" National " : market concentration on inflation and central bank policies

The weekly report of the National Bank of Kuwait, on the money markets, said that the focus of the global markets remained on inflation and the policies of central banks, while the Jackson Hole symposium constituted the main driver of market sentiment trends. The report added that at the level of economies, interest rates may remain at high levels for a longer period, at a time when policymakers continue to discuss the timing of any additional tightening of monetary policy. In the United States, Federal Reserve officials maintained a tough tone, after inflation data for July showed limited progress towards the federal target level of 2%.

The overall inflation rate according to the personal consumption expenditures index stabilized at 3.7%, while core inflation remained at 3.3%, which kept the possibility of raising interest rates again strongly. Federal Reserve Chairman Kevin Warsh confirmed that the Federal Reserve may have to take further measures if inflation does not return to the target level at an acceptable pace. At the same time, labor market conditions remained strong, with unemployment claims declining and the unemployment rate stabilizing near its historical lows, confirming the strength of the economy. The dollar also remained supported by expectations of the possibility of the Federal Reserve continuing to tighten monetary policy before the end of the year, and markets are still pricing in a high probability of keeping interest rates unchanged in September. However, inflation data and recent statements by Federal Reserve officials have strengthened expectations of the possibility of raising interest rates later in the year. In Canada, the economy recorded a strong positive surprise, as it grew at an annual rate of 3.3% during the second quarter of the year.

Growth was driven by strong exports, improved consumer spending, and a recovery in business investment, indicating the economy's ability to adapt to continuing trade tensions and external uncertainty. Stronger growth prospects provide support for the Canadian dollar, while at the same time reducing pressure on the Bank of Canada to consider easing monetary policy. In Europe, economic sentiment improved with business and consumer confidence reaching its highest levels since January. The euro zone economy continues to show some degree of resilience despite rising energy prices and geopolitical uncertainty, but inflation remains a source of concern, especially after the release of data indicating that prices rose at a stronger-than-expected pace in France and Spain, which reinforced expectations that the European Central Bank could raise interest rates again in September. In the United Kingdom, financial challenges remain after borrowing in July exceeded its level recorded a year ago.