One Minute Macro Update
U.S.: Markets up again this morning. Wisconsin’s state assembly passed the highly debated legislation that weakens state workers’ unions and the bill will now head on to the state senate. In a meeting with outside economic advisors, President Obama acknowledged that current rates of unemployment will continue in the near term. St. Louis Fed President James Bullard told reporters yesterday that he supports a more flexible quantitative easing program that would change the amount of bond buying based on the health of the economy. Bullard’s comments were not limited to QE2, and said a third easing program is a possibility. Today will see the release of 4Q GDP, estimated at 3.3% v 3.2% prior.
Europe: The SOVXWE and periphery quiet and slightly tighter ahead of today’s Irish election results. U.K. GDP shrank by 0.6% QoQ in the fourth quarter, larger than the expected -0.5%. Construction and investment led the contraction and adds on to the 0.5% decrease in the previous quarter. Government spending rose 0.7% v -0.4%E while private consumption declined 0.1% v -0.2%E. Russia’s central bank raised its main rates up 25bps to mitigate inflation, which is viewed by the country to be one of its largest economic challenges. The bank also raised reserve requirements for a second consecutive month. Euro zone M3 rose 1.5% YoY in January, missing market expectations of +2.1%.
Asia: India’s finance ministry announced that the country will need to make efforts to slow inflation and the economy is projected to grow by 9.25% in the next year. The announcement comes ahead of next week’s release of the budget statement, and inflation is the main concern for the rebounding economy.
From Brian Yelvington of Knight Capital
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