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No help for the euroMathematicians at the University of Michigan, the eponymous originator of a highly-regarded index of US consumer sentiment, have come up with an algorithm to reduce the effects of jet lag. In the best traditions of benevolent science they have packaged it as a free Iphone application called “Entrain”. On their arrival in a new time zone the app requires users to spend particular periods in different light conditions, including one described as “bright outdoor”. That isn’t a great deal of help to anyone flying from Tokyo to Helsinki in mid-December.
Nor was a nineteenth consecutive monthly fall in Finland’s industrial output of much help to the euro on Thursday morning. In fact almost none of the economic news from Euroland could be considered helpful to the currency: French inflation fell to 0.6% and retail prices in Greece were down by -1.3% on the year. France’s 0.1% monthly increase in industrial output was nullified by Italy’s -0.5% decline. The only good news came from Greece, where unemployment was down by half a point at 26.7% and the government was able to borrow €3bn of five-year money at 4.95% in a bond sale. Bids from 550 investors totalled €20bn.
It was unclear whether strong demand for Greek government bonds increased investors’ appetite for the euro or vice versa. Either way, the euro (accompanied by the Swiss franc) was the day’s top performer, strengthening by half a cent against sterling. The currencies that suffered most were the Commonwealth dollars, the South African rand and the Swedish krona. The krona’s specific problem was a quickening of deflation from -0.2% to -0.6%. The commodity currencies’ general problem was a retreat from risk by investors, which also caused a broad sell-off in equity markets.
Sterling’s biggest gain on Thursday was the cent and a half it took from the NZ dollar. It lost a quarter of a US cent, a third of a yen and three quarters of a Swiss cent. On average it was just about unchanged on the day.
The US dollar did not see much benefit from a seven-year low for initial jobless claims nor from a six-year low for continuing claims. The Kiwi received no boost from an increase in NZ house price inflation from 2.1% to 3.4%. There was little reaction to Chinese consumer prices rising by an annual 2.4% or to factory gate prices falling by -2.3%. News that German inflation was steady at 1% had no effect.
All in all, the movement of bond, equity and currency prices on Thursday had precious little to do with the hard economic evidence. Although nobody has shouted “fire” in the theatre there seems to be a sense of foreboding that someone might be about to do so. There is nothing today’s list likely to provide evidence for such nervousness, just US producer prices and the provisional Michigan consumer confidence reading. But absence of evidence is not evidence of absence as far as twitchy investors are concerned at the moment. Have good weekend.
Nor was a nineteenth consecutive monthly fall in Finland’s industrial output of much help to the euro on Thursday morning. In fact almost none of the economic news from Euroland could be considered helpful to the currency: French inflation fell to 0.6% and retail prices in Greece were down by -1.3% on the year. France’s 0.1% monthly increase in industrial output was nullified by Italy’s -0.5% decline. The only good news came from Greece, where unemployment was down by half a point at 26.7% and the government was able to borrow €3bn of five-year money at 4.95% in a bond sale. Bids from 550 investors totalled €20bn.
It was unclear whether strong demand for Greek government bonds increased investors’ appetite for the euro or vice versa. Either way, the euro (accompanied by the Swiss franc) was the day’s top performer, strengthening by half a cent against sterling. The currencies that suffered most were the Commonwealth dollars, the South African rand and the Swedish krona. The krona’s specific problem was a quickening of deflation from -0.2% to -0.6%. The commodity currencies’ general problem was a retreat from risk by investors, which also caused a broad sell-off in equity markets.
Sterling’s biggest gain on Thursday was the cent and a half it took from the NZ dollar. It lost a quarter of a US cent, a third of a yen and three quarters of a Swiss cent. On average it was just about unchanged on the day.
The US dollar did not see much benefit from a seven-year low for initial jobless claims nor from a six-year low for continuing claims. The Kiwi received no boost from an increase in NZ house price inflation from 2.1% to 3.4%. There was little reaction to Chinese consumer prices rising by an annual 2.4% or to factory gate prices falling by -2.3%. News that German inflation was steady at 1% had no effect.
All in all, the movement of bond, equity and currency prices on Thursday had precious little to do with the hard economic evidence. Although nobody has shouted “fire” in the theatre there seems to be a sense of foreboding that someone might be about to do so. There is nothing today’s list likely to provide evidence for such nervousness, just US producer prices and the provisional Michigan consumer confidence reading. But absence of evidence is not evidence of absence as far as twitchy investors are concerned at the moment. Have good weekend.