And finally, here’s our economics editor Larry Elliott on Jerome Powell’s speech:

Share prices hit fresh records on Wall Street after the head of the US central bank, Jerome Powell, expressed concern about rocketing Covid-19 infections and gave no new clues on when the Federal Reserve would start to ease back on its stimulus programme.

Speaking at the virtual gathering of central bankers at Jackson Hole, the Fed chairman said that while the economy was recovering from the pandemic he and his fellow policymakers were carefully monitoring the impact of the Delta variant of the coronavirus.

Powell’s remarks were far less hawkish than some Wall Street analysts had expected and had an instant impact on the financial markets. The S&P 500 and the technology-dominated Nasdaq share price indices both reached new peaks in the immediate aftermath of the Fed’s chairman’s speech, while there were falls in both the dollar and yields on US Treasury bills.

Wall Street had been braced for Powell to flesh out plans to start tapering away the support the Fed has been providing to the US economy through its asset-buying programme. Instead, he warned that an over-hasty tightening of policy could be “particularly harmful” to jobs.

In July the bank’s main policy setting body, the federal open market committee (FOMC), had said that on current trends there would be a case for starting the taper by the year’s end.

But amid some signs that the pace of US growth might be slowing, Powell said:

“At the FOMC’s recent July meeting, I was of the view, as were most participants, that if the economy evolved broadly as anticipated, it could be appropriate to start reducing the pace of asset purchases this year.

“The intervening month has brought more progress in the form of a strong employment report for July, but also the further spread of the Delta variant. We will be carefully assessing incoming data and the evolving risks.”

Powell said that while it was a concern US inflation was running at double its 2% target, a number of factors meant the current high readings were likely to be temporary.

More here.

That’s all for this week. Have a lovely weekend. GW

While Jerome Powell was busy not announcing a QE tapering yet, a new survey was showing that US consumer confidence weakened this month.

The University of Michigan said its consumer sentiment index fell to 70.3 in August - the lowest since December 2011 - from July’s final reading of 81.2.

Consumers’ views of their personal financial prospects continued to worsen, as recent income gains slowed and inflation continued to rise (with the CPI index at a 13-year high).

Stocks have pushed higher in London too, where the blue-chip FTSE 100 index has just closed 23 points higher at 7148 points, a gain of 0.3% today.

Mining stocks finished on top, with the weaker dollar continuing to push up commodity prices.

Anglo American (+3%) topped the FTSE 100 risers, followed by copper producer Antofagasta (+2.4%), after Fed chair Jerome Powell resisted any temptation to set out a firm tapering timescale today.

But Just Eat slumped, down 7.5% after New York approved a permanent cap on food delivery firm commissions. Supermarket chain Sainsbury shed almost 3%, as it continued to drop back from Monday’s seven-year high as takeover fever fades.

The smaller FTSE 250 index jumped 0.45%, finishing at a new all-time high.

The clear delineation between the Fed’s inflation mandate and its employment mandate in Jerome Powell’s comments today, has reassured markets, says Michael Hewson of CMC Markets:

Additionally, the reinforcement of the message that tapering is not tightening, and merely a reflection of the improvement in the economy has helped reassure markets that the central bank is not going to be hasty in removing accommodation.

This message has helped deliver the FTSE100 to a positive week, with basic resources leading the gainers, with the likes of Anglo American, BHP and BP leading the gainers on the back of firmer commodity prices.

On the downside, Just Eat shares have dropped sharply after authorities in New York approved legislation to cap the commissions delivery apps can charge restaurants to 15%. Just Eat has only just completed the acquisition for GrubHub, which helped boost its H1 numbers when it reported ten days ago. The move by NY authorities will certainly act as a significant headwind to the company’s ambitions to curb its losses quickly, if pushed through.

Sainsbury shares have continued to give up their early week gains as it becomes apparent that no bid is imminent after the speculation on Monday that private equity group Apollo was giving the business the once over.

