October 31, 2022
United States:
Morgan Stanley’s Wilson Says End of Fed Tightening Nearing
The end of the Federal Reserve’s campaign to raise interest rates is approaching, according to Morgan Stanley strategist Michael Wilson, who until recently was a prominent stock market bear who correctly predicted this year’s slump in equities.
Indicators including the inversion of the yield curve between 10-year and three-month Treasuries — a recession indicator with a perfect record — “all support a Fed pivot sooner rather than later,” Wilson wrote in a note on Monday. “Therefore, this week’s Fed meeting is critical for the rally to continue, pause or even end completely.”
Europe:
Euro-Zone Inflation Soars to New Record as Economy Fades
Euro-area inflation surged to a fresh all-time high, while the bloc’s economy lost momentum — reinforcing fears that a recession is now all-but unavoidable.
Consumer prices jumped by 10.7% from a year ago in October, far exceeding the 10.3% median estimate in a Bloomberg survey.
Asia:
Hong Kong’s Economy Records Worst Contraction Since 2020
Hong Kong’s economy recorded its worst quarter in more than two years as weak demand and pandemic isolation battered the financial hub and increased the likelihood the city will end the year in contraction for the third time since 2019.
Gross domestic product plunged 4.5% in the July-to-September period from a year earlier, according to advance estimates released by the government on Monday. That was far weaker than economists’ forecasts for a 0.8% decline, and worse than the second quarter’s 1.3% fall.
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