Latest fraudulent alert - last updated on Apr 2023. To find out more information and how to protect yourself, please click here.

Investment Institute
Weekly Market Update

Take Two: Fed keeps interest rates on hold; global GDP growth expected to slow

  • 25 September 2023 (3 min read)

What do you need to know?

The Federal Reserve (Fed) left its benchmark interest rate unchanged at between 5.25% and 5.50% at its meeting last week. While officials were all in agreement to keep rates on hold, the Fed’s ‘dot plot’ – the chart of officials’ rate expectations – shows one more hike is expected this year. The Fed described recent economic activity as “solid” and noted that jobs growth had slowed but remains strong. Elsewhere, the Bank of England surprised by keeping interest rates at 5.25%, following an unexpected fall in inflation in August to 6.7% from 6.8% in July.

Around the world

Global economic growth is expected to slow to 3.0% this year from 3.3% in 2022, with stronger than expected performance in the US moderating the impacts of China’s weakening economy, according to the Organisation for Economic Co-operation and Development (OECD). However, this is an improvement on the 2.7% growth it forecast in June. In its Interim Economic Outlook, the OECD said it expects growth in 2024 to be 2.7% - down from its previous prediction of 2.9% - as the longer-term effects of tighter monetary policy materialise. Inflation is expected to ease throughout 2023 and 2024 but remain far above central bank objectives in most economies.

Figure in focus: 5.2%

The Eurozone’s annual inflation figure for August was revised lower to 5.2% from an initial estimate of 5.3%, after 5.3% in July. Eurostat, the statistical office of the European Union, said the highest contribution to price rises over the month came from services. However, core inflation, which excludes more volatile food, energy, alcohol and tobacco prices, remained in line with the flash estimate, easing to 5.3% from 5.5% in July. The European Central Bank raised its key benchmark interest rate to a record high of 4% earlier this month, aiming to return inflation to its 2% target.

Words of wisdom

Planetary boundaries: A term which defines critical processes and their limits in the maintenance of a stable and resilient Earth system. A study by a group of scientists including from the Potsdam Institute for Climate Impact Research, published this month, outlines nine boundaries: Climate change; biosphere integrity; land system change; freshwater change; biogeochemical flows; ocean acidification; atmospheric aerosol loading; ozone depletion; and novel entities. Researchers revealed the Earth is beyond the “safe operating space” in six of the nine areas and pressure in all of them is increasing. However, rehabilitation is still feasible in all nine areas, the study said.

What’s coming up

On Monday, Germany releases its Ifo Business Climate index for September, a closely watched indicator of the country’s economic health. On Wednesday, the Bank of Japan publishes the minutes from its latest monetary policy meeting. On Thursday, a series of Eurozone surveys covering September are issued, including the bloc’s Economic and Industrial Sentiment measures. In addition, Germany’s preliminary estimate for September inflation is released, as well as the final estimate for US second quarter (Q2) GDP growth. On Friday, Japan reports its unemployment rate for August while the Eurozone releases its flash estimate for September inflation and the UK reports the final estimate of Q2 GDP.

Related Articles

Weekly Market Update

Take Two: US inflation eases; Japan falls into recession

  • by AXA Investment Managers
  • 19 February 2024 (3 min read)
Weekly Market Update

Take Two: Eurozone avoids recession; Fed and BoE keep interest rates on hold

  • by AXA Investment Managers
  • 05 February 2024 (3 min read)
Weekly Market Update

Take Two: US growth beats expectations; ECB leaves rates on hold

  • by AXA Investment Managers
  • 29 January 2024 (3 min read)


    This website is published by AXA Investment Managers Asia Limited (“AXA IM HK”), an entity licensed by the Securities and Futures Commission of Hong Kong (“SFC”), for general circulation and informational purposes only. It does not constitute investment research or financial analysis relating to transactions in financial instruments, nor does it constitute on the part of AXA Investment Managers or its affiliated companies an offer to buy, sell or enter into any transactions in respect of any investments, products or services, and should not be considered as solicitation or investment, legal, tax or any other advice, a recommendation for an investment strategy or a personalised recommendation to buy or sell securities under any applicable law or regulation. It has been prepared without taking into account the specific personal circumstances, investment objectives, financial situation, investment knowledge or particular needs of any particular person and may be subject to change at any time without notice. Offering may be made only on the basis of the information disclosed in the relevant offering documents. Please consult independent financial or other professional advisers if you are unsure about any information contained herein.

    Due to its simplification, this publication is partial and opinions, estimates and forecasts herein are subjective and subject to change without notice. There is no guarantee such opinions, estimates and forecasts made will come to pass. Actual results of operations and achievements may differ materially. Data, figures, declarations, analysis, predictions and other information in this publication is provided based on our state of knowledge at the time of creation of this publication. Information herein may be obtained from sources believed to be reliable. AXA IM HK has reasonable belief that such information is accurate, complete and up-to-date. To the maximum extent permitted by law, AXA IM HK, its affiliates, directors, officers or employees take no responsibility for the data provided by third party, including the accuracy of such data. This material does not contain sufficient information to support an investment decision. References to companies (if any) are for illustrative purposes only and should not be viewed as investment recommendations or solicitations.

    All investment involves risk, including the loss of capital. The value of investments and the income from them can fluctuate and that past performance is no guarantee of future returns, investors may not get back the amount originally invested. Investors should not make any investment decision based on this material alone. 

    Some of the services listed on this Website may not be available for offer to retail investors.

    This Website has not been reviewed by the SFC. © 2023 AXA Investment Managers. All rights reserved.