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# The Economy: Economic news and Policy

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## Posts
- [Strait of Hormuz 2026: Why Markets Still Don’t Trust It’s Open](https://economy.com.pk/strait-of-hormuz-2026-why-markets-still-dont-trust-its-open/): If you've followed headlines about the Strait of Hormuz over the past several months, you'd be forgiven for losing track of whether it's actually open. That confusion isn't a media failure — it genuinely has opened, closed, and reopened multiple times since the conflict began, and the pattern itself is the real story markets need to understand, far more than any single day's price move.
- [AI Capex Bubble 2026: The Hidden $662B Debt Nobody Reports](https://economy.com.pk/ai-capex-bubble-2026-the-hidden-662b-debt-nobody-reports/): Every earnings season now brings a fresh wave of headlines about hyperscaler AI capital expenditure hitting a new record. The "big four" — Amazon, Microsoft, Alphabet, and Meta — are on track to spend roughly $725 billion combined in 2026, a 77% jump from the $410 billion deployed in 2025 (UnboxFuture). That number gets reported constantly. What almost nobody is reporting with the same prominence is a separate figure that may matter more: roughly $662 billion in data center lease commitments that hyperscalers have already signed but not yet begun — obligations that currently sit entirely off balance sheet.
- [Gold Overtakes US Treasuries in Reserves: What It Means](https://economy.com.pk/gold-overtakes-us-treasuries-in-reserves-what-it-means/): Most gold coverage in 2026 has fixated on the price chart — the spectacular run from roughly $2,633 an ounce at the start of the year to fresh record highs above $5,400 by mid-year (Intellectia). That's a legitimate story. But it's not the most important one. The more consequential shift is structural, not seasonal: gold has overtaken US Treasuries as the largest share of global central bank reserves for the first time in three decades (BlackRock).
- [Pakistan Economy FY2026-27: Stability vs. Real Growth](https://economy.com.pk/pakistan-economy-fy2026-27-stability-vs-real-growth/): Not everyone is buying the stabilization narrative. Independent economic analysis has explicitly pushed back, arguing that despite claims of notable stabilization, Pakistan's economy in FY2025-26 remains fundamentally fragile (Business Recorder). A separate assessment goes further, arguing Pakistan currently lacks the industrial capacity, export diversification, and productivity levels required to sustain the kind of export-led growth the government is now promising (Business Recorder).
- [Indonesia Trade Deficit 2026: The Real Story Behind Rupiah](https://economy.com.pk/indonesia-trade-deficit-rupiah-danantara-2026/): Indonesia's balance of trade turned negative for the first time in six years, with skyrocketing oil prices pushing up import costs while weak global demand simultaneously suppressed exports (The Jakarta Post). That headline alone would normally dominate a news cycle. But it's actually the second-most important economic story unfolding in Indonesia right now — and understanding why requires looking past the trade numbers to what's happening with the rupiah and the country's manufacturing base simultaneously.
- [Malaysia Startup Ecosystem 2026: Ranking #41 Globally](https://economy.com.pk/malaysia-startup-ecosystem-2026-ranking-41-globally/): Malaysia climbed to #41 in the Global Startup Ecosystem Index 2026, holding second place in Southeast Asia behind Singapore and ahead of Indonesia (Startups in Malaysia News). On paper, that's a genuine achievement — a meaningful jump in a competitive regional field. But talk to founders actually building on the ground, and the picture is more complicated than the ranking suggests, and understanding why matters for anyone evaluating Malaysia as an expansion or investment target.
- [Johor-Singapore SEZ: The $19B Data Centre Hub You’ve Missed](https://economy.com.pk/johor-singapore-sez-data-centre-investment-2026/): The Johor-Singapore Special Economic Zone, formally established on January 7, 2025, covers roughly 3,588 square kilometres across southern Johor state. It spans nine flagship areas and targets investment across eleven sectors, including manufacturing, logistics, financial services, the digital economy, tourism, education, healthcare, and the green economy (Forest City SFZ / Manila Times).
