Here’s why India is wooing the Middle East

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

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Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Eurogroup President confident of Greek debt deal will get done

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Eurogroup president Jeroen Dijsselbloem said on Friday that he believed Greece and its creditors could ink a debt relief deal for the cash-strapped country at a May 24 meeting.

Euro zone finance ministers are due to meet Tuesday to discuss Athen’s progress on a strict austerity program that was agreed under its current 86 billion-euro (USD 96 billion) bailout package, as well as the possibility of granting it debt relief so the country can cope with its repayments, Reuters reported.

It’s widely estimated that Athens needs more help to cover 3.5 billion euros (USD 3.96 billion) in debt payments coming due in July as its economy buckles under the additional weight of the region’s migrant crisis.

“We’ve made progress in recent weeks addressing debt issues so I think we can get that deal,” Dijsselbloem, who is also the Netherlands’ finance minister, told CNBC on the sidelines of the Group of Seven (G7) meeting in Sendai, Japan.

According to recent reports, the International Monetary Fund (IMF) has requested that creditors grant Athens a temporary period of debt relief. Specifically, the IMF wants interest payments to euro zone creditors fixed at the current rate of 1.5 percent until 2040, The Wall Street Journal (WSJ) and The New York Times said this week.

The fund won’t consider approving a new bailout program unless it contained debt relief measures, IMF spokesperson Gary Rice told media on Thursday.

But many euro zone members are reportedly concerned that a generous haircut on debt would reduce Greece’s incentive to implement austerity reforms.

Without naming names, Dijsselbloem said that those people advocating major debt relief up-front have moderated their stance and those who have said no relief was needed have also shifted their position “a little bit,” helping to close the gap in talks.

“This year or the next, we can reduce the cost of the main loan package for the Greeks,” he said. “For the longer term, we have a number of options that we can consider in terms of debt maturity, grace periods and interest rates. My preference would be to have clear choices in measures that we are prepared to take and then see when they are needed.”

US Treasury Secretary Jack Lew reportedly told Dijsselbloem that Europe must be “flexible” regarding debt negotiations, the WSJ reported on Friday.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

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Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Equity markets fear the Fed: UBS

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Equity markets could come under further pressure ahead of a US Federal Reserve rate hike, according to UBS Global Research.

In an analysis note, UBS said bond markets are increasingly reflecting the potential for growth to accelerate in the US, thereby giving the Fed more wriggle room to resume tightening.

“Over the last two weeks, two-year (bond) rates jumped from 0.7 percent to 0.9 percent roughly. Stronger growth leading rates higher and curves steeper is a key component of our views,” UBS said.

However, for the move to stick, UBS stresses that the equity markets also need to rally. However, stocks around the world, reeling from plunging commodity prices, weaker-than-expected corporate earnings results and political events, seem fearful of an earlier-than-expected hike.

UBS warns that the next hike may not trigger as much of an explosion in financial conditions, especially if the Fed is patient enough until a rebound in global growth limits dollar strength.

“Less dollar strength would support oil prices. And less oil weakness would also reduce the downside in US credit. But we are not there yet: markets are still quite pessimistic on growth outside the US, given the ongoing weakness in China-growth-sensitive asset,” the research said, adding, that if the Fed forced rate hikes, there is a risk of sell-off in risky assets which could deliver tightening equivalent to a full cycle.

Read More: Fed likely to hike in June if data improve: Minutes

The latest minutes released from the Fed show the central bank will likely raise interest rates in June if economic data points to stronger second-quarter growth as well as firming inflation and employment.

“Most participants judged that if incoming data were consistent with economic growth picking up in the second quarter, labour markets continued to strengthen, and inflation making progress toward the committee’s 2 percent objective, then it likely would be appropriate for the committee to increase the target range for the Federal funds rate in June,” according to the minutes.

