ECB: Muller and Pereira Comments In Line With Prior Rhetoric
"*MULLER: INFLATION LIKELY TO BE NEAR 2% IN FORESEEABLE FUTURE" Bloomberg
"*ECB'S MULLER: INFLATION NOW BEING VERY CLOSE TO 2%" Bloomberg
- Muller noted on Oct 31 (just after the last meeting): "Given that the pace of inflation in the euro area remains close to 2% and the economic situation has gradually improved, the current level of interest rates is appropriate. Interest rates do not hold back the economic recovery and do not add to inflation"
- We consider him one of the more hawkish Governing Council members.
Elsewhere: Unchanged signalling from Pereira (several ECB officials have provided warnings around valuations in recent weeks):
"*PEREIRA: ECB MONETARY POLICY IS APPROPRIATE AT THE MOMENT" Bloomberg
"*ECB'S PEREIRA: WE KNOW WE HAVE A MORE UNCERTAIN WORLD" bbg
"*PEREIRA: RISK OF OVERVALUATION IN FINANCIAL MARKETS" bbg
Want to read more?
Find more articles and bullets on these widgets:
Historical bullets
US DATA: Chicago Area Econ Surveys Point To Better Activity, Weak Otherwise
The Chicago Fed Survey of Economic Conditions (CFSEC)'s regional activity index rose to +15 in October from -14 prior, suggesting above-trend growth in the 7th Fed District. While this series is volatile, we note that this is the highest reading since March 2022, and comes with improvements in both manufacturing (+14 after -10) and nonmanufacturing (+16 after -19).
- This represents an indication of solid regional activity - but the subindices were actually quite poor across the board: hiring and capex intentions were negative (ie below average), while both labor cost and nonlabor cost pressures were also negative, suggestive of more moderate inflation.
- The indices roughly mirror the MNI Chicago Business Barometer (PMI) and national ISM Services/Manufacturing, though with more month-to-month volatility, so can be considered a positive in the services activity column after weak NY and Philly Fed surveys for October, as well as a solid manufacturing reading vs mixed NY / Philly.
- The latest Chicago Fed entry to the Beige Book covering September: "Economic activity in the Seventh District was little changed over the reporting period, and contacts expected a slight decrease in activity over the next year. Consumer spending increased modestly; construction and real estate activity increased slightly; employment was flat; nonbusiness contacts saw no change in activity; business spending declined slightly; and manufacturing activity declined modestly."
FED: US TSY 17W BILL AUCTION: HIGH 3.735%(ALLOT 52.62%)
- US TSY 17W BILL AUCTION: HIGH 3.735%(ALLOT 52.62%)
- US TSY 17W BILL AUCTION: DEALERS TAKE 30.74% OF COMPETITIVES
- US TSY 17W BILL AUCTION: DIRECTS TAKE 4.36% OF COMPETITIVES
- US TSY 17W BILL AUCTION: INDIRECTS TAKE 64.91% OF COMPETITIVES
- US TSY 17W BILL AUCTION: BID/CVR 3.27
US TSY OPTIONS: Large Nov'25 10Y Put Buyer
- +30,000 TYX5 113.75 puts from 16-17 - expiring this Friday
