• This weekly wrapper brings you the latest stories from the world of economics and finance and about the global economy.
  • Top economy stories: China's largest banks warn about challenges ahead; US inflation concern hits 40-year high; Biden administration proposes minimum tax on US's richest individuals.

1. Top global economy news stories

Malaysia's central bank has slightly lowered its economic growth outlook for 2022. It also says any changes to its monetary policy will be "measured and gradual", reports Bloomberg.

Job openings in the US remained near record highs last month, with 11.3 million positions available in February, according to the Labor Department's Job Openings and Labor Turnover Survey.

Job openings, hires, and separations levels, seasonally adjusted
US job openings, hires and separations levels, seasonally adjusted.
Image: US Bureau of Labor Statistics

Consumer lending in the UK rose in February by the most in nearly five years. The Bank of England figures showed consumer credit increased by a net £1.876 billion ($2.46 billion) during the month, driven by a record rise in credit card borrowing.

Fitch will withdraw ratings on all Russian entities and their subsidiaries in order to comply with EU sanctions. The ratings will be withdrawn before 15 April.

Australia has said it is close to signing a free-trade agreement with India, with an announcement possibly very close, according to Australian Trade Minister Dan Tehan.

US Treasuries have recorded their worst start to the year in history. Yields on the US benchmark 10-year Treasury, which move inversely to bond prices, reached a high of 2.417% in mid-March as investors factored in a more aggressive Federal Reserve, a 90 basis point gain since the beginning of the year and its highest level since May 2019.

The Russian finance ministry said it has fully paid a coupon on the country's Eurobond, due in 2035. This is its third payout since Western sanctions called Russia's ability to service foreign currency debt into question.

The World Bank has warned that the war in Ukraine could cause lasting damage to the economies of low- and middle-income countries. Millions could be pushed into poverty and countries forced into a debt crisis, the Financial Times reports.

The White House has proposed imposing a minimum tax on the US's richest people to challenge "indefensibly low tax rates", as Democrats take another swing at a so-called billionaire's tax.

2. China's largest banks warn of tough times ahead

Three of China's largest banks have warned that lenders in the country face multiple challenges this year, including the COVID-19 pandemic, global politics and domestic real estate turmoil.

China's banking industry is facing "a more complicated and severe business environment", the country's second-biggest lender by assets China Construction Bank said.

The Bank of China, meanwhile, said "the global epidemic will continue to recur, the easing policies of developed economies will be withdrawn, geopolitical conflicts will intensify".

The president of China's Bank of Communications has warned that it will be difficult for the bank to deliver satisfactory earnings this year.

Analysts say that a rise in COVID-19 cases, which have prompted full and partial lockdowns, will be a drag on the economy. The main impact on banks will be "rising loan delinquencies among service sectors", said Nicholas Zhu, a banking analyst at Moody's.

3. Concern about inflation hits 40-year high in the US

Around one in five Americans mention the cost of living/inflation (17%) or fuel prices (4%) as the most important issue facing the US today, in a new Gallup poll.

Inflation began rising as a concern in the last quarter of 2021, after barely registering as a worry throughout 2020. The percentage of Americans citing it has increased more in the last month – seven percentage points – than in any month since it started trending upwards. Concern about inflation is now at a 40-year high, Gallup reports.

Fears about fuel prices have followed a similar trend, with concern inching up in recent months.

Inflation as most important problem facing the US
Concern about inflation is rising quickly in the US.
Image: Gallup

The research mirrors concerns around inflation in many countries. Inflation expectations among consumers in South Korea have hit their highest since 2014.

Economics research to read this week

New analysis shows the challenges facing immigrant women in the European jobs market and finds that their labour market outcomes have not improved.

A new National Bureau of Economic Research working paper suggests that intergenerational mobility can begin before birth.