India’s bickering lawmakers test investors’ faith
By Andy Mukherjee
(The author is a Reuters Breakingviews columnist. The opinions expressed are his own)
The $12 billion foreign investors have poured into Indian equities this year is not a gift: it’s a bet that Finance Minister Palaniappan Chidambaram will keep his promise to lift the country’s GDP growth from its 10-year low. But the government can’t deliver without lawmakers doing their part. The problem is that India’s national parliament, never a bastion of efficiency, has simply stopped working.
UK minus EU is another loser from Lawson
By Ian Campbell
The author is a Reuters Breakingviews columnist. The opinions expressed are his own.
Nigel Lawson is back in the ring and as sharp as ever. The UK chancellor who dismissed his critics as “teenage scribblers” in the 1980s – as he fomented a housing bubble that weighed on the economy for half a decade – is now throwing his weight behind a UK exit from the EU. It will make Britain stronger, he jabs. Someone should throw in his towel.
Record aircraft orders point to global growth bump
By Andy Mukherjee
(The author is a Reuters Breakingviews columnist. The opinions expressed are his own)
The aviation industry’s incurable optimism is like a seatbelt sign for investors. That’s the conclusion of a Breakingviews study of global airline orders and economic growth. Aggressive aircraft orders have an inverse relationship with expansion in global GDP a year later. If that affiliation holds, big orders by Asian airlines point to rising risks of economic turbulence next year.
Hong Kong dockers’ pay sets tone for future strife
By Peter Thal Larsen
(The author is a Reuters Breakingviews columnist. The opinions expressed are his own)
Hong Kong’s port strike is over, but the tensions that sparked it remain. Dockers are feeling the squeeze of Hong Kong’s rising living costs, while port operators face challenges from China’s slowing and shifting economy. Labour relations look set to stay tense.
Malaysia poll offers only short-term relief
By Andy Mukherjee
(The author is a Reuters Breakingviews columnist. The opinions expressed are his own)
Malaysia’s ruling coalition has narrowly survived a strong challenge to its 56-year-old rule. While the results of the country’s general election on May 5 came as a relief for investors, the poll showed a widening racial divide. That doesn’t portend well for the economy.
Ailing South Korea needs monetary remedy
By Andy Mukherjee
(The author is a Reuters Breakingviews columnist. The opinions expressed are his own)
The Bank of Korea is making a big mistake by not cutting interest rates more aggressively. A weaker Japanese yen and tepid global demand are squeezing the country’s exporters from Hyundai Motor to steelmaker Posco. Though demand from China is still growing, shipments to Europe are falling, while those to the United States have stalled (See graphic).
Unsure voters could dim lure of Malaysian assets
By Andy Mukherjee
(The author is a Reuters Breakingviews columnist. The opinions expressed are his own)
Malaysia’s upcoming general election looks set to be a close-run affair. The big risk for investors from the May 5 poll is that neither of the two competing coalitions – the ruling Barisan Nasional or the opposition Pakatan Rakyat – may be able to claim a decisive victory.
Why China’s “Minsky moment” may be a long way off
By Peter Thal Larsen
(The author is a Reuters Breakingviews columnist. The opinions expressed are his own)
China may be a long way from its “Minsky moment”. Rising leverage has prompted many to predict the kind of financial meltdown theorized by the economist Hyman Minsky. But China’s closed, state-controlled system is well placed to postpone such market panics. The bigger challenge is managing social tensions arising from slowing growth.
Political heat endangers no-brainer ECB rate cut
By Pierre Briançon and Olaf Storbeck
The authors are Reuters Breakingviews columnists. The opinions expressed are their own
The heat is on for Mario Draghi again this week. What should have been a rather banal decision on rates will prove controversial whatever the outcome. Give credit to euro zone leaders for their ability to create drama whenever things threaten to go too quiet on the crisis front. The governing council of the European Central Bank will have to decide whether to cut rates or not at its meeting May 2. The case for doing it is a no-brainer, but euro zone politics gives the decision an intensity it shouldn’t have.
Japan lifts Nomura from its lost half decade
By Peter Thal Larsen
(The author is a Reuters Breakingviews columnist. The opinions expressed are his own)
Nomura has spent most of the past five years trying to break out of Japan. So it’s ironic that the investment bank’s best full-year results since 2007 were propelled by a revival at home. As with Japan’s economic renaissance, however, investors’ hopes are running ahead of reality.
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