Bank of England survey bolsters view of weaker British economy
Growth slowed across British business services and consumer spending eased last month, a Bank of England survey showed, offering a more mixed picture of the economy than some of the gloomier indicators since June's Brexit vote.
The BoE released some of the findings of its August regional agents' survey in last week's quarterly Inflation Report, which showed companies expected the referendum would hurt capital spending, hiring and turnover over the coming year.
Although Wednesday's report suggested the economy is likely to slow, the monthly survey of around 700 companies was not as starkly downbeat as the larger purchasing managers' indexes (PMIs).
Last week's Markit/CIPS PMIs suggested the economy is now contracting at the fastest rate since the 2008-09 financial crisis. [GB/PMIS]
China's commercial bank bad loans hit 11-year high at end-June
The rise in troubled loans at China's commercial banks slowed in the second quarter although the total volume of bad loans reached an 11-year high, data from the banking regulator showed.
The total volume of non-performing loans (NPLs) at Chinese commercial lenders hit 1.44 trillion yuan ($217 billion) at the end of the second quarter, the highest since 2005, data from the China Banking Regulatory Commission (CBRC) showed late on Wednesday.
NPLs increased 45.2 billion yuan over the second quarter, the smallest quarterly increase since the end of 2013, according to Reuters calculations based on official data.
The NPL ratio of Chinese commercial lenders stood at 1.75 percent at end-June, the same level as end-March.
Net profit earned by commercial banks in the second quarter slipped to 427.5 billion yuan, compared with 427.9 billion yuan in the same period a year prior, the CBRC data shows.
Net interest margin narrowed to 2.27 percent, compared with 2.51 percent in the period a year prior.
U.S. budget deficit up 10% for fiscal year to date
The federal government’s budget deficit is up 10% so far this fiscal year, the Treasury Department said Wednesday, with receipts flat through July and spending rising slightly.
The government’s shortfall for the first 10 months of the year was $514 billion, up from $466 billion in the same period a year ago.
Lower-than-expected revenues recently led the Congressional Budget Office to increase its estimate of the 2016 deficit to $590 billion, up from $534 billion. That would be about $150 billion more than last year’s deficit.
China 'unlikely' to resort to aggressive monetary easing in 2016: Xinhua
Market speculators betting on more monetary easing in China will probably be disappointed, state media Xinhua said in an editorial late Wednesday, as it would hamper efforts to reduce industrial overcapacity and remove asset bubbles.
"Market anticipation for more cuts is rising as moderate consumer inflation in July offered sufficient room for such maneuvers," Xinhua said.
"Those hoping for cuts, however, will probably be disappointed."
The People's Bank of China (PBOC) is unlikely to resort to frequent interest rate and reserve requirement ratio (RRR) cuts in the second half of the year, Xinhua claims, noting that such moves would jeopardize the government's efforts to reform bloated industrial sectors.
"Aggressive easing of the RRR and interest rates cuts will not only cause excessive liquidity but also dampen China's efforts to reduce overcapacity and squeeze out asset bubbles," the newspaper says.
Further loosening would likely put fresh depreciation pressure on the Chinese yuan, which helps exporters but risks capital flight.
Crude Below $42
West Texas Intermediate crude fell 0.3 percent to $41.57 a barrel, after sinking 2.5 percent on Wednesday as official data showed U.S. supplies increased by 1.06 million barrels last week. Analysts surveyed by Bloomberg had forecast a drop of 1.5 million barrels. Weakness in global crude markets may persist as demand slows seasonally and fuel inventories remain abundant, the Organization of Petroleum Exporting Countries said Wednesday.
Reference: Reuters,Bloomberg, Reuters, MarketWatch
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