Macro-News round-up:


– EE.UU: Let’s start with yesterday’s US data, jobless claims came in lower than expected, 187k vs 207k, showing that the US labor market remains resilient. The Philadelphia Fed manufacturing index falls by -10.6 points, indicating worsening economic conditions in the region.

The Atlanta Fed’s GDPNow growth indicator estimates a Q4 growth rate of 2.4%. Also, US crude oil inventories contracted by 2.492 million barrels.

– Japan: Last night, Japan’s inflation rate was released, which declined further, from 2.5% in November to 2.3% in December, reducing the pressure on the BoJ to tighten policy.

However, it may not necessarily be good news for Japan if we take into account that its industrial production, published hours earlier, showed a contraction of its activity, -0.9% compared to a growth of 1.3% in the previous period. Lowering inflation by reducing economic activity is a worse problem because it generates poverty and unemployment.

– UK: After an upwardly corrected 1.5% increase in November, retail sales fell 3.3% month over month in December 2023—much worse than the 0.6% decline predicted by the market. The data could once again stoke fears of an economic recession in the UK.

– Germany: On a monthly basis, producer prices in Germany declined by 1.2% in December 2023, worse than market expectations and November’s 0.5% drop.

Worryingly, the effect we have seen in China, the US, and the UK, also emerges in the German data. Producer prices declined by 1.2% against the forecast of 0.5% and with a decrease in November of 0.5%. We are entering a scenario of deflationary risks, it could be the prologue to a global recession.

– Geopolitics: A few minutes ago, the Houthis claimed to have successfully attacked a US ship in the Gulf of Aden, according to The Insider Paper.  Yesterday, during remarks to reporters, when asked by a reporter whether the bombing in Yemen was working, President Biden replied: “Well, when you say working, are they stopping the Houthis? No. Are they gonna continue? Yes.”

Separately, Kiev has claimed responsibility for the attack on oil depots in Russia, according to the AFP Agency citing Ukrainian military sources.

The TASS news agency has reported, citing Belarusian Defence Ministry sources, that the country is considering deploying nuclear weapons as a strategic deterrent.  Please remember that this country borders three NATO countries and Ukraine.

Additionally, a two-day NATO meeting ended yesterday, after which, at a press conference in Brussels, they announced preparations for military exercises, which will mobilize more than 90,000 troops, making it NATO’s largest military exercise in decades, called ‘Steadfast Defender 2024’.

– Commodities: despite all the above, the price of crude oil shows a timid upward movement, with Brent crude currently at $79.50 per barrel and WTI at $74.50 per barrel.