The ECB left interest rates unchanged yesterday. Reuters reports:
The European Central Bank left interest rates unchanged on Thursday and insisted inflation was still its key fear even though risks to growth were taking hold, prompting markets to scrap bets on rates rising again this year.
ECB President Jean-Claude Trichet said growth in mid-2008 would be substantially weaker than at the start of the year and the central bank had only partially anticipated the scope of the slowdown.
Yesterday's European economic data weren't too bad, though, with both German and Italian industrial production rebounding somewhat in June and German exports that month rising by the most since September 2006.
Elsewhere in Europe, the BoE also left interest rates unchanged yesterday.
In the US, the economic data were mixed. Reuters reports:
Initial claims for state unemployment benefits rose 7,000 last week to 455,000, the highest in six years, the Labor Department said. But it said a new federal program to extend benefits was partly to blame for the elevated level...
Wal-Mart said sales at U.S. stores open at least a year rose 3 percent, shy of Wall Street expectations of a 3.4 percent gain. Other retailers also reported disappointing sales...
The 5.3 percent rise in the [pending home sales] index brought it to 89.0, its highest since October.
But it's getting difficult to deny the weakening trend in Japan. From Bloomberg:
Japan's government said the world's second-largest economy is "weakening" for the first time since May 2001, when the country was in a recession.
"The economy has been weakening recently," the Cabinet Office said in a statement in Tokyo today, downgrading its monthly assessment for August...
Machinery orders, an indicator of capital spending in three to six months, fell 2.6 percent in June from May, the Cabinet Office said today. Orders rose 0.6 percent in the second quarter.