Putin sends tough message to Western companies to leave Russia, US remains strong, Chinese house prices fall

It will not be easy for Western companies to return to Russia, the US remains strong, Chinese house prices continue to fall, the EU is determined to protect its domestic steel industry, the Fed and BoJ keep interest rates unchanged... are some of the outstanding world economic news.

A Louis Vuitton store in Moscow, Russia closed after the conflict broke out in Ukraine in February 2022. (Source: Shutterstock)

US economy

* At its meeting ending on March 19, the Fed decided to keep interest rates unchanged at 4.25-4.50%, as expected by the market. However, the central bank lowered its economic growth forecast for 2025 and raised its inflation forecast. However, the Fed still expects to cut interest rates twice this year.

Fed Chairman Jerome Powell said there was growing uncertainty, partly due to tariffs. But he also expressed confidence in the U.S. economic outlook, citing a number of economic indicators that remain strong despite weakening consumer sentiment.

Chairman Powell affirmed that the US economy remains strong and the labor market remains solid, although inflation remains high and there are many uncertainties.

* The US delegation to the World Trade Organization (WTO) said it is ready to negotiate with China and Canada in Geneva (Switzerland) after the two countries filed a lawsuit against the US regarding the new tariffs.

In early March 2025, Canada requested consultations — the first step in a trade dispute at the WTO — to protest “unjustified tariffs” imposed by US President Donald Trump this month. Meanwhile, China filed a complaint after the US leader imposed tariffs on Chinese goods in February. Both countries then imposed retaliatory tariffs, which Washington has outlined in WTO documents.

Chinese Economy

* According to statistics, in 2024, the total number of foreigners entering China under visa exemption at border gates reached 20.12 million, an increase of 112.3% over the same period in 2023. Of which, the number of people applying for transit visa exemption policy increased by 113.5% over the previous year, especially after the transit visa exemption policy was expanded and optimized, the number of people entering under this category increased by 29.5%.

Beijing Border Inspection Station said that the number of people entering and leaving Beijing Daxing International Airport this year has exceeded 1 million. Of these, the number of foreigners entering through this airport reached 211,000, an increase of about 67.9% compared to the same period last year. At Daxing Airport, foreign visitors only need 10 minutes to complete the entry procedures according to the instructions.

* Despite the latest stimulus measures, new home prices in China continued to fall in February 2025 at a faster pace than the previous month, a worrying sign that the Chinese government's efforts to revive the real estate market have yet to yield positive results.

Data from the National Bureau of Statistics (NBS) showed that home prices in 70 cities (excluding state-subsidized housing) in the country fell 0.14 percent from January, accelerating from a 0.07 percent decline in the previous month. Second-hand home prices did not fare any better, maintaining a 0.34 percent decline in January.

European Economy

* The European Union (EU) has taken drastic measures to protect the domestic steel industry from the wave of cheap steel flooding the market, due to the impact of US tariff policies.

The European Commission (EC) on March 19 announced plans to cut steel imports by a further 15% from April 1, as part of efforts to protect the struggling European steel industry.

The decision comes after US President Donald Trump imposed a 25% tariff on imported steel and aluminium, raising deep concerns about disruption to global trade and the potential negative impact on the EU steel industry.

* Economic data released on March 18 showed a mixed picture for the Eurozone , with optimism about the German economy rising sharply, but the region's trade surplus falling more than expected.

The ZEW index of German economic sentiment jumped to 51.6 points in March 2025, up from 26 points in January 2025 and well above market expectations of 48.1 points. This is the highest level of economic optimism since January 2023.

Meanwhile, the eurozone’s trade surplus in goods fell sharply to just €1 billion in January 2025, down from €10.6 billion a year earlier. This also marked a sharp decline from the €15.4 billion surplus in December 2024.

* Russian President Vladimir Putin on March 18 sent a tough message to Western companies that left Russia after the conflict in Ukraine that returning to the Russian market would not be easy, especially for those that had sold off assets.

He also warned that if the void left by these companies is filled by Russian businesses, the chance of a return is almost gone.

* Investors are shifting sharply from the US to Europe, betting that the era of "American exceptionalism" has peaked, while also anticipating a European resurgence, largely thanks to Germany's fiscal stimulus and increased defence spending.