- [China-Russia Trade: Why Beijing Now Holds All the Leverage](https://economy.com.pk/china-russia-trade-why-beijing-now-holds-all-the-leverage/): For years, the phrase "no-limits partnership" defined how Beijing and Moscow described their relationship. It's still the phrase both governments use publicly. But look closely at what's actually happening in the energy trade underpinning that partnership, and a very different picture emerges — one where China holds nearly all the leverage, and Russia is discovering that a lifeline can also function as a leash.
- [CUSMA Deadline Passed: What It Means for Canada’s Economy](https://economy.com.pk/cusma-deadline-passed-what-it-means-for-canadas-economy/): On July 1, 2026, one of the most consequential deadlines in North American trade policy quietly passed without resolution. The mandatory review of the Canada-United States-Mexico Agreement (CUSMA) came and went with no new deal — and almost no one outside trade policy circles seems to understand what happens next, or how long "next" might actually take.
- [Fed Ends Forward Guidance: What Kevin Warsh’s Shift Means](https://economy.com.pk/fed-ends-forward-guidance-what-kevin-warshs-shift-means/): For fifteen years, traders built entire careers around parsing Federal Reserve speeches for hints about where interest rates were headed next. That game is now effectively over, and almost nobody outside a narrow circle of economists has noticed how big a deal this is.
- [China Economy 2026: Export Growth Masks Manufacturing Overcapacity](https://economy.com.pk/china-economy-exports-2026-overcapacity/): China's exports have been the good-news story in an otherwise mixed economic picture. They're not just holding up; through the first four months of 2026 they were running about 14% to 15% above the same period a year earlier, according to figures cited by the US-China Economic and Security Review Commission and Vanguard's economic outlook. That's the kind of number that would normally signal a healthy economy. The complication is what's happening underneath it.
- [Pakistan Iran-US Ceasefire Mediation 2026: Diplomatic Gains, Economic Risks](https://economy.com.pk/pakistan-iran-us-ceasefire-mediation-2026/): For a country usually discussed in terms of what it owes the IMF, Pakistan spent much of 2026 doing something unusual: sitting at the center of the biggest diplomatic story in the world. When Prime Minister Shehbaz Sharif announced the framework that calmed the Strait of Hormuz crisis, it wasn't a footnote. It was Pakistan converting decades of quiet back-channel access into the kind of leverage that normally belongs to much bigger players.
- [Pakistan Circular Debt Crisis 2026: IMF Deadline Missed, Rs 3.44 Trillion](https://economy.com.pk/pakistan-circular-debt-crisis-2026-imf-deadline-missed-rs-3-44-trillion/): There's a number that keeps showing up in every conversation about Pakistan's economy, and it keeps getting bigger: circular debt. As of early July 2026, the gas sector's share of that debt alone has topped Rs 3.44 trillion, and Islamabad has missed a deadline the IMF set for tariff reforms meant to arrest the slide, according to Dawn.
- [Indonesia Russian Oil Imports 2026: Why Jakarta Is Diversifying Crude Supply](https://economy.com.pk/indonesia-russian-oil-imports-2026/): On June 29, a tanker called the Sierra pulled into the Indonesian port of Balikpapan carrying just under 770,000 barrels of Russian crude oil, worth roughly $75 million. It sailed from Kozmino, Russia. It's a small shipment in the scheme of global oil trade — but it marks the first delivery under a supply deal Jakarta struck with Moscow in April, and it captures something bigger about how the Iran war has reshuffled who buys oil from whom, according to Bloomberg reporting via gCaptain.
- [Russia Bans Diesel Exports 2026: Global Fuel Market Impact Explained](https://economy.com.pk/russia-bans-diesel-exports-2026-global-fuel-market-impact-explained/): For months, the story of the global fuel market has been the Strait of Hormuz. Now there's a second front, and it's coming from a completely different direction: Ukrainian drones over Russian refineries.
