World economy can't find momentum

<p>Kia ora,</p><p>Welcome to Tuesday’s Economy Watch where we follow the economic events and trends that affect Aotearoa/New Zealand.</p><p>I'm David Chaston and this is the international edition from Interest.co.nz.</p><p>And today we lead with the Americans face yet another government shutdown threat from disorganised partisans in Congress.</p><p>But first today, the respected NY Fed <a href="https://www.newyorkfed.org/newsevents/news/research/2023/20231113" target="_blank"><strong>American inflation expectations survey</strong></a> was actually little changed. Consumers said in October that inflation for the year ahead will be to 3.6%, down from 3.7% in September. Inflation expectations remained high but unchanged for rent (at 9.1%) and food (at 5.6%). They were much lower for many other items. Essentially, inflation expectations declined slightly at the short- and longer-term horizons while remaining unchanged at the medium-term horizon. For three years they see +3.0% inflation. Labour market expectations and household expectations of future income and spending growth were largely stable.</p><p>And small businesses were much less pessimistic in October. The RealClearMarkets/TIPP Economic Optimism Index rose to 44.5 in November 2023, the highest in seven months.</p><p>That may get challenged again soon as chaos in the US Congress (specifically by the Republicans in the House of Representatives) yet again are threatening a shutdown because they can't agree a way forward in their factions. The key date now is Saturday, November 18 (NZT). Meanwhile all eyes on on the US October CPI data due out tomorrow. Expect a 3.3% rate.</p><p>Across the Pacific, <a href="https://www.boj.or.jp/statistics/pi/cgpi_release/cgpi2310.pdf" target="_blank"><strong>Japanese producer prices rose by just +0.8% in October</strong></a> from a year ago, slowing from an upwardly revised +2.2% annual gain in the prior month and coming slightly less than market forecasts of +0.9%. This was the lowest producer inflation since a deflation in Fe