The ongoing worries over global economic growth and the outbreak of Ebola were the key triggers to last week’s selloff, as October is shaping up to be a scary month for investors. German industrial production fell more than economists forecast.

Meanwhile, in this scenario, the Bank of England kept its key interest rate at a record low, at least for now.

On a positive note, the International Monetary Fund (IMF) revised upwards the largest economy growth forecast to 2.2 per cent, but at the same time revised downwards global growth fore­cast, including that of the eurozone.

The IMF cut its outlook for global growth in 2015 as it warned about the risks of rising geopolitical tensions and a financial market correction as stocks reach higher levels. The world economy will grow 3.8 per cent next year, compared with a July forecast for four per cent, after 3.3 per cent expansion this year. US growth is helping lead a worldwide acceleration that is weaker than the fund predicted two and a half months ago as the outlooks for the euro area, Brazil, Russia and Japan deteriorate.

In the meantime, German industrial production fell more than economists forecast in August as factory orders plunged the most since 2009, underlining the risk of a slowdown in Europe’s largest economy.

Production, adjusted for seasonal swings, dropped four per cent from July, when it expanded 1.6 per cent. This is the biggest decline since January 2009 and compares with a median estimate of 1.5 per cent.

Meanwhile, orders, adjusted for seasonal swings and inflation, fell 5.7 per cent in August. Economists had predicted a 2.5 per cent decline.

This drop followed a 4.9 per cent increase in July that was the most in more than a year.

Orders fell 1.3 per cent from a year earlier.

This article was compiled by Bank of Valletta for general information purposes only.

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