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Euro zone producer prices head north a bit faster than anticipated in January
In January, euro zone producer prices surged a bit faster than anticipated, backed by an ascend in energy, capital, and intermediate goods. That’s what data revealed on Monday.
The EU’s statistics office Eurostat informed that prices at factory gates in the trading bloc tacked on by 0.4% month-on-month for a 3% year-on-year rally.
Market experts had hoped for a 0.3% monthly ascend as well as a 2.9% annual leap.
Eurostat told that energy prices bounced off in January, heading north by up to 0.4% on the month following a 2.7% tumble in December. In addition to this, intermediate products prices managed to tack on by up to 0.3% after a 0.4% slump in December. Besides this, capital goods prices went up by nearly 0.6% after no change in December.
Producer prices turn out to be an early gauge of trends in consumer prices due to the fact that unless their changes are absorbed by retailers and intermediaries, they’re passed on to EU customers.
Aside from that, the European Central Bank is on the verge of keeping consumer inflation below, although close to 2% over the medium term. As a matter of fact, in February, consumer prices managed to head north by up to 1.5% year-on-year, speeding up from January’s outcome of 1.4%. As for the probable explanation of this, many experts point to the still high contribution of energy.
Excluding the volatile energy component, in February, consumer prices inched up by about 1.2% year-on-year. By the way, the given reading is equivalent to the outcome of producer prices in January.
All attention on the market is on the Brexit process. Fears over the no-deal Brexit pushed the British pound deep down yesterday after UK Prime Minister Boris Johnson claimed he was ready to abandon negotiations.
The market sentiment is mixed, and the US dollar is trading near the lowest levels for over two years. Let’s have a look at the main market movements today.
The market optimism waned amid stricter restrictions to control rising coronavirus infections. S&P 500 and Nasdaq dropped from the all-time highs, while the USD jumped higher.
S&P 500 skyrocketed to the all-time high on optimism that Biden’s fiscal stimulus will support economic growth and boost corporate earnings.
PMI reports from the EU, the UK, and the USA will be released during the day!