Politics overshadows economics

<p>Kia ora,</p><p>Welcome to Tuesday’s Economy Watch where we follow the economic events and trends that affect Aotearoa/New Zealand.</p><p>I'm David Chaston and this is the International edition from Interest.co.nz.</p><p>Today we lead with news all eyes are on the political situation, but the global economic indications are mostly positive.</p><p>On the global stage, it has been announced that there will be a face-to-face summit meeting between US President Biden and Russian President Putin, brokered by the French, to try for a Ukrainian resolution. It's an 'in principle' agreement. Russia seems lukewarm because it delays plans, and is signaling it will recognise Russian-speaking breakaway regions as independent countries. Both regions suffer from declining populations and economic stagnation.</p><p>A spillover consequence of these tensions is that <a href="https://kali.by/" target="_blank"><strong>a state-owned Belarusian potash miner</strong></a> that accounts for about 20% of global supply has declared <i>force majeure</i> because it is hit by sanctions, shaking up a market that’s already contending with soaring fertiliser prices.</p><p>For the US, just a quick reminder that Wall Street is closed as the country is on a long weekend holiday. </p><p>Markit <a href="https://www.markiteconomics.com/Public/Home/PressRelease/85ced2491b9340eaa2fc7c73667232db" target="_blank"><strong>reported</strong></a> their preliminary PMIs for Japan for February yesterday. Both dipped. The factory one is still expanding however, but the services one took a large tumble as the country battles Omicron, and is now contracting. Still, companies remained optimistic that activity would improve in the year ahead.</p><p>Westpac <a href="https://westpaciq.westpac.com.au/Article/51282/53915/" target="_blank"><strong>says</strong></a> that with the Covid-affected New Year festival, and the sanitised Winter Olympics behind it, they expect "China's economic promise to shine bright in 2022". China kept its prime loan rates unchanged today af