Republicans in the U.S. House of Representatives on Friday turned to a new strategy in a long-shot bid to prevent the fourth government shutdown in a decade, as time runs short ahead of a Sept. 30 deadline. Republicans have so far failed to advance legislation that would keep the government running when the new fiscal year starts on Oct. 1. Instead, they will prepare four separate spending bills, most of which reflect the deep cuts sought by the party’s right flank. Those are certain to be rejected by the Democratic-controlled ...

The U.S. central bank needs to raise interest rates further to control inflation in a “timely way,” Federal Reserve Governor Michelle Bowman said on Friday in remarks that sketched out a hawkish argument based on a potential rise in energy prices and a possibility the inflation battle may take years to complete. “Inflation is still too high, and I expect it will likely be appropriate for the (Federal Open Market) Committee to raise rates further and hold them at a restrictive level for some time to return inflation to our ...

The war in Ukraine has reduced European economic growth and “considerably” pushed up inflation across the continent, the Swiss National Bank said in a study published on Friday, with worse effects still to come. Since Russia invaded Ukraine in February 2022, Europe has seen a surge in energy prices, financial market turmoil and a sharp contraction in the economies of both Russia and Ukraine, the report said. Examining the war’s economic impact on Germany, Britain, France, Italy and Switzerland, the study said output would have been between 0.1% and 0.7% ...

Britain’s economy displayed clear recession signals on Friday, a day after the Bank of England called a halt to its long run of interest rate increases that have turned the tide on inflation but at the expense of a hit to businesses. A business survey, which the BoE factored into its decision to keep rates on hold, showed companies endured a much tougher September than feared, marked by growing unemployment. The preliminary reading of the UK S&P Global Purchasing Managers’ Index (PMI) for the services sector sank to its lowest ...

U.S. business activity showed little change in September, with the vast services sector essentially idling at the slowest pace since February, and overall new order activity slipping to the lowest level this year, a survey published Friday showed. S&P Global said its flash U.S. Composite PMI index, which tracks the manufacturing and service sectors, dipped to a reading of 50.1 in September from a final reading for August of 50.2. September’s result was negligibly above the 50 level that separates expansion and contraction. The survey’s composite new orders index slid ...

Turkey’s central bank raised its key interest rate by a lofty 500 basis points to 30% on Thursday, marking a second month of aggressive tightening after President Tayyip Erdogan set aside his long opposition to tight policy. The bank reiterated it is ready to raise rates further as needed to rein in inflation that leapt to nearly 59% in August and is expected to rise into next year. It has hiked rates by 2,150 basis points since June. The lira slipped to 27.105 to the dollar after the decision, just ...

With oil prices at their highest this year and eyeing $100 a barrel again, the last thing U.S. consumers, businesses and policymakers need is another inflationary headache. The fledgling auto workers strike, if it lasts and broadens out, could be just that. Most economists reasonably focus on the temporary blow to U.S. economic output or payrolls from a lengthy strike across the sector. And the economy could contract almost one full percentage point in the fourth quarter, according to Morgan Stanley economists, which would cut their full-year 2023 GDP growth ...

Goldman Sachs economists said they now expect the U.S. Federal Reserve to begin its interest rate-cutting cycle in the fourth quarter of next year, later than an earlier forecast of a cut in the second quarter. The Fed on Wednesday kept its benchmark interest rate unchanged in the 5.25% – 5.5% range and its projections showed that it now expected to cut only by 50 basis points next year, down from a full percentage point cut estimated earlier. “Today, participants appeared to move away from the view that monetary policy ...

The U.S. Congress faces a midnight Sept. 30 deadline for passing some sort of temporary funding bill or triggering partial federal government shutdowns beginning on Oct. 1, the start of a new fiscal year. Here are a few ways Congress might avoid a shutdown: THE OLD-FASHIONED WAY House of Representatives Speaker Kevin McCarthy could find the sweet spot for a one-month funding deal that his Republicans would embrace. Passage by the Republican-controlled House, where appropriations bills normally originate, would send the stopgap measure to the Democratic-led Senate. It likely would ...

nsumer goods firms like Nestle, Lindt and Unilever (LON:) may face increased pressure across Europe to cut prices after being singled out by French retailers and politicians, industry experts say. Ahead of contract talks due to start by next month, supermarket chain Carrefour (EPA:) has slapped price warnings on products to pressure top consumer goods suppliers including Nestle, PepsiCo (NASDAQ:) and Unilever to reduce inflation. France is a crucial country for consumer goods companies, having long outstripped Germany, Italy, Spain and others as the European Union’s biggest market for groceries ...

There are no strong arguments for the European Central Bank to increase mandatory reserves for banks, Belgian central bank chief Pierre Wunsch said on Thursday, weighing in on a key debate about a potential move to tighten policy further. The ECB cut to zero the rate it pays to banks on mandatory reserves earlier this year. Some policymakers are now pushing for an increase in the reserve requirement, in part to reduce losses associated with the multi-trillion-euro pool of excess liquidity sloshing around banks. Wunsch said that reducing the volume ...

The Bank of England has voted to keep rates on hold, and we suspect that means the tightening cycle is now over. What’s striking, though, is just how close the decision was, with a 5-4 split on the committee between those wanting ‘no change’ and those opting for a 25bp rate hike. That degree of division is actually pretty unusual and shows just how close a call this meeting was. What’s very clear is that the Bank is leaving all options on the table for November. Remember, the BoE has ...

European Central Bank (ECB) interest rates have likely peaked and its next move is expected to be a cut, Greek central bank chief Yannis Stournaras told German newspaper Boersen-Zeitung, pushing back on colleagues keeping another hike in play. The ECB raised rates for the 10th straight time last week but signalled a pause, with markets taking its guidance to mean an end to the steepest pace of policy tightening for the 20-nation euro area. While many policymakers, mostly conservatives from the bloc’s north, are keeping another rate hike firmly on ...

Global traditional investment managers (IMs) are experiencing mixed fortunes in the challenging operating environment, with the type of client having a key effect, Fitch Ratings says following a sector ratings review. IMs with diversified product offerings and a greater focus on more stable institutional clients or sticky wealth management clients are generally benefiting from net inflows, while those with a predominantly mass retail client base are more prone to net outflows due to customer risk aversion in uncertain financial markets. itch-rated traditional IMs domiciled in western Europe and the US ...

China’s economy is positioned for continued recovery given the ongoing policy support and an uptick in economic indicators, keeping any potential risk of deflation at bay, officials and international experts said on Wednesday. “Since the beginning of the year, prices have been at a low level, which we need to pay attention to,” said Cong Liang, deputy head of the National Development and Reform Commission. “However, taking into account the price level, demand recovery, economic growth and money supply factors, it can be concluded that there is no so-called deflation ...