While equities around the world are feeling the pressure, UK equities in particular are seeing tough times in the run-up to the country’s referendum on its membership of the European Union. In a recent survey conducted by Bank of America-Merrill Lynch, global fund managers have been avoiding UK stocks on fear that the equity sector may get badly impacted. The survey showed that fund allocations to the UK equities fell to their lowest levels since November 2008.

Investors surveyed said they considered Brexit to be their biggest “tail-risk” this summer. However, nearly 71 percent say Brexit is “unlikely” or “not at all likely.”

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

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Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

This country just introduced plain packaging for cigarettes

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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The UK became the second country in the world after Australia to introduce plain, standardized packaging for cigarettes on Friday, after a High Court ruling rejected a legal challenge from major tobacco firms.

On Thursday, the judge rejected the case from the claimants – British American Tobacco, Japan Tobacco International, Philip Morris International and Imperial Brands – who accused the regulations of being disproportionate.

The judge noted in his ruling that there was a “significant moral angle which is embedded in the regulations which is about saving children from a lifetime of addiction, and children and adults from premature death and related suffering and disease.”

What’s changing?

As of Friday, all cigarette packs sold in the U.K. will have to come in standardized packaging, although there is a “sell-through period” of twelve months to enable retailers to get rid of existing stock produced, imported and branded before Friday.

The UK’s Department of Health indicates that packs will have to be cuboid in shape, and their colour a “non-shiny drab dark brown.” Brand names will be allowed, but will have to be in a “set position, font and maximum size.”

Health warnings will be in both pictures and text, and each pack will have to have a minimum of 20 cigarettes in it. Trademarks, logos, promotional images and color schemes will be banned.

A huge ‘victory’

Jane Ellison, a government minister for public health, said that the High Court’s decision was a “victory for a generation that will grow up smoke-free. Standardized packaging will reduce smoking rates and save lives … we will never allow the tobacco industry to dictate our policies.”

The UK’s National Health Service says that smoking kills roughly 100,000 people a year and causes cancer in many parts of the body, including the lungs, stomach, mouth, bladder, throat and pancreas. Smoking also heightens a person’s risk of heart attack, stroke and coronary heart disease.

“This landmark judgement is a crushing defeat for the tobacco industry and fully justifies the government’s determination to go ahead with the introduction of standardized packaging,” Deborah Arnott, chief executive of Action on Smoking and Health (ASH), said in a statement.

“Millions of pounds have been spent on some of the country’s most expensive lawyers in the hope of blocking the policy. This disgraceful effort to privilege tobacco business interests over public health has rightly failed utterly.”

Read More: You should be 18 to watch a ‘smoking’ movie: WHO

Unsurprisingly, the tobacco companies did not welcome the decision. Responding to the judgment, a spokesperson for British American Tobacco said the court’s decision was “by no means the final word on the lawfulness of plain packaging.”

“We believe that the judgment contains a number of fundamental errors of law and we are applying for leave to appeal the decision,” they said in a statement.

The spokesperson added that the judgement, if left to stand, would raise concerns for “many other legitimate businesses … it creates a worrying precedent whereby public policy concerns can ride roughshod over long established fundamental commercial rights.”

Simon Clark, director of smoker’s group Forest, called the judgement “very disappointing” in a statement and added that plain packaging was “gesture politics designed to appease public health campaigners who are forever searching for new ways to force smokers to quit.”

British American Tobacco’s shares finished down 1.9 percent in London on Thursday, while Imperial Brands finished 0.6 percent lower. Japan Tobacco International fell by 2.0 percent overnight.

A shift in attitudes

Friday will also see all EU countries required to comply with the Tobacco Products Directive. Currently, the EU says that tobacco consumption represents a 25 billion euro (USD 28.05 billion) burden on public healthcare costs, with productivity losses of €8 billion per year.

This will mean, among other things, a ban on menthol cigarettes from 2020, larger and mandatory “graphic health warnings” on tobacco products, and health warnings for e-cigarettes containing nicotine becoming compulsory.

