A little quieter on the economic front this week. The release of the FOMC minutes from the previous meeting contained no real surprises and reflected very much what was said by Chair Powell in the post-meeting press conference and statements made by other Fed governors since. The Minutes confirmed the…

This week saw the release of the UK budget. Some are terming it as being a ‘rescue’ budget and this is understandable given the forecasts made by the Office for Budget Responsibility (OBR). They forecast that the economy will contract by 1.4% in 2023, before expanding by 1.3% in 2024, 2.6% and 2.7% in the following two years.

A number of central banks have held their latest meeting to set interest rates. The ECB acted in line with expectations, increasing its policy rate by 0.75% to 1.5%. The ECB also offered hints as to the future direction of its rate setting. Whilst further hikes are expected to combat inflation, which is still deemed as being too high, the central bank suggested that pace of rate hikes may be slower moving forward.

This week as again been dominated by central bank actions. Here in the UK we had the Bank of England working busily. Firstly they auctioned their first tranche of government bonds as they looked to reduce their balance sheet holding of £838bn. They sold £750m of gilts which had a remaining maturity of between three and seven years.

A number of central banks have held their latest meeting to set interest rates. The ECB acted in line with expectations, increasing its policy rate by 0.75% to 1.5%. The ECB also offered hints as to the future direction of its rate setting. Whilst further hikes are expected to combat inflation, which is still deemed as being too high, the central bank suggested that pace of rate hikes may be slower moving forward.

It is fair to conclude that this week has again been dominated by politics, with the resignation of Liz Truss stealing the headlines. This has been very well publicised in great depth and therefore we will leave it there. From an economic perspective in the UK, this week we saw the release of CPI to September. This came in at 10.1%. This was slightly ahead of the consensus forecast of 10% and given this did little to unnerve markets.