Should we be afraid of inflation? Yes, especially when the question of knowing whether it is a heavy or temporary trend is clearly decided (in favor of the first hypothesis) and when it raises fears of a risk of recession. Soaring inflation has already changed and will continue to change the way the economy, governments and households operate. In this new school year 2022, calls for sobriety are increasing…
Towards 9% inflation in the euro zone
On August 24, Berlin launched its energy saving plan, which primarily concerns public buildings, but individuals and businesses will also have to make an effort. The energy crisis caused a new surge in inflation in Germany in August. The consumer price index rose to 8.8% year on year, in harmonized data from the European Union, fueled by energy prices (+35.6% year on year) and food (+16.6%). For specialists, it is clear: the upward trend will continue. ” We expect the consumer price index to be around, or above, 10% in October after the withdrawal of temporary measures and the introduction of a gas tax. In addition, underlying price pressures are still very strong warns Andrew Kenningham, Chief Economist Europe at Capital Economics. This bodes ill for inflation in the euro zone, whose data for the month of August will be released this Wednesday at 11 am. It should see a push of 0.1 point, to 9% in global data and 4.1% in data core, ie excluding volatile elements such as food and energy. In France, we will see these same data just before the start of the European session, at the same time as household consumption expenditure and producer prices in July. Although petrol prices fell during the summer in France, inflation will nonetheless remain at a high level… and, above all, unacceptable for the European Central Bank (ECB), whose primary mission is to maintain price stability. ” This is the best contribution that central banks can make to everyone’s well-being. “Recalls the institution on its website.
In the United States, the debates on inflation and rate hikes are also raging. Since Jerome Powell’s offensive speech in Jackson Hole, investors have been convinced that they will be eaten by “75 basis points” in September, as in June and as in July. This prospect made Wall Street falter again on Tuesday evening, the Dow Jones losing 0.96% and the Nasdaq Composite, even more sensitive to rising rates, 1.12%. In order to refine their analysis of monetary policy, investors, like the Fed, which has become “data-dependent”, will closely monitor the indicators of the day. And they are many : private sector employment figures in August as calculated by the ADP firm, index Manufacturing PMI of the Chicago area purchasing managers of the same month and weekly stocks of oil of the Department of Energy.
Another contraction in the industry in China
In Asia, the Chinese markets are also marking time, weighed down by the sentiment indices of purchasing managers, PMI. The manufacturing indicator stood at 49.4 in August, against 49 in July, signaling a contraction, for the second consecutive time, in activity, against a backdrop of the resurgence of the epidemic, electricity rationing at because of the drought and the real estate crisis. Data published separately by the National Bureau of Statistics (BNS) indicate that activity in services grew less significantly in August.
In such a context, will the Cac 40 afford a last stand for the last session of August? The evolution of the future contract on the star index of the Paris Stock Exchange, which has just aligned four consecutive decline sessions, suggests that “yes” – it gains 0.3% half an hour from opening – but the trend, like the last few days, could still be hesitant, as there are so many uncertainties.
On the values front, the diagnostic specialist in vitro bioMerieux revised its revenue and operating profit targets for 2022 slightly upwards, after returning to sales growth in the second quarter, which ended at the end of June.
PC