MARKET MOVER - BNP PARIBAS - Investment Services India
MARKET MOVER - BNP PARIBAS - Investment Services India
MARKET MOVER - BNP PARIBAS - Investment Services India
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Key Data Preview<br />
Chart 7: US Consumer Confidence<br />
Source: Reuters EcoWin Pro<br />
Sep (f) Aug 2H Sep p Aug<br />
Conference Board 52.0 53.5<br />
Michigan Sentiment 67.3 68.0 66.6 68.9<br />
<strong>BNP</strong> Paribas Forecast: Still Sluggish<br />
US: Consumer Confidence (September)<br />
Release Date: Tuesday 28 September<br />
The Conference Board Index of Consumer Confidence is<br />
expected to edge down to 52.0 in August after improving<br />
1.5 points to 53.5 in the previous month. The University of<br />
Michigan index of consumer confidence declined in the<br />
beginning of September to 66.6 from 68.9, the lowest<br />
reading for more than a year. Leading the decline, future<br />
conditions dropped to 59.1, the lowest reading since March<br />
2009, suggesting consumers are becoming pessimistic<br />
about future business prospects, jobs and family income.<br />
Recent weakness is particularly worrying as the stock<br />
market has rebounded significantly from its May/June<br />
crash, oil prices have been stable and corporate earnings<br />
reports have been upbeat about Q2 results (which have<br />
generally beat analysts’ estimates). We expect the<br />
recovery to continue and payrolls to keep growing,<br />
although at a moderate pace. Therefore, we should see<br />
confidence stabilise at current depressed levels.<br />
Key Point:<br />
The Conference Board Index of consumer<br />
confidence is expected to edge down in September.<br />
Source: Reuters EcoWin Pro<br />
Chart 8: German CoL<br />
% Sep (f) Aug Jul Jun<br />
CoL m/m -0.2 0.0 0.3 0.1<br />
CoL y/y 1.2 1.0 1.2 0.9<br />
HICP m/m -0.1 0.1 0.2 0.0<br />
HICP y/y 1.3 1.0 1.2 0.8<br />
Key Point:<br />
Energy price base effects should help drive headline<br />
inflation higher in September.<br />
<strong>BNP</strong> Paribas Forecast: Energy Base Effects<br />
Germany: CoL (September, preliminary)<br />
Release Date: Tuesday 28 September<br />
In August, energy price base effects pushed down inflation<br />
despite stronger food and core inflation. In September,<br />
energy base effects will be in play once again. A 1.5% m/m<br />
decline in energy prices last September will not be<br />
repeated this month, mechanically pushing energy inflation<br />
higher.<br />
Food inflation should also rise further on the month. The<br />
boost from food price base effects is now past, but we<br />
should increasingly begin to see pass-through from the<br />
recent soft commodity price shock to food prices in the<br />
coming months.<br />
Core inflation should creep higher on modest gains in<br />
clothing and non-energy transport price inflation, though<br />
rounded it should remain at 0.6%.<br />
Looking beyond August, German headline inflation is likely<br />
to trend higher over the remainder of the year, but is not<br />
expected to rise above 2%. Core inflation is likely to remain<br />
subdued, although with consumption in Germany gaining<br />
momentum, we do not expect the discount to the euro area<br />
average to continue for long.<br />
Market Economics 23 September 2010<br />
Market Mover<br />
57<br />
www.GlobalMarkets.bnpparibas.com