- [Gulf Sovereign Wealth Funds Hit Record $53.9B in H1 2026 Despite Iran War](https://economy.com.pk/gulf-sovereign-wealth-funds-record-h1-2026/): There's a version of this story that writes itself: a shooting war breaks out between Israel, the US and Iran, oil markets seize up, the Strait of Hormuz effectively shuts for weeks, and the region's biggest financial institutions pull back to lick their wounds. That is not what happened. Instead, Gulf sovereign wealth funds just booked their most active first half on record, and the numbers are hard to square with the headlines they were competing against.
- [America’s Workers Are Vanishing From the Labor Force — And It’s Not the Usual Reasons](https://economy.com.pk/americas-workers-are-vanishing-from-the-labor-force-and-its-not-the-usual-reasons/): The US labor force participation rate has fallen to its lowest level in 50 years outside of the Covid-19 pandemic period, a decline that is reshaping how economists read every other US labor market indicator, according to CNBC's ongoing coverage of the trend.
- [ASEAN+3 Enters 2026 From a Position of Strength — But Two Storms Are Building Offshore](https://economy.com.pk/asean3-enters-2026-from-a-position-of-strength-but-two-storms-are-building-offshore/): The ASEAN+3 region expanded 4.3% in 2025, outperforming expectations despite what regional economists describe as the most significant shift in global trade policy in decades, according to the AMRO ASEAN+3 Regional Economic Outlook 2026.
- [US Tariff Investigation 2026: 60 Countries, Forced Labor Claims and the EU Trade Fight](https://economy.com.pk/us-tariff-investigation-2026-60-countries-forced-labor-claims-and-the-eu-trade-fight/): The US administration has launched an investigation into 60 countries — including the European Union — to determine whether they are permitting imports of goods produced with forced labor, setting the stage for new tariffs ranging from 10% to 12.5% and reopening a trade fight many assumed was settled, according to Deloitte's Weekly Global Economic Update.
- [UK Digital Identity Framework 2026: The £5bn Plan to Reshape Financial Verification](https://economy.com.pk/uk-digital-identity-framework-2026-the-5bn-plan-to-reshape-financial-verification/): The City of London Corporation has proposed a digital identity framework it says could unlock more than £5 billion for the UK economy, reshaping how consumers verify themselves across financial services, according to CPA's UK business news briefing for July 1, 2026.
- [The Money Is Drying Up: How US Pressure Is Choking Off Russia-China Payment Channels](https://economy.com.pk/the-money-is-drying-up-how-us-pressure-is-choking-off-russia-china-payment-channels/): The US Treasury Department has moved aggressively against a sanctions-evasion network linking Russia and China, exposing a secret payment channel used to facilitate cross-border transactions for sensitive exports and designating a Kyrgyz Republic-based financial institution accused of helping Moscow evade restrictions, according to the US Treasury's official press release.
- [Indonesia GDP Growth 2026: 5.61% Expansion Marks Fastest Pace in Three Years](https://economy.com.pk/indonesia-gdp-growth-2026-5-61-expansion-marks-fastest-pace-in-three-years/): Indonesia's economy expanded 5.61% in the first quarter of 2026, its fastest pace in more than three years, driven by a surge in government spending and household consumption during the Eid festive period, according to McKinsey's Southeast Asia quarterly economic review.
- [Singapore Makes Its Move to Become Asia’s Precious-Metals Capital](https://economy.com.pk/singapore-makes-its-move-to-become-asias-precious-metals-capital/): Singapore is launching a gold clearing system in a bid to establish itself as a regional hub for precious-metals trading, a move that positions the city-state to compete directly with established centers in London, Zurich, and Shanghai, according to Wikipedia's economy of Singapore overview.
