The Economist

The Reserve Bank of Australia is expected to resume raising its key interest rate as policymakers lose patience with stubbornly slow progress on inflation. Economists are weighing the timing and size of the next move, with households and markets bracing for the return of monetary tightening after a pause.

The European Central Bank has raised its key interest rates by 25 basis points, in line with widespread expectations from economists and markets. The decision keeps the bank's campaign against elevated inflation moving forward, and analysts are now watching for signals on whether further tightening will follow at upcoming meetings.

The Bank of Japan is increasing its lending scheme that offers funds to banks financing climate action, even as central bankers and economists argue over how far monetary institutions should go in supporting green policies. Supporters see climate lending as a way to address financial risks from global warming, while critics say central banks are overstepping their mandates by pursuing environmental goals beyond price and financial stability.

The Reserve Bank of Australia meets on Tuesday for the sixth time this year, with economists and financial markets treating another interest rate rise as near certain. The question being debated is not whether rates will go up but how many further increases may follow as the bank tries to curb inflation, and what that means for mortgages and household budgets.

Billionaire hedge fund manager Bill Ackman says the Federal Reserve's latest rate hike could backfire and make inflation worse rather than curb it. His argument adds to a growing debate among investors and economists over whether further monetary tightening is the right response to persistent price pressures.

The Reserve Bank of Australia is widely expected to raise the cash rate to 4.6%, which would take borrowing costs to their highest level since 2011. The anticipated hike is drawing attention from homeowners and economists concerned about mortgage repayments and inflation, with debate focused on how much further the bank will go to bring prices under control.

Iran has declared that diplomacy is the only path open to the United States, a statement reported in The Economist's World in Brief roundup. The same briefing covers disruption of the Orange Order march at Drumcree in Northern Ireland, a longstanding and contentious parade. Both stories are drawing attention amid ongoing tensions over Iran's nuclear programme and persistent disputes over parading in Portadown.

Mortgage rates in the United States have reached 7%, reigniting concern among homebuyers and homeowners. The Wall Street Journal examines what the rise means for the housing market, with analysts weighing whether higher borrowing costs will cool demand, keep prices elevated, and how long buyers can expect relief amid ongoing economic uncertainty.

The US Federal Reserve has decided to keep interest rates unchanged even as inflation reaches its highest level in three years. The decision means borrowing costs will stay where they are for now, with policymakers weighing stubborn price pressures against signs of strain in the economy. Markets and economists are watching closely for signals on when, or whether, the central bank might move rates again.

Big technology companies are rapidly expanding the use of guarantees to back debt for AI datacentres and chips, issuing up to $300bn in commitments in less than a year, according to analysis shared by economist Adam Tooze. A key concern raised is that much of this exposure goes unrecorded on their balance sheets, echoing pre-crisis off-balance-sheet practices and raising questions about hidden systemic risk in the AI buildout.

The Economist examines how climate change is reshaping national security, arguing that rising temperatures, extreme weather and resource pressures are becoming core defense and foreign policy concerns rather than purely environmental ones. The piece highlights how governments are being forced to plan for climate-driven instability, migration and strategic competition alongside traditional military threats.

New orders for US durable goods were unchanged in August, according to the latest Commerce Department figures, falling short of the growth many analysts expected. The flat reading suggests businesses remained cautious on big-ticket investments amid uncertain demand and higher borrowing costs. Economists say the data adds to questions about the strength of US manufacturing heading into the final months of the year.

An economist told CBC that Alberta's economy is growing faster than the rest of Canada this year, in an interview explaining the factors behind the gap. The province's outperformance comes amid national debate over regional economic divergence, with Alberta's resource-heavy economy continuing to widen the gap with other provinces in 2024.