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Sustained US job growth and an unemployment rate near a 50-year low bolstered bets that the Federal Reserve will proceed with another big interest-rate hike this month to rein in demand and tamp down inflation.
Jumbo hikes were the theme of the week in other countries as well, like Hungary and Pakistan, as policy makers work to extinguish price pressures.
Meantime, Germany is considering setting aside strict borrowing limits next year if Russia halts natural gas deliveries for an extended time. In Japan, household spending weakened, calling into question the strength of the recovery.
Here are some of the charts that appeared on Bloomberg this week on the latest developments in the global economy:
World
A very busy week for central banks saw more than a dozen across the world hiking rates. Jumbo increases were in the majority, with Hungary going for 200 basis points, Pakistan for 125 basis points and another eight for 50 or 100.
The recession calls are getting louder on Wall Street, but for many of the households and businesses who make up the world economy the downturn is already here. The worries among small business owners, consumers and others are illustrated by so-called Misery Indexes, which blend unemployment and inflation rates.
Each wave of supply shock to hit the global economy during the pandemic seems to produce a different scapegoat. With the second half of 2022 just underway, there may yet be another culprit for supply stress — labor unrest.
US
Nearly 400,000 jobs added in a month and an unemployment rate near a 50-year low is probably enough evidence of the extreme tightness in the US labor market. But a look beneath the surface of the June employment report, and other recent data, shows just how hot it really is.
Europe
Germany is set to ditch its plan to return to strict borrowing limits next year if Russia stops natural gas deliveries to Europe’s largest economy for good, according to people familiar with the matter. There’s a silent agreement among cabinet members of Chancellor Olaf Scholz’s coalition that Berlin can’t stick to its fiscal plans in an emergency where Russian President Vladimir Putin uses scheduled maintenance on the Nord Stream pipeline as an excuse to end gas flows for a longer period, said the people.
Expectations for inflation, output prices and wage increases among UK businesses are all building, according to a Bank of England survey that may convince policy makers to push for bigger interest-rate hikes in the coming months.
French President Emmanuel Macron’s standout success in using public spending to tame rampant inflation is reaching its limits as a swelling debt burden and the loss of a governing majority curtails his ability to act. An intensifying cost-of-living squeeze would also further cloud France’s economic outlook, and threaten to revive grievances that sparked unrest during Macron’s first term with the so-called yellow-vest protests.
Asia
Japan’s households cut spending in May for the first time in three months in a sign that the economic recovery is proving weaker than previously thought.
Signs are mounting that China’s economy shrank in the second quarter for the first time since 2020, placing the nation’s official statistics under fresh scrutiny as analysts bet the government will avoid acknowledging that slump.
China’s Ministry of Finance is considering allowing local governments to sell 1.5 trillion yuan ($220 billion) of special bonds in the second half of this year, an unprecedented acceleration of infrastructure funding aimed at shoring up the country’s beleaguered economy.
Emerging Markets
Thailand’s retail inflation accelerated in June to a new 14-year high, boosting the case for central bank to raise borrowing costs sooner than later. Faster inflation adds to the case for Southeast Asia’s second-largest economy to join central banks the world over in tightening policy settings to rein in price gains.
TORONTO – Strength in the base metal and technology sectors helped Canada’s main stock index gain almost 100 points on Friday, while U.S. stock markets also climbed higher.
The S&P/TSX composite index closed up 93.51 points at 23,568.65.
In New York, the Dow Jones industrial average was up 297.01 points at 41,393.78. The S&P 500 index was up 30.26 points at 5,626.02, while the Nasdaq composite was up 114.30 points at 17,683.98.
The Canadian dollar traded for 73.61 cents US compared with 73.58 cents US on Thursday.
The October crude oil contract was down 32 cents at US$68.65 per barrel and the October natural gas contract was down five cents at US$2.31 per mmBTU.
The December gold contract was up US$30.10 at US$2,610.70 an ounce and the December copper contract was up four cents US$4.24 a pound.
This report by The Canadian Press was first published Sept. 13, 2024.
OTTAWA – Statistics Canada says wholesale sales, excluding petroleum, petroleum products, and other hydrocarbons and excluding oilseed and grain, rose 0.4 per cent to $82.7 billion in July.
The increase came as sales in the miscellaneous subsector gained three per cent to reach $10.5 billion in July, helped by strength in the agriculture supplies industry group, which rose 9.2 per cent.
The food, beverage and tobacco subsector added 1.7 per cent to total $15 billion in July.
The personal and household goods subsector fell 2.5 per cent to $12.1 billion.
In volume terms, overall wholesale sales rose 0.5 per cent in July.
Statistics Canada started including oilseed and grain as well as the petroleum and petroleum products subsector as part of wholesale trade last year, but is excluding the data from monthly analysis until there is enough historical data.
This report by The Canadian Press was first published Sept. 13, 2024.
TORONTO – Canada’s main stock index was up more than 150 points in late-morning trading, helped by strength in the base metal and energy sectors, while U.S. stock markets were mixed.
The S&P/TSX composite index was up 172.18 points at 23,383.35.
In New York, the Dow Jones industrial average was down 34.99 points at 40,826.72. The S&P 500 index was up 10.56 points at 5,564.69, while the Nasdaq composite was up 74.84 points at 17,470.37.
The Canadian dollar traded for 73.55 cents US compared with 73.59 cents US on Wednesday.
The October crude oil contract was up $2.00 at US$69.31 per barrel and the October natural gas contract was up five cents at US$2.32 per mmBTU.
The December gold contract was up US$40.00 at US$2,582.40 an ounce and the December copper contract was up six cents at US$4.20 a pound.
This report by The Canadian Press was first published Sept. 12, 2024.
