EUROPEAN INFLATION: EZ Final HICP Broadly In-Line with Flash
Nov-19 10:14
Eurozone October Final HICP was in-line with flash at 2.00% Y/Y (vs 2.00% flash, 1.74% prior) and 0.3% M/M non-seasonally adjusted (vs 0.34% flash, -0.09% prior).
- Core inflation (ex energy, food, alcohol & tobacco) also saw little revision at 2.69% Y/Y (vs 2.68% flash, 2.67% prior) and 0.25% M/M (vs 0.23% flash, 0.07% prior).
- The final reading reaffirms the stickiness seen in the flash services inflation print, with services contribution broadly unchanged at 1.77ppts (vs 1.76 ppts in September) and the Y/Y figure rising to 3.95% Y/Y (vs 3.92% flash, 3.92% prior).
- The change in Energy's contribution to headline CPI was the most significant driver this month, with the contribution increasing to -0.45ppts (from -0.60ppts in September).
- The contribution of "Unprocessed foods" increased 0.06ppts to 0.13ppts in October - the highest since January 2024 while the contribution from "Processed foods, alcohol and tobacco" edged up to 0.43ppts (vs 0.39ppts in September).
- "Non-energy industrial goods" (i.e. core goods) contribution was broadly similar to both August and September at 0.13ppts (vs 0.12ppts in September).
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RATINGS: UK, Italy Affirmed by S&P; Scope Downgrades France
Oct-18 21:02
Recapping sovereign ratings actions today:
- S&P affirms Italy's Long-Term Local Currency Debt Rating at BBB, outlook remains stable
- S&P affirms the UK's Long-Term Local Currency Debt Rating at AA, outlook remains stable
- Scope downgraded France to AA- (from AA) with a stable outlook
- S&P did not affirm/update the ratings of Greece or the Netherlands as part of their semi-annual review of the sovereigns.
US FISCAL: Budget Deficit Rises As Interest Payments Soar
Oct-18 20:27
The US's September budget balance came in very close to expectations with a $64B surplus, just the 2nd monthly surplus posted in the 2024 fiscal year just ended (Monthly Treasury Statement here - PDF).
- For the fiscal year as a whole (Oct-Sep), the nominal deficit came in at $1.83T, equating to 6.4% of GDP - that's up from $1.70T in FY 2023 (6.2% of GDP).
- For the year, revenues rose by a little under $500B but outlays grew by over $600B. Notably, interest rose 29% to $1.13T (net $882B), with the net figure 3.06% of GDP: the highest since 1996. That came as the weighted average interest rate of debt outstanding rose 35bp on the year to 3.32%, while social security payments rose by $103B on higher cost of living increases and more retirees.
- The 2025 fiscal year deficit is not expected to be much changed as a percentage of GDP, though that could depend on the November election results.
- CBO director Phillip Swagel told MNI recently America has fiscal headroom in the near-term but spending is on an unsustainable track over the long-term (link).
MNI: US SEP TREASURY BUDGET $64.3B
Oct-18 20:00
- MNI: US SEP TREASURY BUDGET $64.3B
