Globally, lots to ponder - ANZ

Analysts at ANZ note that in the US the June PCE deflator was a touch stronger than expected at 1.4% y/y, with core (the Fed’s preferred measure) up 1.5% y/y, but the current trend is down and moving away from target (2.0%).

Key Quotes

“The July ISM manufacturing index was as expected at 56.3. Prices paid rose to 62.0, new orders were 60.4 (63.5) and the employment reading was 55.2 (57.2). The data still point to solid manufacturing activity at the start of Q3.”

“In the Euro area, annual GDP growth set its strongest pace for the last six years or since Q1 2011. There is no component breakdown at this stage but data have been pointing to a broadening recovery. The July final manufacturing PMI was a touch weaker than the initial estimate, coming in at 56.6 (56.8) and 57.4 in June - which was a record high. The print therefore is still positive and indicative of robust momentum in output at the start of Q3. Although pulling back, the subcomponents remain firmly in expansionary territory with new orders at 57, new export orders at 56.8, future output at 66.3 and the stock of finished goods at 48.6.”