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You can find the current article at its original source at http://www.theguardian.com/business/live/2015/oct/30/bank-of-japan-stimulus-hints-eurozone-inflation-business-live
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| Version 12 | Version 13 |
|---|---|
| Eurozone emerges from deflation; Japan hints at more stimulus - as it happened | Eurozone emerges from deflation; Japan hints at more stimulus - as it happened |
| (about 1 month later) | |
| 1.47pm GMT | 1.47pm GMT |
| 13:47 | 13:47 |
| Afternoon summary | Afternoon summary |
| Time for a quick recap. | Time for a quick recap. |
| Economists are expecting the European Central Bank to press on with fresh stimulus measures, even though the eurozone has escaped deflation for the second time this year. | Economists are expecting the European Central Bank to press on with fresh stimulus measures, even though the eurozone has escaped deflation for the second time this year. |
| The consumer prices index has inched back to zero this month, according to eurostat, from 0.1% in September. Lower energy costs continued to drag the cost of living down. | The consumer prices index has inched back to zero this month, according to eurostat, from 0.1% in September. Lower energy costs continued to drag the cost of living down. |
| Europe’s jobless crisis has eased a little, with the unemployment rate across the EU hitting a six-year low. | Europe’s jobless crisis has eased a little, with the unemployment rate across the EU hitting a six-year low. |
| Spain has posted another quarter of solid expansion, although growth slowed to 0.8% from 1%. | Spain has posted another quarter of solid expansion, although growth slowed to 0.8% from 1%. |
| Japan’s central bank governor has vowed to do more, if necessary, to get the country’s inflation rate back to target. Haruhiko Kuroda made the pledge after the BoJ lowered its growth and inflation forecasts. A move could come in December, analysts say. | Japan’s central bank governor has vowed to do more, if necessary, to get the country’s inflation rate back to target. Haruhiko Kuroda made the pledge after the BoJ lowered its growth and inflation forecasts. A move could come in December, analysts say. |
| Angela Merkel has predicted that China’s economy will avoid a very hard landing, on a trip to the country. | Angela Merkel has predicted that China’s economy will avoid a very hard landing, on a trip to the country. |
| And Portugal’s president has defended asking former PM Pedro Passos Coelho to form a new government, rather than his left-wing rivals. | And Portugal’s president has defended asking former PM Pedro Passos Coelho to form a new government, rather than his left-wing rivals. |
| #Portugal: President evokes 40yrs "constitutional habitude": "only the party that win elections must form govt". pic.twitter.com/WlUIN4bB8F | #Portugal: President evokes 40yrs "constitutional habitude": "only the party that win elections must form govt". pic.twitter.com/WlUIN4bB8F |
| #Portugal: President reminds need to preserve commitment w/EU and Euro, asks govt to respect budget discipline. pic.twitter.com/MMs53uOWQz | #Portugal: President reminds need to preserve commitment w/EU and Euro, asks govt to respect budget discipline. pic.twitter.com/MMs53uOWQz |
| Passos Coelho’s administration has just been sworn in, but could be kicked out next month at a crunch confidence vote. | Passos Coelho’s administration has just been sworn in, but could be kicked out next month at a crunch confidence vote. |
| And that may be all for today, but we’ll be back if there are any huge developments.... If not, have good weekends all. GW | And that may be all for today, but we’ll be back if there are any huge developments.... If not, have good weekends all. GW |
| 12.54pm GMT | 12.54pm GMT |
| 12:54 | 12:54 |
| The latest US economic data just hit the wires, and paints a mixed picture of the world’s largest economy. | The latest US economic data just hit the wires, and paints a mixed picture of the world’s largest economy. |
| American household spending rose by just 0.1% in September, down from 0.4% in August, and only half as fast as economists expected. | American household spending rose by just 0.1% in September, down from 0.4% in August, and only half as fast as economists expected. |
| But US labour costs have risen by 0.6% during the last quarter, up from 0.2% in the previous three months. That’s a broad measure of pay, suggesting salaries are rising as the employment market continues to tighten. | But US labour costs have risen by 0.6% during the last quarter, up from 0.2% in the previous three months. That’s a broad measure of pay, suggesting salaries are rising as the employment market continues to tighten. |
