The effects of the war in Iran continue to rattle households in the euro area, heaping more pressure on the European Central Bank to raise interest rates for a third time this year.

Headline consumer price growth in the Eurozone in September jumped to its highest point in three years, rising to 3.8% versus the 3.7% estimate and 3.2% in August. The preliminary reading for the period from EU statistics office Eurostat was the most inflationary since September 2023, when the global post-pandemic price surge was finally subsiding.

The impact of the war sparked another surge in energy prices, with costs up 18.8% from September of last year and 3.9% from August, Eurostat said. Fresh food prices rose at an annual rate of 4%, the fastest pace since May.

(Continue Reading – LS)

Rising long-term bond yields are a global phenomenon, rooted in growing concern about government finances. But the US has led the way in this collapse of fiscal responsibility. As such, it bears outsized responsibility for thinking about solutions.

Higher yields aren’t just a sign of persistent budgetary excess. They could also be the start of a dramatic economic unraveling. In the US, net interest payments now amount to $1 trillion a year, accounting for roughly half of what the government borrows. As a result, rising yields could dramatically expand the federal deficit — which already stands at an extraordinary 6% of gross domestic product, even with the economy at full employment.

(Continue Reading – BBG)

Tourists to London’s Oxford and Bond Streets are used to parting with their cash, but they could soon find themselves embroiled in a more complex financial transaction.

Under plans to levy a charge on overnight visitors, the government is encouraging England’s mayors and local leaders to borrow against tourist stays. They’d be leveraging income from the new tax to pump money back into their regions.

(Continue Reading – BBG)