1. Economic growth in the US was stronger than expected in the second quarter of 2023, as activity proved resilient in the face of the Federal Reserve’s campaign of aggressive interest rate rises. The world’s largest economy grew 2.4 per cent on an annualized basis between April and June, according to preliminary figures released by the Department of Commerce on Thursday. That marked an acceleration from a 2 per cent growth rate in the first quarter, and was well above the 1.8 per cent rate predicted by economists. Consumer spending growth slowed after an unusually strong start to the year but the reduction was more than offset by strong business investment in inventories and fixed assets. (Source: ft.com)
2. The price of gasoline is starting to surge everywhere, an inflationary omen for central banks and governments the world over. Futures just soared to a nine-month high in New York, sending shock waves through to the pump, while prices have also been rising in Asia. Markets for the motor fuel have tightened worldwide due to a combination of unexpected refinery outages plus lower-than-normal stockpiles in key storage hubs such as the US Gulf Coast and Singapore for this time of the year. In global energy markets, it’s telling that while crude oil futures are little changed year-to-date, US gasoline contracts have rallied by more than 20%. The resurgence in gasoline potentially poses a headache for central banks including the US Federal Reserve as policymakers grapple with the problem of how much more monetary tightening, if any, is needed to bring inflation to heel. (Source: bloomberg.com)
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