Daily update
Daily update
- US September consumer price inflation should show a slower rate of growth in the headline measure. Now that the Federal Reserve has finally started its easing cycle, this matters a little less to markets, but it is still important. Critically, middle-income inflation is running at about half the headline rate, and that gives the group an important degree of spending power.
- The minutes of the last Federal Reserve meeting signaled that there was quite a lot of disagreement over the size of the last rate cut. Markets are likely to conclude that sizable rate cuts are unlikely to be repeated, and that the Fed will cut twice this year to try and make up for lost time—but that it will cut by 25bps each time. The “account” of the last ECB meeting is due, but is less likely to attract drama.
- Japanese producer price inflation was stronger than expected—agricultural prices were the main inflation impulse, rising at the fastest pace in two decades.
- For those riding the rollercoaster of China’s policy stimulus, the finance minister is to give a press conference on Saturday. This has raised hopes of a fiscal stimulus, which would probably be more effective than simply changing the cost of credit.
