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U.K. business remains in a cheery mood, driven by a thriving services sector, the Confederation of British Industry's growth indicator for September shows. Firms in the private sector expect activity to rise around 9% over the three months to November, swinging from a decline in the three months to August. Financial and professional services are expected to lead growth, offsetting a small decline in consumer-services activity, while expansion in manufacturing activity is set to be weaker. Recent momentum in economic growth has been sustained into the second half of 2024, although the CBI's surveys "paint a very mixed picture across sectors," CBI economist Alpesh Paleja says. "Consumer-facing businesses are still struggling, and momentum in manufacturing remains tepid at best." ([email protected]; @joshualeokirby)
Domestic demand still needs to weaken before the Turkish central bank can begin to take its foot of the monetary-policy brake, Capital Economics' William Jackson says. Gross domestic product increased just 2.5% on year in the second quarter, the lowest rate since the global pandemic, but the quarter-on-quarter progression of 0.1% remained more dynamic than expected, according to Capital's projections. "The net result is that although the economy is slowing, it hasn't weakened to the extent we and most others thought it would have," Jackson says. Turkey's central bank has kept a hawkish tone around its high interest rates, and will likely keep policy tight until demand begins to fall back within the country, Jackson writes in a note. "We expect the first rate cut in the first quarter of next year," he says. ([email protected]; @joshualeokirby)
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