Daily update
Daily update
- The calendar is so quiet today that even former US Treasury Secretary Summers does not appear to be speaking. While a rational market would not be moving in the absence of new information, markets are rarely rational and so silly stories will be amplified.
- We did have the release of German wholesale prices for July, which remain in deflation. The information is useful in assessing price pressures, but as no one believes German wholesale price data will deter the ECB from its autopilot hiking program, the news is not especially market significant.
- China’s currency and equity markets have been weakening on the absence of news. The recent trend of worse-than-expected economic data has left investors scanning the horizon for the arrival of some kind of policy rescue. The weekend did not produce any great policy pronouncements, leaving markets somewhat downbeat.
- The US consumer is in focus tomorrow with retail sales data. The middle income consumer has more spending firepower than the headline numbers suggest, although they may be prioritizing experiences (Beyoncé for instance) rather than things purchased in stores. UK consumer price data later in the week is worthy of attention, given the three-way split on interest rates at the Bank of England.
