One Minute Macro Update
US: Equities soft for a second day on geopolitical concerns, which outweighed the mild positive on Jobless Claims observed yesterday. Treasuries are rallying in the early going as a result of higher oil and the rising unrest in Egypt as well as record EM outflows over the past week. We still classify the jobless data as a mild positive as it still has not passed the test of time and still is a long way from progress given that the participation rate has dropped significantly during this recession. Today will see Trade Balance reports for December (-$38.3B prior, -$40.5BE) as well as UMich Confidence for Feb (prelim, 74.2 prior, 75E).
Europe: Relatively quiet in periphery spreads after the move wider over the past two days. UK Jan PPI Input numbers rise 0.7% MoM v 0.3%E, 3.2% YoY v 3.0%E. Increases were led by oil and imported metals as the signs of commodity price inflation continue to permeate the global economy. German Jan CPI revised up to 2.0% YoY v 1.9% originally reported. Spain 4Q10 GDP YoY 0.6% v 0.5%E despite rising unemployment and continued banking issues.
Asia: PBOC reportedly adjusting RRR upwards for smaller banks according to Chinese press. Also reports that software and integrated circuit manufacturers will have a VAT treatment and be granted preferential tax exemptions. Japan Vice Minister of International Affairs Tamaki commenting positively on Japan's support of EFSF bonds. RBA' Stevens stating that zero rate hike expectations are reasonable.
Brian Yelvington of Knight Capital
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