Despite encouraging news on inflation, central banks on both sides of the Atlantic are sticking to their core message – the fight is not over, and interest rates will stay higher for longer. Consequently, government bond yields increased to 15-year highs in August before easing towards the end of the month. The Chinese economy struggled with the post-Covid re-opening, proving a damp squib. The one positive from China's struggling economy is that it will help bring down global inflation. Chinese goods will once again have a deflationary effect on Western consumers.
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