Growth concerns rise after Chinese figures

August inflation data in the US came in slightly below expectations, but headline and core inflation remain strong at +5.3% and +4% yoy respectively. In detail, it is not so clear that a downward turn is really underway and the reaction of the markets (equities and bond yields down, USD finally slightly up) seems to show that it is mainly a concern about the consequences of the pandemic that came out of these figures. For more details, see our News published yesterday.

China’s activity statistics published last night will not reverse the trend: if the growth rates of industrial production and investment have slowed, they came out just below expectations at +5.3% and +8.9% yoy respectively. However, retail sales growth fell sharply from +8.5% to +2.5% yoy, confirming fears arising from the plunge in services PMIs. The measures taken to counter the pandemic are obviously responsible for this.

EnergyScan - Economics news

This glimpse of stagflation is reinforced this morning by the stronger-than-expected rebound in UK inflation (+3.2% for headline inflation and +3.1% for core inflation). Producer prices continue to accelerate in parallel.

Today, we are expecting a rebound in industrial activity in July in the euro zone and statistics in the United States: foreign trade prices and industrial production in August. The markets will probably be more interested in the retail sales published tomorrow, but import prices are to be watched.

Share this news :

You might also read :

ES-economy
November 10, 2021

Back to reality

The decline in long term bond yields was accentuated yesterday, pulling the US 10 year down to 1.43%, mainly on the idea that Joe Biden might decide to…
ES-power
March 15, 2021

EUAs extended their bullish rally

The European power spot prices for today rebounded compared to Friday amid forecasts of lower temperatures and dropping wind output. Prices reached 50.35€/MWh on average…
ES-oil
April 26, 2022

Covid wave in China triggered oil prices drop

Oil prices plunged yesterday, before recovering somewhat, in line with the US stock market: the ICE Brent front month fell to $99.5/b, before rebounding to $102.32/b…
Join EnergyScan

Get more analysis and data with our Premium subscription

Ask for a free trial here

Subscribe to our newsletter

Don’t have an account yet? 

[booked-calendar]