| So on balance, it doesn’t really settle the debate on whether US interest rates will go up before Christmas (as covered in the intro). | So on balance, it doesn’t really settle the debate on whether US interest rates will go up before Christmas (as covered in the intro). |
| Updated | Updated |
| at 1.04pm GMT | at 1.04pm GMT |
| 12.35pm GMT | 12.35pm GMT |
| 12:35 | 12:35 |
| Canadian growth slows in August | Canadian growth slows in August |
| The global slowdown has rippled across to Canada. | The global slowdown has rippled across to Canada. |
| Canadian GDOP rose by only 0.1% in August, data just released showed, down from 0.3% in July. | Canadian GDOP rose by only 0.1% in August, data just released showed, down from 0.3% in July. |
| #Canada #GDP 0.1%m/m from 0.3%. oh well. | #Canada #GDP 0.1%m/m from 0.3%. oh well. |
| That follows this week’s trend of slowing growth in the last quarter (in the UK, the US and Spain). | That follows this week’s trend of slowing growth in the last quarter (in the UK, the US and Spain). |
| It’s the third monthly expansion in a row in Canada, following contractions earlier in the year. On an annual basis, the economy was only 0.9% bigger than 12 months ago. | It’s the third monthly expansion in a row in Canada, following contractions earlier in the year. On an annual basis, the economy was only 0.9% bigger than 12 months ago. |
| Updated | Updated |
| at 12.42pm GMT | at 12.42pm GMT |
| 12.25pm GMT | 12.25pm GMT |
| 12:25 | 12:25 |
| Over in Lisbon, Portugal’s new government is being sworn in after a general election that produced no clear winner. | Over in Lisbon, Portugal’s new government is being sworn in after a general election that produced no clear winner. |
| It means Pedro Passos Coehlo remains as prime minister, but leading a minority government. | It means Pedro Passos Coehlo remains as prime minister, but leading a minority government. |
| #Portugal new government being sworn-in now in Lisbon. pic.twitter.com/NTqFLbD8bN | #Portugal new government being sworn-in now in Lisbon. pic.twitter.com/NTqFLbD8bN |
| #Portugal: Minority govt swears-in 11 days before decisive confidence vote at parliament. President address soon. pic.twitter.com/DJlRZgmD8r | #Portugal: Minority govt swears-in 11 days before decisive confidence vote at parliament. President address soon. pic.twitter.com/DJlRZgmD8r |
| Portugal’s president sparked controversy by asking Passos Coehlo to form the next administration, even though left-wing parties won a majority of seats between them. | Portugal’s president sparked controversy by asking Passos Coehlo to form the next administration, even though left-wing parties won a majority of seats between them. |
| This sparked talk that a coup had been perpetrated. But in truth, the wheels of democracy will keep turning. | This sparked talk that a coup had been perpetrated. But in truth, the wheels of democracy will keep turning. |
| The opposition will get their chance to kick Passos Coehlo out of office early next month, in a vote of confidence on the new government’s policies. | The opposition will get their chance to kick Passos Coehlo out of office early next month, in a vote of confidence on the new government’s policies. |
| Related: Sorry, British Eurosceptics, but there was no coup in Portugal | Felipe Henriques | Related: Sorry, British Eurosceptics, but there was no coup in Portugal | Felipe Henriques |
| 11.44am GMT | 11.44am GMT |
| 11:44 | 11:44 |
| Merkel has used her China trip to call for more protection for Europe’s steel industry, which has been ravaged by falling prices and overcapacity. | Merkel has used her China trip to call for more protection for Europe’s steel industry, which has been ravaged by falling prices and overcapacity. |
| Over to Reuters’ Andreas Rinke: | Over to Reuters’ Andreas Rinke: |
| At a German-Sino business congress in Hefei, Merkel calledfor better protection of the steel and solar industries against unfair international competition, a complaint some manufacturers make against China. | At a German-Sino business congress in Hefei, Merkel calledfor better protection of the steel and solar industries against unfair international competition, a complaint some manufacturers make against China. |
