Aurelia Butler

WASHINGTON (Reuters) -U.S. Treasury Secretary Janet Yellen will convene a high-level panel on Tuesday to discuss the global response to an ongoing food security crisis exacerbated by Russia’s war against Ukraine, the Treasury Department said in a statement.The meeting will include the heads of the International Monetary Fund, the World Bank and the International Fund for Agricultural Development, as well as ministers representing the G7 and G20 countries and technical experts from international financial institutions, it said on Monday.Treasury officials aim to ensure that international financial institutions are sharing knowledge about the key drivers of rising food insecurity, including Russia’s invasion of Ukraine, and push them to step up the scale and urgency of their response, a senior Treasury official said.”Secretary Yellen is deeply concerned about impacts that Russia’s reckless war are having on the global economy, including the risk of rising food insecurity in emerging markets and developing countries around the world,” a second senior Treasury official said.Russia says it is engaged in a “special military operation” in Ukraine.The crisis was hitting emerging market and developing countries that were still struggling to recover from the COVID-19 pandemic particularly hard, the official noted.A third senior Treasury official said Treasury had no specific aid target in mind for the meeting, noting that officials were still analyzing the extent of the problem.Yellen is expected to warn against export bans, drawing on lessons from the last big world food crisis in 2008, the official said, while ensuring efforts to boost food production in Africa and other regions highly dependent on imports.Treasury officials will also call for continued research and innovation to ensure that agricultural production is adapted to climate change factors such as heat and drought.Yellen first announced plans for the meeting last week, noting that over 275 million people worldwide were facing acute food insecurity. Treasury officials expect to release an action plan after the event to help structure the urgently needed global response, one of the officials said.The World Bank, IMF, UN World Food Program and World Trade Organization have also called for urgent, coordinated action on food security, and appealed to countries to avoid banning food or fertilizer exports.They said the crisis was compounded by a sharp increase in the cost of natural gas, a key ingredient of nitrogenous fertilizer, which could threaten food production in many countries.Treasury’s Office of Foreign Assets Control this week will reiterate its commitment to allow the free flow of agricultural goods, including humanitarian aid to the Russian people, despite sweeping sanctions imposed on Russia, a senior official said. More

China’s economy grew faster than expected in the first quarter but official data revealed a contraction in consumer activity as lockdown measures to counter the spread of Covid-19 weighed on the country’s outlook. China’s gross domestic product rose 4.8 per cent compared with the same period a year earlier, after expanding 4 per cent in the final three months of 2021. On a quarter-on-quarter basis, GDP grew 1.3 per cent.Retail sales, a gauge of consumer spending, fell 3.5 per cent in March — its first contraction since July 2020 — as authorities hardened restrictions to counter the country’s worst coronavirus outbreak in more than two years.The data will add to pressure on the government of Chinese president Xi Jinping, which has reaffirmed its commitment to a zero-Covid policy despite mounting costs and disruptions in the biggest cities. Infections across China rose in April and Shanghai, its main financial hub, has remained largely sealed off.The lockdown effect: The lockdown in Shanghai began in late March, meaning its full impact will not be recorded in the first quarter report, which did take into account less severe lockdowns in the manufacturing hubs Shenzhen and Jilin. Wealthy seek to leave: Chinese immigration consultants say inquiries from wealthy individuals trying to leave have surged following the lockdown of Shanghai, underscoring frustration with Beijing’s zero-Covid strategy.What do you think of Beijing’s zero-Covid strategy? Share your thoughts with me at [email protected]. Thanks for reading FirstFT Asia. — Emily The latest from the war in UkraineEastern offensive: Russia has launched a full-scale offensive in the Donbas region. The attack follows missile strikes earlier on Monday in Lviv that killed seven people in the western city. (AP, FT) Energy: Soaring oil prices caused by the war in Ukraine could improve Malaysia’s balance sheet, according to its finance minister.Eye on Asia-Pacific: China will welcome a prolonged war in Ukraine as a “rolling strategic diversion” from its own assertiveness, according to former Australian prime minister Kevin Rudd.Five more stories in the news1. Gold rises to highest level in a month Gold prices climbed and US stocks slipped on Monday as worries over a weakening global economy were heightened by signs that coronavirus lockdowns had clouded the outlook for growth in China.2. Whisky on the table as Johnson heads to New Delhi Leading Scotch maker Chivas Brothers says it aims to double exports to India if New Delhi eliminates whisky tariffs, a top UK demand in bilateral trade talks ahead of prime minister Boris Johnson’s visit to India this week.3. Sri Lanka’s president appoints new leaders President Gotabaya Rajapaksa appointed 17 cabinet members yesterday as protests over alleged economic mismanagement continue to roil the nation. Rajapaska chose younger leaders to appease the public, but his 76-year-old brother, Mahinda Rajapaksa, will remain prime minister. (Straits Times) 4. Marine Le Pen rejects reports of EU funds misuse French far-right presidential challenger Marine Le Pen has dismissed allegations that she misappropriated tens of thousands of EU funds as “dirty tricks”, less than a week away from a tight election race against Emmanuel Macron.5. UK braced for prolonged period of stagflation The risk of a prolonged period of low growth in gross domestic product coupled to high inflation in the UK has increased after consumer prices surged more than expected while economic growth slowed to a crawl. Coronavirus digestA US judge has halted the Biden administration’s mask requirement for public transport passengers.China’s zero-Covid policy has taught the world that it is no longer possible, if it ever was, to combat the virus with suppression alone. Ways to live with the virus must be found, our editorial board writes.The number of births in advanced economies has largely rebounded to pre-pandemic levels, an FT analysis shows — a recovery partly due to stimulus policies.The day aheadIndonesia central bank meeting Policymakers at Bank Indonesia will meet and make their interest rate decision.Johnson faces UK parliament A defiant Boris Johnson will face MPs for the first time since being fined over the “partygate” affair, with allies privately criticising the Metropolitan Police’s handling of the issue. The UK prime minister will apologise to MPs but will insist that he was not aware he was breaking his own Covid-19 lockdown rules.IMF World Economic Outlook With inflation hitting a fresh 40-year high in the US and a 30-year high in the UK this week, the IMF said its forecasts set to be released today would also show rapid price increases would be more persistent than it previously thought.Join us for the FT’s Crypto and Digital Assets summit on April 26-27. Register today to be part of a critical conversation with the world’s global financial and corporate elite, as they carve out the path ahead for bridging traditional finance and the crypto leaders of tomorrow.What else we’re readingUS-China Tech Race: Shock and Awe In the latest episode of this Tech Tonic season about US-China tech rivalry, the FT’s US-China correspondent Demetri Sevastopulo tells the inside story of his scoop on China’s secret hypersonic weapon test and how it changed geopolitics.Asian Americans take safety into their own hands after violent attacks Since the pandemic, anti-Asian hate in the US has escalated. Amanda Chu speaks to Asian Americans in New York City, where the police department estimates that hate crimes against them jumped more than 360 per cent in 2021.OK, boomer: generations aren’t real. Class is. Desperate individuals — like marketing professionals or opinion columnists who have passed their deadline — love to talk about “generations” because they are neat ways to sell someone something they might not otherwise buy, writes Stephen Bush. For more from Stephen, sign up here for our latest newsletter, Inside Politics.India’s biggest-ever merger The proposed $40bn merger between India’s biggest private sector bank and mortgage provider has been driven by tighter regulation of the country’s shadow banking sector, Deepak Parekh, chair of HDFC Bank and Housing Development Financing Corporation, told the FT. Donald Trump and the Republicans’ midterm dilemma The Republican Senate primary in Pennsylvania next month is becoming a pivotal event in this year’s midterm elections and could determine which party controls the upper chamber of Congress. US president Joe Biden defeated Donald Trump in 2020 in the state, but only by a razor-thin margin.FashionHard luxury drives the retail market because watches and jewellery tend to retain, or even increase, their value. Historically, clothing has been a poor investment, losing about 90 per cent of its value at the point of purchase. But a boom in online retail and changing attitudes towards pre-owned have given rise to vast online marketplaces for second-hand goods.

