September 02, 2007	Sunday	Sha’aban 19, 1428

WASHINGTON, Sept 1: Economic data showed inflation under control in July while U.S. factories were busier than forecast, portraying a resilient economy in little need of an interest rate cut.

But other reports showed US consumer sentiment worsened in August from July, while the outlook for economic growth weakened.

However, markets and analysts mostly shrugged off the data, focusing instead on a speech by Fed chief Ben Bernanke and word that President George W. Bush would announce plans to help homeowners at risk of losing their homes due to the sub-prime mortgage crisis.

The efforts Bush will outline “are designed to address some of the current problems we are seeing in the housing market and also include reforms to prevent these sorts of problems from arising again in the future,” White House Spokesman Tony Snow said.

Core US consumer prices edged up less than expected in July while income and spending rose smartly and factory orders far exceeded forecasts, according to government reports.

A core inflation index from the Commerce Department rose 0.1 per cent in July, holding the year-on-year increase in the Federal Reserve’s favourite inflation gauge to 1.9 per cent for the second straight month.

Analysts polled by Reuters were expecting the core PCE price index, which excludes often-volatile food and fuel costs, to gain 0.2 per cent after a June rise of 0.2 per cent that was originally reported at 0.1 per

cent.—Reuters