Global Economy Update: China Exports Contract, BoE Holds Rates, Emerging Markets Mixed
London/Beijing/Santiago/Brasília – The Bank of England held interest rates steady Thursday, while China’s exports unexpectedly fell in October, signaling continued challenges for the global economy. these developments come as emerging markets present a mixed picture, wiht Chile seeing economic rebound and Brazil’s central bank maintaining a tight monetary policy.
The Bank of England’s decision to maintain its current course reflects a cautious approach amid persistent inflationary pressures and a slowing UK economy.Together, China’s export contraction – driven by a slump in shipments to the US – adds to concerns about weakening global demand and its impact on the world’s second-largest economy, already grappling with domestic headwinds.
China’s exports contracted in October as global demand failed to offset the deepening slump in shipments to the US, dealing a blow to an economy already slowing amid sluggish consumer spending and investment at home. China’s central bank responded with a small government bond purchase in October, its first such operation this year, as it revived a tool to support the economy.
Across the Atlantic, Chile’s economic activity bounced back in September, driven by gains in mining and services.The imacec index,a proxy for gross domestic product,rose 0.5% from August,recovering from a 0.7% decline the prior month due to a temporary mine shutdown.
In Brazil, the central bank held its key interest rate unchanged at a near two-decade high, expressing confidence that its current tight policy will eventually tame inflation, which it forecasts will remain above target until 2027. Central bankers reiterated the need for caution given ongoing uncertainty.