Roaring Consumer Sentiments

Though the U.S. Retails sales disappointed on Wednesday, the University of Michigan’s Preliminary Consumer Sentiment index did not. For the month of December 2014, it came at 98.2 compared to the expectations of 94.2 and prior month’s reading of 93.6. Same with UoM’s Inflations Expectation reading. It was 2.4%, though it declined from previous month’s expectations…

Killing Softly – The CPI Edition

The U.S. December CPI report came on the softer side. Here are the highlights: Month-over-Month Headline CPI Headline CPI m/m came at -0.4% versus -0.3% expected Gasoline index declined by -9.4% and food index rose by +0.3% so did the index for natural gas and electricity Month-over-Month Core CPI (excluding food and energy) The m/m…

Not Over For Franc

Yesterday SNB announced removal of floor for EUR/CHF. Today’s retails sales are not helping the situation. The inflation adjusted retail sales fell -1.2% on year-over-year basis for the month of December 2014. Here is the graph and the downward trend is unmistakable. The ogre of deflation is becoming more menacing. Book Recommendations:

Secular Stagnation – Meditative Musings

This is just note to myself. Off late there has been discussion in the economists’ circle regarding ‘Secular Stagnation’. I may be late but I do believe that it is going to have profound impact on the global securities markets for the next few years – at least one to three – including on the outlook and policies of major central banks.…

BoE Does Nothing

Well, in a sense. In its monthly meeting, Bank Of England’s Monetary Policy Committee voted to maintain the Bank Rate at 0.5% and the stock of purchased assets financed by the issuance of the central bank reserves at £375 billion. The Bank Rate has been at 0.5% level since March 5, 2009. The asset purchase program was…

Madam Chairwoman Stands Pat – Federal Reserve’s Semi-Annual Monetary Policy Report

The maiden monetary policy report by Chairwoman Janet Yellen is neither hawkish nor dovish. This was somewhat expected despite hyped-up market expectations. Along with former Chairman Bernanke, Chairwoman was one of the prime architects of the current policy so it should not have been surprising that her prepared remarks were quiet unexciting given that nothing…...

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More Dovish Than Fed’s Evans

That would be, drumroll please, Chicago Fed President Charles Evans, again. This is via MarketWatch: In a speech to the C.D. Howe Institute, an independent not-for-profit economic research firm based in Toronto, Evans said policy makers should vow low rates until unemployment falls below 6.5%, as long as inflation is not forecast to rise above…