Every Friday, Brian Jacobsen provides perspective on key events and topics of the current week and his thoughts about what the week ahead may hold. Here’s his report for the week of September 4–10, 2021.
The week that was
· The Federal Reserve’s (Fed’s) Beige Book (a collection of qualitative information from across the U.S.) said economic “growth downshifted slightly to a moderate pace in early July through August.” The Fed said the downshift was mainly in the areas of dining out, travel, and tourism. In other areas of the economy experiencing softness, the Fed attributes it mostly to supply chain and hiring issues, not a lack of demand.
· The Reserve Bank of Australia held its policy rate steady but continued to taper its asset purchases. The central bank’s president said the Delta variant of COVID-19 will “delay, but not derail” the economic recovery.
· The Bank of Canada held policy steady, expressing concern over supply chain issues and the Delta variant of COVID-19 but also expressing optimism about a second-half economic rebound.
· The European Central Bank said it would slow the pace of its pandemic emergency purchase program relative to the pace in the first two quarters of the year. President Christine Lagarde said it wasn’t tapering but a recalibration to account for the eurozone’s increasingly advanced economic rebound.
· China’s government released some of its oil reserves to try to tamp down producer prices. Producer prices rose 9.5% year over year in August.
· Scotland’s first minister says she intends to hold a public vote on independence by the end of 2023.
· El Salvador became the first country to adopt bitcoin as its legal tender. Previously, the U.S. dollar was El Salvador’s legal tender. Merchants will be required to accept bitcoin for transactions, though there is an exemption for those who are technologically unable to. People will have the option to pay their taxes in bitcoin. In a recent poll, 70% of respondents said they’d prefer to use the dollar. Two-thirds of respondents said the law should be repealed.
· In the U.S., President Biden is mandating that all employers with 100 or more employees require workers to be vaccinated or to be tested weekly for COVID-19. Government and health care workers will be required to be vaccinated with no option for weekly testing. The mandate covers approximately two-thirds of the nation’s workforce.
The week to come
· On Tuesday, U.S. inflation for August and August’s small business optimism survey results will be released. Later that night, China’s industrial production data for August will be released.
· On Wednesday, the U.K.’s inflation for August, eurozone industrial production for July, and U.S. industrial production for July are to be released. On Wednesday, U.S. retail sales for August are to be released.
· The week wraps up with the U.K.’s retail sales for August and a preliminary reading of September consumer sentiment in the U.S.
Thanks for reading, stay informed!
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