The Great Wall against China
- Yesterday, a US Treasury official indicated that US President Trump was mulling sanctions against Chinese banks over North Korea. Today, one of the many EU presidents is to advocate powers to block foreign (subtext Chinese) takeovers of EU companies. This worrying anti-globalization signal would be more worrying if capital globalization had not already collapsed.
- Final August consumer price data from Germany is due, and is expected to hit the ECB target (which is below, but not too far below, but not exactly, sort of, 2%), with a 1.8% reading. The Spanish are also due to give their final August CPI reading.
- UK labor market data is due. The unemployment rate will probably receive less attention than average weekly earnings – which will be compared to yesterday's stronger inflation release. Average weekly earnings less consumer price inflation do not measure real incomes. Real incomes can rise while real average earnings simultaneously fall.
- US producer price inflation is due – a better measure of corporate pricing power than consumer prices. How producer prices are adjusted differs from how consumer prices are adjusted, and the blurring of corporate and consumer roles in the economy makes interpreting the signals from this data a lot more difficult.