Moving in the opposite direction to much of the rest of the world, Russia’s central bank lowered its interest rate 1.5 percentage points to 8 percent on Friday, taking it even lower than it was before the country invaded Ukraine, the New York Times reported. The bank said inflation, which fell to 15.9 percent last month from about 17 percent in May, was slowing in the country because of “subdued” consumer demand and the strength of the ruble, which reached a seven-year high against the dollar last month. The rate cut was larger than economists had expected.
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Greek public debt has significantly increased since last year reaching 193 percent of the country's GDP, the Express reported. Inflation for June was 11.6 percent, up from 10.5 percent in May last year. According to data from the Greek Statistical Service (ELSTAT), public debt increased by €13.417 billion (£11.4 bn) between Q1 2021 and Q2 2022. Public debt is now expected to exceed €357 billion (£303 bn). The worrying figure has alerted experts, who have warned that another collapse of the Greek economy could bring the whole eurozone down.
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Russia and Ukraine signed separate agreements Friday to reopen blockaded Ukrainian ports and allow grain exports to begin to flow, Axios reported. Ukraine is one of the world's top exporters of wheat, sunflower oil and other agricultural products. With those exports almost entirely blocked due to Russia's Black Sea blockade, the food crisis plaguing countries in Africa and elsewhere has deepened. The deal, which was brokered by the UN with the help of Turkey, would be in place for 120 days and can be renewed, UN officials said.
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Germany has finalized a plan to bail out struggling energy firm Uniper, Chancellor Olaf Scholz confirmed on Friday, Deutsche Welle reported. The wholesale gas and electricity importer is threatened with bankruptcy over skyrocketing energy prices from the Ukraine war. Scholz told a news conference in Berlin that the government will take a 30% stake in the energy firm. He added that his administration would make up to €7.7 billion ($7.8 billion) available as hybrid capital and expand a credit line to €9 billion through the state-run bank KfW.
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The European Central Bank raised interest rates Thursday for the first time in 11 years by a larger-than-expected amount, joining steps already taken by the U.S. Federal Reserve and other major central banks to target stubbornly high inflation, the Associated Press reported. The move raises new questions about whether the rush to make credit more expensive will plunge major economies into recession at the price of fighting inflation, which is forcing people to spend more on food, fuel and everything in between.
Russian natural gas began flowing again at a reduced volume through a critical pipeline into Europe on Thursday, buying time for governments to decouple from the Kremlin’s exports amid what they expect will be an increasingly unreliable supply of energy from Moscow heading into the winter, the Wall Street Journal reported.
The number of Russian citizens who have declared bankruptcy and faced liquidation in the first half of 2022 rose by 37.8% over the same period from last year, a Russian Ministry of Economic Development report shows, the Egypt Independent reported. From January to the end of June, 121,313 Russian citizens filed for bankruptcy and had their assets liquidated to pay off debts, the report stated. Among them, the largest number of bankruptcy declarations were from Moscow at more than 6,000 individuals, followed by the region surrounding the capital, with more than 5,600.
As the 17 July 2022 deadline for Slovenia to implement the Directive (EU) 2019/1023 on Restructuring and Insolvency is fast approaching, it is still not entirely clear exactly when and how its provisions will be transposed into Slovenian law, Mondaq reported. A draft amendment of the main Slovenian insolvency law, the Financial Operations, Insolvency Proceedings, and Compulsory Dissolution Act (the "Insolvency Act"), which (among several other topics) provides for transposition, has been in circulation among various state authorities and the interested public for over a year.
Russia's foreign ministry on Thursday said that the latest round of European Union sanctions were illegitimate and would have "devastating consequences" for security and parts of the global economy, Reuters reported. European Union diplomats on Wednesday agreed on a new round of sanctions against Moscow for invading Ukraine, including a ban on importing gold from Russia and freezing the assets of the country's top lender Sberbank.
The European Central Bank will raise interest rates for the first time in 11 years on Thursday with a bigger-than-flagged move seen as increasingly likely as policymakers fear losing control of runaway consumer price growth, Reuters reported. With inflation already approaching double-digit territory, it is now at risk of getting entrenched above the ECB's 2% target, requiring rate hikes even if that slows — or crashes — an economy already suffering from the impact of Russia's war in Ukraine.