Chicken Little and President Draghi
- Eurozone consumer price inflation is due. Since the start of 2003, the headline measure has averaged 1.65%; today, it is expected to be 1.3%. Since the start of 2003, the core measure has averaged 1.34%; today, it is expected to be 1.1%. There is no evidence here that the inflation sky is falling.
- German retail sales accelerated in the latest data. Although the German consumer does not have a reputation for hedonistic shopping, the strength of domestic demand in Europe and in the US is helping support global economic activity. Japanese industrial production was good, reflecting this trend.
- China produced an official opinion poll on business sentiment. The US will produce less official polls with the Chicago PMI and the Dallas Fed surveys. None are worth dignifying with attention.
- Politics continues to provide some distraction. US President Trump appears to be regretting sharing his chocolate cake with President Xi of China, criticizing China's approach to North Korea (via Twitter). US Congressional leaders are now focusing on fiscal reform, which will probably please markets, but Trump would like healthcare reform pulled out of the morgue and revived.