UK inflation on expected lines while German ZEW disappoints – TDS

Discussion in 'Fundamental Analysis' started by FXStreet_Team, Feb 16, 2016.

  1. FXStreet_Team

    FXStreet_Team Well-Known Member Trader

    Oct 7, 2015
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    Research Team at TDS, notes that the UK inflation rose 0.3% y/y, as markets expected.

    Key Quotes

    “Core inflation, which has been on a steady upward trend for much of the past six months decelerated somewhat to 1.2% y/y, supporting our view of a downside risk. Key factors weighing on growth in January included lower petrol prices and a reversal in last month’s outsized gain in airfare prices. An anticipated 5% cut in gas prices at one of the major distributors did not materialise in January, and should therefore weigh somewhat on February’s CPI.

    Germany: As we broadly expected, the February’s German ZEW index disappointed markets in the Current Situation measure, falling to 52.3 from 59.7 in January, while the Expectations index fell to 1.0 as we expected. Heightened market volatility, weak PMI readings, and generally worse than expected economic data all weighed on the index. Deterioration in the index could be seen in the banking and insurance sectors in particular, while steel & chemicals also declined. The retail / consumer goods sector and autos sectors gained on the month.”
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