Summary for the 4th of March 2019


The growth in the EU Area had declined at the end of 2018. The manufacturing PMI from the EU Area was lower than what the market expected and indicated a lower economic activity in the future. At the last ECB meeting in January, the ECB had adjusted the assessment of the economic growth to a downside, and that there wouldn’t be changes in the monetary policy until the ECB had updated the inflation and growth objectives. These updates will be announced on Thursday.

The first tranche of the TLTROII loans will, as of June this year, no longer be considered stable funding, and banks will need to refinance these loans directly from the financial market, unless the ECB is offering new financing operations. The announcement about the situation will most likely be during this week.

The US ISM Manufacturing PMI for February fell below (54.2)market expectations (55.5). Personal consumption expenditures (PCE) fell by 0.5% from November to December. Personal income for January was weak, but this was after a strong increase in December.

Even with a tight labor market, the inflation hasn’t increased, as the US Core PCE Price Index, Fed’s preferred measure of inflation, was unchanged at 1.9% in December.

On Friday, there were news from the trade negation between the US and China. The two parties were close to an agreement, and that the tariffs on Chinese good implemented last year would be removed, that China would be obliged to import more US goods, reduce the subsidiaries to state owned companies and change the current practice surrounding joint ventures between China and foreign companies.

Indices for 4th of March:
Dow: +0.4% (1st of March )
S&P 500: +0.7% (1st  of March)
Nasdaq: +0.8% (1st of March)
Nikkei: +1.1%  (4th of March)
Chinese indices: +3.6% (4th of March))
STOXX Europe 600 Index: +0.23% (4th  of March)

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