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- The Eurozone updates its financial profile via the current account balance
- Brazil’s Economic Activity Index will point to the state of its recession
- US home builders in good shape for August update of the Housing Market Index
Monday’s a slow day for economic news, although we’ll see the monthly update of theEurozone’s current account data for July.
Later, Brazil’s central bank publishes new data for its Economic Activity Index, a proxy for GDP. We’ll also see the August update of the US Housing Market Index, which tracks sentiment in the home building industry.
Eurozone: Current Account (0800 GMT) The European Central Bank’s efforts to reflate the economy will be in focus today with the July release of balance of payments data.
The current account numbers in particular deserve attention as the currency bloc continues to struggle with an unwelcome strengthening in the euro.
“The euro is far stronger than they want, and stronger than the economy deserves, but they don’t know how to weaken it,” Hans Redeker, head of currency at Morgan Stanley, told The Telegraph recently. “This is exactly what happened to the Japanese.”
The rising current surplus, he advised, is supporting the disinflation by strengthening the currency. If so, recent figures paint a troubling profile. In the June update, the unadjusted surplus jumped to €37.6 billion - the highest so far this year and close to a record since the euro was launched.
Bolted on: US housing starts are expected to remain robust all year. Photo: iStock
If the unadjusted numbers push even higher in today’s July release from the European Central Bank, the news will remind the market that the risks of deflation by way of a stronger euro continue to lurk.
