Crisis? What crisis?

Posted by: Paul Donovan

13 Mar 2019
  • The UK Parliament voted down the government's plan for the interminably tedious EU-UK divorce. This was expected. Media are competing with one another for adjectives to sensationalize the situation. The British public simply does not care very much.
  • The UK Parliament will almost certainly reject a no-deal exit today. That leaves extending the process. If the UK government is legally mandated to avoid a no-deal exit, they can extend Article 50, or withdraw and resubmit Article 50 (if the EU does not cooperate). The UK Chancellor presents the government's spring budget statement. This is an example of the British sense of humor, which foreigners often find difficult to understand.
  • Euro area industrial production data is due. The European manufacturing sector was a drag on developed economy manufacturing at the end of last year, but there is evidence of improvement (aside from Germany, where the data looks suspect). Spanish consumer price inflation is also due.
  • US durable goods orders offer some insight into investment spending in the US (albeit indirectly, and with volatile data). Investment should be stabilizing as the uncertainties over NAFTA's future fade. Producer price inflation hints at whether US companies are passing on higher labor costs as inflation.