- Domestic demand growth remained strong in the United States, and with continued tightness in labour markets, the Federal funds target rate was increased by ¼% to 5¼% in late August.
- Growth in the euro area remained moderate in the second quarter, but survey evidence suggests that growth may have increased in the third quarter.
- In Japan, there was further evidence of a recovery in output in the second quarter. But with declining business investment and the possibility of further falls in employment, the recovery remains fragile.
- Current account imbalances between the major economies increased further in the second quarter.
- World trade growth appears to be increasing, partly in response to continued recovery in many emerging market economies.
- Sharp increases in oil prices put upward pressure on the major economies’ import prices. But consumer price inflation remained subdued.
Published on
01 December 1999
The international environment