Wall Street has cheered Jerome Powell’s speech to the Jackson Hole symposium, with stocks hitting fresh record highs.

Both the broad S&P 500 index, and the tech-focused Nasdaq, have touched fresh records, continuing their rapid rally since the early days of the pandemic.

The dollar has weakened too against the pound, which has jumped by half a cent to $1.375.

There’s relief that Powell didn’t announce firm plans to taper the Fed’s stimulus, which is pumping $120bn of new money into the system each month.

Powell’s concerns about the Delta variant may also indicate that the Fed will tread softly when winding in its stimulus.

Simon Harvey, Senior FX Market Analyst at Monex Europe, explains:

More accommodative Fed policy looks to be on the horizon as long as Covid continues to linger over the US economic recovery, and the classic adage of “bad news is good news” rings out for markets amid this environment.”

Neil Wilson of Markets.com says Powell is determined to avoid spooking the markets though its tapering plan:

What did we learn? Powell is a dove and wants more time to assess the data on employment – as we talked about this last week, the reasons for using this speech to signal the taper have reduced since the July FOMC. Critically the ‘substantial further progress’ criterion for the labour market has not been met yet.

Powell is still fully behind the idea that inflation is transitory – but took a huge amount of the speech to explain why, which I guess is answer to critics and hawks on the committee as to the delay in getting on with the taper. And Powell is doing all he can to avoid a taper tantrum - he’s still saying that the Fed is overwhelmingly likely to taper this year but is not pre-committing to a schedule before he needs to.

Jerome Powell also warns that tightening monetary policy too early, in response to temporary inflation pressures, would be a “particularly harmful” mistake.

In a signal that he is determined to avoid a hawkish premature tightening, the Fed chair says that workers would suffer from such an error,.

He insists:

If a central bank tightens policy in response to factors that turn out to be temporary, the main policy effects are likely to arrive after the need has passed.

The ill-timed policy move unnecessarily slows hiring and other economic activity and pushes inflation lower than desired. Today, with substantial slack remaining in the labor market and the pandemic continuing, such a mistake could be particularly harmful. We know that extended periods of unemployment can mean lasting harm to workers and to the productive capacity of the economy.

America’s top central banker, Jerome Powell, has just addressed the Jackson Hole economic symposium....and declared that the Federal Reserve could begin to slow its bond-buying stimulus programme later this year.

In an eagerly awaited speech, Powell says that the Fed has achieved the ‘substantial further progress’ it was aiming for on inflation, and is making “clear progress toward maximum employment” too, given strong jobs gains in recent months.

But, Powell hasn’t given a clear pledge on exactly when the Federal Reserve might start winding back the $120bn/month programme, or how quickly it will act. He’s not lit the tapering touch paper today.

Pointing to the spread of the Delta variant, Powell says:

We have said that we would continue our asset purchases at the current pace until we see substantial further progress toward our maximum employment and price stability goals, measured since last December, when we first articulated this guidance.

My view is that the “substantial further progress” test has been met for inflation. There has also been clear progress toward maximum employment.

At the FOMC’s recent July meeting, I was of the view, as were most participants, that if the economy evolved broadly as anticipated, it could be appropriate to start reducing the pace of asset purchases this year.

The intervening month has brought more progress in the form of a strong employment report for July, but also the further spread of the Delta variant. We will be carefully assessing incoming data and the evolving risks. Even after our asset purchases end, our elevated holdings of longer-term securities will continue to support accommodative financial conditions.

Powell also expresses hope that America’s jobs market will continue to recover this autumn, despite the threat from the Delta variant of Covid-19.

With vaccinations rising, schools reopening, and enhanced unemployment benefits ending, some factors that may be holding back job seekers are likely fading. While the Delta variant presents a near-term risk, the prospects are good for continued progress toward maximum employment.

After faltering last winter, job gains have risen steadily over the course of this year and now average 832,000 over the past three months, of which almost 800,000 have been in services, the Fed chair says.