Bank of America's (BofA) latest fund manager survey, conducted by analysts Andreas Bruckner and Sebastian Raedler, shows the largest rotation of capital from US stocks to European stocks since records began in 1999.

Currently, 39% of fund managers are holding a higher-than-average weighting of European stocks, up from 12% last month and the highest level since mid-2021. At the same time, 23% of investors said they were holding a lower-than-average weighting of US stocks, compared with 17% in February 2025. This marks a 40 percentage point change in US stock allocations in just one month, the largest on record.

* The French central bank has slightly revised down its growth forecast for 2025, with GDP expected to grow by 0.7%, down from the previous forecast of 0.9%. The main reason is a decline in business investment and exports, which could be negatively affected by the international situation. Meanwhile, consumption is showing a more positive trend, with a forecast of 1% growth in 2025, compared to the initial forecast of 0.9%.

Economy of Japan and South Korea

* Figures released by the Japanese government on March 19 showed that the country's exports in February 2025 increased 11.4% compared to the same period last year while imports decreased slightly, creating a trade surplus after two consecutive months of deficit.

Accordingly, Japan recorded a trade surplus of 584 billion yen (3.9 billion USD) in February 2025, in contrast to a deficit of 415 billion yen recorded in the same period last year. Total exports reached 9.19 trillion yen (61 billion USD), while imports decreased 0.7% to 8.61 trillion yen (57 billion USD) in the reporting period. The major contributors to the surge in exports were food, machinery and vehicles.

* The Bank of Japan (BoJ) on March 19 announced that it would keep its current interest rate at 0.5% as the economy faces unpredictable fluctuations related to US tariff measures. The BoJ, which is shifting away from a decade of easy monetary policy, raised its key short-term interest rate from 0.25% at its previous meeting in January 2025.

Inflation has been at or above the bank's 2% target for nearly three years, while major companies have pledged a third straight year of strong pay rises in this year's wage talks.

* The South Korean government is seeking to attract more global Korean Treasury Bond (KTB) investors ahead of a record 240 trillion won ($165 billion) issuance this year as a precautionary move to anchor stable capital flows from foreign bond funds , the Ministry of Economy and Finance (MOEF) said on March 17.

The MOEF plans to issue a record 200 trillion won in KTB bonds this year. This, along with about 20 trillion won in foreign exchange stabilization bonds and about 20 trillion won in supplementary budget, brings the total volume to 240 trillion won.

Many global investors remain cautious about the potential for an 80 trillion won increase in KTB issuance from a year ago, as the larger volume would lead to lower prices, thereby pushing up yields.

ASEAN Economy and Emerging Economies

* As part of its investigation into price manipulation by global media and advertising companies, the Competition Commission of India (CCI) has questioned chief executives (CEOs) and seized documents.

The CCI has raided around 10 premises of leading media houses and television stations in New Delhi, Mumbai and Gurugram. The CCI is investigating allegations of price-fixing and discounting of advertising by Indian television stations and media houses.

* A survey by the South African Chamber of Commerce and Industry (SACCI) shows that the country's business community recorded the best trading conditions in February 2025 since the Government of National Unity (GNU) was formed. Indicators such as sales volume, new orders, deliveries, inventories and selling prices all improved.

SACCI chief executive Alan Mukoki said the GNU measures were having a positive impact. However, Mukoki warned of inflationary pressures as 94% of businesses expected input costs to rise over the next six months.

* State Railway of Thailand (SRT) and the Railway Technology Research and Development Agency (RTRDA) have signed a memorandum of understanding (MoU) on cooperation in developing domestic railway transport , reducing dependence on imported technology.

The MoU focuses on enhancing human resources capacity and developing railway technology, with the aim of reducing logistics costs and increasing competitiveness in freight transport. SRT and RTRDA are developing Thai-made train components, aiming to support the continued development of the country’s rail transport system.

Source: https://baoquocte.vn/kinh-te-the-gioi-ong-putin-gui-thong-diep-cung-ran-toi-cong-ty-phuong-tay-roi-khoi-nga-my-van-manh-me-gia-nha-trung-quoc-giam-308214.html