Citing inflation developments and further improvement in the labour market, the Federal Reserve (Fed) on Wednesday announced its widely expected decision to accelerate the pace of reductions to its asset purchase programme, known as quantitative easing. The US central bank had already announced it was tapering off the monthly support introduced to bolster the economy during the pandemic.

The Fed said it has decided to reduce the monthly pace of its asset purchases by $30 billion per month, double the previously announced $15 billion per month. The move opens the door to interest rate hikes in 2022.

“Economic activity is on track to expand at a robust pace this year, reflecting progress on vaccinations and the reopening of the economy,” Fed chair Jerome Powell said.

Meanwhile, unemployment in the UK fell in October despite the end of the furlough scheme, as companies continued to hire amid record numbers of vacancies.

Unemployment in the UK fell in October despite the end of the furlough scheme, as companies continued to hire amid record numbers of vacancies

The Office for National Statistics (ONS) reported on Tuesday that the unemployment rate dropped 0.4 percentage points from the previous three months to 4.2 per cent during the three months through October. The rate came in line with economists’ expectations.

Reflecting a continued recovery in the labour market after the end of the government’s multibillion-pound job support scheme in September, the ONS said the number of workers on company payrolls rose by 257,000 in November from a month earlier − the largest monthly rise in payroll employment on records dating back to 2014. Data also showed that the number of job vacancies continued to rise to a new record of 1,219,000 in the September to November period.

Finally, China’s industrial production growth accelerated in November as the disruption caused by the power shortages eased, while retail sales growth weakened amid an outbreak of the new variant of coronavirus.

The National Bureau of Statistics (NBS) announced on Wednesday that major enterprises’ industrial added value expanded by 3.8 per cent year-on-year in November. The growth rate was up 0.3 percentage points compared with the previous month.

As in October, however, strength was concentrated in the mining and power sectors, which continue to rebound steadily after the relaxation of safety and environment-related curbs that forced widespread power outages in the early autumn.

Meanwhile, retail sales grew at a slower pace of 3.9 per cent on a yearly basis after climbing 4.9 per cent in October.

This article was prepared by Bank of Valletta plc for general information purposes only.

Independent journalism costs money. Support Times of Malta for the price of a coffee.

Support Us