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U.S. fracking bonanza to lift GDP by 1 percent by 2040: study
(Reuters) - A surge of oil and gas production will drive the U.S. economy 1 percent higher in 2040 than it would have otherwise grown, and energy exports will only stoke the expansion, an independent study on energy policy concluded on Tuesday.
New drilling technologies such as 'fracking' have unlocked an abundance of fossil fuels from shale deposits and the bounty will both jolt the economy and increase tax receipts, according to the study from the Congressional Budget Office.
ECB's Praet Says Falling Oil Price May Push Inflation Below Zero
European Central Bank Executive Board member Peter Praet said falling oil prices could push the euro-area inflation rate below zero, just as policy makers prepare to examine options for quantitative easing.
"Given the potency of the current oil-price shock, the risk is that inflation may temporarily fall into negative territory in coming months," Praet said in Washington yesterday. "Normally, any central bank would prefer to look through a positive supply shock. After all, lower oil prices boost real incomes and may lead to higher output in the future. But we may not have that luxury at present."
Russia Set to Raise Main Rate as Ruble Rout Endangers Stability
Russia's central bank will probably raise borrowing costs to avert threats to financial stability as oil prices near the lowest in more than five years and sanctions over Ukraine risk the collapse of the ruble.
The Bank of Russia will increase its key rate to 10 percent from 9.5 percent, according to the median estimate of 27 economists surveyed by Bloomberg. Eleven forecast no change. Fifty of 77 traders polled by brokerage Tradition project a rate increase of between 100 and 400 basis points. The regulator will announce the decision at about 1:30 p.m. tomorrow in Moscow, followed by a news conference.
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