Daily update
Daily update
- Korean export data for the first twenty days of July was weaker, reflecting modest international demand for goods. Some of this is the legacy of negative real wage growth across developed economies, but there is also the ongoing favoring of service sector spending. The bias to service spending may be less about a post-pandemic boom, and may instead reflect a more structural change.
- The UK July BRC shop price index showed ongoing disinflation. Publicity around profit-led inflation seems to have had an impact, with consumers rebelling against margin-expanding price increases. Slowing food inflation in the BRC index may not translate into consumer prices. Supermarkets’ two-tier price structure offers discounts for loyalty card holders. The BRC data includes privileged discounts consumer price inflation does not.
- The Federal Reserve’s Senior Loan Officer Opinion Survey showed tighter lending standards and slowing demand for commercial borrowing. The tighter lending standards seem to reflect the economic cycle, not banking problems. Cyclical and structural factors are likely to be reducing loan demand.
- The US JOLTS job vacancy data is due. Nearly 70% of companies do not complete the survey, raising major questions about quality. The data is more likely to reflect changes in labor market churn than absolute labor demand levels.