- [Malaysia Bets Its 2026 on “Execution” — And the Semiconductor Upcycle Is Doing the Heavy Lifting](https://economy.com.pk/malaysia-bets-its-2026-on-execution/): Malaysia's government has declared 2026 a year of "execution" and "discipline" as the Anwar Ibrahim administration races to deliver on the 13th Malaysia Plan (RMK13) ahead of elections that could come as early as February 2028, according to Fortune's interview with economy minister Akmal Nasrullah Mohd Nasir.
- [Canada’s Central Bank Holds the Line at 2.25% as Tariffs and a Middle East Oil Shock Collide](https://economy.com.pk/canadas-central-bank-holds-the-line-at-2-25-as-tariffs-and-a-middle-east-oil-shock-collide/): The Bank of Canada has maintained its policy rate at 2.25% for a consecutive meeting, navigating a rare combination of tariff-driven trade disruption and Middle East-driven energy inflation that is squeezing the economy from two directions at once, according to the Bank of Canada's June 2026 rate announcement.
- [China Economy 2026: Property Crash Meets Record AI-Driven Export Boom](https://economy.com.pk/china-economy-2026-property-crash-meets-record-ai-driven-export-boom/): China's economy is being pulled in two directions at once. Fixed-asset investment fell 4.1% year-on-year in the first five months of 2026 — the steepest decline since May 2020 — while exports surged 19.6% in May alone, powered overwhelmingly by semiconductor and AI-hardware demand, according to Deloitte's Weekly Global Economic Update.
- [Pakistan IMF Deal 2026: Third Review Cleared, Budget 2026-27 and Inflation Outlook](https://economy.com.pk/pakistan-imf-deal-2026-third-review-cleared-budget-2026-27-and-inflation-outlook/): The International Monetary Fund's Executive Board has completed the third review of Pakistan's Extended Fund Facility and the second review of its Resilience and Sustainability Facility, unlocking continued disbursements at a moment when the country's external buffers remain thin but improving, according to the IMF's official press release.
- [Bank of England Interest Rates 2026: Why Inflation Is Rising Again Despite a Hold](https://economy.com.pk/bank-of-england-interest-rates-2026-why-inflation-is-rising-again-despite-a-hold/): The Bank of England has held its benchmark rate at 3.75% for a second consecutive meeting, but the real story is what comes next: policymakers now expect inflation to climb from roughly 2.8% toward 3.25% by the fourth quarter of 2026, driven by an energy shock the central bank says it cannot offset, according to the Bank of England's June 2026 Monetary Policy Summary.
- [Fed Ends Forward Guidance: What Kevin Warsh’s Policy Shift Means for Markets](https://economy.com.pk/fed-ends-forward-guidance/): The US Federal Reserve has quietly abandoned one of its most consequential communication tools. New Fed chair Kevin Warsh has told markets he no longer intends to provide forward guidance on monetary policy, a break from more than a decade of central-bank practice, according to Deloitte's Weekly Global Economic Update.
- [AI Bubble Warning 2026: Why BIS, IMF and Bank of England Fear a Market Crash](https://economy.com.pk/ai-bubble-warning-2026/): The warnings did not emerge in a vacuum. In late June 2026, South Korea's KOSPI index was forced into a trading halt after Samsung and SK Hynix shares each lost roughly 12% in a single morning, a shock that rippled into the Nasdaq, which fell 2.2% the same day. By the following week, Oracle had recorded its worst trading week since the dot-com crash, sliding 19%, after Apple raised product prices in response to soaring chip costs. The sell-off, detailed in Wikipedia's account of the June 2026 rout, spread across global chip manufacturers before the BIS issued its formal caution on June 29.
- [Russia Raised VAT to 22% to Pay for the War. It Still Isn’t Enough](https://economy.com.pk/russia-raised-vat-to-22-to-pay-for-the-war-it-still-isnt-enough/): Russia's federal budget collected less revenue in 2025 than originally planned for the first time since the pandemic, a shortfall that has pushed the Kremlin to raise its value-added tax rate from 20% to 22% starting January 1 and pull far more small businesses into the VAT system, according to The Moscow Times' assessment of the country's 2026 fiscal trajectory.