| Merkel said the steel sector needed “a certain amount of market protection” as steelmakers have pointed out that environmental regulations differ from country to country,impacting cost advantages. | Merkel said the steel sector needed “a certain amount of market protection” as steelmakers have pointed out that environmental regulations differ from country to country,impacting cost advantages. |
| “I also hope that we can extend the rules already in placein the solar sector,” she added. | “I also hope that we can extend the rules already in placein the solar sector,” she added. |
| Updated | Updated |
| at 11.44am GMT | at 11.44am GMT |
| 11.35am GMT | 11.35am GMT |
| 11:35 | 11:35 |
| Angela Merkel also had an opportunity to pass on some football tips to the next generation today, during a trip to a primary school in Xin Nan Cun. | Angela Merkel also had an opportunity to pass on some football tips to the next generation today, during a trip to a primary school in Xin Nan Cun. |
| Updated | Updated |
| at 11.36am GMT | at 11.36am GMT |
| 11.32am GMT | 11.32am GMT |
| 11:32 | 11:32 |
| Angela Merkel has also predicted that China’s economy will avoid a crash, during her trip to Hefei today. | Angela Merkel has also predicted that China’s economy will avoid a crash, during her trip to Hefei today. |
| She told journalists: | She told journalists: |
| “I think one can expect that China’s growth will be a bit weaker, but that it will have constant growth. | “I think one can expect that China’s growth will be a bit weaker, but that it will have constant growth. |
| “It is obvious that particularly the domestic demand through growing cities is an important factor to stimulate consumption and here with growth.” | “It is obvious that particularly the domestic demand through growing cities is an important factor to stimulate consumption and here with growth.” |
| This is Merkel’s eighth visit to China since becoming Germany’s leader a decade ago, underlining the importance of the links between Berlin and Beijing. | This is Merkel’s eighth visit to China since becoming Germany’s leader a decade ago, underlining the importance of the links between Berlin and Beijing. |
| 11.23am GMT | 11.23am GMT |
| 11:23 | 11:23 |
| Photos: Angela Merkel visits China | Photos: Angela Merkel visits China |
| Angela Merkel has been hard at work building closer trade links with China. | Angela Merkel has been hard at work building closer trade links with China. |
| The chancellor has put worries over Germany’s economy, and Europe’s escalating refugee crisis behind her. And the latest photos from the trip suggest it’s going well. | The chancellor has put worries over Germany’s economy, and Europe’s escalating refugee crisis behind her. And the latest photos from the trip suggest it’s going well. |
| Merkel got a warm welcome from students at Hefei University in Hefei, capital of east China’s Anhui Province.... | Merkel got a warm welcome from students at Hefei University in Hefei, capital of east China’s Anhui Province.... |
| ...and then shared a drink with Chinese Premier Li Keqiang, using beer brewed by the students #cheers | ...and then shared a drink with Chinese Premier Li Keqiang, using beer brewed by the students #cheers |
| Merkel also told reporters that Germany favours granting China “market economy status” - a shift that would make it harder for the EU to protect local industry from Chinese competition. | Merkel also told reporters that Germany favours granting China “market economy status” - a shift that would make it harder for the EU to protect local industry from Chinese competition. |
| However, Beijing still “has to do some homework, for example in the area of public procurement,” she added (Reuters reports) | However, Beijing still “has to do some homework, for example in the area of public procurement,” she added (Reuters reports) |
| And she also met a group of children in the Baohe district of Hefei: | And she also met a group of children in the Baohe district of Hefei: |
| Updated | Updated |
| at 11.38am GMT | at 11.38am GMT |
| 11.02am GMT | 11.02am GMT |
| 11:02 | 11:02 |
| Mario Draghi will be pleased to see the eurozone clamber out of deflation this month, but it only takes a little pressure off his central bank. | Mario Draghi will be pleased to see the eurozone clamber out of deflation this month, but it only takes a little pressure off his central bank. |
| Last week, the ECB chief hinted that more stimulus could be needed soon, as inflation remained sharply off course. | Last week, the ECB chief hinted that more stimulus could be needed soon, as inflation remained sharply off course. |
