The most important events and reports on the economy, central banks and politics from the Dow Jones Newswires program
ADP: US private sector creates fewer jobs than expected
Employment in the US private sector rose more weakly than expected in September. As the labor market service provider Automatic Data Processing Inc (ADP) reported, 89,000 jobs were created compared to the previous month. Economists surveyed by Dow Jones Newswires had predicted an increase of 160,000 jobs. In August, the bottom line was that 180,000 jobs were added, 3,000 more than originally reported.
US industrial orders increased in August
Incoming orders from US industry increased by 1.2 percent in August compared to the previous month. Economists, on the other hand, had expected an increase of just 0.2 percent. For the previous month there was a minus of 2.1 percent, as the US Department of Commerce also announced.
S&P Global: US service provider with declining business in September
Business activity in the US services industry was more subdued in September than in the previous month, according to a survey by S&P Global. The purchasing managers’ index calculated by S&P Global for the sector weakened to 50.1 from 50.5 points. Economists had predicted a reading of 50.2. A preliminary value of 50.2 was determined for September.
US crude oil inventories surprisingly fell
US crude oil inventories unexpectedly fell in the week ended September 29th. According to the state Energy Information Administration (EIA), they fell by 2.224 million barrels compared to the previous week. Analysts polled by Dow Jones Newswires had predicted an unchanged level. In the previous week, inventories had reduced by 2.169 million barrels.
ECB: Country shares in PEPP government bond holdings almost unchanged
The European Central Bank (ECB) hardly changed its purchases of government bonds from highly indebted euro countries under the PEPP program at the end of September. The share of Italian government bonds did not increase for the first time since the beginning of the year. As figures published by the ECB show, the share of Italian government bonds in total government bonds purchased was 19.4 percent at the end of September. At the end of July it was 19.5 percent, at the end of May 19.4, at the end of March 19.1 and at the end of January 19.0 percent. The ECB can increasingly purchase bonds from certain countries as part of the reinvestment of principal amounts of bonds that have matured.
ECB/Herodotou worried about high energy prices
ECB Governing Council member Constantinos Herodotou has expressed concern about the recent rise in energy prices. The governor of the Central Bank of Cyprus said at the opening of a conference at his home: “There is a rise in energy prices, which could again spread to the rest of the economy and put upward pressure on prices.”
ECB/De Guindos: Underlying inflation pressure remains strong
ECB Vice President Luis de Guindos sees underlying inflationary pressure as remaining high despite the significant decline in inflation rates. At a conference at the Central Bank of Cyprus, De Guindos also said that most of the effects of the European Central Bank’s (ECB) previous monetary policy tightening were still “in the pipeline”. That speaks for a data-dependent one monetary policy.
Federal cabinet allows power plants to be reactivated until the end of March 2024
The Federal Cabinet is allowing suppliers to reactivate decommissioned coal-fired power plants to generate electricity until the end of March 2024 in order to save gas in electricity generation. With the change to this so-called “Supply Reserve Call Ordinance” from the Federal Ministry of Economics, the supply reserve, which was already active from October 1, 2022 to June 30, 2023, will be temporarily reactivated from the beginning of October 2023. The participation of these power plants in the Electricity market According to the ministry, this is linked to the validity of the gas alert level or the gas emergency level.
FDP wants immediate “economic turnaround”
The FDP presidium has called for five “immediate measures for an economic turnaround”. “We must refrain from doing anything that slows down growth and do everything that strengthens growth,” the party said. “For this, Germany needs a new economic policy course and a return to a culture that promotes performance, hard work and entrepreneurship.” Better framework conditions and more appreciation are needed. The Growth Opportunities Act, the Bureaucracy Relief Act and the Future Financing Act are important building blocks for this change of course.
EU states agree on asylum compromise
In the dispute over European asylum reform, the EU states have agreed on a compromise. According to the Spanish Council Presidency, the member states cleared the way for the so-called crisis regulation at the meeting of the permanent representatives in Brussels, which is considered the final building block of the reform. The crisis regulation provides for significantly stricter measures if a particularly large number of migrants threaten to overload the asylum system.
DJG/DJN/AFP/apo/kla
(END) Dow Jones Newswires
October 04, 2023 1:00 p.m. ET (17:00 GMT)