Positive outlook regarding US debt ceiling agreement and significant economic updates

This weekly roundup highlights the latest stories from the world of economics and finance. The top economic news includes the expectation of a US debt ceiling deal, a global debt increase, and the United Nations’ raised global economic growth forecast.

Regarding the US debt ceiling, President Joe Biden and House Speaker Kevin McCarthy expect the cap to rise after Biden’s return from his trip to Japan on May 21. Failure to remove the debt ceiling could result in a default, which would affect the US credit rating and increase borrowing costs. Global debt has increased by $8.3 trillion in the first quarter of 2023 compared to the end of 2022, reaching $304.9 trillion. This is according to the Institute of International Finance (IIF) Global Debt Monitor, which highlights that global debt is now $45 trillion higher than pre-pandemic levels.

Furthermore, the United Nations predicts global economic growth to increase to 2.3% in 2023, an increase of 0.4 percentage points from their previous forecast. In other news, UK consumer confidence rose for the fourth straight month, Japan’s economy emerged from recession, and the Japanese stock market hit a 33-year high.

U.S. bankers are stepping up risk management, monitoring, and emergency procedures for social media use after Silicon Valley Bank’s collapse and management has devised plans to combat online threats. The World Economic Forum’s Fourth Industrial Revolution Center Network is building a global community of central banks, international organizations, and leading blockchain experts to develop distributed ledger technology innovations. Lastly, the International Monetary Fund has approved a $3 billion three-year loan program for Ghana to alleviate its unsustainable foreign debt.

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