The US economy appears to be on an upward trajectory, as consumers returned to restaurants, hotels and shopping malls, a report by the Federal Reserve (Fed) showed on Wednesday.

The report, a collection of business anecdotes from around the country known as the Beige Book, said that the economy grew at a moderate pace between early April and late May. However, businesses told the Fed that ongoing supply chain disruptions and severe labour shortages have made it difficult for them to satisfy demand. The report found that inflationary pressures continued to build as both input and selling prices moved higher.

Meanwhile, inflation in the eurozone reached its highest level in more than two years after Europe’s pandemic-battered economies started to lift restrictions and rebounding demand intensified the effects of supply bottlenecks.

Consumer prices in the countries that share the euro currency rose by an annual rate of two per cent in May, higher than economists had forecast as energy costs underpinned the jump.

Germany, Spain and Italy, three of the four largest eurozone economies, all reported price increases. On the other hand, the European Central Bank stressed that price increases are not likely to last, as much of the price rise can be explained by temporary factors such as energy prices.

Finally, in the UK, house prices have risen by their fastest annual rate in seven years, supported by demand for larger homes outside London and a temporary stamp duty holiday, according to the Nationwide Building Society.

The UK Nationwide house price index rose by 1.8 per cent in May compared with the previous month, bringing the average house price to a record £243,000, up by £24,000 over the past 12 months. The average house price accelerated by 10.9 per cent compared with May last year, up from 7.1 per cent the previous month, its fastest rate since August 2014.

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