Fragile Global Economy Faces New Crisis in Israel-Gaza War

The International Monetary Fund said on Tuesday that the pace of the global economic recovery is slowing, a warning that came as a new war in the Middle East threatened to upend a world economy already reeling from several years of overlapping crises. The eruption of fighting between Israel and Hamas over the weekend, which could sow disruption across the region, reflects how challenging it has become to shield economies from increasingly frequent and unpredictable global shocks. The conflict has cast a cloud over a gathering of top economic policymakers…

Diesel Prices Could Keep Inflation High

Inflation has been easing around the world. But what happens next could depend partly on the cost of diesel, a wild card that few analysts have been able to predict well. Higher gasoline prices — lit up on giant signs on streets and highways — are typically the most visible, visceral reminder of inflation to consumers. But analysts say diesel can have a bigger impact on inflation because the fuel powers trucks, industrial machinery and agricultural equipment. The prices of heating oil and jet fuel are also closely connected to…

$100 Oil Could Scramble the Fed’s Efforts to Ease Inflation

What rising oil prices mean for the Fed Crude oil has slipped below the 10-month high it hit on Tuesday. But analysts say the monthslong rally that has sent prices close to $100 a barrel isn’t over, posing a big risk for global growth and complicating central bankers’ efforts to tame inflation. Expect Jay Powell to field plenty of questions about oil prices at his news conference on Wednesday. The crude rally has become a wild card for the Fed chair and other policymakers grappling with high inflation. The Fed…

Interest Rate Jitters Sink the Giants of Tech

Market whiplash In the span of a month, the bottom has dropped out of the bull-market rally as investors have come to grips with the prospect of “higher for longer” interest rates worldwide. The sell-off in global stocks and bonds picked up steam on Thursday. And weary market watchers will be looking for more hints on the Fed’s view at next week’s Jackson Hole summit of central bankers and policymakers. Technology stocks have been hit particularly hard. The high-flying FANG+ Index — which comprises the largest tech stocks by market…

China’s Woes Loom Large Over the Global Markets

What’s behind the August sell-off? Goldman Sachs economists see an end to the Fed’s hawkish policy on interest rates, predicting that the central bank will cut its prime lending rate in the second quarter of next year. But that bullish prediction is doing little to restore investors’ optimism, as concerns mount about consumer confidence and the health of global economy. China’s woes are reverberating. The country, a major engine of growth, has been rocked by a decline in trade, a slowdown in consumer spending, a crackdown on the private sector…

The Numbers in the News

Numbers that count 2 Two major central banks — the Bank of Japan and the People’s Bank of China — were the only ones not to raise interest rates this year, as inflation threatened economic growth and sapped consumer purchasing power. Central banks have collectively increased rates by more than 70 percent in 2022, according to LPL Financial, with the same goal: raise borrowing costs to cool rising prices that have been hitting shoppers from London to Poughkeepsie. Many were following the Fed, which increased its prime lending rate to…

Businesses Brace for Currency Chaos in Asia

Tigun Wibisana and Sandra Kok, who own the SiTigun cafe on Penang Island in Malaysia, are facing an excruciating decision that could make or break their business of 14 years: Can they increase prices to cover rising expenses without driving customers into the arms of their bigger rivals? The cost of the coffee beans that the couple, who are married, buy is spiraling because they are traded globally in U.S. dollars, and the Malaysian ringgit has fallen to a 24-year low. Compound that with an inflationary spike in prices for…

Federal Reserve Walks a Tightrope Between Inflation and Recession

In an interview, James D. Hamilton, professor of economics at the University of California, San Diego, and a leading expert on the economic effects of oil shocks, said they had “made major contributions to recessions over many decades.” At current oil price and supply levels, the effects of the Russian war “are fairly manageable for the American economy.” But Professor Hamilton pointed out that Russia’s oil, which amounts to about 10 percent of world production, could not be easily replaced if totally cut off — an outcome that he does…

Who’s Buying Evergrande?

A look inside Robinhood during meme-stock mania The trading app Robinhood has grown explosively, gone public and, for good measure, is now getting into crypto wallets. But internal exchanges between company managers revealed in a new legal filing — featuring Robinhood’s C.E.O., Vlad Tenev — highlight the tensions between fast growth and consumer protection. A class-action lawsuit brought by Robinhood users alleges that the company was negligent during a period of extreme market volatility in late January, knowing it had insufficient capital to handle all the trading by new and…