“The benefits of falling smoking rates are clear: not only do people enjoy better health and wellbeing, and significantly lower rates of chronic diseases and premature death related to tobacco, there is also a substantial economic benefit,” Vytenis Andriukaitis, the EU commissioner for Health and Food Safety, said in a statement.

“A reduction in tobacco consumption of just 2 percent translates into annual health care savings of approximately 506 million euros for the EU,” he added.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

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Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Here’s why India is wooing the Middle East

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

Listen to the Article (6 Minutes)

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

The Fed brought this fear back to markets this week

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Now that the Fed appears ready to hike rates this summer, markets are watching how the dollar responds.

The greenback, still 3 percent lower on the year, has risen this week against most currencies after Fed officials said in their meeting minutes that they could raise rates as early as June. New York Fed President William Dudley reaffirmed that view Thursday when he said the Fed could hike rates in June or July if economic data improves as expected.

On Friday, existing home sales are expected at 10 a.m. EDT.

“It’s going to be what happens overnight with the currencies…The home sales data is important but I feel like after this week, everyone’s trying to get their head around what’s going on with the Fed,” Tom Simons, money market economist at Jefferies, said.

On Thursday, the fed funds futures market was pricing in about a 30 percent chance of a rate hike in June, compared to just 4 percent last week. Simons said a 100 percent chance was priced in for November, while just a week ago, the first full hike was not priced in until the second half of 2017.

 “I think that people are pretty well comfortable with the domestic data and the Brexit thing is something that’s going to be hard to get any handle on until right when it’s going to the polls,” said Simons.

Brexit, or the British vote on whether to remain in the European Union, is one reason economists think the Fed could put off its rate hike until after June. There was more speculation Thursday that July or September could be the time because of Brexit, which Dudley said complicated the Fed’s decision. The Brexit vote is June 23, about a week after the Fed meets.

Simons said traders would focus on how the markets adjusted to this week’s news flow. Options and futures expiration in equities also come Friday.

“The only near-term monitor we have is volatility caused by currency movements and the volatility of the dollar,” he said.

The dollar’s swift rise in 2014 and into 2015 was a concern, as it drove commodities prices lower and hurt emerging market economies while also raising their debt burden. In the U.S., corporate profits felt the pinch from the higher dollar biting into overseas sales.

“The dollar is looking healthier, basically as you might expect,” said Alan Ruskin, head of G10 currency strategy at Deutsche Bank. But Ruskin said he didn’t expect quite as aggressive a move in the dollar as the last time it took off. While emerging markets were definitely hit by the higher dollar, he said he did not expect to see as much damage to risk assets as when the markets were also more worried about instability in China.

 “As long as China is not solidly in the mix, then I think the risky assets won’t have as quite a hard time,” he said.

Ruskin said the euro could reach parity with the dollar but not likely until next year. “It probably takes two rate hikes to take it to 1.05, but it’s going to need cumulative rate hikes beyond that to take us to parity and beyond,” said Ruskin.

Treasury yields this week moved to higher levels, both ahead of the Fed move and after it. Yields rose across the curve this week, though they gave back some ground Thursday, with the 2-year at 0.87 percent and the 10-year at 1.84 percent. The dollar firmed against a group of currencies, including the euro, which dipped under 1.12.

Stocks sold off as the market considered the potential for a rate hike. The S&P 500 slid 7 points to 2,040 and the Dow fell 91 to 17,435. Friday will mark a year exactly since the S&P reached an all-time closing high of 2,130.

James Paulsen, chief investment strategist at Wells Capital Management, said the anticipated Fed move should give the markets more confidence, especially as global economies appeared to be picking up.

“I think you’ve got to give them a week or so to get okay with it. That might mean the stock market sells off, commodities sell off. People go to the dollar a bit. The undertone of growth is what’s going to rule it, and it looks better and better than other parts of the world,” said Paulsen. “I can see why we get a few day or maybe a few weeks of turbulence on this but I also think that change in momentum might rule the day.”

