Philippine annual inflation at 1.4% in June
Economists in a Reuters poll had expected annual inflation of 1.5 % last month, within the central bank's forecast range of 1.1 to 1.9%.
Core inflation, which strips out volatile food and energy prices, was unchanged at 2.2% in June.
Inflation in the first half of the year averaged 1.8%, within the central bank's 2% to 4% target for the year.
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Coin Geek
10 minutes ago
- Coin Geek
Thailand gets new tax measures; Malaysia sets up sandbox
Getting your Trinity Audio player ready... While most governments struggle with digital asset taxation, Thailand has approved a five-year tax exemption plan that the government says will boost innovation. In neighboring Malaysia, the government has launched a new regulatory sandbox for digital asset firms as the race to dominate the sector in Southeast Asia heats up. Thailand's tax exemption It's 'full speed ahead,' Deputy Finance Minister Julapun Amornvivat stated on X as he announced the tax exemption plan. He revealed that the Cabinet had approved new tax measures to support Thailand's ambition to become a 'Digital Assets Hub.' 'The key point is the exemption of personal income tax on capital gains from the sale of digital assets, provided the transactions are conducted through operators regulated by the SEC, covering the period from January 1, 2025, to December 31, 2029,' he stated. With the new exemption, the Thai government intends to promote transparent digital asset trading on regulated exchanges and support innovation, the deputy minister says. And while it will erase capital gains, the government expects the increased trading will increase mid-term tax revenue by at least THB1 billion ($30.6 million). 'The main goal of this legislation is to invigorate Thailand's crypto market, attract foreign investment, boost domestic spending, and potentially pave the way for other forms of taxation, such as Value Added Tax (VAT), in the future,' Amornvivat added. The $30 million in 'crypto' tax revenue would put Thailand at par with countries like Switzerland, Belgium, Norway, and Portugal, according to data from digital asset tax service provider Blockpit. These countries also have attractive taxation policies for the sector; Portugal, for instance, exempts taxation for private individuals who hold their digital assets for more than one year. Blockpit estimates that the United States collected $1.9 billion in 2023, six times higher than second-placed India at $303 million. Japan, France, and the United Kingdom make up the top five. Besides the exemption, the Thai tax agency has also pledged to comply with the Crypto-Asset Reporting Framework designed by the Organisation for Economic Co-operation and Development (OECD). The global standard was launched in 2022 and requires exchanges, wallets, and brokers to report all transactions to prevent tax evasion. Over 50 nations signed the agreement in March this year. 'I firmly believe this is another significant step forward in enhancing our country's economic potential and an opportunity for Thai entrepreneurs to grow on the global stage,' the Deputy Minister concluded. Meanwhile, the Thai Securities and Exchange Commission (SEC) recently launched a public consultation on the listing criteria for digital assets on local exchanges. The proposed criteria would expand the list of issuers and promote innovation, all while increasing safeguards for investors. Malaysia launches Digital Asset Innovation Hub In neighboring Malaysia, the government has launched a Digital Asset Innovation Hub to spur innovation in the blockchain sector. The hub was launched by Prime Minister Anwar Ibrahim, who described it as an initiative that will spark 'deeper collaboration between regulators and industry players,' reports The Business Times. The new hub provides a regulatory sandbox for both local and international virtual asset service providers (VASPs) to test their products and services before rolling them out to consumers. Top financial regulators, including Bank Negara Malaysia and the Securities Commission, will be part of the project to ensure the products adhere to regulations. 'Our ambition is clear—to align infrastructure, policy and talent, across both the public and private sectors, in pursuit of a digitally capable, future-ready Malaysia,' Ibrahim added. The premier identified stablecoins backed by the local ringgit, programmable payments, and supply chain financing as the priority areas for VASPs in the hub. Programmable payments, in particular, have been of interest to Malaysia for some time; the country's central bank digital currency (CBDC), which the central bank has been exploring for years, will support these payments. With the ringgit-backed stablecoin, Malaysia would join dozens of countries pushing for stablecoins backed by their local currencies as USD-backed options dominate the market with a 98% market share. The central bank has expressed its support for the hub, which Governor Abdul Rasheed Ghaffour says will enable Malaysia 'to build a strong foundation for an adaptive and resilient economy.' Watch | From BRICS to Blockchain: How Global Trade and Digital Currencies Are Evolving title="YouTube video player" frameborder="0" allow="accelerometer; autoplay; clipboard-write; encrypted-media; gyroscope; picture-in-picture; web-share" referrerpolicy="strict-origin-when-cross-origin" allowfullscreen="">