Powell started his speech by hailing those in the front line fighting the pandemic: the essential workers who kept the economy going, those who have cared for others in need.

He also points to those in medical research, business, and government who developed, produced and distributed vaccines that have allowed economies to reopen, adding:

We should also keep in our thoughts those who have lost their lives from Covid, as well as their loved ones.

Powell points out that the pandemic recession—the briefest yet deepest on record—displaced roughly 30 million workers in the space of two months.

The slump in Q2 2020 was twice as severe as the full decline during the Great Recession of 2007–09. But, the pace of the recovery has exceeded expectations too, with the economy surpassing its previous peak after only four quarters, less than half the time required following the Great Recession.

Employment gains have also come faster than expected, but are lagging the output recovery, he points out.

On inflation, Powell says that the spike in inflation is so far largely the product of a relatively narrow group of goods and services, driven by the pandemic and the reopening of the economy.

He cites energy prices, hotel rooms and airplane tickets, and used car prices (which seem to have stabilised after surging, and could soon pull inflation down).

Just in. The prices paid for Americans for goods and services continues to rise last month, according to a closely watched survey.

The PCE index rose by 4.2% year-on-year in July, up from 4.0% in June. Energy prices were one factor, jumping 23.6% year-on-year, while food prices increased 2.4 percent.

And core PCE, which strips out food and energy, rose by 3.6% per year. That’s a 30-year high, matching last month’s reading.

PCE is the Federal Reserve’s preferred measure of inflation, so this rise could increase pressure to rein in its stimulus programme.

However, officials may still feel that the factors pushing price up are mostly transient - such as ongoing supply-chain bottlenecks, shortages caused by the pandemic.

Prices rose 0.4% during the month while core PCE rose 0.3% month-on-month -- both down from the pacey 0.5% price growth seen in June.

The Bureau of Economic Analysis has also reported that US personal incomes rose by 1.1% last month, helped by rising wages and child tax credit payments under the White House’s stimulus plan.

But personal spending was more subdued, rising 0.3% in the month.

In yet another blow to China’s tech sector, Beijing’s top court said today the country’s notorious “996” overtime policy is illegal.

Under 996, employees work 9am to 9pm, six days a week -- part of an engrained culture of overwork that has been particularly prevalent at fast-growing technology companies.

China’s Supreme People’s Court and the Ministry of Human Resources and Social Security have today jointly published guidelines and examples on what constituted as overtime work, warning companies not to abuse staff.

These new “model” cases that will guide courts on how to treat workers’ rights in labour disputes.

Back in 2019 Jack Ma, founder of e-commerce giant Alibaba, was criticized for endorsing the controversial culture of 12-hour workdays, saying those who put in longer hours would get the “rewards of hard work.”

Younger workers have been pushing back against 996, with an online movement encouraging people to take breaks, relax - and embrace a less intense philosophy known as “touching fish”.

And recently, tech firms have been moving away from it - with TikTok owner ByteDance pledging to end its weekend overtime policy this month.

The FT has a good take:

The strengthening of labour rights followed years of dissent among tech workers over the so-called 996 system, which had been held up for many years as a badge of pride and a source of competitive advantage. Jack Ma, the founder of Alibaba, once told his employees that they needed to be prepared to work 12 hour days at his company, and described 996 as “a blessing”.

But an anti-996 campaign has taken hold at China’s big tech companies after complaints of gruelling conditions and deaths blamed on overwork. In response companies including ByteDance, owner of short video platform TikTok, and the internet group Tencent have recently cut back working hours.

“This clarification of regulations is very specifically targeted at tech giants and even medium-sized tech companies in China,” added Suji Yan, founder of Mask Network, a Singapore-based cryptographic and encryption start-up.

“If tech companies still practice further violations of working hours, regulators will highly likely take action against them.”

In another significant move to control its technology sector, China is seeking to tighten oversight of the algorithms they use to drive their businesses.

