The trading week has come to a close. Key events included the European Central Bank meeting, the release of inflation reports in the US, and a block of data from the UK.
On Monday, it was reported that Japan's economy grew below expectations in the second quarter. Revised data showed GDP increased by 2.9% year-over-year from April to June, falling short of the 3.1% forecast. In quarterly terms, inflation-adjusted growth was 0.7%, also lower than the initial estimate. Experts suggest that the current decline in spending may hinder the Bank of Japan's plans for a rate hike.
That same day, China recorded its highest consumer inflation in six months. Rising food prices, driven by extreme weather, pushed the consumer price index up 0.6% in August compared to the same period last year, though this was below the 0.7% forecast. Meanwhile, producer price deflation worsened.
Data from the UK released on Tuesday evidenced that average weekly earnings excluding bonuses rose 5.1% in the three months to July, meeting expectations. However, wage growth including bonuses in July was weaker than expected at 4.0%. The unemployment rate increased slightly to 4.1%, down from 4.2% in the previous three months.
In Germany, inflation fell to its lowest level in three years in August, boosting the likelihood of a potential rate cut by the European Central Bank. Inflation dropped to 1.9%, which is in line with forecasts.
On Wednesday, the UK reported flat output, with July's GDP registering 0.0% month-over-month.
In the US, the Consumer Price Index increased by 0.2% in August, while annual inflation declined to 2.5%. The core consumer price index rose 0.3%, exceeding expectations. U.S. crude oil inventories increased by 0.833 million barrels.
On Thursday, the European Central Bank cut interest rates as inflation eased and economic growth slowed. The deposit rate was reduced by 0.25% to 3.5%, and the refinancing rate was lowered by 0.60% to 3.65%.
In the United States, producer prices rose slightly in August, signaling that inflationary pressures are easing. The number of Americans filing for unemployment benefits increased to 230,000, indicating moderate labor market challenges, though there is no evidence of widespread layoffs.
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