In Brief: US spending rises
US household spending rose in August as incomes were buoyed by solid wage gains – signs that momentum could be growing in the US economy despite months of harsh government austerity.
American families spent 0.3pc more last month than the month before, as higher wages drove incomes up 0.4pc – the biggest gain since February, and a positive sign for growth in the second half of the year. The readings might bolster the case for the US Federal Reserve to wind down a bond-buying stimulus programme, although policymakers have expressed concern that political gridlock could trigger a debt default that would deliver a serious blow to the economy.
CLONTARF'S GHANA HOPE
DUBLIN-based explorer Clontarf Energy said it would focus on Ghana in future. The AIM-listed company has farmed out operations in Peru and is actively negotiating the disposal of US-based unit Petrolex and all related assets and liabilities to a Latin American group in return for a revenue royalty.
Clontarf has held the interest in Ghana for four years. Ghana has since become an oil province producing circa 100,000 barrels a day.
NO TAX HIKES FOR SPAIN
SPANISH Budget Minister Cristobal Montoro ruled out further tax increases for next year, banking on a return to growth to trim the European Union's widest deficit.
The government forecasts the economy will grow 0.7pc, trimming the unemployment rate to 25.9pc. Economic growth will bolster revenue, and the government plans an overhaul of tax rules next year after a review, Ms Montoro said, after the cabinet approved the 2014 budget. Prime Minister Mariano Rajoy is betting that the end of a six-year slump will help Spain comply with EU deficit rules after posting the bloc's largest shortfall last year.
FED SHUTDOWN THREAT
A SHUTDOWN of the US government would reduce fourth-quarter economic growth by as much as 1.4 percentage points, depending on its length, economists say, as government workers from park rangers to telephone receptionists are put on temporary unpaid leave.
Bernard Baumohl, chief global economist at Economic Outlook Group, said: "What everyone is watching right now is if the uncertainty is affecting consumer and business psychology, that they are postponing spending until they get more clarity about what's going to happen in Washington."