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BOE Inflation Report: CPI Forecast Nudged Up To Near Target
BOE November inflation report cuts near-term growth forecast, raises inflation forecast
Italian auction results
Spain’s EconMin: Govt convinced policy path is the right one despite general strike
Happy Diwali to all our Hindu readers!!!
BUBA financial stability review- Eurozone crisis is the greatest threat to German financial stability
ECB Allots $3.306 Bln In 8-Day USD Liquidity Providing Op
Analysis: EMU Industry Down More Than Expected In September
EMU DATA: September industry output sa -2.5% m/m,….
Swiss ZEW investor sentiment -27.9 in November
Greek seasonally adjusted Q3 GDP -7.2 % y/y
Euro zone September industrial production -2.5% m/m, -2.3% y/y
Portuguese Q3 GDP -0.8 % q/q -3.4 % y/y
UK Europe Min Affirms Britain’s Tough EU Budget Stance: Press
IMF’s Lagarde: Expects a real fix, not a quick fix for Greece, including debt sustainability
UK Analysis: Oct Claimant Count Up Post Olympics
UK DATA: Oct Claimant Count Unemployment +10,100;….
UK October jobless claims +10k
Option expiries (updated)
Right, EUR/USD poll within a poll……

BOE Inflation Report: CPI Forecast Nudged Up To Near Target

Posted: 14 Nov 2012 02:40 AM PST

-BOE: CPI 1.8% 2yrs time on stg375bn QE, market rates
-BOE: CPI Seen close 1.9% in 3yrs on stg375bn QE, market rates

LONDON (MNI) – The Bank of England’s Monetary Policy Committee
pushed up its near term inflation forecast and predicted it would come
in only a little under target in two years’ time.

The central projection in the November Inflation Report shows CPI
at around 1.8% in two years’ time and at 1.9% three years out. This is a
shade higher than the 1.7% two year, and 1.8% three year, forecasts in
the August Inflation Report and leaves only a little room for further
stimulus.

The probability chart, showing the chances of inflation coming in
above or the 2% target, showed a little over a 45% chance of inflation
being above target, which again suggests the door to further stimulus is
just ajar.

Analysts had expected the slight rise in the two and three year
inflation forecasts.

Larger utility price hikes than the BOE had predicted contributed
to the increase in near term inflation.

“The near term outlook is higher than in August, reflecting
higher-than-expected outturns for inflation together with unexpectedly
large increases in household energy prices announced for the next few
months,” the report said.

It highlighted the uncertainty surrounding the inflation outlook,
but said inflation is likely to fall in the second half of 2013.

At its November meeting the MPC voted to keep policy unchanged, and
the Inflation Report sketched out the thinking behind this decision.

It said that at the November meeting “the Committee noted that a
slow recovery in GDP growth was likely as some of the headwinds holding
back demand in recent years abated.”

The MPC, which had the key November Inflation Report forecasts,
also noted that the near term inflation outlook had been raised “but
further out inflation was likely to fall back to around the target.”

“Against that backdrop, the Committee decided that it was
appropriate to maintain Bank Rate at 0.5% and the size of the asset
purchase programme at stg375 billion.”

The Inflation Report shows that on unchanged policy inflation would
be a little lower than on its headline forecast, which is based on
market rates.

On flat rates CPI two years’ out looks closer to 1.7%. This is
because markets are still pricing in a rate cut, with Bank Rate down at
0.3% in Q2 2013 and only rising back up to its current 0.5% two years
out.

The growth projections do show a slow, but fairly steady, recovery
with GDP growth rising to around 1.9% on the year in two years’ time and
then accelerating only marginally from this pace in the third year of
the forecast.

The report says that while GDP expanded by 1% on the quarter in Q3
it is “likely to fall sharply in Q4″ and that stripping out the
volatility it has been “broadly unchanged over the past two years.”

