Politicians Won’t Risk Not Reconfirming Bernanke
January 25, 2010
The dollar and yen are slightly lower in a sign of somewhat receding risk aversion, but stocks still look shaky. Congress took a look at the stock market bloodbath last week and decided not to kill Bernanke’s reappointment at Fed Chairman.
The yen fell 0.4% against the dollar, which is otherwise off 0.8% against the Australian dollar, 0.6% lower versus the kiwi, down 0.4% against the Swiss franc, and 0.3% softer relative to the Canadian dollar, euro and sterling.
Most Asian stocks nonetheless lost ground, with drops of 0.7% in Japan, Taiwan and Australia, 1.1% in China, 0.6% in Hong Kong, and 0.5% in Thailand, Indonesia and India. The German Dax is off 0.2%, while the British and French markets have firmed 0.4% and 0.2%.
Ten-year sovereign debt yields edged one basis point higher in Japan, Britain, and Germany.
Gold and oil recovered 1.1% and 0.4% to $1103.70 per ounce and $74.82 per barrel.
Australian producer prices fell 0.4% last quarter and 1.5% from a year earlier. That evidence of significantly less inflationary pressure than assumed reduces the chance of a fourth Australian rate hike after the February policy meeting. Import prices plunged another 5.1% last quarter and by 12.0% from a year before. Such had risen 6.5% in the year to 3Q09 and by 20.3% in the year to 2Q09. Domestic producer prices firmed 0.3% from 3Q and merely 0.2% from a year earlier.
German orders were substantially under-reported when announced earlier this month, resulting in a corrected release of Euroland orders for November. The German component of the original Euroland release had shown a 0.7% monthly increase but a 1.5% on-year drop. The revised monthly gain for Germany is 3.2%, and the data also show an on-year increase of 0.9%. For Euroland as a whole, orders went up 2.7% in November, not 1.6% as reported initially, and fell 0.5% from November 2008, 1.0 percentage point less than announced initially. Euroland orders in October-November were thus 0.5% above their 3Q level, signaling continuing economic recovery last quarter and some momentum heading into 2010.
German consumer sentiment eased to 3.2% in February from an upwardly revised reading of 3.4% the month before. Analysts had predicted a 3.1% score. German construction orders in November were 0.5% higher than a year earlier.
Reuters calculates monthly diffusion indices for Japanese manufacturing and non-manufacturing, which serve as proxies for the Bank of Japan’s Tankan data series. Each gauge improved in January, manufacturing by 8 points to a 16-month high of minus 19 and non-manufacturing by five points to minus 34. Other reports from Japan were more unsettling. The central bank there is not expected to change policy after this week’s two-day meeting but reportedly is prepared to undertake more quantitative easing if future conditions warrant. Public debt per person in Japan is likely to reach $84,500 by March 2011.
Taiwanese industrial production growth accelerated to an on-year increase of 47.3% in December from 40.9% in November.
Hungarian retail sales in November were 7.8% lower than a year earlier and dropped by 5.0% in January-November from a year before.
Producer prices in Spain edged up 0.1% in December and 0.4% from a year earlier.
The Canadian budget swung to a deficit of C$ 36.3 billion in April – November (the first eight months of the present fiscal year) from a surplus of C$ 39 billion a year earlier.
Consumer prices in Singapore were unchanged from a year before in December and fell 0.5% compared to November. The results were lower than forecast and left full-2009 average CPI inflation at merely 0.2% after a pace of 6.5% in 2008.
Israel and Hungary announce interest rate decisions later today. The Bank of Japan began a two-day policy meeting. Scheduled U.S. economic data today feature existing home sales and the Dallas Fed index.
Copyright Larry Greenberg 2010. All rights reserved. No secondary distribution without express permission.
Tags: Australia
ShareThis
