Daily update
Daily update
- Eurozone April inflation data generates less of the tense excitement that a US inflation release can produce. The regional data we have already had suggests a modest decline in the headline consumer price inflation rate. Overall, Eurozone inflation has fallen from 10.6% to essentially an on-target number within a year and a half—without an unemployment shock. This suggests that inflation is neither sticky, nor conventionally cyclical.
- The UK April British Retail Consortium shop price index was weaker than three economists thought it would be, with non-food items falling into deflation. Food price inflation is also moderating, and supermarkets’ two-tier pricing approach may be moving toward more general price discounts. Where market forces determine prices, disinflation still seems to be the norm.
- Japanese unemployment did not decline in March, and retail sales were weak. There has been some speculation about the extent to which the Bank of Japan will tighten policy, adding volatility to the yen in foreign exchange markets—this data is unlikely to help reduce that speculation.
- French first quarter GDP was somewhat stronger than expected, with the consumer leading growth higher. German March retail sales showed recent momentum, but revisions to earlier data weighed on the year-over-year comparison.