London Bureau; Tel: +44207 862 7491 e-mail: drobinson@marketnews.com

[TOPICS: M$B$$$,M$$BE$,MT$$$$]

BOE November inflation report cuts near-term growth forecast, raises inflation forecast

Posted: 14 Nov 2012 02:35 AM PST

BOE chart shows annual GDP growth around +1.9% in 2 years assuming market rate path (down from +2.0% in August report)
BOE chart shows CPI at around +1.8% in 2 years assuming market rate path (up from +1.7% in August report)
Euro zone poses greatest threat to sustained UK recovery, stronger productivity also needed for growth
Underlying UK growth likely to remain sluggish in near term, below average through to end 2015

Growth data/comments have underminned cable which is down at 1.5865.

200 dma well-noted at 1.5851.

Italian auction results

Posted: 14 Nov 2012 02:32 AM PST

Sold Eur 3.5 bln of July 2015 BTP’s at 2.64% yield , cover 1.496

Sold Eur 816 mln of August 2023 BTP’s at 4.81% yield, cover 1.51

Sold Eur 683 mln of November 2029 Btp’s at 5.33% yield, cover 1.48

Full take up of a targeted Eur 5 bln

Spain’s EconMin: Govt convinced policy path is the right one despite general strike

Posted: 14 Nov 2012 02:31 AM PST

Govt totally committed to meeting deficit targets

Happy Diwali to all our Hindu readers!!!

Posted: 14 Nov 2012 02:22 AM PST

BUBA financial stability review- Eurozone crisis is the greatest threat to German financial stability

Posted: 14 Nov 2012 02:11 AM PST

Risks have not decreased this year
Substantial deterioration in debt crisis would have significant impact on Germany’s banking and insurance sectors
Low interest rates, high liquidity and potential real estate exaggerations could threaten future financial stability

ECB Allots $3.306 Bln In 8-Day USD Liquidity Providing Op

Posted: 14 Nov 2012 02:10 AM PST

FRANKFURT (MNI) – The European Central Bank said Wednesday that it
has allotted $3.306 billion in its 8-day USD liquidity providing
operation.

The central bank said it received five bids.

Today’s operation was carried out at a fixed rate of 0.66%. The
Euro/USD rate was set at 1.2732.

– Frankfurt Bureau: +49-69-720 142, email: frankfurt@mni-news.com –

[TOPICS: MT$$$$,M$$EC$,M$$FI$,M$X$$$,MGX$$$]

Analysis: EMU Industry Down More Than Expected In September

Posted: 14 Nov 2012 02:10 AM PST

Sept preliminary: -2.5% m/m, -2.3% y/y

MNI survey median: -1.9% m/m, -2.5% y/y
MNI survey range: -2.5% to +0.6% m/m

August revision: +0.9% m/m (+0.6%)
July revision: +0.5% m/m (+0.6%)
June revision: -0.4% m/m (-0.5%)
May revision: +0.9% m/m (+1.0%)
April unrevised: -1.0% m/m
–

PARIS (MNI) – Eurozone industry output fell back more than
generally expected in September to a two-year low, with marked declines
in most economies, Eurostat said Wednesday.

The 2.5% monthly downturn left production 2.3% lower on the year
and more than 10% below pre-crisis levels. Moderate gains in July and
August assured a 0.3% recovery in 3Q after two quarters of 0.5% decline.

Many analysts had expected a marked correction in September since
the solid gains in several large economies in August looked too good to
last.

(Workday-adjusted data taking account of two fewer workdays in
September, by contrast, gave a sharp monthly rebound to the highest
level in six months.)

All categories posted declines in September: intermediate goods
(-2.0%), capital goods (-3.0%), consumer durables (-4.3%), non-durables
(-2.8%) and energy (-1.8%). Annual comparisons showed capital goods
holding up best (-0.8%) and intermediate goods hit hardest (-4.0%).

Leading indicators continue to point to sluggish activity ahead.
Even if the PMI polls appear to have lost some of their predictive
value, they remain far below the threshold for expansion for the
Eurozone as a whole (45.4) and the larger economies.

