United States (U.S.): The U.S. economy remained resilient in August 2026, supported by strong services activity, robust retail sales, firm employment conditions, and continued manufacturing expansion, although inflationary pressures persisted amid higher energy and input costs. Against this backdrop, the Federal Reserve raised the policy rate by 25 bps to 3.75–4.00% in September, reflecting a more challenging inflation-growth trade-off and reinforcing expectations of relatively restrictive monetary conditions.
Euro Area: Economic activity in the Euro Area showed gradual improvement in August, with manufacturing strengthening, services remaining in expansion, and external trade providing support, although household consumption and industrial production remained relatively subdued. Renewed energy-price pressures pushed inflation to 3.2%, prompting the ECB to raise policy rates further in September and highlighting the tension between supporting a fragile recovery and containing persistent inflation.
China: China’s August economy remained highly reliant on external demand and technology-intensive manufacturing, with industrial production accelerating and exports surging, while weak consumption, property-market conditions, employment, and subdued credit demand continued to constrain domestic momentum. With inflation remaining low and monetary transmission relatively weak, the PBoC maintained an accommodative but cautious policy stance, leaving exports and high-tech investment as important buffers for growth.
Indonesia: Indonesia’s domestic economy remained relatively supported in August by accelerating bank credit, improving consumer confidence, recovering retail sales, and continued fiscal support, although manufacturing activity slipped back into contraction. Meanwhile, rising inflation and renewed rupiah pressures amid tighter global financial conditions led Bank Indonesia to maintain the BI-Rate at 5.75% in September while placing greater emphasis on exchange-rate stabilization, liquidity management, and macroprudential support.
