Oil for excitement. Economics for calm and tranquility
- Fundamental economics have not been very exciting, so markets have turned to the excitement of the oil price to justify their existence. It is worth observing that the gap between crude oil prices and US retail oil prices has trended ever wider.
- The Fed's Beige Book of anecdotal evidence was all about "moderate" economic activity with subdued wages. However, importantly, there were further reports of upward pressures on skilled wages – the US labour market is not homogenous.
- US import prices are due (moderately interesting as to cost pressures for companies, but it is export price issues that are doing the damage to data accuracy). Europe has some smaller economies' consumer price inflation.
- The Bank of England has its meeting today with no change expected, but the question is whether they chose to lean against some of the market dovishness. The issue of the UK referendum on the EU complicates policy.