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Market insight 20.04.2018

Eurozone: improving consumer confidence

Eurozone: improving consumer confidence

Eurozone: Consumer confidence (Apr.): 0.4 vs -0.1 expected (prior: 0.1)

  • Flash estimate for consumer confidence has shown a rebound after regular weakening over the past two months (due to lower sentiment on employment and prices development). More details will be provided next week.
  • This could point towards firmer spending in Q2.

 

Germany: PPI (March): 0.1% m/m vs 0.2% expected (prior: -0.1%)

  • PPIs have slightly increased from 1.8% y/y to 1.9% y/y.
  • Prices of energy were on a rising trend.

 

Turkey: Consumer confidence (Apr.): 71.9 (prior: 71.3)

  • Sentiment on current and future economic situation was mixed, but the willingness to spend has slightly increased.

 


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Meistgelesene News

Market insight 26.04.2018

The ECB stays cautious due to low and fragile core inflation

The ECB has not changed its current strategy

  • The ECB has recognized that the slowdown in Q1 was broad based, but it was mainly due to temporary factors; so the ECB remains confident on growth.
  • The inflation  should finally converge at/or slightly below 2%, but the ECB has noticed that the core inflation has not shown convincing signals of being on an upward trend; for this reason, a still large monetary accommodation still looks justified according to the ECB.
  • According to M. Draghi, there was no discussion on monetary policy; no pre-commitment of any change in the ECB’s communication in June.
  • As core inflation is not a firm trend, the ECB will take some time before officially shifting its communication and its strategy. This increases the probability of a change in communication only in the next July meeting and favors a smooth end of the QE in Q4-18.

 

US: Initial jobless claims (Apr.21): 209k vs 230k expected (prior: 233k revised from 232k)

  • Continuing claims: 1837 k after 1866 k.

 

US: Durable goods orders (March): 2.6% m/m vs 1.6% expected (prior: 3.5% revised from 3%)

  • Orders have been boosted by civil aircrafts (44% m/m).
  • Orders for capital goods non-defense ex aircraft (core orders) were down by 0.1% m/m after 0.9% m/m the prior month. By sector, the picture was mixed: a rebound in computers, but falling orders for machinery and flat in equipment.
  • Shipments were up by 0.3% m/m (-0.7% m/m for core orders); inventories were up by 0.1% m/m (+0.3% m/m for core orders).

 

US: Wholesale inventories (March): 0.5% m/m vs 0.7% expected (prior: 1%)

  • Inventories of durable goods were up close to 1% m/m.

 

Germany: GFK consumer confidence (May): 10.8 as expected (prior: 10.9)

  • Some cautiousness on future activity and income, despite good fundamentals.

 

Spain: Unemployment rate (Q1-18): 16.74% vs 16.45% expected (prior: 16.55%)

  • Unemployed has surprisingly decreased by close to 2% over the quarter; this could be viewed as a pause in a still positive trend.
Market insight 25.04.2018

France: consumer confidence under stabilization

France: Consumer confidence (Apr.): 101 vs 100 expected (prior: 100)

  • Sentiment is less negative on personal situation and on standard of living; in details, prices, and unemployment to a lesser extent, were sources of rising concerns.
  • In absolute terms, the index remained well above the levels reached before the financial crisis, pointing towards good fundamentals for households. The index could stabilize around these current levels, which stayed below levels reached in Q4-17.

 

Spain: PPI (March): -0.9% m/m (prior: 0% revised from 0.1%)

  • Prices were up by 1.3% y/y after 1.2% y/y past month. Energy prices have fallen by 3% m/m.

 

Poland: Unemployment rate (March): 6.6% vs 6.5% expected (prior: 6.8%)

  • The decrease of unemployed has accelerated: -35 k after -7 k past month.

 

Brazil: Current account (March): 798 M$ vs -100 M$ expected (prior: 290 M$ revised from 283 M$)

  • Current account has jumped into a surplus for the second month; FDI has also jumped from USD 4.7 bn to USD 6.5 bn over the month.

 

Turkey: Central bank has increased liquidity lending rate from 12.75% to 13.50%.

  • Repo rate was unchanged at 8%, overnight lending rate unchanged at 9.25% and overnight borrowing rate unchanged at 7.25%.
  • In its statement, central bank mentioned that it wanted to implement some tightening in order to preserve price stability, as inflation and expectations have increased.
Market insight 24.04.2018

Richmond Fed manufacturing fell sharply in April, disappointing German IFO survey

US: Richmond Fed manufacturing (Apr): -3 vs 16 expected (prior: 15)

  • The index fell sharply in April for the second consecutive month.
  • The underlying composition was generally weak, with sharp declines in the shipments and new orders components.

 

US: Consumer confidence (CB) (Apr): 128.7 vs 126 expected (prior: 127 revised from 127.7)

  • The improvement in confidence was spread evenly across the present situation and expectations indices.

 

US: New home sales (Mar): 694k vs 630k expected (prior: 667k revised from 618k)

  • On a m/m basis: 4% vs 1.9% expected (prior: 3.6% revised from -0.6%)
  • By region, March sales increased in the West (+28.3%), South (+0.8%) but declined in the Northeast (-54.8%) and Midwest (-2.4%). Inventory available on the market edged down to 5.2 months of available supply, towards the lower end of its 12-month range.

 

US: Housing prices (FFHA) (Feb): 0.6% q/q as expected (prior: 0.9% revised from 0.8%)

 

Germany: IFO (Apr): 102.1 vs 102.8 expected (prior: 103.3 revised from 103.2)

  • Expectations: 98.7 vs 99.5 expected (prior: 100 revised from 103.2)
  • Current assessment: 105.7 vs 106 expected (prior: 106.6 revised from 106.5)
  • The headline decline was driven by a drop in expectations. From a sector perspective, sentiment in manufacturing eased further from high levels, while construction and retail sentiment improved slightly.
  • Note that there have been methodological changes to the survey this month, which in theory should make it a better guide to German GDP growth.

