sharply risen in recent months. In November last year, it was still 0.3%. Inflation for oils, fish, dairy products, bread and cereals and meat has sharply increased in recent months. Inflation for oils stands this month at 25.4%. In November last year, it was still 4.2%. For dairy products, inflation is now 16.7% compared to 0.8% in November 2021. Fish has an inflation rate of 11.1% this month, while in November last year it was -1.2%. For bread and cereals, it is 14.9% this month compared to 1.7% in November 2021. Inflation for meat amounts to 12.3% this month compared to 0.7% in November last year.

Electricity is now 84.7% more expensive than a year ago. Natural gas is 130.6% more expensive on an annual basis. The price of domestic heating oil has risen by 62.6% compared to last year.

Inflation and effect on inflation for the 12 main groups

Based on the breakdown into 12 main groups, the highest inflation rate in October was measured for ‘Housing, water, energy’ (42.0%). The lowest inflation rate is recorded for the group “communication” (0.4%). The main group with the largest upward effect on inflation in October was ‘housing, water, energy’ with 5.9 percentage points. The largest downward effect is measured for ‘Health’ with -0.9 percentage points.


Source: STATBEL
Legal Notice: The information in this article is intended for information purposes only. It is not intended for professional information purposes specific to a person or an institution. Every institution has different requirements because of its own circumstances even though they bear a resemblance to each other. Consequently, it is your interest to consult on an expert before taking a decision based on information stated in this article and putting into practice. Neither Karen Audit nor related person or institutions are not responsible for any damages or losses that might occur in consequence of the use of the information in this article by private or formal, real or legal person and institutions.


Read more

Steel product exports of Türkiye totaled 1.4 million tons in September, down 42.1% in terms of value

November 24, 2022

STEEL MANUFACTURING IN TÜRKİYE

Türkiye produced 2.7 million tons of crude steel in September 2022, a 19% decline from the same month the year prior.

To 27.3 million tons in the first nine months of the year, production fell by 9.3%.

STEEL CONSUMPTION

The amount of final product consumed in September was 2.1 million tons, down 3.2% from the same month in 2021, while the total amount used through the first nine months of the year was 24.1 million tons, down 5.2%.

FOREIGN TRADE

Export

Steel product exports totaled 1.4 million tons in September, down 31.2% in terms of volume, and 1.1 billion dollars, down 42.1% in terms of value.

When compared to the same time in 2021, exports from January to September totaled 12.5 million tons, a 15% reduction in quantity, and 11.7 billion dollars, a gain of 0.2% in value.

Imports

In September, imports grew by 0.8% to 1.1 million tons but declined in value by 6.5% to $1.1 billion when compared to the same month in 2021.

In comparison to the same period in 2021, imports in the first nine months of 2022 totaled 11.3 million tons, a 5% decrease in quantity, and 12.4 billion dollars, a 17.6% increase in value.

While imports accounted for 32% of the consumption of steel products, they made up 50% of the consumption of flat products. 65.4 percent of all imports were made within the DIR’s purview.

Foreign Trade Balance

The ratio of exports to imports, which was 110.8% in the first 9 months of 2021, decreased to 94.5% in the same period of this year.


Source: Turkish Steel Producers Association
Legal Notice: The information in this article is intended for information purposes only. It is not intended for professional information purposes specific to a person or an institution. Every institution has different requirements because of its own circumstances even though they bear a resemblance to each other. Consequently, it is your interest to consult on an expert before taking a decision based on information stated in this article and putting into practice. Neither Karen Audit nor related person or institutions are not responsible for any damages or losses that might occur in consequence of the use of the information in this article by private or formal, real or legal person and institutions.


Read more