Global economy chart: Inflation slows in the US and Europe

(Bloomberg) –Inflation cooled in the United States and Europesetting the stage for policy makers in both regions to reduce interest rates in September.
On a three-month annualized basis, the Federal ReserveAmericans’ preferred measure of underlying assets inflation rose 1.7% in July, the lowest level of the year. In Europe, consumer prices rose 2.2% in August from a year earlier, the lowest level since mid-2021 and significantly slower than the 2.6% pace in the previous month.

Meanwhile, inflation in Tokyo —a leading indicator for national data due out in September—gained momentum in August, supporting the argument for Bank of Japan continue to raise rates at a gradual pace as the bank balances the need to support the economy. Here are some of the charts that appeared on Bloomberg this week on the latest developments in the economy. global economymarkets and geopolitics:

US

The Fed’s preferred measure of underlying U.S. inflation rose at a moderate pace and household spending picked up in July, reinforcing policymakers’ plan to begin cutting interest rates next month. However, slower income growth and a declining savings rate may raise questions about the durability of consumer spending going forward.

From Los Angeles to Chicago to Boston, aging business districts are grappling with empty offices and a slow return of workers, while neighborhoods just a few miles or even blocks away are faring better — or even thriving. These disparities are playing out across the United States, exposing deep divisions in the commercial real estate market and cities’ post-pandemic recovery.

Americans are trying to change their insurance coverage more frequently than in the past, following a surge in premiums that has squeezed household budgets, a new industry report shows. While the overall cost of living has risen 20% since the start of the pandemic in 2020, auto insurance bills have increased nearly 50%. Europe

Positive news on inflation will help sustain the upbeat mood evident at the Federal Reserve’s annual meeting in Jackson Hole last week, when Chairman Jerome Powell joined ECB and Bank of England officials in strongly signaling that rates are coming down.

UK house prices unexpectedly fell in August, a sign that affordability remained limited even after the Bank of England eased borrowing costs, according to one major mortgage lender.

Asia

Consumer prices excluding fresh food rose 2.4% in the capital, accelerating from the 2.2% growth recorded in July, the Interior Ministry said. Following the BOJ’s July 31 interest rate hike, Governor Kazuo Ueda indicated his intention to raise the benchmark rate again if price trends develop in line with the bank’s projections.

China is asking local traders to buy less foreign grain as abundant supplies and weaker-than-expected demand weigh on prices and threaten its long-standing policy of supporting local producers. China is the world’s biggest buyer of barley and sorghum, and any sustained import restrictions would deal a blow to farmers in major exporters such as Australia and the United States.

Mortgage lending in China shrank to the lowest level in nearly three years, highlighting weak confidence in the property sector that is weighing on growth. The data comes as authorities are considering allowing homeowners to renegotiate the terms of their mortgages with their lenders or refinance them with a different bank, Bloomberg News reported.

Emerging markets

Mistakes and inaction by governments, health agencies and funders of scientific research have created the perfect environment for the mpox virus to mutate into a strain that spreads more easily among humans. Despite the availability of an effective vaccine (which costs about $100 per shot) and countries like the United States stocking up on millions of doses, Congo has yet to receive any.

Zambia’s annual inflation rate rose to a 32-month high in August as an El Niño-induced drought continued to wreak havoc on food prices. The drought has complicated the central bank’s efforts to return inflation to its 6% to 8% target band for next year and has meant it has had to keep its key interest rate higher for longer.

World

Hungary kept its key interest rate unchanged for the first time in more than a year, while Guatemala and Kazakhstan did so as well. Israel’s central bank kept its benchmark interest rate at 4.5% and said it was likely to refrain from cuts for the rest of the year as the war in Gaza continues. The Dominican Republic cut.