Sweden’s central bank (the Riksbank) set the benchmark rate to zero as deflation sets in. Some have been calling for the central bank to launch quantitative easing, but for now, a zero rate is all we are going to get. The Riksbank has been chasing inflation and property prices up and down over the past decade. However Sweden is simply riding the global macro shifts that have little to do with domestic policies.
In Japan we see more evidence of stabilisation as industrial production unexpectedly jumped 2.7% in September. It remains to be seen just how sustainable this improvement will be, but for now the Bank of Japan is not changing course.
The Economist put together a chart showing the ease of doing business in the European Union, as measured by the number of years to enforce a contract and resolve insolvency. The results for EMU members seem to correlate (somewhat) to how hard the nations got hit by the Eurozone crisis.
This certainly is part of the reason for poor monetary transmission in the Eurozone periphery. No matter how low rates get, demand for credit in nations with difficult business environments won’t improve much.
Standard Chartered shares (UK) were hammered today on the bank's Asian exposure, including slower trading activity in China, problems in Korea, weakening commodity markets, etc. Standard Chartered used to be in an enviable position for having penetrated these markets, but now it’s a disadvantage.
In the United States, the October consumer confidence report from the Conference Board was unexpectedly strong. I was sure that all the market turbulence earlier in the month, combined with the Ebola scare, should have dampened sentiment. It hasn’t.
Moreover, this trend is supported by high frequency surveys such as this one from Gallup.
Residential rental vacancies in the United States are at the lowest level in a decade. Demand for rental housing keeps rising as the nation faces rental shortages and higher rental costs.
Source: Federal Reserve Economic Data
Why all this demand for rentals? Here is the other side of the coin — homeownership. The decline is particularly sharp for the 35-44 age group.
Now, let’s revisit the issue of the energy sector’s impact on the US economy. We are about to face a decline in oil & gas fixed investment. The shock to energy-dependent communities will be quite real.
In fact, early signs of the energy sector’s negative impact are already showing up in the Dallas Fed survey.
Now some food for thought. Here are the nations with the highest proportion of women in parliament. It’s interesting to see three African nations among the top five. North America is represented by Cuba.
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