Friday, May 13, 2016

US retail sales jump 1.3%; Malaysia growth slows to 4.2%; IMF says Brexit is 'pretty bad to very, very bad'

1 US retail sales jump 1.3% (The Guardian) US retail sales jumped 1.3% in April, beating expectations of a 0.8% increase.

Excluding cars, sales were up 0.8%, again beating expectations of a 0.5% increase. The figures will bring relief to worried investors.

2 Malaysia growth slows to 4.2% (Straits Times) Malaysia recorded its slowest economic growth in nearly seven years in the first quarter, as weak exports and tepid domestic demand continue to hurt the trade-dependent nation.

In January-March, the economy grew 4.2 per cent from a year ago, down from 4.5 per cent in the previous quarter. The quarter was the fifth straight one of declining growth and showed the slowest expansion since the third quarter of 2009.

Bank Negara governor Muhammad Ibrahim indicated that the current quarter could bring further slowing, but said growth could improve in the second half .

3 IMF says Brexit is ‘pretty bad to very, very bad’ (BBC)The International Monetary Fund chief has said a vote by the UK to leave the European Union w ould have "pretty bad, to very, very bad" consequences.

Christine Lagarde said she had "not seen anything that's positive" about Brexit and warned that it could "lead to a technical recession". She echoed similar comments made by Bank of England governor Mark Carney.

The IMF said in a report on the UK economy that a leave vote could have a "negative and substantial effect". It has previously said that such an outcome could lead to "severe regional and global damage".

The Fund said a Brexit vote would result in a "protracted period of heightened uncertainty" and could result in a sharp rise in interest rates, cause volatility on financial markets and damage London's status as a global financial centre.

Ms Lagarde said the IMF had a duty to assess the risks of Brexit. It has a mandate to oversee the international monetary and financial system. The Fund is expected to publish detailed estimates of the economic impact of a vote to leave the EU in the week before the 23 June referendum, the timing of which has been criticised by leave campaigners.

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