Telegraph
an hour ago
- Telegraph
The Russian potato shortage that shows Putin's economy is on the brink
When the last leader of the Soviet Union visited Chequers for lunch with prime minister Margaret Thatcher in 1984, one topic of discussion was potatoes. Raisa Gorbachev, the wife of Soviet leader Mikhail, claimed Russia had 300 ways of cooking the humble spud, prompting Michael Jopling, Britain's agriculture minister, to express disbelief. She later posted a Russian cookbook to Jopling with the clarification: 'In fact, there are 500, rather than 300, recipes to cook potatoes.' For Vladimir Putin, Russians' appetite for the vegetable has become problematic, however. Shortages have pushed up prices by 167pc over the past year, the biggest rise of any food. 'It turns out that we don't have enough potatoes,' Putin admitted during a televised meeting in May, adding: 'I spoke with [Belarusian leader] Alexander Grigoryevich Lukashenko. He said, 'We've already sold everything to Russia.'' Since the invasion of Ukraine in 2022 made Russia the world's most sanctioned country, eagle-eyed economists have watched closely for signs of economic damage which have proved remarkably elusive. But now surging food prices and labour shortages are keeping inflation high, driving big cracks in the economy. 'We're basically already on the brink of falling into a recession,' economy minister Maxim Reshetnikov told a conference recently. Could Russia's well-oiled war machine be running out of steam? The strain is definitely starting to show, says Alexandra Prokopenko, a fellow at the Carnegie Russia Eurasia Center. 'Slowing economic growth coupled with high inflation leaves Russia close to stagflation,' says Prokopenko, a former adviser at Russia's central bank. It means Putin is vulnerable. Further falls in oil prices or a tightening of sanctions can now inflict far greater harm than they did previously, Prokopenko warns. 'None the less, we are not quite there yet,' she cautions. Another economist at a European bank, who didn't want to be named, said the waters were still muddied when it came to Russia's economy. 'The momentum is much slower than it used to be. If we look at the deficit, it has been widening. That suggests that despite the fiscal support, which is most likely aimed at military-related areas, the Russian economy is clearly not as robust as it used to be,' they said. In other words, Putin's war economy is likely at capacity: 'The potential to draw more people into the army and military production has been used. There is a limit to how many shifts people can work in factories, producing munitions and military uniforms.' As a result, inflation was running high at 9.9pc in May, fuelled by billions of roubles ploughed into the war effort, worker shortages and other price pressures. To quell it, interest rates are at 20pc, even after a one percentage point cut in June. 'The financial resources are not endless. The central bank, which maintains some sort of independence, has to maintain a very restrictive monetary policy. That lowers the availability of finance for the rest of the economy,' the economist adds. Still, experts caution against concluding this means all Russians must be struggling. Unemployment is hovering around record lows, high interest rates are boosting savings and mortgage borrowers are to some extent shielded. Wages have also surged. 'Yes, inflation has been high in the last three years, but nominal incomes have been growing much faster, therefore the average real wage actually increased quite substantially. I travel to Russia quite often, and there doesn't seem to be any discontent which is about to bubble to the surface,' says Tatiana Orlova, from Oxford Economics. She believes the economy minister's warning of recession was an attempt to cajole the central bank into cutting rates further – a more underhanded attempt than Donald Trump's frequent angry social media outbursts against Jerome Powell, the US Federal Reserve chief. She says that people in some sectors – teachers, doctors and others – will probably feel worse off because of high inflation. But the war has also created a big class of winners in poor towns across Russia. 'The families who are affected by the war because someone has joined the contractual army, for example, are using it as a social lift. The government is paying very high bonuses equivalent to between $20,000 [£14,600] and $35,000 just for signing up,' Orlova says. 'Those fighters are also receiving monthly wages, which are quite above average. So the families are suddenly able to afford more things. They can make a down payment for a new flat or buy a new car. It's a weird paradox that the war actually brought prosperity to families at this horrible cost,' she adds. This is echoed by the other economists who study the Russian economy. The country is experiencing the slow-burn effect of sanctions, but with very different impacts across the population. 