1. US economy largely unchanged in recent weeks – Fed report
Economic activity in the United States changed little over the last six weeks, according to a new Federal Reserve report. It reports continued easing of labour market tightness, with prices continuing to increase, although more modestly.
“The near-term outlook for the economy was generally described as stable or having slightly weaker growth,” the Fed said in the latest “Beige Book”, a collection of surveys, interviews and observations gathered across the central bank’s 12 districts, through to 6 October. “Overall, firms expect prices to increase the next few quarters, but at a slower rate than the previous few quarters,” it said.
The report is slightly at odds with other data suggesting that the economy is gaining momentum, according to Reuters. Recent data suggests retail sales and manufacturing are growing more quickly than expected, hiring is on the rise and consumer prices continue to grow at around 4%.
2. China’s GDP “on track”
China’s gross domestic product (GDP) grew 4.9% in the period from July to September, new data from the National Bureau of Statistics has shown. It exceeded the expectations of economists polled by Reuters, but was lower than the second quarter when growth of 6.3% was posted.
The latest data suggests the country is on track to meet its 5% target for 2023 overall, with the government having released a series of stimulus measures in recent weeks. There was growth in industrial output, retail sales and fixed asset investment, but challenges remain for the property market.
“It seems that all of that stimulus is finally beginning to take effect, with a broad beat from growth, retail sales, industrial production and unemployment,” said Matt Simpson, senior market analyst at City Index in Brisbane.
It comes as the country’s benchmark lending rates were left unchanged in the latest monthly meeting.
3. News in brief: Stories on the economy from around the world
Eurozone industrial production increased by more than expected in August. Eurostat, the European Union’s statistics office, said production rose 0.6% month-on-month but saw a 5.1% decline, year-on-year.
China’s consumer price index was unchanged in September from the previous year, while factory gate prices fell at a slower rate.
Singapore’s gross domestic product grew by 0.7% in the third quarter of this year, exceeding the expectations of economists polled by Reuters.
Wholesale prices in Germany have fallen for a sixth consecutive month, which suggests lower inflation might be ahead.
Japanese inflation fell below 3% for the first time in more than 12 months in September, but remains above the central bank’s target.
A survey by Deloitte suggests that holiday spending in the United States is set to grow by 14% this year, with shoppers expected to spend an average of $1,652.
Homebuilder sentiment in the US has fallen, though, dropping to a nine-month low in October. It’s the third decline in a row, reflecting the impact of rising rates on real estate.
Indonesia raised rates on Thursday to tackle a declining rupiah, with the central bank’s seven-day reverse purchase rate increasing to 6.0% – a rise of 25 basis points.
South African consumer inflation hit 5.4% year-on-year in September – a rise on August when it reached 4.8%. Core inflation, which doesn’t include food and fuel costs, was lower in September (4.5%) than in August (4.8%).
UK consumer confidence fell to a three-month low in October. The GfK consumer confidence index dropped to -30, from -21 in September.
4. More on finance and the economy on Agenda
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The International Monetary Fund and the World Bank have both offered sub-Saharan Africa an additional seat on their executive boards. Chido Munyati, Head of Regional Agenda for Africa at the World Economic Forum, explains what it might mean for the region.
What is a soft landing? Find out more about this often-used phrase – as central banks and governments attempt to navigate recent economic challenges – in our explainer.
Source: World Economic Forum