 

France: Business confidence (Apr): 108 as expected (prior: 109)

  • Manufacturing: 109 vs 110 expected (prior: 110 revised from 111)

Auch lesenswert

Market insight 26.04.2018

The ECB stays cautious due to low and fragile core inflation

The ECB has not changed its current strategy

  • The ECB has recognized that the slowdown in Q1 was broad based, but it was mainly due to temporary factors; so the ECB remains confident on growth.
  • The inflation  should finally converge at/or slightly below 2%, but the ECB has noticed that the core inflation has not shown convincing signals of being on an upward trend; for this reason, a still large monetary accommodation still looks justified according to the ECB.
  • According to M. Draghi, there was no discussion on monetary policy; no pre-commitment of any change in the ECB’s communication in June.
  • As core inflation is not a firm trend, the ECB will take some time before officially shifting its communication and its strategy. This increases the probability of a change in communication only in the next July meeting and favors a smooth end of the QE in Q4-18.

 

US: Initial jobless claims (Apr.21): 209k vs 230k expected (prior: 233k revised from 232k)

  • Continuing claims: 1837 k after 1866 k.

 

US: Durable goods orders (March): 2.6% m/m vs 1.6% expected (prior: 3.5% revised from 3%)

  • Orders have been boosted by civil aircrafts (44% m/m).
  • Orders for capital goods non-defense ex aircraft (core orders) were down by 0.1% m/m after 0.9% m/m the prior month. By sector, the picture was mixed: a rebound in computers, but falling orders for machinery and flat in equipment.
  • Shipments were up by 0.3% m/m (-0.7% m/m for core orders); inventories were up by 0.1% m/m (+0.3% m/m for core orders).

 

US: Wholesale inventories (March): 0.5% m/m vs 0.7% expected (prior: 1%)

  • Inventories of durable goods were up close to 1% m/m.

 

Germany: GFK consumer confidence (May): 10.8 as expected (prior: 10.9)

  • Some cautiousness on future activity and income, despite good fundamentals.

 

Spain: Unemployment rate (Q1-18): 16.74% vs 16.45% expected (prior: 16.55%)

  • Unemployed has surprisingly decreased by close to 2% over the quarter; this could be viewed as a pause in a still positive trend.
Market insight 25.04.2018

France: consumer confidence under stabilization

France: Consumer confidence (Apr.): 101 vs 100 expected (prior: 100)

  • Sentiment is less negative on personal situation and on standard of living; in details, prices, and unemployment to a lesser extent, were sources of rising concerns.
  • In absolute terms, the index remained well above the levels reached before the financial crisis, pointing towards good fundamentals for households. The index could stabilize around these current levels, which stayed below levels reached in Q4-17.

 

Spain: PPI (March): -0.9% m/m (prior: 0% revised from 0.1%)

  • Prices were up by 1.3% y/y after 1.2% y/y past month. Energy prices have fallen by 3% m/m.

 

Poland: Unemployment rate (March): 6.6% vs 6.5% expected (prior: 6.8%)

  • The decrease of unemployed has accelerated: -35 k after -7 k past month.

 

Brazil: Current account (March): 798 M$ vs -100 M$ expected (prior: 290 M$ revised from 283 M$)

  • Current account has jumped into a surplus for the second month; FDI has also jumped from USD 4.7 bn to USD 6.5 bn over the month.

 

Turkey: Central bank has increased liquidity lending rate from 12.75% to 13.50%.

  • Repo rate was unchanged at 8%, overnight lending rate unchanged at 9.25% and overnight borrowing rate unchanged at 7.25%.
  • In its statement, central bank mentioned that it wanted to implement some tightening in order to preserve price stability, as inflation and expectations have increased.
Market insight 24.04.2018

Richmond Fed manufacturing fell sharply in April, disappointing German IFO survey

US: Richmond Fed manufacturing (Apr): -3 vs 16 expected (prior: 15)

  • The index fell sharply in April for the second consecutive month.
  • The underlying composition was generally weak, with sharp declines in the shipments and new orders components.

 

US: Consumer confidence (CB) (Apr): 128.7 vs 126 expected (prior: 127 revised from 127.7)

  • The improvement in confidence was spread evenly across the present situation and expectations indices.

 

US: New home sales (Mar): 694k vs 630k expected (prior: 667k revised from 618k)

  • On a m/m basis: 4% vs 1.9% expected (prior: 3.6% revised from -0.6%)
  • By region, March sales increased in the West (+28.3%), South (+0.8%) but declined in the Northeast (-54.8%) and Midwest (-2.4%). Inventory available on the market edged down to 5.2 months of available supply, towards the lower end of its 12-month range.

 

US: Housing prices (FFHA) (Feb): 0.6% q/q as expected (prior: 0.9% revised from 0.8%)

 

Germany: IFO (Apr): 102.1 vs 102.8 expected (prior: 103.3 revised from 103.2)

  • Expectations: 98.7 vs 99.5 expected (prior: 100 revised from 103.2)
  • Current assessment: 105.7 vs 106 expected (prior: 106.6 revised from 106.5)
  • The headline decline was driven by a drop in expectations. From a sector perspective, sentiment in manufacturing eased further from high levels, while construction and retail sentiment improved slightly.
  • Note that there have been methodological changes to the survey this month, which in theory should make it a better guide to German GDP growth.

 

France: Business confidence (Apr): 108 as expected (prior: 109)

  • Manufacturing: 109 vs 110 expected (prior: 110 revised from 111)