The Cyberspace Administration of China has issued a swathe of draft proposals to more rightly regulate how companies use algorithms.

The proposed guidelines say they must comply with laws and regulations, respect social ethics and ethics, abide by business ethics and professional ethics, and follow principles of (among others) fairness, openness and transparency.

The wide-ranging regulations would bar companies from using algorithms to hit consumers with higher prices based on their known preferences and trading habits, or influence online public opinion, or excessively manipulate search results in a way that harms competition.

Practices which violate public order, or encourage addiction or “high consumption” would also be curbed.

The proposals also say users must be given simple options to turn off algorithm recommendation services -- which are used to provide personalised adverts and shopping recommendations -- and to select, modify or deleting user tags used for algorithm recommendation services.

The proposals would also force firms to ensure that they protect children, and don’t serve them content that could encourage unsafe behaviors, violate social ethics or induce bad habits among minors... such as becoming addicted to the Internet.

And companies who use algorithms to schedule their workers (such as ride-hire companies) must ensure they protect pay, working hours and other labor rights.

Kendra Schaefer, head of tech policy research at Beijing-based consultancy Trivium China, says the proposals mean algorithms would be “tightly controlled”.

Here’s her full take:

China’s State Council, the cabinet, has issued guidelines on promoting employment in the 2021-2025 period, including targets for boosting the extent of employment and improving workers’ skillsets, according to the official Xinhua News Agency.

China will aim to solve structural issues with the workforce and effectively fend off large-scale unemployment risks, Xinhua cited the State Council as saying (via Reuters).

This looks to be another sign that Beijing’s trying to limit the slowdown in its economy, with factory profit growth having slowed this morning.

There will be a reduced choice of toys in stores this Christmas, and prices are expected to rise by 10% over 18 months because of supply chain disruption, labour shortages and higher transport costs, the chairman of the retailer The Entertainer has warned.

Gary Grant, the founder of the family-run toy store chain, which has about 170 shops in the UK, said the cost of shipping a container from China by sea had risen twelvefold from about $1,500 (£1,095) a container in early 2020 to nearer $18,000.

“You are going to see some inflationary pressure, and retailers are working hard to hold those down,” Grant said in an interview with BBC Radio 4’s Today programme.

“Not all stock we have is being shipped at the very latest container rates, so I think it will probably see 18 months for those prices to flow through to a significant change at retail, which might be a 10% increase over an 18-month period.”

This chart shows just how sharply shipping costs have risen:

European stock markets are holding steady this morning, with the FTSE 100 index gaining a modest 0.1% or 7 points to 7132.

Mining stocks and energy are among the risers in London, including Anglo American (+1.5%), gold and silver miner Polymetal (+1.3%) and Glencore (+1.1%).

Investors are waiting for Jerome Powell’s speech at 3pm UK time to the Jackson Hole (virtual) symposium, but the markets don’t appear to expect a major announcement on his plans to wind back the Federal Reserve’s stimulus programme.

Jim Reid of Deutsche Bank explains:

On the Fed’s website, the title of Powell’s speech is simply given as “The Economic Outlook”, and DB’s US economists think that the speech will largely mirror his remarks at the July FOMC press conference, and so aren’t expecting a strong signal on the Fed’s September meeting.

Instead they think that a tapering announcement will come at the following meeting in early November.

The Europe-wide Stoxx 600 index is flat, highlighting the caution (or lack of drama) in the markets.

In the UK, ministers and unions fear that Liberty Steel faces a “cliff edge”, risking thousands of jobs when the UK’s furlough scheme ends next month, unless owner Sanjeev Gupta can secure a new source of financing after months of delays.

Liberty’s main UK plants have been running intermittently for months, and it is understood that the salaries of about 70% of its workers – more than 2,000 employees – have been supported by the government’s furlough scheme in the last month. The company has relied on orders and upfront payments from major customers such as jet engine manufacturer Rolls-Royce.

