Eurozone emerges from deflation; Japan hints at more stimulus - as it happened
Prices across the single currency region were flat in October, while the Bank of Japan cuts its forecasts again
1.47pm GMT
Time for a quick recap.
Economists are expecting the European Central Bank to press on with fresh stimulus measures, even though the eurozone has escaped deflation for the second time this year.
#Portugal: President evokes 40yrs "constitutional habitude": "only the party that win elections must form govt". pic.twitter.com/WlUIN4bB8F
#Portugal: President reminds need to preserve commitment w/EU and Euro, asks govt to respect budget discipline. pic.twitter.com/MMs53uOWQz
12.54pm GMT
The latest US economic data just hit the wires, and paints a mixed picture of the world's largest economy.
American household spending rose by just 0.1% in September, down from 0.4% in August, and only half as fast as economists expected.
12.35pm GMT
The global slowdown has rippled across to Canada.
#Canada #GDP 0.1%m/m from 0.3%. oh well.
12.25pm GMT
Over in Lisbon, Portugal's new government is being sworn in after a general election that produced no clear winner.
It means Pedro Passos Coehlo remains as prime minister, but leading a minority government.
#Portugal new government being sworn-in now in Lisbon. pic.twitter.com/NTqFLbD8bN
#Portugal: Minority govt swears-in 11 days before decisive confidence vote at parliament. President address soon. pic.twitter.com/DJlRZgmD8r
Related: Sorry, British Eurosceptics, but there was no coup in Portugal | Felipe Henriques
11.44am GMT
Merkel has used her China trip to call for more protection for Europe's steel industry, which has been ravaged by falling prices and overcapacity.
Over to Reuters' Andreas Rinke:
At a German-Sino business congress in Hefei, Merkel calledfor better protection of the steel and solar industries against unfair international competition, a complaint some manufacturers make against China.
Merkel said the steel sector needed "a certain amount of market protection" as steelmakers have pointed out that environmental regulations differ from country to country,impacting cost advantages.
11.35am GMT
Angela Merkel also had an opportunity to pass on some football tips to the next generation today, during a trip to a primary school in Xin Nan Cun.
11.32am GMT
Angela Merkel has also predicted that China's economy will avoid a crash, during her trip to Hefei today.
She told journalists:
"I think one can expect that China's growth will be a bit weaker, but that it will have constant growth.
"It is obvious that particularly the domestic demand through growing cities is an important factor to stimulate consumption and here with growth."
11.23am GMT
Angela Merkel has been hard at work building closer trade links with China.
The chancellor has put worries over Germany's economy, and Europe's escalating refugee crisis behind her. And the latest photos from the trip suggest it's going well.
11.02am GMT
Mario Draghi will be pleased to see the eurozone clamber out of deflation this month, but it only takes a little pressure off his central bank.
The ECB's most likely next move is to announce an extension in December of the duration of its quantitative easing program to last through March 2017. But hawks on the Governing Council may point to an exit from deflation as a reason for the ECB to continue with asset purchases in 2016, but without as clear a pre-commitment as they made in 2015.
This would provide the ECB with discretion to begin a taper of its easing program earlier than expected if inflation surprises to the upside due to pass-through of higher import prices or higher food prices (unprocessed food prices rose 3.0% from a year earlier in October).
When do we start talking about tapering the 2nd lot of QE the ECB hasn't yet announced?
10.38am GMT
Unemployment in the wider European Union has hit a six-year low of 9.3%, even better than the 3.5 year low of 10.8% in the eurozone:
But that still leaves 22.631 million men and women out of work in the 28 countries which make up the EU.
The EU28 unemployment rate was 9.3% in September 2015, down from 9.4% in August 2015, and from 10.1% in September 2014. This is the lowest rate recorded in the EU28 since September 2009.
At just 5.3%, the UK unemployment rate is about half the eurozone average (10.8%) pic.twitter.com/kHZqnHO8S4
10.28am GMT
It's almost a year since oil prices began to tumble on the world markets, giving the global economy a deflationary squeeze.
The impact of cheap oil should soon start to drop out of the annual inflation rates, though (as prices will no longer be cheaper than a year ago). And that could send consumer prices indices up again....
Can't help feeling there will be a bit of a pop in aarea inflation once this washes through https://t.co/311GaHfmXo pic.twitter.com/HYTJueilma
10.14am GMT
This is the second time this year that the eurozone has shaken off a bout of negative inflation:
#Eurozone out of #deflation: CPI bounced back to 0.0% YoY in Oct. Core CPI a touch better at 1.0% YoY vs 0.9% cons. pic.twitter.com/nIjIEqan5b
10.12am GMT
Europe's unemployment crisis has eased a little, in another little boost to the region.
Eurostat reports that the overall jobless rate dropped to 10.8% in September, down from 10.9% in August.
