The euro area economy likely produced minimal expansion in the third quarter after a like showing in the previous three-month period as the world’s trade environment continued to suffer dramatic shifts.

An economists’ poll said quarterly GDP growth in the Eurozone rose 0.1% last quarter after increasing by that amount in the previous three months. Also due with the preliminary data report Thursday is the year-on-year rate, with a Q3 rise of 1.2% expected following 1.5% in the previous three months. 

“Q3 GDP is expected to post a flat reading, as weakness in exports to the US weighs further on the external sector, while the domestic economy has also lost some momentum based on incoming activity data,” ABN Amro predicted. (LS – Continue Reading) 

Euro area rate-setters are off to the Italian tourist haven Florence for this month’s monetary policy decision, and one analyst said those who monitor the European Central Bank for a living can spend their Thursday focused on something else.

“If you’ve ever thought about skipping an ECB meeting, this is the one to sit out,” wrote ING’s Carsten Brzeski, who went on to cite various reasons why this week’s meeting is a non-event. 

Atop that list was a lack of new data since last month’s rate decision, giving officials almost nothing to act upon. Policymakers are still looking at September’s inflation numbers. The annual headline rate of 2.2% is unlikely to warrant action as it remains close enough to the ECB target of 2.0% over the medium term. And the initial October number is not due until Friday. Additionally, third-quarter GDP data from the Eurozone is set for release just hours ahead of the ECB decision. (LS – Continue Reading) 

Japan’s central bank on Thursday kept benchmark interest rates steady at 0.5% in its first meeting after Sanae Takaichi took power as the country’s prime minister earlier this month.

The decision was in line with expectations from economists polled by Reuters, and comes even as inflation has stayed above the central bank’s 2% target for 41 months in a row. 

The Bank of Japan said the decision was split 7-2, with board members Naoki Tamura and Hajime Takata proposing a 25 basis point hike. (CNBC – Continue Reading) 

Federal Reserve Chair Jerome Powell’s blunt warning that investors need to rein in expectations for a December interest-rate cut underscored a growing tug-of-war among US policymakers who are opposed in their outlooks for jobs and inflation.

While Powell made it clear that the primary concern for some is a cooling job market, others inside the Fed are warning persistent inflation will limit room for more easing. And a freeze on the release of official economic data during the ongoing government shutdown is only hardening the divide. (BBG – Continue Reading)