European Consumer Confidence Stumbles on Covid Resurgence

November 22, 2021

Market movement has been limited this Monday. The most notable development has been a net 0.3% drop in the net price of oil. WTI crude is down 0.3% but about a dollar above the intra-day seven-week low of $74.68 per barrel. The weighted DXY dollar index has edged up 0.1% but is currently close to the bottom of it’s daily high-low range. Individual dollar changes today include upticks of 0.2% against the Mexican peso and 0.1% versus the euro and yen, along with drops of 0.4% against the Australian dollar, 0.3% versus the Turkish lira, 0.2% relative to the New Zealand dollar and 0.1% against the Canadian dollar, Swiss franc and Chinese yuan.

The U.S. ten-year Treasury yield has risen three basis points, while comparable European 10-year sovereign debt yields are up two basis points in the U.K., Spain, France and Italy and by a basis point in Germany.

U.S. stock futures show a 0.3-0.4% advance. In the Pacific Rim, share prices closed down 1.0% in New Zealand, 0.6% in Australia and 0.4% in Hong Kong but up 1.4% in South Korea, 0.6% in China and 0.1% in Japan. There have been modest stock market dips in Germany, France, Italy and the U.K..

Consumer confidence in November fell to at least a 24-year low in Turkey, a 9-month low in the Netherlands, an 8-month low in Denmark, and a 7-month low in Belgium.

Consumer prices in Hong Kong more than reversed September’s 2.3% drop, rising 2.8% and resulting in a 3-month high 1.7% advance from the same month a year earlier.

Irish wholesale price inflation ended 2020 at a severely sub-zero pace of -14.5% and still hasn’t returned to zero percent. A monthly 0.2% uptick in October was associated with a 2.6% decline from a year earlier. That was the largest 12-month decline in four months.

A 1.8% jump in Polish producer prices lifted the 12-month rate of PPI inflation there to a 287-month high of 11.8% compared to 10.3% in September and 7.2% at midyear. The 7.8% year-0n-year rise of Polish industrial production last month was the smallest advance since February and down from 44.2% last April.

Spain’s trade deficit narrowed to a two-month low of EUR 2.4 billion in September but was still 60% wider than in September 2020.

The People’s Bank of China maintained its 1-year and 5-year loan prime rates at 3.85% and 4.65% after this month’s review. They have been at those levels since reductions in April 2020 of 20 and 10 basis points, respectively. Commenting verbally on the latest decision, however, officials seemed to suggest a tilt away from restraint.

U.S. existing home sales and the Chicago Fed National Activity Index will be reported later this morning.

Copyright 2021, Larry Greenberg. All rights reserved. No secondary distribution without express permission.

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