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Confidence, CPI and China clues

| Posted by: Paul Donovan | Tags: Paul Donovan

  • The Bank of Japan minutes did not signal any particular urgency to ease policy further, with generally sanguine comments. However the possibility of negative third quarter GDP growth may create a desire to be seen to be doing something on policy.
  • There is a spate of Bank of England talk today, as well as inflation data. The inflation will be subject to oil and supermarket competition base effects, and thus sty subdued – but the Bank has a wider range of issues motivating it to consider tightening.
  • German ZEW business confidence data continues to run into the problems of overreaction that is a feature of confidence surveys. However, auto sector problems and Chinese concerns may weigh on the figures – at least, that is where investor attention is likely to focus.
  • Chinese trade data showed weaker imports (presumably headwinds from the housing sector) but a moderation in the decline in exports. That however may reflect payback from exaggerated weakness in earlier data, rather than a shift in the trend.