This morning has already seen a raft of negative German data, however this was completely overshadowed by the UK CPI data. Released a short while ago, the Consumer Price Index fell dramatically, actually giving its worst reading since 2009. Coming it at 1.7% for October and only 0.8% for the year on year this data highlights a). the economy is not generating price inflation at the ideal level of 2% and thus implies the economy is a long way from performing at desired levels and b). there is more than ample scope for further stimulus in monetary supply, or at least there is a hugely reduced probability that any current stimulus will be removed.
The focus now moves to tomorrows triple whammy from the UK with Unemployment figures, the Bank of England’s Quarterly inflation report and the following speech from Mark Carney.
Posted in Daily Market News on May 30 2014