Macroeconomic round up: Oil continues its decline
Jason Walls breaks down the week's biggest news in macroeconomics. With special audio feature.
The year is just 22 days old and there are already forecasts of another global financial downturn.
The problem? In a word, it’s oil; there is just too much of it. As well as an oversupply, global oil demand has also been wavering.
China’s turbulent six months has led to the People’s Republic decreasing demand. It is a similar situation in Europe.
This week, the price of a barrel of crude oil fell below $27, after dropping more than $10 in the space of 20 days. In fact, a barrel of oil has become cheaper than the physical barrel it is stored in.
This has had a harmful effect on markets all around the world.
Wednesday was a bloodbath. The Dow shed 249 points, with the FTSE falling 3.5% and the DAX down 2%.
China’s Shanghai Composite was down 1%, after having an abysmal start to the year. 2016 is now officially the worst start to the calendar year for markets since 2000.
As well as its stock market woes, China’s economic growth rate for 2015 also took a bit of a tumble.
The economy grew 6.9% year-on-year, which is in line with analysts’ expectations. However, a debate still rages over the accuracy of the data.
If you are travelling by Air New Zealand, remember Koru Lounge wi-fi provides you with FREE access to NBR ONLINE premium content.
Jason Walls
Fri, 22 Jan 2016
Fri, 22 Jan 2016
© All content copyright NBR. Do not reproduce in any form without permission, even if you have a paid subscription.
Macroeconomic round up: Oil continues its decline
54888