The US trade deficit widened in July. Reuters reports:
The U.S. trade deficit widened sharply in July to a record $68 billion, as oil import prices and demand for foreign goods and services rose to new highs, a government report showed on Tuesday...
However, some economists saw a silver lining because oil prices have fallen about 20 percent since setting a record above $78 per barrel in July. U.S. light crude for October delivery was trading around $65 a barrel on Tuesday...
The Commerce Department report showed U.S. exports dropped for the first time in four months, but were still the second highest on record...
For more analysis on the trade figures, refer to Brad Setser, Menzie Chinn and Calculated Risk.
Elsewhere, inflation was very much in the news.
In the UK, consumer prices rose 0.4 percent in August, lifting the annual rate to 2.5 percent.
In Germany, wholesale prices rose o.6 percent in August and were 5.3 percent higher than in August 2005.
In Japan, the corporate goods price index (CGPI) rose 0.2 percent in August and was up 3.4 percent from a year earlier, matching the rate in July and maintaining the fastest pace of increase in 25 years. On the other hand, the Cabinet Office survey's sentiment index for general households fell to 47.6 in August from 48.6 in July.
Meanwhile, China may finally be showing signs of slowing. From Reuters:
Spending in urban areas on fixed assets such as property, factories and roads was up 21.5 percent in August from a year earlier, much smaller than July's 27.4 percent increase, statistics chief Qiu Xiaohua told a news conference.
The growth rate was the slowest for a single month since December 2004...
The People's Bank of China...showed its determination to curb money supply growth by mopping up a record 225 billion yuan ($28.3 billion) in its regular open market operations on Tuesday.
... The Shanghai Securities News reported on Tuesday that annual growth in China's broad M2 measure of money supply slowed to 17.9 percent in August from 18.4 percent in July.