Factory demand weakens across major economies in October

October’s GEP Global Supply Chain Volatility Index — an indicator tracking demand conditions, shortages, transportation costs, inventories and backlogs based on a monthly survey of 27,000 businesses — posted -0.39, which was little change from -0.43 in September. Therefore, the index remained in territory that indicated one of the highest levels of spare capacity at global suppliers in over a year during October, with no imminent turnaround in Western manufacturing in sight.

Suppliers feeding the world’s largest markets reported contractions in October. Most notable was another steep rise in slack across North American supply chains due to declining factory activity in the US. In fact, purchasing managers at US manufacturers made their strongest cutbacks to buying volumes in nearly a year and a half, indicating that factories in the world’s largest economy are preparing for lower production volumes.

Suppliers feeding Asia also reported spare capacity in October, albeit to a lesser degree than we’re seeing in Western markets. This is due to the sustained strong expansion of certain manufacturing industries, such as India’s. Notably, in October, China’s factory production growth rebounded, and procurement activity rose after three months of contraction, although Japanese and South Korean producers made fewer purchases - an adverse leading indicator for manufacturing in these economies.

Europe’s industrial plight remained a key feature of the data in October. Vendor capacity was significantly underutilised, reflecting a continuation of subdued demand in key manufacturing hubs across the continent. Germany’s retrenching automotive manufacturing sector is a major headwind to factory output in Europe.

Additionally, October is the fourteenth consecutive month that the items in short supply indicator have been negative. This shows an excess supply of commodities and intermediate goods relative to current manufacturing demand globally.

“We’re in a buyers’ market,” said Todd Bremer, vice president, GEP. “October is the fourth straight month that suppliers worldwide reported spare capacity, with notable contractions in factory demand across North America and Europe, underscoring the challenging outlook for Western manufacturers. President-elect Trump inherits US manufacturers with plenty of spare capacity while in contrast, China’s modest rebound and strong expansion in India demonstrate greater resilience in Asia.”

 

Swedish economy experiencing a delayed recovery

Restrictive monetary policy has held back growth in Sweden, but the economy will pick up speed next year and gain strength in 2026, according to Swedbank’s latest Economic Outlook. The US election outcome has led to increased global economic uncertainty and is expected to have a negative impact.

Global economic development is highly divergent; the US economy continues to grow, while China and Europe are still experiencing headwinds. The US election outcome has generated greater uncertainty, and the growth outlook has weakened as a result of higher tariffs. In Sweden, economic development is weak, and the labour market continues to deteriorate.

“In Sweden, consumption remains weak, and so far there is no turnaround in sight,” commented Mattias Persson, Group Chief Economist, Swedbank. “However, we believe that households will start consuming more next year as incomes continue to rise faster than prices, while interest rates continue to fall. At the same time, savings rates will remain on a high level.” 

The labour market has weakened during the past two years, and unemployment has risen. “We estimate that Swedish unemployment will peak at 8.7% and that the labour market will begin a cautious turnaround during the first half of 2025, with lower unemployment,” Persson added. “A more substantial improvement on the labour market is dependent on additional rate cuts from the Riksbank.” 

In Sweden, inflation is just under the target and will remain near the target in the coming years. Monetary policy remains restrictive in Sweden, and Swedbank expects the Riksbank to make an additional policy rate cut at its December meeting, by 25 basis points. In 2025, the cuts are expected to continue until the rate reaches 1.75%.

Meanwhile, Sweden’s housing market will benefit as interest rates fall and household purchasing power gains strength. “Even if mortgage rates fall during the coming period, we expect them to remain on a higher level than they were before rates started to increase in 2022,” Persson noted. “At the same time, the easing of macroprudential measures will give the housing market some support for 2026. We expect housing prices to rise by about 5% in 2025 and 6-7% in 2026.”

Swedish economic performance will be weak in 2024, and the economy will grow by a modest 0.6%, according to Swedbank’s new forecast. Weak global economic development and greater barriers to trade as a result of the US election outcome are additional reasons for the weakened outlook. Swedbank expects Swedish GDP to rise by about 2% in 2025 and by just under 3% in 2026. 

“The Swedish economy will begin its recovery in 2025, driven mainly by domestic factors despite continued weakness in the surrounding environment,” concluded Persson. “The US election outcome has led to greater uncertainty, and we have revised our Swedish growth outlook down somewhat for 2026.”

 

RBA and DFCRC explore role of digital money in wholesale tokenised asset markets

The Reserve Bank of Australia (RBA) and the Digital Finance Cooperative Research Centre (DFCRC) have published a consultation paper which seeks industry feedback on a new research initiative, Project Acacia. This project will explore how different forms of digital money and associated infrastructure could support the development of wholesale tokenised asset markets in Australia. It was flagged in the roadmap set out in the recent joint RBA-Treasury paper and related speech on central bank digital currency (CBDC) and the future of digital money in Australia.

The consultation paper seeks expressions of interest from the industry in participating in an experimental research phase for Project Acacia and in joining an Industry Advisory Group for the project. Input is also sought on the technical and functional capabilities of new forms of settlement infrastructure and digital money, including wholesale CBDC and tokenised bank deposits, that could promote well-functioning tokenised asset markets and stability in the financial system. Responses to the consultation paper are requested by Wednesday, 11 December 2024.

