Thinking the Unthinkable
03 August 2020
The debt accumulation is a problem that may be solved by inflation, but the status quo could persist as funding rates remain low, so there may not be an immediate need to address it.
5 min read
03 Aug 2020
Economic Highlights
Welcome to our Economic Highlights, bringing you market updates from across the UK, US, Europe and China, as well as the FTSE weekly winners and losers.
UK
June data for consumer credit suggested UK consumer retrenchment is nearly over with data showing a print of £-0.1bn versus a consensus figure of -£2bn. The recently announced stamp-duty holiday seems to have had a positive effect on the UK housing market, with net lending on housing increasing to £1.9bn in the month versus a consensus figure of £1.5bn. Nationwide price house data also showed a recovery in the housing market, with prices up 1.7% month-on-month and 1.5% year-on-year.
US
The headline data was the US GDP print for Q2, which came in at -32.9%, actually better than the consensus forecast of -34.5% (on an annualised basis). Personal income was somewhat weaker than the consensus for June -1.1%, however the rebound in personal consumption continued with a print of 5.6% in the month –which follows a 8.5% print in the previous month.
Europe
German IFO business confidence confirmed an improvement in both current and future expectations with prints for July at 90.5 and 97 respectively. In contrast to the sharp deterioration in the US labour market, the Eurozone labour continues to be supported by government support schemes as the Eurozone unemployment rate ticked up to 7.8% in June.
Source: FactSet
Source: FactSet