On Thursday, China released the latest CPI (Consumer Price Index). Results came in at +1.6% yoy (year-on-year) but failed to meet the expected +1.8%, the main price growth being in the food sector. The PPI (Producer Price Index) read +5.9% yoy, coming in line with the forecasted value. The overcapacity issue continues to haunt the Chinese economy, influenced also by the global commodity prices.
UK’s ONS (Office for National Statistics) also released the unemployment figure on Tuesday, with the reading hitting mid-2008’s low. This is considered to be the sign of a resilient economy towards the global slowdown. The unemployment rate made it down to 5.4% in the June-August period from a 5.5% in the March-May period. Opposed to this, the wage growth excluding bonuses went down from 2.9% to 2.8%, while the same figure but including bonuses went up from 2.9% to 3.0% – although it was expected a 3.1% rise. The jobless rate fall is a positive sign, but questions are arising regarding the slowdown in the wage growth pace.
There is also a data release from the other side of the Atlantic on Tuesday regarding the household spending. In the US, the Commerce Department published the latest numbers regarding the previously-mentioned indicator. The results mark a feeble third-quarter finish, with retail sales printing +0.1% missing the expected +0.2%. Also, retail sales minus automobiles went down 0.3% (biggest decline since this year’s January) although it was projected only a 0.1% regress. The indicators used to calculate GDP (these exclude food services , service stations, home-improvement stores and auto dealers) went down 0.1% after a +0.2% print in August . Inflation is pushed lower due to the falling energy prices, with the PPI going down 0.5% – the highest fall since January. US officials also released the cost of living on Thursday, which dropped at an annualized 0.1% figure. Core inflation went up to 1.9% yoy, surpassing the estimated 1.8% growth. The mom (month-on-month) core prices 0.2% and the headline figure went down 0.25 as forecasted by analysts. Energy costs kept the downwards trend, managing to go even lower from -2.0% in August to -4.7% in September, as well as gasoline dropping 9.0% (lowest since January).
Crude went down on Thursday, the WTI (West Texas Intermediate) trading in the $45.70/br. area, although last week the preferred threshold around which the trend lingered was $51.00. The EIA’s (Energy Information Administration) report according to which crude inventories have gone up with more than 7.5 million barrels / day last week is the one setting the tone and dictating the downward spiral.