Besides home sales, Fed Gov. Daniel Tarullo speaks Friday at 9 a.m. EDT to the National Association of Insurance Commissioners.

A few companies, including Campbell Soup, Deere, Foot Locker and The Buckle, will also report earnings.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Asia markets waver on hawkish Fed comments; Nikkei flat

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Asia markets wavered between positive and negative on Friday, in a muted reaction to a fresh stream of hawkish commentary from US Federal Reserve officials.

Japan’s benchmark Nikkei 225 index edged up 0.14 percent and the yen strengthened a bit against the US dollar, possibly in a risk-off shift toward the safe-haven currency. The dollar-yen pair was at 110.06 at 8:53 a.m. SIN/HK, compared with levels as high as 110.34 Thursday.

Australia’s S&P/ASX 200 index was up 0.24 percent as the energy sector recovered some recent losses, with the subinex up 2.04 percent. South Korea’s Kospi inched up 0.21 percent.

The muted reaction to the possibility of tighter US monetary policy may be due to markets under-pricing the possibility of further tightening in US monetary policy, with analysts saying market indicators suggested a roughly 30 percent likelihood of a June interest rate hike.

But it’s not clear that a relatively relaxed response would necessarily bite market players, analysts said.

“The markets are complacent about the risks of further tightening over the next couple of years,” Julian Jessop, chief global economist at Capital Economics, said in a note Thursday. “Context, however, is everything: the gradual normalization of U.S. interest rates will remain contingent on favorable economic and financial conditions that should limit the downside for asset prices.”

Fed officials continued to send clear signals to the market on Thursday that a June interest rate hike could be on the cards.

New York Fed President William Dudley said that June was definitely a live meeting and that he was quite pleased market expectations for the probability of a June or July rate hike had moved up.

Those comments raised analysts’ radar over the Fed’s likely steps.

“If one of the most dovish members of the central bank thinks that a rate hike is imminent, then perhaps investors really need to re-think and re-price their expectations for tightening this year,” said Kathy Lien, managing director for foreign-exchange strategy at BK Asset Management, in a note late Thursday.

Additionally, Richmond Fed President Jeffrey Lacker said on Bloomberg Radio that he was comfortable with four Fed rate hikes in 2016.

The remarks followed the release of the minutes for the Fed’s April meeting, which sounded remarkably clear hawkish signals to the market.

That sent the dollar index, which measures the greenback against a basket of currencies, up to tap highs not seen since late March, before trimming gains on Thursday. The dollar index was at 95.327 at 8:54 a.m., after climbing as high as 95.502 Wednesday.

In Asia trade, U.S. crude oil futures for June delivery rose 0.96 percent to USD 48.62 a barrel by 8:56 a.m. SIN/HK after settling nearly flat. Brent was up 0.82 percent at USD 49.21 a barrel.

Among energy plays, Australia-listed Oil Search tacked on 4.63 percent and Woodside added 1.81 percent, retracing recent losses.

Gold shares may be in focus after the price of gold fell as low as USD 1,244.60 an ounce in the U.S. session Thursday. A stronger dollar weighs on the price of gold, in part because it lessens the yellow metal’s attractiveness as a potential hedge against inflation.

Australia-listed Alacer Gold tacked on 4.59 percent, but Newcrest fell 1.06 percent.

In Japan, heavily weighted Fast Retailing shed 0.16 percent, dampening the index. Other plays on the domestic consumer were also lower, with Kirin off 0.41 percent and Japan Tobacco off 2.52 percent.

Shares of Hong Kong’s Li & Fung may be in focus after shares of its major customer, Wal-Mart, surged more than 9 percent after better-than-expected quarterly results.

