Moderate US inflation; UK GDP has rebounded in Q2
US: CPI (July): 0.2% m/m as expected (prior: 0.1%)
- Inflation remained moderate; prices of energy, apparels and computers were down over the month, while rents and services were up by 0.3% m/m; core inflation was up by 0.2% m/m as expected.
- Headline inflation stayed on a stable trend at 2.9% y/y, while core inflation has slightly accelerated at 2.4% y/y after 2.3% y/y the prior month.
- Headline inflation is expected to moderate at year-end, but the Fed should continue to hike in H2-18.
France: Industrial production (June): 0.6% m/m vs 0.5% expected (prior: -0.2%)
- Activity has rebounded in all sectors, and particularly activity in refinery, reversing the decrease seen past months.
- Construction and production of autos have both rebounded, which should be a positive signal for consumption and growth on Q3.
UK: Industrial production (June): 0.4% m/m vs 0.3% expected (prior: -0.2% revised from -0.4%)
- The rebound was mainly led by consumer goods production, while production in investment good was flat; production was down for intermediate, energy and oil sectors.
UK: GDP (Q2-18): 0.4% q/q as expected (prior: 0.2%)
- Investment has driven the rebound, with firmer consumption. Exports have sharply fallen, still contributing negatively to GDP.
- In terms of sectors, the main positive contribution came from services, transport, leisure and water distribution.
- On a yearly basis, GDP has stabilized at 1.3% y/y, but domestic growth has slowed down further from 2.3% y/y in Q4-17.
- The growth outlook depends from next UK-EU negotiations on Brexit.
Russia: GDP (Q2-18): 1.8% y/y vs 1.9% expected (prior: 1.3%)
- Growth trend has slightly improved by Q2, but remained moderate as sanctions remained a drag on activity.