Daily update
Daily update
- Today we get information on the US consumer—but unfortunately it is a mix of old data and misdirection. September personal income and spending numbers (and the consumer expenditure deflator) should show the US consumer spending even as inflation pressures have built. Since April, consumer durable goods prices have added to inflation (having previously reduced it), for instance. However consumers have cut their savings rate to cover the price increases, keeping consumption stable.
- The December Michigan Consumer Sentiment data is much more up to date. But distorted data is still distorted data. Political polarization remains extreme and makes the numbers untrustworthy. Ignoring the views of registered Republicans and registered Democrats does not necessarily help—an independent consumer watching Fox News is likely to report very different sentiment from an independent consumer watching CNN.
- Euro area third quarter GDP will not receive any attention from markets. The data is, however, a reminder that the Euro area economy continues to operate at around trend growth (although with two major economies experiencing falling populations, trend growth is naturally restrained).
- French and Spanish October industrial production data are due. The Spanish numbers perhaps deserve more attention than they receive (the consensus forecast has only five contributors). France’s political machinations notwithstanding, French production has been rising.