| Bill Adams, senior international economist at PNC Financial Services Group, believes Draghi will make an announcement at its next meeting: | Bill Adams, senior international economist at PNC Financial Services Group, believes Draghi will make an announcement at its next meeting: |
| The ECB’s most likely next move is to announce an extension in December of the duration of its quantitative easing program to last through March 2017. But hawks on the Governing Council may point to an exit from deflation as a reason for the ECB to continue with asset purchases in 2016, but without as clear a pre-commitment as they made in 2015. | The ECB’s most likely next move is to announce an extension in December of the duration of its quantitative easing program to last through March 2017. But hawks on the Governing Council may point to an exit from deflation as a reason for the ECB to continue with asset purchases in 2016, but without as clear a pre-commitment as they made in 2015. |
| This would provide the ECB with discretion to begin a taper of its easing program earlier than expected if inflation surprises to the upside due to pass-through of higher import prices or higher food prices (unprocessed food prices rose 3.0% from a year earlier in October). | This would provide the ECB with discretion to begin a taper of its easing program earlier than expected if inflation surprises to the upside due to pass-through of higher import prices or higher food prices (unprocessed food prices rose 3.0% from a year earlier in October). |
| When do we start talking about tapering the 2nd lot of QE the ECB hasn't yet announced? | When do we start talking about tapering the 2nd lot of QE the ECB hasn't yet announced? |
| No time like the present, eh?.... | No time like the present, eh?.... |
| Updated | Updated |
| at 11.08am GMT | at 11.08am GMT |
| 10.38am GMT | 10.38am GMT |
| 10:38 | 10:38 |
| European Union jobless rate hits six-year low | European Union jobless rate hits six-year low |
| Unemployment in the wider European Union has hit a six-year low of 9.3%, even better than the 3.5 year low of 10.8% in the eurozone: | Unemployment in the wider European Union has hit a six-year low of 9.3%, even better than the 3.5 year low of 10.8% in the eurozone: |
| But that still leaves 22.631 million men and women out of work in the 28 countries which make up the EU. | But that still leaves 22.631 million men and women out of work in the 28 countries which make up the EU. |
| Eurostat explains: | Eurostat explains: |
| The EU28 unemployment rate was 9.3% in September 2015, down from 9.4% in August 2015, and from 10.1% in September 2014. This is the lowest rate recorded in the EU28 since September 2009. | The EU28 unemployment rate was 9.3% in September 2015, down from 9.4% in August 2015, and from 10.1% in September 2014. This is the lowest rate recorded in the EU28 since September 2009. |
| But this is still far, far too high -- almost twice the levels in the UK and the US. | But this is still far, far too high -- almost twice the levels in the UK and the US. |
| And many countries are still lagging behind. | And many countries are still lagging behind. |
| The highest rates were recorded in Greece (25.0% in July 2015) and Spain (21.6%) -- a reminder that the Spanish recovery hasn’t fully fed through to its labour market. | The highest rates were recorded in Greece (25.0% in July 2015) and Spain (21.6%) -- a reminder that the Spanish recovery hasn’t fully fed through to its labour market. |
| The lowest were recorded in Germany (4.5%), the Czech Republic (4.8%), Malta (5.1%) and the United Kingdom (5.3% in July 2015). | The lowest were recorded in Germany (4.5%), the Czech Republic (4.8%), Malta (5.1%) and the United Kingdom (5.3% in July 2015). |
| At just 5.3%, the UK unemployment rate is about half the eurozone average (10.8%) pic.twitter.com/kHZqnHO8S4 | At just 5.3%, the UK unemployment rate is about half the eurozone average (10.8%) pic.twitter.com/kHZqnHO8S4 |
| Updated | Updated |
| at 10.49am GMT | at 10.49am GMT |
| 10.28am GMT | 10.28am GMT |
| 10:28 | 10:28 |
| It’s almost a year since oil prices began to tumble on the world markets, giving the global economy a deflationary squeeze. | It’s almost a year since oil prices began to tumble on the world markets, giving the global economy a deflationary squeeze. |
| The impact of cheap oil should soon start to drop out of the annual inflation rates, though (as prices will no longer be cheaper than a year ago). And that could send consumer prices indices up again.... | The impact of cheap oil should soon start to drop out of the annual inflation rates, though (as prices will no longer be cheaper than a year ago). And that could send consumer prices indices up again.... |
