Global Macro Perspectives
Nothing surprising here. The program announced is in the middle of speculated €70-€100 billion range.
The interest rate (if facility would be drawn now) is at 5.8%.
All this looks so futile, it is almost impossible for Irish economy to grow with this kind of austerity and interest rate burden.
Baltic Dirty Tanker Index fell 4.8%; Baltic Clean Tanker Index rose 4.0%.
Back to normal: supply of ships outweighing demand.
Bloomberg’s Jonathan Weil has the answer…
Spain 10 year government bond spread vs. it’s German peer reached new high of 255 bps. Irish bond spread reached record high of 654 bps.
Markets have lost faith in EU bailout plan and are now finding out (again) that math is quite exact science. CNBC Europe has even sent it’s anchor to Lisbon to provide live coverage of Portugal bailout; they were wrong: the markets skipped Portugal and moved to big story – Spain. Spain has a funding requirement of at least €155bn in 2010. Looks intimidating, especially if we took to account the fact that Ireland was pre-funded for the first half of the 2011 and despite that needed a bailout.
This puts the markets near the point where the only solution is the Ben Bernanke way – buy worthless paper and stuff cash in monetary system. I would do it fast, but I doubt on EU leadership determination. In any case, more the ECB waits the situation will get worse.
Working gas in storage fell 6 Bcf from previous week. Consensus was at 3 Bcf.
I expect large draws in following weeks.
Crude oil stocks rose 1.0 million barrels; Gasoline stocks were up 1.9 million barrels; Distillate stocks were down 0.5 million barrels; Propane/propylene stocks fell 0.4 million barrels; Other oils stocks decreased 1.4 million barrels; Total crude oil and petroleum stocks were 0.3 million barrels lower than the week before.
Refinery utilization rose 1.5% to 85.5%.
Implied crude oil demand remained unchanged.
Crude oil and petroleum product net imports rose 1.3 million barrels to 9.4 million barrels.
Excess of excesses are now cleared; demand is unchanged and now again the stocks will probably again begin to rise.
The American Trucking Associations seasonally adjusted For-Hire Truck Tonnage Index rose 0.8% in October vs. 1.9% rise in September.
No Ireland in today’s reading.
University of Michigan Consumer Sentiment November final reading was reported at 71.6 vs. 69.7 consensus and 69.3 prior November reading.
U.S. new home sales in October were reported at 283.000 SAAR vs. consensus of 314.000 SAAR and prior reading of 307.000 SAAR.
U.S. personal income rose 0.5% in October vs. 0.4% consensus and unchanged in September. On y-o-y level the personal income is up 3.7%.
MBA mortgage applications rose 2.1%; Prior reading was a decrease of 14.4%; On year level MBA Basic Index is up 21.3%.
Durable good orders fell 3.3% in October vs. 0.1% consensus and 5.0% increase in September (revised upwards from 3.3%)…
Initial jobless claims in the U.S. were reported at 407.000. The consensus was at 435.000, last week revised (down 3.000) reading was at 441.000.
The most positive data point today.