Daily update
Daily update
- We get one of the fun economic statistics today. US Michigan consumer sentiment data offers the always humorous breakdown between Republicans and Democrats (sadly only for headline sentiment—a breakdown of inflation expectations is not provided). These two groups report that they are living in different economies. To be fair, regional divergence in the US has increased, but the sentiment split is mainly about partisan bias. Obviously, people say one thing in surveys and act totally differently in reality.
- The Bank of Japan meeting decided on another month of masterful inactivity. The Bank of Japan is very good at masterful inactivity, having perfected the policy over many years. There is an expectation of a higher range for 10-year bond yields at some point, but the timing of that is being pushed later and later.
- The Bank of England inflation expectations survey is due, ahead of the policy decision next week. Consumer inflation expectations are strongly influenced by high frequency purchases—and fuel prices have been coming down after the Competition Authority expressed interest in profit-led inflation in that area.
- Markets are bombarded with ECB speakers after yesterday’s rate decision. The ECB policy auto-pilot light is still illuminated, though some economic warning lights are now also starting to flash red.
