Daily update
Daily update
- The cycle of European consumer price inflation data is about to start again (in reality, this is pretty much a perpetual cycle). The Spanish and German preliminary August numbers are due today. Both are expected to show a fairly sizable decline. That means, of course, that real interest rates are rising. The ECB should continue to chase inflation down, not to offer policy stimulus but to maintain policy stability.
- Revised second quarter GDP from the US is not expected to show anything too exciting—and these numbers will be revised a lot in the future. Investors tend not to pay too much attention to revisions. It makes no difference to consumers, who experienced the second quarter they experienced, not the second quarter that the Bureau for Economic Analysis reported.
- There will also be revisions to the price deflators within the GDP data, but markets are set in their views that the Federal Reserve will be cutting rates in September. The Fed’s Bostic was trying to sound a bit hawkish yesterday, but it is a futile gesture.
- Despite some more meaningful macro data, markets are still focusing on earnings data—although market moves say more about the levels of expectations than about corporate signals of economic health.