Sept 2015 euro area unemployment rate 10.8% (Aug 10.9%), EU 9.3% (Aug 9.4%) #Eurostat https://t.co/JN3JQcdm6f pic.twitter.com/HJPqhbbVle
10.09am GMT
Although the eurozone's inflation rate was zero in October, that masks wide differences across the economy.
Today's eurozone inflation data shows that food prices rose by 1.5% year-on-year in October, while service sector costs were up by 1.3%.
10.03am GMT
The eurozone has emerged from deflation!
Prices across the single currency region were flat in October, having shrunk by 0.1% the previous month.
Euro area inflation up to 0.0% in Oct 2015 (Sept -0.1%): flash estimate from #Eurostat https://t.co/pzXfjPwYOg pic.twitter.com/UPMIIcQFB7
Euro Zone CPI Data (Oct A) CPI Y/Y 0.0% versus 0.0% expected, previous -0.1% Core CPI Y/Y +1.0% versus +0.9% expected, previous +0.9%
9.38am GMT
European stock markets are subdued this morning, as investors wait for the latest eurozone inflation and unemployment data in 25 minutes.
The FTSE 100 has lost 5 points, or just under 0.1%, while the French and German markets are up just 0.15%.
October has been a merry month for markets. Here are the highlights https://t.co/Z93Ib69vr7 pic.twitter.com/dZGj39pXtK
9.26am GMT
Looking back at Japan...some economists believe the BoJ may beef up its stimulus package in November, when it meets again.
By then, they should have new growth figures showing whether Japan's economy shrank in the last quarter, or not.
"They could move after the next meeting - expectations for more easing aren't going away."
Bbg's Brian Fowler in Tokyo says BoJ is waiting for December Fed move to make its next move. Fed action would be Japan-positive: strong $USD
9.10am GMT
Italy's unemployment rate has dipped to its lowest point since January 2013 but still remains worryingly high.
New data shows that the Italian jobless rate fell to 11.8% in September, from 11.9% in August, suggesting prime minister Matteo Renzi's reform plan may finally be bearing some fruit.
*ITALIAN SEPT. UNEMPLOYMENT RATE FALLS TO 11.8%; EST. 11.9%
8.47am GMT
Spain's recovery has been partly due to a strong tourist season, which helped it overcome the housing crash.
Record spending by foreign tourists has helped speed Spain's recovery from a double dip recovery that began after its real estate bubble popped in 2008.
Tourists injected a53.8bn into the economy over the first nine months of 2015, 6.3 per cent more than in the same period in 2014.
8.34am GMT
Capital Economics fears that today's GDP report shows Spain's 'impressive' recovery is faltering a little:
Morning. Spain Q3 GDP +0.8% q/q after Q2's +1.0%. Suggests impressive recovery may be losing some steam, in line with survey indicators
#Spain's #GDP up 0.8% q/q in Q3, almost back at pre-crisis level. But many gaps have not been closed pic.twitter.com/UHnZRizeww
8.26am GMT
Spain's economic recovery continues, although at a slightly lower speed.
The Spanish statistics body reports that GDP rose by 0.8% in the last three months, compared to 1% in the second quarter of this year.
8.13am GMT
Governor Kuroda is also trying to dampen fears over China's economy, and its impact on Japan.
He says he agrees with the IMF that the slowdown in China could last longer than expected, which would be bad for Japanese trade:
Many Japanese companies operate in East Asia so their profits may also be affected.
Our main scenario is for the global economy to recover moderately, driven by the strength in advanced economies."
8.05am GMT
Here's some instant reaction to BoJ governor Haruhiko Kuroda's comments:
Kuroda leaving the easing door open, obviously.
The Bank of Japan lowers projections of growth, inflation https://t.co/yeiHwXl64d pic.twitter.com/uUav5IjbNW
BoJ's Kuroda pushes 2% inflation target to H2 16. Sees lower oil prices as main reason. Says overall inflation trend is improving in #Japan.
BoJ's Kuroda: Don't think confidence in BoJ is falling apart. BoJ's bal sheet expansion smaller than Fed's or PBoC's pic.twitter.com/fiA9RUPi5X
7.49am GMT
The Bank of Japan has fuelled speculation that it could soon announce fresh stimulus measures, after cutting the Bank's inflation and growth forecasts.
"We won't hesitate to make necessary policy adjustments if we judge that there is a change in the broad price trend."
"I'm not thinking of raising or lowering the current 2% inflation target."
"I don't think there are limits to our policy options."
*KURODA: DON'T SEE THERE ARE LIMITS TO ANY FURTHER ACTION
Related: Bank of Japan keeps QE programme on hold as it hopes for economic recovery
7.26am GMT
Good morning, and welcome to our rolling coverage of the world economy, the financial markets, the eurozone and business.
It looks like another busy day for economic news, as policymakers, analysts and the public all ponder the state of the global economy as the year grinds towards its close (just 55 sleeps till Christmas, folks!)
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