- [Six Straight Quarters of Falling Prices: Inside China’s Deflation Trap](https://economy.com.pk/six-straight-quarters-of-falling-prices-inside-chinas-deflation-trap/): China has now recorded six consecutive quarters of falling prices, a deflationary cycle that Beijing's traditional playbook of aggressive monetary easing and fiscal stimulus has so far failed to break, with the leadership instead pursuing a more cautious approach aimed at avoiding a renewed run-up in debt, according to GIS Reports' analysis of the country's economic trajectory.
- [Canada Missed Its CUSMA Deadline. Now Its Economy Is “On Pause”](https://economy.com.pk/canada-missed-its-cusma-deadline-now-its-economy-is-on-pause/): Canada's economy has slipped into what Deloitte calls being "on pause," with the mandatory July 1 review of the Canada-United States-Mexico Agreement having passed without a clear resolution, leaving businesses across the country's most trade-exposed sectors unable to plan with any confidence, according to Global News' reporting on the Deloitte assessment.
- [UK Stagflation 2026: Why the Bank of England May Hike Rates, Not Cut Them](https://economy.com.pk/uk-stagflation-2026-why-the-bank-of-england-may-hike-rates-not-cut-them/): The United Kingdom is heading into a second consecutive year of what economists at RSM UK are calling "stagflation-lite," a combination of sluggish growth and rising inflation driven by an energy shock that traces directly back to the closure of the Strait of Hormuz. Bank of England Governor Andrew Bailey has said market pricing for two rate cuts this year looked reasonable before the Iran war lifted inflation risks, a shift in tone that now has traders debating whether the next move is a cut, a hold, or an outright hike, according to the Credit Protection Association's business briefing.
- [Chipmakers Just Lost 6.7% in Two Days: Inside the Great AI Trade Rotation](https://economy.com.pk/chipmakers-just-lost-6-7-in-two-days-inside-the-great-ai-trade-rotation/): The damage has concentrated in specific names rather than spreading evenly across the sector. Sandisk tumbled 10.6%, Applied Materials fell about 10%, and Micron Technology, Lam Research, Intel, and Marvell each lost between 5.5% and 10% as investors took profits following what Schwab's market desk described as a great run for chip stocks through the second quarter, per Schwab's update. Teradyne and KLA fared worse still, sliding 13.6% and 11.5% respectively, dragging the VanEck Semiconductor ETF down 4.5% in a single session, according to CNBC.
- [AI Bubble Risk 2026: BIS Warns Private Credit Could Trigger Financial Crisis](https://economy.com.pk/ai-bubble-risk-2026-bis-warns-private-credit-could-trigger-financial-crisis/): The Bank for International Settlements has told the world's central banks something few wanted to hear in the middle of an AI-fueled bull run: the financing behind the boom now resembles the early architecture of a credit crisis. In its flagship Annual Economic Report, the Basel-based institution known as the central bank of central banks said that if AI returns disappoint and investors reassess risk, falling asset values combined with sudden funding withdrawals could transmit stress across the broader financial system, as first detailed by The Economy.
- [US Jobs Report July 2026: Why Weak Payrolls Sent the Dow to a Record High](https://economy.com.pk/us-jobs-report-july-2026-why-weak-payrolls-sent-the-dow-to-a-record-high/): The US economy added just 57,000 jobs in June, roughly half the number economists had forecast, and Wall Street's reaction was almost perfectly inverted from what the headline number would suggest. The Dow Jones Industrial Average surged nearly 600 points to a record close of 52,900.07, even as the weak print signaled a cooling labor market, because investors read it as evidence the Federal Reserve has less reason to keep policy tight, according to Google Finance's market wrap.
