The Day at a Glance | September 25 2023

*China could have limited room for implementing further monetary easing and should instead implement structural reforms, according to a member of the Chinese central bank.

*One week before US federal government´s financing comes to an end, groups within the Republican party in Congress continue to be unable to reach an agreement.

*The Federal Reserve of Chicago’s National Activity Index fell by -0.16 points in August from a revised previous reading of +0.07 points. All four categories contributed negatively – with even two of them showing further deterioration. Consequently, the three-month average set at -0.14 points.

*A Russian airstrike carried out overnight on the city of Odessa in southern Ukraine caused significant damage to the port´s infrastructure, as well as the destruction of some grain storage facilities.

Economic environment

Limited room for stimulus on the Chinese monetary front. This weekend, during a financial forum in Beijing, Liu Shijin, Vice President of the Research Center for Development of the Monetary Policy Committee of the People’s Bank of China (PBOC), pointed out that the difference in interest rates with the United States restricts the space for further easing in Chinese monetary policy, adding that if the focus continues to be on macroeconomic policies to stabilize growth, “there will be increasingly more side effects.” Instead, Liu proposed a series of structural reforms that could immediately assist the economy and inject long-term growth momentum.