Japan’s economy narrowly averted a recession in the final months of 2022, barely growing on frail consumption after shrinking in the third quarter, revised data showed, underscoring the challenge for policymakers trying to shore up a wobbly recovery. Record high inflation and slowing global growth amid sweeping monetary tightening across many countries have undermined the world’s third-biggest economy’s post-pandemic revival, despite relaxation of COVID curbs, energy subsidies and ultra-easy monetary policy. Japan’s gross domestic product (GDP) expanded by an annualized 0.1% in October-December, against a preliminary estimate of a 0.6% expansion and much lower than economists’ median forecast for a 0.8% rise in a Reuters poll. That followed a revised 1.1% contraction in July-September. Private consumption, which makes up more than half of the country’s GDP, grew 0.3%, the data showed, downgraded from an initial estimate of a 0.5% increase.
The major Asian stock markets had a negative day today:
The major Asian currency markets had a mixed day today:
Some economic news from last night:
National Core CPI (YoY) (Feb) decreased from 4.2% to 3.1%
Services PMI increased from 54.0 to 54.2
Some economic news from today:
Bank Loan Growth increased from 15.5% to 15.7%
Deposit Growth increased from 10.1% to 10.3%
FX Reserves, USD increased from 560.00B to 572.80B
European Union leaders and the ECB sought to calm market jitters by presenting a united front on the banking sector on Friday, saying EU lenders are well capitalized and liquid thanks to lessons drawn after the 2008 Lehman Brothers collapse. European banking stocks fell sharply again on Friday, with Deutsche Bank and UBS knocked by worries that actions by regulators and central banks have yet to contain the worst problems to face the sector since the 2008 financial crisis. European Central Bank head Christine Lagarde told EU leaders that European banks were safe but called on governments to push on with a stalled EU deposit insurance scheme, officials said. Defending the ECB’s push to raise interest rates to stamp out high inflation at a time of turbulence in the financial sector, Lagarde said there was no tradeoff between fighting inflation and keeping the banking sector stable.
The major Europe stock markets had a negative day:
The major Europe currency markets had a mixed day today:
Some economic news from Europe today:
Composite PMI decreased from 53.1 to 52.2
Manufacturing PMI decreased from 49.3 to 48.0
Services PMI decreased from 53.5 to 52.8
Core Retail Sales (MoM) (Feb) increased from 0.9% to 1.5%
Core Retail Sales (YoY) (Feb) increased from -5.4% to -3.3%
Retail Sales (MoM) (Feb) increased from 0.9% to 1.2%
Retail Sales (YoY) (Feb) increased from -5.2% to -3.5%
Spanish GDP (QoQ) (Q4) remain the same at 0.2%
French Manufacturing PMI (Mar) increased from 47.4 to 47.7
French Services PMI (Mar) increased from 53.1 to 55.5
German Manufacturing PMI (Mar) decreased from 46.3 to 44.4
German Services PMI (Mar) increased from 50.9 to 53.9
Manufacturing PMI (Mar) decreased from 48.5 to 47.1
S&P Global Composite PMI (Mar) increased from 52.0 to 54.1
Services PMI (Mar) increased from 52.7 to 55.6
Wall Street closed in the green this Friday after banking fears were quelled. Yellen’s promise to the public yesterday to cover deposits brought some hope to investors, as did Powell’s statement earlier in the week that hinted the Fed may be pumping the breaks rate hikes. Yet, the issue with banks is not limited to the US and seems to be a contagion sweeping through the global economy. Deutsche Bank has lost over a fifth of its value in March alone. The increased cost of insuring banks against possible defaults led to the bank’s stock slipping by over 14% during midday trading. US-listed shares on the exchange experienced a dramatic sell-off, as the banking sector remain volatile on a macro level.
US Market Closings:
Canada Market Closings:
Brazil Market Closing:
The oil markets had a mixed day today:
The above data was collected around 11:36 EST on Friday
The above data was collected around 11:43 EST Friday.
Japan 0.38% (+8bp), US 2’s 3.75% (-0.056%), US 10’s 3.3687% (-3.53bps); US 30’s 3.64% (-0.038%), Bunds 2.125% (-6.1bp), France 2.652% (-6.6bp), Italy 4.006% (-5.1bp), Turkey 11.91% (+0bp), Greece 4.074% (-13.9bp), Portugal 3.025% (-4.7bp); Spain 3.178% (-6.2bp) and UK Gilts 3.279% (-8.2bp).
The post Market Talk – March 24, 2023 first appeared on Armstrong Economics.