Growth Remains On Pace With Little Sign of Overheating
|U.S. Review
Growth Remains On Pace With Little Sign of Overheating
- The inflation data took center stage this week. The CPI and PPI both came in slightly below expectations and inflation expectations remain well anchored. Import prices also fell more than expected during the month.
- The NFIB Small Business Optimism Index rose to an all-time high in August, climbing 0.9 points to 108.8.
- Retail sales rose less than expected in August, rising just 0.1% overall. The prior month’s data were revised higher, however, and consumer spending remains solidly on pace with our forecast for the third quarter.
Global Review
ECB Leaves Rates Unchanged, EM Remains in Focus
- Several central bank announcements were slated for release this week, including the European Central Bank (ECB), which left policy unchanged. We look for the ECB to maintain a slowand-steady approach to removing policy accommodation, as inflationary pressures remain muted.
- Economic data released in China this week showed steady retail and firmer industrial activity growth, as that country’s central bank pauses along its deleveraging path.
- Turkey’s central bank notably raised interest rates 625 bps to 24%, higher than consensus estimates, in an attempt to curb rampant inflation and rapid depreciation of the Turkish lira.
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