UK industrial production fell in August, hitting the recent run of upbeat economic news. Industrial production fell by 0.4% between July and August, partly due to a drop in oil and gas production. Manufacturing rose 0.2%, although this followed a steep fall in July. The UK's deficit on trade in goods and services was estimated at £4.7bn, compared with £2.2bn in July. The deficit on trade in goods widened by £2.6bn to £12.1bn.
The widening deficit comes despite hopes that the weaker pound, currently trading at the lowest rate in more than three decades, against the dollar should boost demand for British goods. Exports rose by just £100m against expectations of a £4bn increase. Imports however rose by £2.6bn in August following a slump in July.
In the US employment growth unexpectedly slowed for the third straight month in September and the jobless rate rose, which could make the Federal Reserve more cautious about raising interest rates. Nonfarm payrolls rose 156,000, down from a gain of 167,000 jobs in August, while the unemployment rate ticked up a tenth of a percentage point to 5.0 percent as more Americans re-joined the labour force. The data suggested the economy was on firm ground, but not growing so swiftly as to knock the Fed off its game plan of raising borrowing costs only gradually.
Hourly wages for private sector workers rose 2.6 percent in September from the same month a year earlier, in line with expectations. Wage growth has shown signs of accelerating over the last year although it remains slower than before the 2007-2009 recession.
US Bank Holiday - Columbus Day