'It's important to understand that the Russian households are not poor. The situation is far from catastrophic. The mood from now on will likely deteriorate because of the lack of new stimulus. These are the longer-term consequences of everything that the Russian government put upon itself in 2022,' said another economist. 'The politically liberal middle class that was formed in the early 2000s, which was mostly employed in the private sector, left the country in response to Putin's war. Since 2022, the new middle class has emerged among those beneficiaries [from the war], and they have been upscaling their consumption patterns,' they add. And this brings us back to potatoes. Prices of the beloved vegetable have surged because of poor harvests have reduced supply. They have only just started easing slightly. Bellwether of household finances Any sign of heightened popularity is worth watching: 'Potatoes are a Giffen good. That means if household wealth is going down, then some lower quality products such as potatoes see increasing demand,' the economist says. In other words, if people feel poorer they typically buy more potatoes, making it an unusual bellwether of household finances in a country with sparse reliable data. But says Andrey Sizov, a Russian commodity expert, other food types like butter, eggs and meat have also become much costlier after shortages. This may in fact reflect people trading up from potatoes. 'My speculation is that supply went down, and actually demand went down a little bit. Potatoes are not an expensive food. In the previous two years, it was first of all poor Russians who were making more money. So they could consume something else – less potatoes, more meat and butter, for example,' Sizov says. The humble spud's mixed signals underline that even as Russia's economy has lost momentum, some are feeling the gain and others the pain. But with the longer running toll from sanctions mounting and a costly war nearing its fourth anniversary, Putin has few options to trigger another growth spurt. 'The central bank could cut interest rates. But that would risk another surge in inflation. Another option is for the government to increase spending, but this is also more likely to increase prices than stimulate growth,' says Prokopenko, the former central bank adviser. 'Protectionism is yet another option. But this only works at the expense of consumers. In other words, it is ordinary Russians who will feel the consequences – through either increased prices, falling income, or less choice on the shelves,' she adds. Will the economic strain matter to Putin? He has been emboldened by a friendlier regime in the US under Trump administration, which has just paused some arms shipments to Kyiv. 'I do not see that the finances are at breaking point. This could go on for years,' warns Orlova. 'In Russia, people have very low expectations. They expect their life to be hard. They expect to always fight and find new ways of surviving. So it's just life as usual. When the population has very low expectations, it actually helps those who rule the country to do whatever they want,' she adds.
Reuters
2 hours ago
- Reuters
Thailand has submitted latest trade proposal to United States, finance minister says
BANGKOK, July 7 (Reuters) - Thailand has submitted its latest trade proposal to the United States, its finance minister Pichai Chunhavajira said on Monday, as it tries to head off steep tariffs from its largest export market. Washington has threatened to impose a 36% levy on imports from Thailand if a reduction cannot be negotiated before July 9, when a 90-day pause capping tariffs at a baseline of 10% for most nations expires. The United States accounted for 18.3% of Thailand's shipments last year, or $54.96 billion. Washington has put its deficit with Thailand at $45.6 billion. "We heard their feedback and what what they were especially interested in and we adjusted it," said minister Pichai Chunhavajira, who returned from Washington last week following talks. He said there could be other adjustments in future. Thailand's top three exports to the United States last year were computers, teleprinters and telephone sets, and rubber products. Its top three imports from the U.S. were crude oil, machinery and parts, and chemicals. Thai state-owned energy giant, PTT Group ( opens new tab in June signed an agreement to procure 2 million metric tons of liquefied natural gas per year from Glenfarne's Alaska LNG project over a 20-year term. The $44 billion project has been by U.S. President Donald Trump. Pichai earlier said Southeast Asia's second-largest economy, opens new tab could expand by just over 1% this year due to the impact of U.S. tariffs. Thailand's has struggled with weak consumption, soaring household debt, slowing tourism, trade uncertainty and potentially steep U.S. tariffs. Last month, the central bank forecast economic growth of 2.3% this year, after last year's growth of 2.5% lagged peers in the region.