In a broader survey by the European Commission, manufacturing
sentiment sunk to a three-month low in October, undermined by ever
thinner order books and weaker output expectations. Last month, the
national statistics offices of France and Italy and Germany’s Ifo think
tank projected an industry decline of 0.4% in 4Q and an anemic recovery
of 0.2% in 1Q.

German industry output dropped 2.1% in September, led by a sharp
fall for capital goods. Producers polled by the Ifo institute in October
confirmed the marked erosion in business conditions in recent months and
were only slightly less pessimistic about medium-term prospects in light
of fading foreign demand.

French industry also surprised to the downside in September with a
2.7% setback accentuated by the skid in the auto industry and the
temporary shutdown of a large refinery. Under pressure from producers
and unions to stem the decline in industry, the government has come up
with a number of measures to help producers regain competitiveness,
including a E20 billion rebate on business taxes over the next three
years. However, little real impact can be expected in the near term.

Production in Italy fell back 1.5% in September from a 1.7% rebound
in August. Sector sentiment has stabilized since spring around lows last
seen three years ago, according to Istat’s surveys; producers’
assessment of orders do not point to any recovery in the near term.

In Spain, output dropped 2.8% after a 1.6% jump in August. Reviving
export growth has so far been unable to offset the slump in domestic
demand throttled by fiscal consolidation and high unemployment. Sector
sentiment has fallen back to lows seen nearly three years ago and
producers’ assessment of total orders has been on a downward trend since
February, according to the Commission’s survey.

Nearly all of the smaller reporting countries contributed to the
contraction in September, with monthly declines led by Ireland (-12.6%)
and Portugal (-12.0%), followed by Greece (-4.4%), Slovenia (-2.3%),
Malta (-1.7%) and Luxembourg (-0.9%). The only gains were in Slovakia
(+1.4%) and Estonia (+2.0%). Output was unchanged in the Netherlands.

–Paris newsroom +331 4271 5540; e-mail: ssandelius@mni-news.com

[TOPICS: M$XDS$,MT$$$$,M$X$$$,MTABLE]

EMU DATA: September industry output sa -2.5% m/m,….

Posted: 14 Nov 2012 02:10 AM PST

EMU DATA: September industry output sa -2.5% m/m, wda -2.3% y/y
– EMU September industry output m/m below MNI median fcast (-1.9%)
– EMU August ind output rev up +0.9% m/m, -1.3% y/y (+0.6%,-2.9%)
– EMU 3q industry output +0.3% q/q; 2q -0.5%; 1q -0.5%
– EMU September 3mm avg (July-September:June-August) -0.3% after August
+0.3%
– See MNI’s Mainwire for more details

Swiss ZEW investor sentiment -27.9 in November

Posted: 14 Nov 2012 02:09 AM PST

Improved from -28.9 in October.

Greek seasonally adjusted Q3 GDP -7.2 % y/y

Posted: 14 Nov 2012 02:03 AM PST

From a revised -6.3% y/y in Q2

Well don’t think anything better was to be expected :(

Euro zone September industrial production -2.5% m/m, -2.3% y/y

Posted: 14 Nov 2012 02:02 AM PST

Month on month number demonstrably weaker than Reuter’s median forecast of -1.9%, year on year as expected.

However Augusts’ data revised upward, to +0.9% m/m, -1.3% y/y from previous +0.6%, -2.9% respectively.

Portuguese Q3 GDP -0.8 % q/q -3.4 % y/y

Posted: 14 Nov 2012 02:01 AM PST

From – 1.2% and -3.2% y/y in Q2

UK Europe Min Affirms Britain’s Tough EU Budget Stance: Press

Posted: 14 Nov 2012 02:00 AM PST

–But Britain Willing To Discuss Shortening Next Budget Period

BERLIN (MNI) – Britain’s Europe Minister, David Lidington, has
reaffirmed his government’s strict opposition to real term increases in
the EU budget, but has proposed shortening the duration for the next
financial period.

“We want to freeze the budget, and it will stay this way” Lidington
told German weekly Die Zeit in an interview to be published Thursday.

