BUSINESS NEWS APRIL 16TH, 2016
Many analysts had anticipated that a dramatic drop in oil prices such as we’ve seen since the summer of 2014 could provide a big stimulus to the economy of a net oil importer like the United States. That doesn’t seem to be what we’ve observed in the data.
There is no question that lower oil prices have been a big windfall for consumers. Americans today are spending $180 B less each year on energy goods and services than we were in July of 2014, which corresponds to about 1 percent of GDP. A year and a half ago, energy expenses constituted 5.4 percent of total consumer spending. Today that share is down to 3.7 percent.
IMF MEMBERS URGE 'GROWTH-FRIENDLY' SPENDING, NEW LENDING TOOLS
The International Monetary Fund's steering committee on Saturday urged member countries to boost "growth-friendly" spending and said the Fund should explore new lending tools to help deal with slowing global growth. IMF Managing Director Christine Lagarde said that calmer markets since February had reduced the stress level at the IMF and World Bank spring meetings here, but the outlook was still fraught with downside risks from weak demand, a potential UK exit from the European Union and low oil and commodity prices. "There was not exactly the same level of anxiety but I think there was an equal level of concern, and a collective endeavor to identify the solution and the responses to the global economic situation," Lagarde told a news conference.
VOLKSWAGEN INCREASES DISCOUNTS AFTER EMISSIONS SCANDAL
Volkswagen AG is offering bigger discounts in its home market to try to lure back customers after the automaker admitted using software to allow diesel vehicles to cheat emissions tests, a German trade magazine reported on Saturday.Germany's Automobilwoche said Volkswagen was trying to boost the used car trade by raising discounts to up to 1,681 euros ($1,896.17)in April and May to win over buyers from alternative automakers.A Volkswagen spokesman said current promotions in Germany were around the same level as competitors. Beyond that, he said discounts were usual measures that allowed the company to react in a flexible way to comparable offers from rivals.