As has been widely known, China’s economy continued to slow in Q3 to a rate of growth of 7.4% (believe it or not, focus on trajectory). It’s the slowest pace since Q1 ’09 but in line with expectations. Other Chinese stats overnight point to stability and in particular the shift to consumer consumption. Retail sales rose 14.2% y/o/y, the best rate since March and above est of 13.2%. IP was up 9.2% y/o/y and fixed asset investment was higher by 20.5% ytd, both a touch better than expected. On the signs of economic stability, the Shanghai index closed up 1.2% to a one month high and the Hang Seng index rallied for a 6th straight day to the highest since March. The yen is falling to a 2 month low vs the US$ and it helped to spike the Nikkei by 2%.

European leaders meet where there will be more discussions but not decisions as the WSJ said. Spain sold 4.61b euros of 2′s, 3′s and 10′s, above their target amount of 4.5b and with yields continuing to drop, we’ll see if Spain continues to drag its feet. UK retail sales in Sept were better than estimated.

In the US, the avg 30 mortgage rate according to Bankrate.com rose to 3.46% from 3.43%, the highest since Sept 24th. The Fed’s endless QE plan has lowered rates by a whopping 11 bps. Cost/benefit analysis anyone?

Category: MacroNotes

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