ECONOMICS

As we previewed earlier, while the ECB decision was a tough call and while pure mathematical consensus expected no hike today, moments ago the ECB surprised the consensus (if not our readers) with what is most likely the final rate hike, when it raised all three deposits rates by 25bps (and the key Deposit rate for the 10th consecutive time to a record 4.00%) because while "inflation continues to decline but is still expected to remain too high for too long. The Governing Council (more…)

With China's economic data on a relentless downslope for the past several months, there was a sliver of hope this morning when the PBOC reported the latest credit data which came in stronger than consensus expected after a dismal July, as seasonal patterns and policy easing likely contributed to the rebound of credit growth in August.

With total social financing and new loan growth rebounding strongly last month, household loan growth rose to a still-modest 4.7% MoM annualized from 0.8% (more…)

After four months of declines in the 1-Year inflation expectation as reported by the NY Fed's consumer survey, August saw a reversal in this series which traditionally is also a proxy for the price of oil (which just hit a 2023 high this morning), however this was offset by a small decline in 3 year inflation expectations. However, the most concerning observations was that the inflation outlook at the 5-year point hit the highest since march 2022 while households turned even less (more…)