While only very few countries have actually succeeded in joining the group of high-income economies over the past few decades, partial income convergence is a reality. Of the 24 countries with a population of 60 m or more, nine countries have a per capita income of USD 5,000 or less. Of these nine, a full seven are located in a geographically almost contiguous crescent stretching from Pakistan in the West to Indonesia in the East. With a combined population of 2 bn, these Indian Ocean economies are bound to emerge as a major centre of economic gravity over the course of this century. [more]

The EUR 489 bn provided by the ECB’s first three-year tender was a signal that the ECB is prepared to do its utmost as a lender of last resort for the banks – but will not take on the role as the buyer of last resort for government bonds. This might have disappointed some die-hard fans of a bazooka solution, but more importantly it has reassured the probably large majority of investors who were concerned about medium-term inflation. This reassurance might also have been a contributing factor to the quite successful bond auctions to date and the declining volatility. Given this psychological support corporate sentiment has inched up too, which has lifted our forecast of a few weeks ago of growth just below zero to a growth forecast of just above zero. [more]

In Europe, the most frequent users of online banking are found in the Nordic countries. In online banking there are stringent security standards, giving rise to the question as to whether internet users in countries with high online banking adoption rates also have computers equipped with above-average levels of security software. [more]