Providing you with a short summary of events from around the world. ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌

Blackfinch Group
Monday Market Update

The ever-changing world we live in reinforces the importance
of regular up-to-date communication. This weekly news update from our
multi-asset portfolio managers provides you with a summary of global events
 for your reference and to share with clients.

Issue 123 | 19th December, 2022 

UK COMMENTARY

  • The Bank of England’s Monetary Policy Committee raised borrowing costs by 50 basis points to 3.5%, in line with economist predictions. It was the ninth consecutive increase. 
  • UK inflation, as measured by the Consumer Price Index (CPI), slowed from 11.1% in October to 10.7% in November, leading economists to suggest inflation had passed its peak.
  • Fuel prices rose by 17.2% year-on-year in November, down from 22.2% in the year to October. Clothing and footwear prices rose by 7.5%, down from 8.5% in October.
  • Gross domestic product (GDP) grew 0.5% in October, according to the Office for National Statistics (ONS). This followed a fall  of 0.6% in September, which was affected by the additional bank holiday for the Queen’s funeral.
  • The Insolvency Service reported 2,029 company insolvencies in England and Wales in November. This was an increase of 21% on insolvencies in November 2021, and 35% higher than the pre-pandemic number of solvencies recorded in November 2019. 

NORTH AMERICA COMMENTARY

  • US CPI inflation eased more than expected in November. The rate of increase fell to 7.1%, lower than the 7.3% forecast and down from 7.7% in October.  Core CPI rose 0.2% on the month and 6.0% on an annual basis, compared with estimates of 0.3% and 6.1%.
  • The US Federal Reserve (Fed) raised its benchmark policy rate by 50 basis points, raising its federal funds rate to 4.25%-4.5%. The Fed also signalled it intends to keep rates higher throughout 2023, with no rate reductions anticipated until 2024. 

EUROPE COMMENTARY

  • The European Central Bank (ECB) raised its base rate by 50 basis points to 2.5%. Based on the substantial upward revision made to its inflation outlook, more increases are on the way in 2023. 
  • Industrial production in the Eurozone fell by 2% during October, according to Eurostat. Production of durable consumer goods fell by 1.9%, output of intermediate goods (used to make final products) dropped by 1.3%, while heavy-duty capital goods production was down 0.6%. Production of energy fell by 3.9%.

EMERGING MARKETS

  • China’s domestic activity data sharply underperformed already-low expectations for the second straight month, as policy confusion around government's COVID-19 containment policies and piecemeal lockdowns kept sentiment weak.
  • Chinese industrial value added growth (which reflects the contribution of the industrial sector to overall GDP) further slowed to 2.2% year-on year in November, versus 5.0% in October.
  • On the demand side, China’s nominal retail sales shrank for the second consecutive month. Despite the impact of China’s largest annual online shopping festival "double 11", it posted a -5.9% year-on-year fall in November, compared to -0.5% in October.

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