| Can't help feeling there will be a bit of a pop in €area inflation once this washes through https://t.co/311GaHfmXo pic.twitter.com/HYTJueilma | Can't help feeling there will be a bit of a pop in €area inflation once this washes through https://t.co/311GaHfmXo pic.twitter.com/HYTJueilma |
| 10.14am GMT | 10.14am GMT |
| 10:14 | 10:14 |
| This is the second time this year that the eurozone has shaken off a bout of negative inflation: | This is the second time this year that the eurozone has shaken off a bout of negative inflation: |
| #Eurozone out of #deflation: CPI bounced back to 0.0% YoY in Oct. Core CPI a touch better at 1.0% YoY vs 0.9% cons. pic.twitter.com/nIjIEqan5b | #Eurozone out of #deflation: CPI bounced back to 0.0% YoY in Oct. Core CPI a touch better at 1.0% YoY vs 0.9% cons. pic.twitter.com/nIjIEqan5b |
| Updated | Updated |
| at 10.16am GMT | at 10.16am GMT |
| 10.12am GMT | 10.12am GMT |
| 10:12 | 10:12 |
| Eurozone unemployment hits lowest since January 2012 | Eurozone unemployment hits lowest since January 2012 |
| Europe’s unemployment crisis has eased a little, in another little boost to the region. | Europe’s unemployment crisis has eased a little, in another little boost to the region. |
| Eurostat reports that the overall jobless rate dropped to 10.8% in September, down from 10.9% in August. | Eurostat reports that the overall jobless rate dropped to 10.8% in September, down from 10.9% in August. |
| That’s lower than economists had expected, and is the lowest level since January 2012. | That’s lower than economists had expected, and is the lowest level since January 2012. |
| Sept 2015 euro area unemployment rate 10.8% (Aug 10.9%), EU 9.3% (Aug 9.4%) #Eurostat https://t.co/JN3JQcdm6f pic.twitter.com/HJPqhbbVle | Sept 2015 euro area unemployment rate 10.8% (Aug 10.9%), EU 9.3% (Aug 9.4%) #Eurostat https://t.co/JN3JQcdm6f pic.twitter.com/HJPqhbbVle |
| 10.09am GMT | 10.09am GMT |
| 10:09 | 10:09 |
| Although the eurozone’s inflation rate was zero in October, that masks wide differences across the economy. | Although the eurozone’s inflation rate was zero in October, that masks wide differences across the economy. |
| Today’s eurozone inflation data shows that food prices rose by 1.5% year-on-year in October, while service sector costs were up by 1.3%. | Today’s eurozone inflation data shows that food prices rose by 1.5% year-on-year in October, while service sector costs were up by 1.3%. |
| Other goods prices only rose by +0.4%, while energy costs slumped by 8.7%. | Other goods prices only rose by +0.4%, while energy costs slumped by 8.7%. |
| So on average prices were unchanged (as the economist with one foot in a bucket of scalding hot water and the other foot in a bucket of ice might put it) | So on average prices were unchanged (as the economist with one foot in a bucket of scalding hot water and the other foot in a bucket of ice might put it) |
| 10.03am GMT | 10.03am GMT |
| 10:03 | 10:03 |
| Eurozone inflation rises to 0.0% | Eurozone inflation rises to 0.0% |
| The eurozone has emerged from deflation! | The eurozone has emerged from deflation! |
| Prices across the single currency region were flat in October, having shrunk by 0.1% the previous month. | Prices across the single currency region were flat in October, having shrunk by 0.1% the previous month. |
| That’s broadly in line with forecast, and shows how little inflationary pressure there is in the eurozone (due to weak energy prices). | That’s broadly in line with forecast, and shows how little inflationary pressure there is in the eurozone (due to weak energy prices). |
| Euro area inflation up to 0.0% in Oct 2015 (Sept -0.1%): flash estimate from #Eurostat https://t.co/pzXfjPwYOg pic.twitter.com/UPMIIcQFB7 | Euro area inflation up to 0.0% in Oct 2015 (Sept -0.1%): flash estimate from #Eurostat https://t.co/pzXfjPwYOg pic.twitter.com/UPMIIcQFB7 |
| Core inflation (which strips out volatile elements such as energy and food) across the eurozone rose to 1% - well below the ECB’s 2% target. | Core inflation (which strips out volatile elements such as energy and food) across the eurozone rose to 1% - well below the ECB’s 2% target. |
| Euro Zone CPI Data (Oct A) CPI Y/Y 0.0% versus 0.0% expected, previous -0.1% Core CPI Y/Y +1.0% versus +0.9% expected, previous +0.9% | Euro Zone CPI Data (Oct A) CPI Y/Y 0.0% versus 0.0% expected, previous -0.1% Core CPI Y/Y +1.0% versus +0.9% expected, previous +0.9% |
| Updated | Updated |
| at 10.04am GMT | at 10.04am GMT |