Chinese growth slows, inflation grows; India slashes interest rates; Thailand on knife-edge awaiting Thaksin verdict; terrorists charged in Turkey's "trial of the century"; and more
Top of the Agenda: Economic Fears Broaden
Two important measures of Chinese economic health, the country's overall growth rate and its rate of inflation, showed signs of weakness Monday. Chinese economic growth slowed for a third straight quarter--and while the country still boasts growth over 9 percent per year, the BBC reports the sharp recent tail-off heightens fears that China could be in for a severe economic downturn. Bubbling inflation furthers China's concerns. Xinhua reports China's consumer price index rose 4.6 percent in September over the year prior, and Chinese food price reportedly rose 17.3 percent since the beginning of 2008. Should these trends continue, analysts say they could undermine a major engine of global growth and heighten the chances that current financial troubles will lead to a worldwide recession.
Similar troubles are now apparent in India, where the central bank unexpectedly cut interest rates by 100 basis points in what Rediff calls an "extraordinary measure" to stabilize the country's economy. Indian Prime Minister Manmohan Singh warned of coinciding declines in economic growth through 2009 (Times of India).
Meanwhile, the Financial Times reports the U.S. Federal Reserve and Treasury are shifting their focus from the financial system to the U.S. consumer, amid fears that the United States will post its worst economic data in decades. President Bush and French President Nicolas Sarkozy jointly announced this weekend that they would host a global summit (NPR) to address the current crisis in the near future. The Wall Street Journal reports, however, that major differences remain between the U.S. and European approaches to the current problems, and that aligning policy could prove difficult. The New York Times week in review has a piece arguing European leaders have proven more flexible and innovative throughout the current crisis than their American counterparts.
Pacific Rim: Thai Tensions
The Bangkok Post reports tensions between anti- and pro-government groups in Thailand have reached a boiling point, following recent protests and the refusal of the country's new prime minister to resign. The article says an impending verdict in a corruption trial against former Prime Minister Thaksin Shinawatra, expected tomorrow, threatens to set off further violence.
South Korea: The Chosun Ilbo looks at recent moves by South Korea's government to guarantee overseas bank loans in an attempt to stabilize the South Korean banking system. Yonhap reports the South Korean currency, the won, has surged following the measures.
This is an excerpt of the CFR.org Daily News Brief. The full version is available on CFR.org.