- Growth driven by services, notably in IT and communications
- Manufacturing is resilient
- Food inflation increased
- Construction momentum picking up
- Government spending should strengthen demand
- Indications of underlying inflation have changed little in recent months and remain consistent with costs
- Forward looking indicators and surveys point to a continued moderation in labor costs
- Most measures of longer-term inflation around 2%
- Uncertainty could weigh on demand
- Inflation could turn out higher if there is persistent upward shift in energy prices
The euro is higher since the speech started but that’s because US initial jobless claims were released and they showed a jump. Combined with a poor Challenger job cuts report and soft ADP/ISM services employment and the market is sniffing out a softer US jobs market. That has the US dollar sagging across the board.
Q&A:
- We are in a broadly balanced place in our risk assessment
This article was written by Adam Button at investinglive.com.