“Shaping the future of money in Australia is a strategic priority of the RBA and the Payments System Board,” explained Brad Jones, Assistant Governor (Financial System) at the RBA. “The RBA, alongside the DFCRC, are seeking to engage with industry partners on Project Acacia to examine how innovation in wholesale markets could be enabled by new forms of digital money and supporting infrastructure. The role that tokenised asset markets could play in improving the efficiency and resilience of wholesale payments and settlements, and in enhancing cross-border payments, are areas of particular interest. Our overarching aim here is to help address the larger question of how innovation in our financial system can best support the Australian economy in the digital age.”

 

RTP network data suggests America loves instant payments

The RTP US instant payments network operated by The Clearing House now averages over 1 million payments per day. The RTP network also set single day records of 1.46 million transactions valued at $1.24bn on Friday, 1 November. 

In October, the RTP network experienced a record 31.7 million transactions valued at $25.4bn, up 6.2% and 9%, respectively, from September, as financial institution customers continued to enjoy the ease and speed provided by instant payments on the network. Payment value on the RTP network is up 11.4% and transaction volume is up 12% from July 2024.

Payments activity on the RTP network shows that businesses and consumers are utilising and benefiting from the system’s 24/7 capability, with a notable 42% of transactions happening overnight, on weekends, or on holidays. The utilisation of the RTP network outside of normal banking hours (Monday through Friday, 8am-6pm ET) shows that it is providing real-world payments solutions that give users the flexibility to move money or pay bills when they want, and to meet the needs of the modern, 24/7 economy.

“It is exciting to see that the RTP network is supporting real world payment needs of both consumers and businesses with almost half of payments happening after banking hours,” said Margaret Weichert, Chief Product Officer at The Clearing House. “With the holiday season upon us, consumers can send money instantly to pay for gifts, holiday meals and other festivities, while small businesses can get paid in real time.”

 

Mastercard launches platform to support small business operations 

Mastercard has announced Biz360, a digital solution designed for providers to equip their small business customers with a simplified way to manage the most critical aspects of running and growing a business. Business owners can access new features on the platform built to streamline their daily operations while also integrating their existing digital tools.

A Mastercard study revealed 75% of small businesses leverage digital tools in their daily operations, and two-thirds listed a seamless, digital experience as critical to their business. But the experience is far from frictionless with 25% of small business owners burdened by using more than six different platforms daily, draining two of their most valuable resources – time and money. 

Mastercard says that, instead of relying on siloed technologies, its new solution means small businesses can consolidate their existing operational tools, subscriptions, and payment gateways into a single destination, in addition to accessing value-added services that optimise productivity. By automating administrative tasks and integrating business management tools into one platform, entrepreneurs can focus on strategic, revenue-generating activities that drive growth. 

The platform offers a client portal where small business owners can manage and cultivate customer relationships, promote loyalty through personalised email and marketing campaigns, and enhance their digital presence with website creation capabilities. Biz360 also provides personalised business performance reports, allowing business owners to unlock valuable insights that help guide more informed decision-making. 

 

Webull Australia leverages J.P. Morgan Asset Management for cash management tool

Webull Australia, a subsidiary of Webull Corporation, has launched a cash management service for its self-directed retail investors in Australia, leveraging J.P. Morgan Liquidity Solutions as the underlying manager. Webull Cash Management aims to offer competitive USD and AUD returns, targeting yields of around 4.9% in USD and 4% in AUD.

The service utilises direct API integration with J.P. Morgan Asset Management, offering real-time settlement and competitive variable returns on uninvested cash via investments into J.P. Morgan Liquidity solutions.

Cash Management offers an ‘auto sweep’ function, allowing clients to redeem uninvested cash held within the service to settle ASX or US market trades when actively investing, while automatically channelling client's uninvested monies back into Cash Management.

 

Treasury management platform Agicap scores €45m Series C funding round

Agicap, a treasury management platform, has announced a €45m Series C funding round led by AVP. The round is designed to enable Agicap to consolidate its position in Europe further as it scales up in the midmarket treasury management space.

Since its inception, Agicap has been a treasury management platform for SMB and mid-market companies. The platform provides the C-suite and finance teams with flexible and real-time visibility into current, historical and projected cash flow data, alongside an end-to-end suite of treasury management tools.

Cash management and forecasting have become top priorities for CFOs navigating increasingly uncertain macroeconomic conditions. Yet, Agicap’s recent survey (in partnership with Innofact) of 500 European CFOs revealed that 80% of mid-market firms still rely on Excel-based processes to manage and forecast their cash positions – a manual, time-consuming task with only 41% conducting long-term cash forecasts.

“In today’s economic conditions, the importance of cash management is paramount,” said Clément Mauguet, Co-founder & Chief Expansion Officer, Agicap. “Mid-market organisations have reached a level of complexity that makes it challenging for them to properly manage and optimise their cash strategy, given the need to track countless incoming and outgoing cash flows across multiple entities with numerous bank accounts and currencies.”