Snapshot - Economic & Strategy Viewpoint
Janet Mui: weekly economic update 11 July
The US Federal Reserve now looks likely to cut interest rates later this month. In the UK, activity remains subdued.
Powell focused on risks to US economy
The chairman of the Federal Reserve chose to emphasize the risks of slowing global growth in his semi-annual report to the US Congress. This was seen as a clear signal that the Fed will cut interest rates when it meets at the end of July.
UK economic activity remains sluggish
UK output increased very slightly in May, following a weak April. However, businesses and consumers remain cautious and the Bank of England is likely to adopt a more dovish stance.
Latest data suggests Chinese inflation remains contained
There is little sign of underlying inflationary pressure in the Chinese economy, despite a sharp rise in the price of pork. This gives Beijing more scope to implement accommodative monetary policy if needed.