- [The Top 10 Economic Research Institutes in the World](https://economy.com.pk/the-top-10-economic-research-institutes-in-the-world/): Economic policy in 2026 is being shaped less by parliaments than by the working papers, staff estimates, and forecasting models produced inside a small cluster of research institutions. From the National Bureau of Economic Research's business-cycle dating committee to the International Monetary Fund's Article IV missions, these organizations set the analytical terms that central banks, finance ministries, and investors ultimately negotiate around.
- [Singapore GDP Grew 6% in Q1 2026 — Why Forecasts Stay Cautious](https://economy.com.pk/singapore-gdp-grew-6-in-q1-2026-why-forecasts-stay-cautious/): Singapore's economy expanded 6.0% year-on-year in the first quarter of 2026, a headline figure strong enough to suggest the city-state has largely shrugged off the disruption radiating from the US-Israel-Iran conflict. Yet the government's own forward-looking signals tell a more cautious story: Singapore has held its full-year GDP growth forecast at a comparatively modest 2.0% to 4.0% range even after posting a 6.0% first-quarter print, according to Singapore's Department of Statistics, while explicitly flagging that downside risks "have risen significantly" as a direct consequence of the conflict.
- [IMF Cuts Pakistan Growth Forecast, Raises Inflation to 8.4%](https://economy.com.pk/imf-cuts-pakistan-growth-forecast-raises-inflation-to-8-4/): The International Monetary Fund has lowered Pakistan's economic growth forecast to 3.5% for the current fiscal year while raising its inflation projection to 8.4% — a dual downgrade that reflects how directly the Middle East conflict and the resulting energy price shock are reshaping the outlook for a country still navigating its Extended Fund Facility (EFF) program, according to reporting from Business Recorder. The revision arrives as Pakistan's current account deficit projection for the coming fiscal year has been more than doubled, underscoring how quickly external pressures can erode the hard-won macroeconomic stability the IMF program was designed to restore.
- [Malaysia GDP Growth Slows as Strait of Hormuz Crisis Drags On](https://economy.com.pk/malaysia-gdp-growth-slows-as-strait-of-hormuz-crisis-drags-on/): Malaysia's economy grew 5.4% year-on-year in the first quarter of 2026, a figure that on the surface suggests resilience against the global disruption triggered by the Iran conflict and the closure of the Strait of Hormuz — but economists tracking the underlying monthly data warn the headline number is masking a momentum loss that is set to compound through the second half of the year, as the true cost of an extended energy shock filters through supply chains still adjusting to a new price regime.
- [Indonesia’s 150-Million-Barrel Russian Oil Deal Explained](https://economy.com.pk/indonesias-150-million-barrel-russian-oil-deal-explained/): Indonesia, Southeast Asia's largest economy, has committed to importing up to 150 million barrels of Russian crude oil through the end of 2026, a deal that goes well beyond emergency crisis management and increasingly resembles a deliberate, multi-year repositioning of the country's energy security architecture away from a Middle East supply base that the Strait of Hormuz conflict has exposed as dangerously concentrated.
- [Russia’s Sanctioned Oil Giants Regain 57% Export Share via Shadow Fleet](https://economy.com.pk/russias-sanctioned-oil-giants-regain-57-export-share-via-shadow-fleet/): Russia's two largest, US-sanctioned oil producers have clawed back control of the majority of the country's crude export trade, restoring their combined share to 57% in the first half of May 2026 after a sharp decline earlier in the year — a recovery that underscores the limits of Western sanctions enforcement even as the Middle East conflict reshapes global energy flows in Moscow's favor.
- [UBS Report: Billionaire Wealth Up 25% on AI Boom as Median Wealth Falls](https://economy.com.pk/ubs-report-billionaire-wealth-up-25-on-ai-boom-as-median-wealth-falls/): The global billionaire population grew by 13.1% over the past year to reach 3,302 individuals, with their collective wealth climbing 25% — nearly two and a half times faster than the 10.8% growth in average personal wealth recorded across the broader global population, according to the UBS Global Wealth Report 2026. The gap between those two figures, both drawn from the same 56-market dataset, has become the report's most closely scrutinized finding, offering the clearest documented evidence yet that the artificial intelligence boom is concentrating wealth gains at a scale and speed rarely seen outside wartime economies.
