Daily update
Daily update
- ECB Chief Economist Lane stated the central bank is ready to cut rates. We have heard this from other ECB governing council members, but Lane’s remarks come with the added authority and insight that only a chief economist can bring. Europe has (on a like-for-like basis) the same inflation as the US or the UK, and the ECB is not known for the speed of its decision-making. That the ECB looks to be first to cut rates may be due to the narrative around European growth, rather than the substance of economic data.
- There are expectations of easing in the Anglo-Saxon world. The Federal Reserve’s Beige Book of anecdotal evidence is due on Wednesday and should point to a need to ease. This report may be increasingly vulnerable to politically partisan distortions, however.
- French Finance Minister Le Maire has been complaining strongly that China is making things people want to buy at prices that people can afford. In other words, fears of overcapacity are stoking economic nationalism. Overcapacity would be evident if China is selling at a loss. These concerns may fade as localization trends develop.
- With the US and the UK on holiday, the data calendar is quiet. The German ifo business sentiment poll is due.