Copenhagen-based Ganni is the latest brand to launch a resale marketplace © Sarah Stenfeldt More

US stocks, government bond and gold prices seesawed on Monday as investors grappled with worries over a weakening global economy and looked ahead to a busy week of corporate earnings and speeches from central bankers.The US blue-chip S&P 500 share index swung from gains to losses in thin trading before ending the day almost exactly where it had closed after the previous session. The tech-heavy Nasdaq Composite closed 0.1 per cent lower. Trading volumes in stocks in the S&P 500 were about 20 per cent below recent averages, according to Bloomberg data.Gold, which typically advances during periods of uncertainty, rose as much as 1.2 per cent to $1,998 a troy ounce, reaching its highest level in more than a month, before falling back to $1,977, a 0.1 per cent increase.A broad MSCI index of equities markets in the Asia-Pacific region dropped 1.1 per cent, its second consecutive day of declines. Big European markets were closed for the Easter Monday holiday.Government bonds also struggled for direction, with the 10-year US Treasury eventually gaining 0.03 percentage points to 2.86 per cent. Yields move inversely to price.The cautious start to the trading week followed China’s release of a flurry of economic data. Gross domestic product rose 4.8 per cent in the first three months of 2022 compared with the same period in 2021, exceeding market expectations.But economic activity data for March revealed how Beijing’s zero-Covid policy, including the lockdown of Shanghai, has eroded the growth outlook of the world’s second-biggest economy. Retail sales declined 3.5 per cent in March from the same month in 2021, the first year-on-year fall since July 2020; the annual rate of increase in industrial production slowed; and indicators tracking China’s struggling property market further deteriorated. “While the March data shows notable slowing in growth momentum, with the escalation in zero-Covid policy and broadening disruption on economic activity, the drag on economic activity will likely be larger in April compared to March,” JPMorgan analysts said. JPMorgan reduced its forecast for China’s GDP growth in 2022 from 4.9 per cent to 4.6 per cent. Barclays also trimmed its estimate for 2022 growth from 4.5 per cent to 4.3 per cent. The latest bout of concerns over China added to investor uneasiness over global central banks’ plans to tighten monetary policy in an attempt to rein in raging inflation. Indeed, US natural gas prices rallied 10 per cent to $8.03 per metric million British thermal unit on Monday — the highest level since 2008.Investors will closely watch speeches from Federal Reserve officials this week, including chair Jay Powell, that may give further guidance on how aggressively policymakers will raise interest rates this year.

Jan Hatzius, chief economist at Goldman Sachs, said at the weekend that the US central bank faced a “hard path to a soft landing” as it attempted to push the inflation rate down to its 2 per cent target, from 8.5 per cent, by sharply boosting borrowing costs and reducing the size of its $9tn balance sheet. Hatzius sees a 15 per cent chance that the US will fall into recession in the next year and 35 per cent that it will do so in the next 24 months. Investors also digested the latest batch of corporate results. Bank of America on Monday reported better than expected earnings fuelled by a lending rebound and higher interest rates.First-quarter earnings season in the US started on a decent footing, with companies in the S&P 500 so far reporting earnings 7.5 per cent higher than estimates, according to FactSet. However, less than a tenth of companies on the blue-chip index have updated the market, and investors will have a better picture of the overall outlook by the end of this week, when a further 67 constituents including Netflix, IBM and American Express will have reported results. More