The Dow Jones industrial average closed down 91.22 points, or 0.52 percent, at 17,435.40, the S&P 500 closed down 7.59 points, or 0.37 percent, at 2,040.04 and the Nasdaq composite closed down 26.59 points, or 0.56 percent, at 4,712.53.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

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Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

EgyptAir flight from Paris to Cairo disappears from radar

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Egyptian airline EgyptAir has said its Flight MS804, en route from Paris to Cairo, has “disappeared from radar.”

In an Arabic-language Facebook post, EgyptAir cited an “official source” as saying the flight, which took off from Paris’ Charles de Gaulle Airport at 11.09 p.m. Paris time had “disappeared from radar in the early hours of day today.”

The post said that the flight was carrying 59 passengers and 10 crew members.

The airline also tweeted from its verified Twitter account that an “informed source” had confirmed the disappearance.

NBC News reported that the airline said plane was flying at nearly 37,000 feet and was about 80 miles from Egyptian airspace when it disappeared. NBC reported that it had been told by Egyptian authorities that a search operation was underway over the Mediterranean Sea.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

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Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Asia markets start pricing in possibility of imminent Fed hike

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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The Federal Reserve’s April minutes upped the prospect of an interest rate hike, sending the dollar higher, spurring divergent performance in Asia markets on Thursday.

“Markets are playing catch up to communications from the US Federal Reserve as they appear to have dramatically under-priced the likelihood of a rate rise over the coming months,” noted Angus Nicholson, a market analyst at IG, in a note Thursday.

Japan’s benchmark Nikkei 225 index tacked on 0.68 percent, likely driven by the stronger dollar helping to push down the persistently stronger yen, which has been dampening earnings for the country’s exporters.

The dollar was fetching 110.11 yen at 8:38 a.m. SIN/HK, the highest levels for the pair since late April, compared with levels around 109 yen on Wednesday.

Australia’s S&P/ASX 200 slipped 0.27 percent, as a 0.39 percent gain in the heavily weighted financials subindex was offset was sharp drops in the energy and materials subindexes. Commodity prices, which are denominated in dollars, may take a hit from a stronger greenback.

South Korea’s Kospi shed 0.38 percent; higher interest rates in the US may spur fund outflows from the country.

Japan’s benchmark Nikkei 225 index tacked on 0.68 percent, likely driven by the stronger dollar helping to push down the persistently stronger yen, which has been dampening earnings for the country’s exporters.

The dollar was fetching 110.11 yen at 8:38 a.m. SIN/HK, the highest levels for the pair since late April, compared with levels around 109 yen on Wednesday.

Australia’s S&P/ASX 200 slipped 0.27 percent, as a 0.39 percent gain in the heavily weighted financials subindex was offset was sharp drops in the energy and materials subindexes. Commodity prices, which are denominated in dollars, may take a hit from a stronger greenback.

South Korea’s Kospi shed 0.38 percent; higher interest rates in the US may spur fund outflows from the country.

The minutes of the Federal Open Market Committee’s April meeting, released Wednesday in the U.S., were remarkably direct about the central bank’s intentions on interest rates.

“Most participants judged that if incoming data were consistent with economic growth picking up in the second quarter, labor market conditions continuing to strengthen, and inflation making progress toward the Committee’s 2 percent objective, then it likely would be appropriate for the Committee to increase the target range for the federal funds rate in June,” the minutes said.

The market didn’t need to resort to tea leaves to divine the meaning.

“Despite all the caveats, the message they intended to send was that June was seriously live,” Steven Englander, global head of G10 foreign-exchange strategy at Citi, said in a note late Wednesday.

That pushed up the greenback, with the dollar index, which measures the dollar against a basket of currencies, trading at 95.173 at 8:40 a.m. SIN/HK time, touching levels above 95 in the U.S. session for the first time in about a month.

Financial shares were higher as higher interest rates may spur better earnings in the sector. In Australia, ANZ was up 1.21 percent and in Japan, Mizuho Financial gained 1.90 percent.

Commodity stocks around the region lost ground.

