The pace of annual inflation in the U.S. accelerated last month, while jobless claims unexpectedly declined, as the Federal Reserve mulls over potentially keeping interest rates on hold at its next policy meeting in September.

Euro zone inflation proved unexpectedly stubborn this month although price pressures for underlying goods eased, providing ammunition for both supporters and opponents of another European Central Bank interest rate hike.

U.S. consumer spending increased by the most in six months in July as Americans bought more goods and services, but slowing monthly inflation rates cemented expectations that the Federal Reserve would keep interest rates unchanged next month.

 Japan's factory activity shrank for a third straight month in August, a survey showed on Friday, as manufacturers were squeezed by cost pressures from raw material inflation and rising wages.

China's manufacturing activity contracted for a fifth straight month in August, an official survey showed on Thursday, maintaining pressure on officials to provide support to shore up economic growth amid soft demand both at home and abroad.

European Central Bank policymakers kept a September rate hike on the table when they raised interest rates in July, although some of them argued that another move would be deemed unnecessary when new economic projections were released, the accounts of the meeting showed on Thursday.