The first and second biggest economies in the world both hit records this week.
In the US, figures for October show that consumer prices rose at the fastest pace in three decades, increasing inflationary pressures on the economy. In response, the Biden administration is scrambling to tame the threat and keep the recovery on track.
Meanwhile in China, factory gate prices rose at their fastest pace in 26 years last month. This uptick, alongside contracting manufacturing activity in September, has raised concerns about stagflation.
Indeed, central bankers are reading the threat of inflation differently. US and UK officials have signalled that interest rates are likely to rise soon, while on Monday Philip Lane, the ECB’s chief economist, said the bloc was in a “completely different” situation.
Elsewhere, negotiations at COP26 are in the final stretch. Initial drafts of the texts to sum up the conference were circulated on Wednesday and will be negotiated extensively. One sticking point is whether to bring forward submitting new emissions targets.
If you are trying to navigate the geo-political minefield, here are five things to watch out for in the closing days of the summit.
On to corporate news and Larry Culp, chief executive of General Electric, revealed his plans to separate the industrial titan into three companies this week. With Toshiba also considering a split, the move is a sign of how the conglomerate business model has fallen from favour.
But this is not the end, writes chief business commentator Brooke Masters. “The obituary of the all-encompassing corporate structure has been written many times and, somehow, it still survives.”
Down-but-not-out was a theme in the FT’s Boardroom Bellwether survey too. Nearly half of FTSE 350 companies described post-Brexit trading arrangements with the EU as “damaging”. Even so, almost all were optimistic about their prospects and the economy.
That did not quite play out in data released by the Office for National Statistics today. Although the UK’s GDP was up by a monthly rate of 0.6 per cent in September, growth slowed more than expected in the third quarter.
That said, the “business friendly” post-Brexit regime has been in full swing. Officials are expected to scale back corporate governance and audit reforms including a proposal to force directors to take greater responsibility for company accounts.
UK chancellor Rishi Sunak also announced new details about Britain’s proposed post-Brexit financial regulation regime. Alongside a new era where officials consider “growth and competitiveness”, there were plans for increased scrutiny of the PRA and FCA.
And finally, business columnist Helen Thomas takes a closer look at pre-emption. While it is considered “sacrosanct” by those leading a government review of capital raising, its importance in the market is “reason for more clarity, more transparency and for strengthening the processes around it.”
