The services side of the US economy, which accounts for the majority of jobs in the country, rebounded in July, countering the growing narrative that the world’s largest economy might be edging closer to recession.

The index of services of the Institute for Supply Management rose to 51.4 in July, from 48.8 the previous month, beating expectations of 51. ISM readings above 50 indicate expansion in the sector whereas readings below that level indicate contraction.

Fears of a US recession were the main culprit for the turmoil in the global financial markets after a disappointing US July jobs report published on June 2. The markets are also worried that the US central bank is late in cutting interest rates to prevent an economic slowdown, opting at its July monetary policy meeting to keep rates at the highest level in two decades.

Meanwhile, German industrial production rose in June, offering some good news for Europe’s largest economy after an unexpected contraction in the last quarter.

Data published by German statistics agency Destatis on Wednesday show that industrial output rose by 1.4 per cent in June compared to May, its fastest pace in 2024, but only partially offsetting the 3.1 per cent fall in May. Economists had predicted industrial output to inch up by 0.9 per cent. The automobile industry underpinned production in the review month, growing at 7.5 per cent sequentially, although only after plummeting 9.9 per cent in May.

Higher energy prices and interest rates have raised costs and dampened investment in a manufacturing sector already grappling with supply chain problems and the aftermath of the COVID-19 pandemic, BDI president Siegfried Russwurm noted.

Finally, in its monetary policy meeting on Thursday, India’s central bank held its benchmark interest rate unchanged, retaining its goal on bringing inflation down even as other major central banks are mulling easing monetary policy in the face of financial market volatility.

The Reserve Bank of India left the repo rate unchanged at 6.5 per cent as widely expected. It is important for monetary policy to stay the course in bringing inflation down towards its four per cent medium term target, RBI governor Shaktikanta Das said, adding that India’s food inflation remains “stubbornly” high.

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