The U.S. economy expanded very modestly in the second quarter, economists estimate, as the housing market sagged under higher mortgage rates, consumers coped with soaring inflation and businesses held back on replenishing bloated inventories.

Economists surveyed by The Wall Street Journal estimated the Commerce Department will report Thursday that gross domestic product, the broadest measure of goods and services produced across the nation, rose at a 0.3% annual rate in the April-through-June period. (Continue Reading – WSJ)

Eurozone stagflation should become even more glaringly apparent Friday when Brussels releases preliminary numbers for July consumer prices and the first estimate of second-quarter growth data.

Economists’ polls point to another record for inflation, with the annual headline number set to increase to 8.8% from last month’s historic high of 8.6%. The yearly core rate is expected to match May’s record 3.8% following last month’s dip to 3.7%.

Economic growth in the single currency area likely eased to a quarterly rate of 0.2% in the three months to June from 0.6% in the previous period, according to surveys. Real annual growth in the second quarter is expected to have slowed to 3.4% from 5.4%. (Continue Reading – LiveSquawk)

Germany is expected to report marginal growth for the second quarter on Friday, but most observers are already looking past that period and into the future, where they see the growing likelihood of a recession in Europe’s largest economy.

The results are to come just an hour before the EU is scheduled to announce Eurozone second-quarter GDP results and preliminary July inflation data.

An economists’ poll says German GDP in the three months to June slipped to a quarterly – and barely palpable – rate of 0.1% versus to the 0.2% in the previous period. Non-seasonally adjusted annual growth last quarter is expected to have fallen to 1.8%. (Continue Reading – LiveSquawk)

The UK economy has probably tipped into recession, and the Bank of England should hold off from further interest-rate increases, a former policy maker at the central bank said.

Danny Blanchflower, who served on the BOE’s Monetary Policy Committee from 2006 to 2009, through the global financial crisis, said the UK will probably follow other major economies into recession and that unemployment is a bigger threat. (Continue Reading – Blomberg)

On the same day the IMF’s World Economic Outlook report downgraded global growth forecasts, the Federal Market Open Committee followed through on its well telegraphed rate increase and promised more to come.  

Rate setters voted unanimously to raise the target range for the federal funds rate by 75 -basis points, lifting the target range to 2.25% to 2.5%, in line with market expectations. There was no change to the balance sheet reduction schedule.

Fed Chairman Jerome Powell’s accompanying statement acknowledged the fact that currently high inflation had “imposed significant hardship” on Americans and said the FOMC remained committed to returning inflation to its 2% goal. (LiveSquawk - Continue Reading)