Daily update
Daily update
- US November consumer price inflation is expected to be stable. Economists must act as second-hand car salespeople; used car prices are a volatile (probably declining) component. Record numbers of people were travelling for fun over Thanksgiving (assuming seeing family constitutes fun), which may have raised leisure travel prices. The fantasy of owners’ equivalent rent adds a lot to consumer prices but not to the cost of living.
- Aside from the weirdness, the US is likely to follow the developed economy trend of slowing profit-led inflation. Consumers are increasingly fighting back against the creative excuses companies have been using to justify price increases. Profit-led inflation often ends quite suddenly; and because it is irrational and infrequent, mathematical models underestimate its impact.
- UK experimental employment data is due (traditional measures are no longer trusted). Political interest focuses on the prime minister’s employment prospects. There is an immigration policy vote that is not officially a confidence vote, but will be interpreted as such. So close is this vote, a parliamentary fact-finding mission to the Caribbean has been cancelled (Caribbean facts are always best discovered in the winter months).
- The German ZEW business sentiment poll is due, as is the US NFIB small business survey. The latter tends to correlate to Republican sentiment.
