Federal Reserve officials pivoted toward a December rate hike in a statement released in Washington yesterday, which referred to the bank's "next meeting" as it discussed the timing of lift-off. Market-based expectations for a rate rise in 2015 now stand at 46 percent this morning, up from 34 percent before the release. Emerging market stocks and currencies have sold off as the dollar strengthened in the aftermath of the statement. (Bloomberg)
Just out this morning: US economic expansion slowed sharply last quarter, though the resilience of consumer spending suggests the dip may prove fleeting. The economy grew at a 1.5 per cent annualized pace in the three months to September, down from 3.9 per cent in the second quarter. Expansion was depressed as companies expanded stockpiles at a slower pace, and a stronger dollar took the shine off exports. Despite those headwinds, consumer spending proved resilient. Household spending grew 3.2 per cent in the quarter, which was just shy of the 3.3 per cent forecast. The economy's weaker showing will have been expected by the Fed, and is unlikely to prompt alarm. (FT)
Royal Dutch Shell swung to a third-quarter loss after taking a $7.9B write-down on big ticket projects including an exploration venture in the Alaskan Arctic and a major oil sands endeavor in Canada. The company, however, is still moving ahead with its $70B acquisition of BG Group. (SA)
Ready for another mega healthcare deal? Pfizer is in early-stage takeover talks with Allergan (for those unfamiliar, the maker of Botox). Allergan shares have surged 17% higher in pre-market trading in New York on news of the potential deal.