The minister said Britain was willing to discuss, though, a
shortening the next budget period to three or five years from seven
years.

EU heads of states and governments are to meet on November 22-23 in
Brussels to decide on the 2014-2020 budget period. British Prime
Minister David Cameron has threatened to veto any increase in the EU
budget.

–Berlin bureau: +49-30-22 62 05 80; email: twidder@mni-news.com

[TOPICS: M$X$$$,MGX$$$,M$$CR$,M$B$$$]

IMF’s Lagarde: Expects a real fix, not a quick fix for Greece, including debt sustainability

Posted: 14 Nov 2012 01:43 AM PST

All of Greece’s partners share same objectives to put Greece programme back on track

We’re all singing from the same hymn-sheet honestly

EUR/USD extends rally to 1.2747.

Some will tell you this latest rally extension is on the back of the Lagarde comments, I know it’s really Perfect Pete’s call for 1.2780 before 1.2680

UPDATE: Halo of uncertainty is going to be removed for China succession

UK Analysis: Oct Claimant Count Up Post Olympics

Posted: 14 Nov 2012 01:40 AM PST

-Oct Claimant Count Unemployment +10,100; rate 4.8%
-Sep Claimant Count Unemployment revised to +800 from -4,000
-Sep Average Weekly Earnings total pay +1.8% vs +1.7% in Aug
-Jul-Sep ILO Unemployment -49,000; Rate 7.8%

LONDON (MNI) – Claimant count unemployment rose unexpectedly in
October at its fastest pace for more than a year, although some of this
is likely due to a temporary effect from the Olympics.

While the headline figure shows a larger rise than the median
forecast, the latest increase probably represents a bounceback to more
normal levels following a dip in July and August caused by the Olympics.
National Statistics has never acknowledged officially any Olympic
effect, but it seems likely that the claimant count will tick up further
next month back to around the level see in June.

National Statistics have pointed to the London figures which showed
falls in the run up to the Olympics and have risen by 3,600 and 2,900
respectively in September and October, accounting for most of the
increase in the claimant count.

The claimant count was up 10,100 on the month in October following
a revised rise of 800 in September, from an initially estimated 4000
decline. Analysts had forecast no change in October.

Given the distortions of the Olympics it is too early to say the
claimant count is now on an upward trend. Moreover, distortions to the
benefit system from lone parent income support means the actual change
in the claimant count is more likely closer to flat on the month — not
as bad as the headline figure.

The ILO numbers showed a healthy fall of 49,000 in Jul-Sep against
the previous three months, although this will still be impacted by the
Olympics. Movements in the ILO data usually lag those in the claimant
count so expect to see smaller falls or a possible rise over the coming
months. Employment was up 100,000 over the same period.

Earnings growth remains very soft with the headline weekly earnings
rate rising to 1.8% in September from 1.7% in August, below the median
for 1.9%.

Excluding bonuses headline growth dipped to 1.9% from 2%, below the
median of 2%.

-London bureau: 00 44 207 862 7491 e:mail: puglow@marketnews.com

[TOPICS: MABDA$,M$B$$$,MT$$$$,MABDS$]

UK DATA: Oct Claimant Count Unemployment +10,100;….

Posted: 14 Nov 2012 01:40 AM PST

UK DATA: Oct Claimant Count Unemployment +10,100; rate 4.8%
-Sep Claimant Count Unemployment revised to +800 from -4,000
-Sep Average Weekly Earnings total pay +1.8% vs +1.7% in Aug
-Jul-Sep ILO Unemployment -49,000; Rate 7.8%
————————————————————————
Claimant count unemployment rose unexpectedly in October at its
fastest pace for more than a year. While the headline figure shows a
larger rise than the median forecast, the latest increase most likely
represents a bounceback to more normal levels following a dip in July
and August caused by the Olympics. While National Statistics has never
acknowledged officially any Olympic effect, it seems likely that the
claimant count will tick up further next month back to around the level
see in June. Given the distortions of the Olympics its too early to say
the claimant count is now on an upward trend.