Afternoon summary
Time for a quick recap.
UK house prices fell in July for the fourth month running. Halifax reported that prices dipped by 0.3%, or around £1,000, last month, and were 2.4% lower than a year ago.
Halifax also reported that first-time buyers were seeking out smaller properties, as rising interest rates hit affordability.
Kim Kinnaird, director at Halifax Mortgages, explained:
“In particular, we’re seeing activity amongst first-time buyers hold up relatively well, with indications some are now searching for smaller homes, to offset higher borrowing costs.
Halifax predicts prices will decline gradually through the year, rather than crashing.
LSL Property Services, one of the UK’s largest providers of mortgage and valuation services, issued a profits warning, due to the impact of rising interest rates on the housing market.
Germany’s economic problems have continued, with industrial production droppin gby 1.5% in June.
Sentix labelled Germany ‘the sick man of the eurozone’.
Back in the UK, the London economy and parts of the south-east have become more attractive to investors than the rest of Britain over the past year, according to a study.
The world’s biggest oil firm, Saudi Aramco, announced a near-40% fall in profits after a decline in crude oil prices and weakening margins in refining and chemicals.
One of Britain’s biggest boiler makers is to start manufacturing electric heat pumps to keep pace with what it describes as the biggest transformation since the switch from coal to gas devices in the 1930s.
A senior executive at HSBC has apologised after saying the “weak” UK government had caved in to the US in its approach to doing business with China.
In the US, a central bank policymaker is warning that more interest rate hikes will likely be needed in order to lower inflation to the official 2% target.
Fed Governor Michelle Bowman will tell a “Fed Listens” event in Atlanta that she is looking for more signs that inflation is on a ‘consistent’ path downwards,
In prepared remarks for the event, Bowman says:
“Given these developments, I supported raising the federal funds rate at our July meeting, and I expect that additional increases will likely be needed to lower inflation to the [2%] goal.
“I will be looking for evidence that inflation is on a consistent and meaningful downward path as I consider whether further increases in the federal funds rate will be needed, and how long the federal funds rate will need to remain at a sufficiently restrictive level.”
US consumer price inflation dropped to 3% in June, a two-year low.