- [Private Credit Warning: Most BDCs Turn Unprofitable in 2026, Reuters Finds](https://economy.com.pk/private-credit-warning-most-bdcs-turn-unprofitable-in-2026-reuters-finds/): The majority of publicly traded business development companies (BDCs) — the only segment of the $3.5 trillion private credit industry that reports results in public view — have turned unprofitable, according to a Reuters analysis of balance sheet data that is now circulating as one of the clearest warning signs yet of stress building inside a market regulators have struggled to monitor in real time.
- [Bank of England AI Kill Switch vs Singapore MAS Agentic AI Rules](https://economy.com.pk/bank-of-england-ai-kill-switch-vs-singapore-mas-agentic-ai-rules/): The Bank of England has, for the first time, publicly questioned whether its existing rulebook can contain the risks posed by autonomous artificial intelligence agents operating inside financial markets — a question that Singapore's Monetary Authority of Singapore (MAS) effectively answered months earlier with a formal agentic-AI risk toolkit built alongside two dozen banks and insurers. The contrast between a major Western regulator now sketching hypothetical "kill switches" and an Asian regulator already operationalizing agentic-AI governance illustrates how unevenly the world's financial supervisors are adapting to the same technological shift.
- [China Hedge Funds Warn Global AI Stocks Are a ‘Super Bubble’](https://economy.com.pk/china-hedge-funds-warn-global-ai-stocks-are-a-super-bubble/): Two of China's best-known hedge fund managers have told clients that the global rally in artificial-intelligence stocks has crossed from exuberance into what they are calling a "super bubble," a warning that has already rattled semiconductor markets from Seoul to Santa Clara. Wealspring Asset, founded by Yang Dong — a manager credited in China with correctly calling the peak of the 2007 bull market — and Shanghai Banxia Investment Management Center issued the warnings in investor letters that quickly circulated beyond their client base.
- [JPMorgan Warns AI Cyberattacks Could Trigger Next Banking Crisis](https://economy.com.pk/jpmorgan-warns-ai-cyberattacks-could-trigger-next-banking-crisis/): JPMorgan Chase has issued a stark departure from conventional bank-risk analysis, telling investors that the next systemic banking crisis is more likely to originate from an artificial intelligence-accelerated cyberattack than from a wave of credit defaults. In a note authored by analyst Kian Abouhossein, the bank identified cybersecurity as one of the largest undiscounted risks currently sitting outside standard bank valuation models — a claim that reframes years of regulatory focus on capital ratios and loan-loss provisioning.
- [The Biggest Monetary Policy Shift Since the Financial Crisis May Already Be Underway](https://economy.com.pk/the-biggest-monetary-policy-shift-since-the-financial-crisis-may-already-be-underway/): When PCE inflation — the Federal Reserve's preferred price gauge — hit 4.1 percent on a year-over-year basis in May 2026, it registered the highest reading since April 2023. It arrived at a moment when global monetary policy is pulled between competing imperatives: the need to restrict demand to contain resurgent price pressures, the exposure of over-leveraged sovereign balance sheets to sustained high rates, and the recognition among some central banks that their economies cannot sustain the current rate environment much longer.
- [The $2 Trillion Shadow: Private Credit’s Quiet Crisis and What It Means for Global Markets](https://economy.com.pk/the-2-trillion-shadow-private-credits-quiet-crisis-and-what-it-means-for-global-markets/): The warning was buried in a Reuters legal section headline, clinical in its phrasing: "Analysis shows publicly traded credit funds are unprofitable." For most readers, a sentence about Business Development Companies carries little urgency. For those who understand what BDCs represent — the visible tip of a $2 trillion private credit iceberg that has quietly financed much of the AI boom — the implications run considerably deeper.

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