Daily update
Daily update
- US retail sales give a glimpse into the hedonism of the US household. This is April data—too soon for consumers to feel any consequences from banking system volatility. Any credit tightening hurts consumers when they try to increase their credit card limits, not when they are spending the limits they already have. Industrial production is also due, but globally the US matters more as a consumer than a producer.
- China’s April data was generally weak. Production, investment, and consumer spending on goods were less than expected. Domestic demand weakness might explain why the government has recently encouraged the reporting of stronger export data. The reopening story seems focused on the service sector (restaurant spending was quite good)—which means a more limited spillover to the rest of the world.
- UK labor market data showed a small rise in unemployment, but more hours worked. Wages are still negative in real terms, but as profit-led inflation fades, this situation should improve. Quite by coincidence, some firms have started discounting prices just as political pressure on profit-led inflation has increased.
- The German ZEW business sentiment survey is due—which might get attention, given concerns about German manufacturing of late. The US debt ceiling farce continues, with US Treasury Secretary Yellen muttering dark warnings yesterday.
