So far this month the flow of good economic news has continued, headed by Q3 GDP ahead of or on target in the US, China and Germany. Emerging from the shadows is Italy with GDP approaching an annual rate of 2% for the first time in six years and a 15th successive positive quarter. Understandably, Italian confidence surveys are perking up despite or because of the revival of Sivio Berlusconi’s political fortunes at the expense of the ruling PD and populist Cinque Stelle (failure to qualify in the World Cup may change all that!). Japan clocked up a seventh successive quarter of GDP growth but the confidence surveys there are still muted if not downright gloomy. Retail Sales were again buoyant in the US in October but this probably reflects replacement of vehicles and household goods damaged in the floods and storms. Following the 19th Communist Party National Congress ,the latest data from China showed almost miraculous consistency with the thoughts of Chairman Xi: new loans down, FX reserves steady and Trade and Industrial Production modestly slowing. The Euro Area as a whole is contuinuing its recovery with annual GDP running well over 2% boosted by both Consumption and Business Investment. Canada enjoyed continuing strong GDP growth (3.7% annually) while South Korea’s economy bounced back in Q3, despite all the noise from Messrs Kim and Trump. The one thing that is not happening is inflation’s taking off. The Central Banks may want more of it even if consumers would prefer otherwise but it is unlikely to be driven by commodities (including energy which has a 29% weighting in the Bloomberg Commodity Index). Any significant upward pressure will have to come from wages and exchange rates, which will vary between countries but represents yet another challenge for our own ‘sceptred isle’.