This week the biggest headlines have been about the deal to prevent the US government defaulting on its debts. When it came to the crunch, Congress and President Biden’s administration managed to achieve the basic function of government by keeping the lights on. But, by suspending the debt ceiling rather than reforming it or scrapping it, the problem is likely to be back after next year’s presidential and congressional elections.
While US markets received a bit of a bump from the conclusion of the deal, over here things are a bit more gloomy. European inflation is falling steadily but shop price inflation in the UK continues to run at a record high rate. Even the sight of food inflation beginning to slow doesn’t offer much to get enthusiastic about yet, as prices are still rising more than 15% a year. Further evidence of the difficulties facing the housing market add to the UK’s headwinds, as borrowing becomes more expensive and falling house prices are likely to depress consumer spending. The gloom is not confined to the UK. China hasn’t managed to defy the global slump in manufacturing so commodity prices have continued their recent slide.
Read what the team at Financial Express consider to be significant over the current week.