Daily update
Daily update
- After the excitement of yesterday’s GDP data, today investors are granted another peek into the hedonistic lifestyle of the US consumer. Personal income and consumption data are due, and both should be relatively buoyant. Job security and rising real incomes are powerful forces for supporting economic activity through consumer spending.
- The US personal consumer expenditure deflator is also due. This is less dependent on fantasy than the US consumer price measure, although there is still a fantasy element. Market determined prices (very definitely a subset of the overall index) showed a less than 2% y/y increase last month, which does not suggest a meaningly imbalance in economic supply and demand.
- European October consumer price inflation will be published (the flash estimate) with Italy and France completing the data from the major economies. Germany’s data was higher yesterday, which may be an idiosyncrasy. Markets are unlikely to be deterred from expecting regular rate cuts.
- European unemployment is unimportant as far as markets are concerned (it is out of date information, and national data has already been released). US initial and continuing jobless claims data may be of more interest as these are reliable snapshots of a subset of the US labor market.
