The minutes of the December meeting of the Federal Reserve (Fed) show that policymakers concluded that interest rate cuts are likely in 2024, though they held back from providing a timeline as to when these cuts would take place.

While some members remained wary of upside risks of inflation, they also concluded that the US benchmark interest rate is “likely at or near its peak for this tightening cycle”.

Policymakers “judged that the current stance of monetary policy was restrictive and appeared to be restraining economic activity”, but that “it was possible that the economy could evolve in a manner that would make further increases in the target range appropriate,” the minutes note.

The document brings to a close a year that began with the Fed still uncertain about the negative impact higher interest rates would have on the economy, but ended with inflation falling faster than expected and hopes that a recession would be avoided.

Meanwhile, in Germany, unemployment rose at the end of last year as Europe’s largest economy weakened further, official data showed on Wednesday.

Germany’s unemployment rate inched up to 5.9 per cent in November compared to 5.8 per cent in the previous month, according to the Federal Labour Office. This is the highest unemployment rate since May 2021.

The report also shows that, on a seasonally adjusted basis, the number of people out of work was up by 22,000 to 2.702 million. “Looking back at 2023, we can see that the weak economy has not left the labour market unaffected,” said Andrea Nahles, chairwoman of BA’s executive board, at a press conference.

Finally, activity in China’s services sector grew at the fastest rate in five months as a solid rise in new business underpinned services firms, a private-sector survey showed on Thursday.

The Caixin China General Services Business Activity Index, which provides a gauge of operating conditions in the services industries such as retail and tourism, rose to 52.9 last month from 51.5 in November. A reading above 50 indicates expansion in activity, while a number below signal contraction.

“Optimism prevailed in the services industry, with enterprises expressing confidence in an improved economic outlook for the coming year,” Wang Zhe, a senior economist at Caixin Insight Group, said.

This article does not constitute legal and/or financial advice and is being issued for information purposes only by Bank of Valletta plc, 58, Zachary Street, Valletta. Bank of Valletta is a public limited company regulated by the MFSA and is licensed to carry out the business of banking and investment services in terms of the Banking Act (Cap.371 of the Laws of Malta) and the Investment Services Act (Cap.370 of the Laws of Malta).