Overseas Headlines – December 2, 2021

United States:

Fed’s Divergence With China to Shape 2022 Global Outlook

“That’s the label that economists Chang Shu and David Qu at Bloomberg Economics attach to the outlook for global monetary policy next year, as the U.S. Federal Reserve moves toward tightening, and the People’s Bank of China prepares to ease. The contrast corresponds to the differing trajectories of their economies. The U.S. recovery remains solid, with inflation taking off, while China may face a sharp slowdown in 2022 if monetary officials don’t step in.”



Omicron Makes BOE’s December Rate Increase Anything But Certain

“The emergence of the omicron variant of the coronavirus may add enough uncertainty to the U.K. economic outlook to delay a widely-anticipated interest rate rise this month. The Bank of England’s decision on Dec. 16 was always set to be a close call, and the new strain of Covid-19 has surpassed the labor market as the key variable likely to guide the speed of the recovery.”



Bank of Korea Sees Faster 2021 Inflation After November Surprise

“The Bank of Korea said it expects inflation this year to come in above its upward revision of just a week ago as consumer price gains exceeded all estimates in November, accelerating to the fastest pace since 2011. Consumer prices rose 3.7% from a year earlier, the statistics office said Thursday, compared with a median forecast of 3.1%. That extended the run of gains above the Bank of Korea’s 2% target to an eighth straight month, validating the central bank’s two interest-rate increases since August and suggesting further tightening ahead.”




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