Daily update
Daily update
- China’s much anticipated economy ministry press conference over the weekend did not give much detail. There were hints, and suggestions, and promises, but few clear proposals. International investors are looking for fiscal support because if consumers are restricting spending out of concerns for the future, monetary policy easing is unlikely to offer much help.
- China’s September consumer and producer price data were both a little weaker than had been hoped. Food prices (mainly vegetables and pork) pushed up consumer prices, but not enough to overcome other disinflationary trends. Today there is the release of China’s import and export data. These numbers do not correlate well with other countries’ data (China exports 16% more to the US than the US buys from China, for instance). They should be treated with caution as signals of global demand.
- The US marks the Columbus Day holiday. Meanwhile, Trump Campaign donor Bessent suggested that former US President Trump’s 20% universal tariff should be considered a bargaining tactic. This is what international investors want to hear (and it may fuel confirmation bias).
- Europe is waiting for its own consumer stimulus, with the ECB meeting on Thursday. More rate cuts will be forthcoming, and with consumers less constrained by fear for the future may offer some support.