It is understood that Liberty had previously warned government officials that it would face acute financial pressures by the end of August. The removal of the government wage support on 30 September would further add to Liberty’s difficulties as it becomes fully liable for salaries.

Here’s the full story:

China is continuing its crackdown on its tech sector, according to reports this morning, by proposing new rules that would ban firms with large amounts of sensitive consumer data from going public in the United States.

The Wall Street Journal reports this morning that China’s stock regulator plans to propose new rules that could thwart internet companies’ plans to list in the US.

Citing ‘people familiar with the matter’, the WSJ says these new rules would target companies seeking foreign listing via units incorporated outside the country.

Here’s more details of the WSJ piece:

China Securities Regulatory Commission officials said that companies with less sensitive data, such as those in the pharmaceutical industry, are still likely to receive Chinese regulatory approval for foreign listings, according to the people.

The new rules are likely to help Beijing exert more control over the complex corporate structure that China’s biggest tech companies use to sidestep restrictions on foreign investment. Chinese leaders consider sectors such as the internet, telecommunications and education sensitive because of political or national-security concerns.

Chinese technology giants including Alibaba Group Holding Ltd. , Didi Global Inc. and Tencent Holdings Ltd. have used such a corporate structure known as a Variable Interest Entity to attract foreign capital and list offshore.

The move is the latest in Beijing’s attempts to rein in its tech sector.

Last month, regulators launched an investigation into Chinese ride-hailing app Didi’s handling of customer data, just days after it floated on Wall Street.

Truck-hailing firm Full Truck Alliance and online recruitment platform Boss Zhipin have also been caught up in the regulatory scrutiny.

And last November, shares in major firms such as Alibaba, Tencent and JD.com all tumbled after Beijing released draft plans to “prevent and stop monopolistic behaviours” of internet platforms.

A crackdown on private tutoring is also underway, with China’s State Council barring for-profit companies from tutoring in core curriculum subjects, and foreign investment in such companies.

Good morning, and welcome to our rolling coverage of the world economy, the financial markets, the eurozone and business.

Investors around the globe are eager to hear from Federal Reserve chair Jerome Powell later today, at the Jackson Hole economic symposium -- the Kansas City Fed’s annual gathering of central bankers, which is being held virtually.

Powell may give some guidance about when the Fed will slow its bond-buying stimulus programme, in an attempt to taper without provoking a market tantrum.

He could lay out the groundwork for some sort of roadmap to be proposed at September’s Fed meeting, as policymakers look to tap the brakes on the $120bn/month bond-buying programme without spooking traders.

But, his speech is likely to focus on the economic challenges facing the US, with cases of the Delta variant rising, and signs that the world’s recovery from the pandemic shock may be peaking.

Paul Ashworth of Capital Economics says:

With the Delta-linked resurgence in coronavirus infections adding to the downside risks to economic growth and officials still split on exactly what qualifies as “substantial further progress” toward meeting the full employment goal, we don’t expect Chair Jerome Powell to provide any definitive guidance in his Jackson Hole speech tomorrow on when the tapering of the Fed’s asset purchases will begin.

More generally, there is still uncertainty surrounding the pace and composition of the run-down in asset purchases and whether the Fed will commit to a pre-announced deterministic path or prefer to make adjustments on a meeting-by-meeting basis.

European stock markets look becalmed ahead of Powell’s speech. We also get a new key measure of US inflation (the PCE index), which will show if price pressures have faded, or are still intense.

We’ll also be tracking the latest in the UK supply chain crisis gripping the economy. Our latest Covid Crisis Watch report shows that firms are under pressure from global supply chain disruption and staff shortages - meaning the recovery could falter.

The agenda

• 7.45am BST: French consumer confidence for August
• 9am BST: Italian business and consumer confidence for August
• 1.30pm BST: US PCE inflation report for July
• 3pm BST: Fed chair Jerome Powell speaks at Jackson Hole symposium