17 minutes ago
UK retail sales were robust in August
People pass shops and retailers as they walk along the busy main street in St Ives on August 21, 2023 in Cornwall, England.
Matt Cardy | Getty Images News | Getty Images
UK retail sales were higher in August, figures from the British Retail Consortium showed on Tuesday, as consumer confidence improved.
Total retail sales rose 4.1% in the four weeks ended August 26, above the three-month average growth of 3.6% and compared to growth of 1% in August 2022. The survey notes that the figures are not adjusted for inflation, i.e. h Overall, sales volumes are likely to have been lower.
Overall consumer price inflation in the UK was 6.8% in July.
“Sales figures reflected the improvement in consumer confidence in August and retailers hope this overall upward trend continues,” said Helen Dickinson, CEO of the British Retail Consortium.
“A moderation in inflation will certainly be welcomed by consumers, but as the rate of price increases falls, so too will the additional spending that consumers need. As a result, sales growth could decline in the coming months, even if volume growth does not increase.”
– Jenni Reid
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German companies’ inflation expectations are falling
According to a survey by the Ifo Institute, German companies reported slightly lower price expectations in August.
Timo Wollmershäuser, head of forecasts at ifo, said there had been little change in high inflation expectations in the hospitality, food and beverage and retail sectors.
“In contrast, the price increase in the manufacturing sector appears to have almost come to a standstill,” said Wollmershäuser on Tuesday, with a survey value of 3.7 compared to 33.5 in retail and 55.1 in food and beverage trade.
The survey found “contradictory developments” in the manufacturing sector: automakers continue to plan to raise prices, while papermakers plan to cut prices.
According to preliminary figures, consumer price inflation in Germany fell slightly to 6.4% in August on an EU-harmonized basis. Producer prices fell in July for the first time in two and a half years, falling 6% year-on-year, while energy prices fell 19.3%.
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UBS expects “clear signs of a slowdown” in the US economy by November’s FOMC meeting
UBS sticks to its assessment of a “soft” landing for the U.S. economy and says inflation is moving closer to the Federal Reserve’s goal of no recession this year.
“August was a tough month for investors,” said Mark Haefele, global wealth management chief investment officer at UBS, noting that the S&P 500 ended last month down 1.6%. “Conflicting evidence and conflicting interpretations of economic data, asset prices and the outlook for Fed policy have sent asset prices reeling in recent weeks as expectations of a soft landing for the U.S. economy continued to waver.”
Some remaining uncertainties could still keep the market on tenterhooks, Haefele said in Monday’s note. Last month’s increase in core PCE was well above the Fed’s target, which could maintain the possibility of another rate hike, the analyst said. UBS is also paying attention to a possible recovery in savings rates and a further slowdown in the labor market.
“Our base case assumes that the economy will show significant signs of slowing by the FOMC meeting in November, prompting the Fed to finally end its strongest rate hike cycle since the 1980s. “We expect U.S. Treasury yields to decline year-over-year as both U.S. economic growth and inflation slow,” Haefele wrote.
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If you had $50,000 to invest, where should you invest it and how much should you allocate to each asset class? CNBC Pro spoke to portfolio managers and other investors to find out.
We also reached out to those who told CNBC Pro how they would commit $50,000 in June and asked what, if anything, they would change.
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European markets: Here are the opening discussions
European markets are expected to open lower on Tuesday.
According to data from IG, the UK’s FTSE 100 index is expected to open 17 points lower at 7,433, Germany’s DAX 27 points lower at 15,778, France’s CAC 10 points lower at 7,263 and Italy’s FTSE MIB 95 points lower at 28,568.
Tuesday’s data releases include final data on the Purchasing Managers’ Index (PMI), which measures business activity in the manufacturing and services sectors in the euro zone and the United Kingdom, for August.
– Holly Ellyatt