The Finance World Magazine| Edition: September 2023

Global News
World Rice Price Index Reaches Near 12-Year High in July -FAO
The United Nations food agency
reported a 2.8% increase in
their rice price index for July,
reaching its highest level in
nearly 12 years. The surge was driven
by strong demand and India’s decision
to limit rice exports, causing prices to
soar in key exporting countries. The
Food and Agriculture Organization’s All
Rice Price Index reached an average of
129.7 points in July, compared to 126.2
points the previous month. This figure
was almost 20% higher than last year’s
and the highest since September 2011.
Furthermore, the world food price
index also rose in July, recovering
from two-year lows. India, with 40%
of the world’s rice exports, halted its
largest rice export category last month
to control domestic prices amid erratic
weather affecting production.
Bank of England Raises
Interest Rates to 5.25%,
Highest Since 2008
The Bank of England has taken
decisive action to address
soaring inflation, raising the
base rate by 0.25 percentage
points to 5.25%, the highest since February
2008. This move aims to mitigate
inflationary pressures and maintain a
low inflation environment. The bank’s
target is to achieve the 2% inflation
rate by early 2025. Recent data from
the Office of National Statistics (ONS)
revealed that UK inflation stood at 7.3%
in June, down from a peak of 9.6% in
October 2022, the highest in nearly
three decades. Experts predict that
the base rate is likely to remain above
5% throughout 2024, possibly reaching
5.75% or even 6%.
Goods and Services Trade Surges by 13% to $31T
According to a new report by
the World Trade Organisation
(WTO), global trade in goods
and services surged to $31T
in 2022, experiencing a notable 13%
year-on-year increase. Trade in goods
had already surpassed pre-pandemic
levels in 2021, with services catching
up in 2022. China remained the leading
merchandise exporter but saw its share
in world exports slightly decline to
14%. The United States and Germany
followed closely in second and third
India’s July Services Sector Hits 13-Year High
with Robust Demand
India’s services sector showed
remarkable growth in July, reaching
its highest pace in 13 years
despite inflationary pressures.
S&P Global’s India services purchasing
managers’ index surged to 62.3,
surpassing expectations and indicating
a strong contribution to the country’s
GDP for the second fiscal quarter.
The economy is projected to grow
by 6.2% in the July-September quarter.
Demand remained robust, with
the new business sub-index showing
significant growth since August 2021.
International demand also increased
notably. Although inflation rose to
4.81%, within the RBI’s target range,
positions, respectively. The report
noted that the share of manufactured
goods in world merchandise exports
decreased to 63% in 2022 due to high
energy prices limiting demand. Intra-regional
merchandise trade represented
a significant portion of Europe’s world
trade, accounting for 65% in 2022.
Additionally, the value of merchandise
trade grew at a faster pace than
volume globally, partly influenced by
high global commodity prices.
firms remained cautious about pricing
strategies while expanding headcount.
Optimism for future activity remained
strong despite concerns over extreme
weather.
82 www.thefinanceworld.com September 2023