Oil prices fell early Thursday, after recently climbing to the highest levels so far this year amid supply concerns after disruptions in Nigeria, Canada, Libya and Venezuela. US crude oil futures fell 0.93 percent to 47.74 a barrel by 8:46 a.m. SIN/HK in Asia trade after settling the US session down 12 cents or 0.25 percent. Brent was down 1.08 percent at USD48.40 a barrel.

Among energy plays, Australia’s Woodside lost 1.21 percent and South Korea’s S-Oil shed 2.21 percent. In Japan, Inpex dropped 2.88 percent after gaining more than 8 percent in the previous session.

Other resources stocks also fell. Heavyweights BHP Billiton and Rio Tinto were down more than 3 percent each.

Suzuki gained 5.93 percent after dropping 9.37 percent on Wednesday. The company on Wednesday confirmed media reports that it had used the wrong method to test the fuel economy of its cars in Japan.

The Dow Jones industrial average closed down 3.36 points, or 0.02 percent, at 17,526.62, the S&P 500 closed up 0.42 points, or 0.02 percent, at 2,047.63 and the Nasdaq composite closed up 23.39 points, or 0.50 percent, at 4,739.12.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

I got 2 out of 4 countries right, ‘Mr BRIC’: Jim O’Neill

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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The BRIC economies of Brazil, Russia, India and China have suffered a rocky ride since renowned economist Jim O’Neill coined the acronym in 2001.

O’Neill, who invented the term as Goldman Sachs’ chief economist, told CNBC on Wednesday that China and India were performing as well — or even better — than he forecast in his now-famous report, “Building better global economic BRICs.” In this, he predicted the BRICs’ importance to the global economy would rapidly increase over the coming decade.

“The most important BRIC, China, despite all its problems and its slowdown, is still, since the decade started, growing by more than I had assumed it would,” O’Neill told CNBC.

“So it was pretty obvious China would slow down at some stage significantly. There are lots of challenges, but so far, China is the only of the four (BRICs) that has grown by more than I had assumed.”

In his 2001 report, he forecast China’s economy would grow by 7 percent on average per year until 2011. Despite the slowdown and more recent stock market rout, China’s growth trumped this every year until 2015.

Last year, China’s economy grew by 6.9 percent, according to the country’s official data. China’s gross domestic product (GDP) figures are viewed by many as inflated, but still indicative of very strong growth compared to developed world peers.

India’s GDP growth has since overtaken that of China, with its economy expanding by 7.3 percent in both 2014 and 2015.

“India, the other country of more than a billion people, is seemingly growing by more than China — so some of the BRICs are kind of doing basically what I thought they would do,” O’Neill said.

Russia and Brazil, however, are mired in recession with both economies contracting by more than 3 percent last year and forecast to shrink again in 2016 by the International Monetary Fund.

Brazil’s economic plight is viewed as particularly challenging, as the country is grappling simultaneously with severe political unrest.

“Brazil and Russia are showing classic signs of the so-called commodities curse and they have got to get through it,” O’Neill said.

“What it has demonstrated is that they have been too dependent on commodities and they have got to undertake reforms in order to stop that being the case, or otherwise they won’t get to where I and some others once said they could.”

O’Neill quit Goldman Sachs in 2013 and is now commercial secretary to the U.K. Treasury. He is also on the economic advisory board of the World Bank’s investment wing and a visiting research fellow at the Bruegel think tank.

On Wednesday, the English economist said it would be better for the UK to remain in the European Union (EU) than vote to quit in its referendum next month.

“I don’t think the risk-reward is in our interest to consider leaving the EU. It doesn’t make a lot of sense,” O’Neill told CNBC .

He hinted at disagreement with some analysts’ view that a so-called “Brexit” might herald the end of the 28-country union.

“The EU, I would guess, is probably going to exist, whatever the UK votes on June 23 and we (the UK) will still be an important country in the world,” he told CNBC.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow