Daily update
Daily update
- ECB President Lagarde testifies before the European Parliament. A central bank head speaking to the legislature is something markets often care about, but we hear so frequently from Lagarde that the chances of her saying anything original are very low.
- US new home sales data is of some interest. The US economy is less interest rate sensitive, but the US housing market shows the effects of Federal Reserve policy tightening. The Dallas Fed regional business sentiment poll is due—of little practical use, perhaps, but the comments section provides considerable entertainment value to economists.
- Early signals suggest record online sales over the US Black Friday consumer festival. Caution is needed —while the US lags some other developed economies in online retail, the trend to virtual shopping is increasing and this data may cannibalize in-person sales. “Buy now, pay later”, the most traditional form of credit, seems to have been favored.
- China is investigating one of the leading shadow finance companies. This is a local concern. The global impact of an economy does not depend on how large the economy claims to be, but how it interacts with the world. In the 1990s, Japan had a lost decade, but global growth accelerated—Japan was a large economy with limited imports.
