The Bank of England has voted to keep its key interest rate at a record low of 0.5 percent as weak inflation has kept the pressure off policymakers to start raising borrowing costs.With a vote, once again, of 8-1 policymakers decided to keep rates steady at their January policy meeting, particularly since inflation remains at 0.1 percent, well below the Bank’s official 2 percent target.Britain’s growth is among the strongest of developed countries but since crude prices have fallen to near $30 a barrel, this would suggest that there will be very little inflation in the short term and harder times ahead for the country’s energy sector.
Australia’s employment report showed a fall of only 1k jobs, this was better than the 12.5k job shedding that the market had expected.Full-time employment saw gains of 17.6k and positive revisions to last month’s solid print.The participation rate fell (65.1% vs. 65.3% prior), however, keeping the unemployment rate steady at 5.8%.The market had expected a slight increase in the unemployment rate and only a one tick fall in the participation rate.Foreign direct investment in China printed a 6.4%, it’s lowest pace of growth since the end of 2014.
German wholesale prices fell in December, down 1.0% year over year.This while the full year German GDP rose a tick to 1.7%.The market had expected it to remain at 1.6%.This while Italian industrial output fell 0.5% in November, dragging the year over year print down to 0.9%, where 2.5% had been expected.
In North America this morning, we see US initial jobless claims increase to 284k, dragging the 4 week average up to 278.75k from 275.75k.Continued claims also climb higher to 2.263M up from 2.234M, the market had been expected a fall to 2.215M.US Import prices in the month of December fell 1.2%, less than expected fall of 1.4%, while export prices fell further than the 0.5% expected with a 1.1% print.Negative revisions were seen to the November figures as well.
North of the border, we see new housing price index print in-line with market expectations at 0.2%.CAD subject to volatility in crude prices and yesterday’s stock market rout, saw fresh highs made vs. the USD. This morning we find crude up 2.25% to start, pushing the CAD higher.Stock futures pointing to positive opens also likely helping the sentiment, over-all, in the market…but if I recall, we did open positive yesterday as well!
Daily updates courtesy of Citizens Bank