Germany's Falling Inflation Expectations Boost Real Yield Demands
Good Morning from Germany, where long-term inflation expectations have fallen sharply again. But nominal bond yields have not dropped by nearly as much. In plain English: investors are now demanding higher real returns to compensate for Germany’s rising economic risks. https://t.co/7DppPGNTX6
Headline Inflation Eases While Core Prices Stay Sticky
Good Morning from Germany, where headline inflation slowed to 2.6% YoY in May from 2.9% in April, helped by the fuel-tax rebate. But the rise in core inflation to 2.5% from 2.3% shows that underlying price pressures remain stubborn. Disinflation...
Germany's CDS Rates Imply Near‑zero Default Risk
Good Morning from Germany, where credit markets remain remarkably forgiving. Despite econ stagnation & rapidly rising debt, it still costs less than 10bps to insure against default within 5yrs. The implied probability of default is just 0.8%, so the CDS...
Germany's Wholesale Power Prices Remain Europe's Highest Since 2024
Good Morning from #Germany, where wholesale electricity prices have been among the highest in Europe almost continuously since 2024. https://t.co/mUPt40XKIh
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Yields on 10y gilts have risen well above 5%, reaching their highest level since 2008 due to the UK government crisis. Keir Starmer's premiership appears to be hanging by a thread after his much-anticipated policy reset speech on Monday -...
German Home Prices Up Nominally, Still Flat in Real Terms
Good Morning from Germany, where house prices are rising slightly again – but only in nominal terms. After adjusting for inflation, there is still little sign of a broad-based recovery. The picture is highly uneven. New-build prices are rising, partly...
Germany Faces Stagflation as Growth Slows, Inflation Rises
Good Morning from Germany, which appears to be heading towards stagflation. Consensus GDP forecasts for 2026 have been revised down from more than 1% to just 0.66%, while inflation forecasts have climbed above 2.7%. Against this backdrop, the ECB is...
Germany's Industrial Output Slides, Growth Pledge in Doubt
Good Morning from Germany, where industrial production unexpectedly fell for a second straight month, down 0.7% in March, led by weakness in energy and machinery. Despite a small uptick in Q1 GDP, the data point to ongoing stagnation and raise...
US Productivity Gains Slow Yet Remain Strong, Wage Inflation Tamed
US labor productivity kept rising in Q1, but more slowly. Output per hour for nonfarm workers increased at a 0.8% annual rate, down from 1.6% in Q4. Compared w/a year earlier, however, productivity was up 2.9%; the biggest gain since...
Germany's Solar Glut Sparks Call to Cut Renewable Subsidies
Good Morning from Germany, where deeply negative energy prices due to solar glut are forcing a rethink of the energy transition, w/Economy Minister calling to end subsidies for excess renewable electricity after costs ran into the tens of millions last...
Trump Tariffs Threaten German Car Earnings, Double‑digit Drops
Good Morning from Germany, where car stocks are under pressure after Donald Trump vowed to impose a 25% tariff on European autos, escalating the trade dispute. A renewed tariff push would weigh on earnings across the sector. Bernstein expects headwinds...
German Unemployment Hits 6.4%, Over 3 Million Jobless
Good Morning from Germany, where econ stagnation is increasingly weighing on the labor market, despite demographic change. In April, the unemployment rate rose to 6.4%, and the seasonally adj number of unemployed climbed above 3 million for 1st time since...
US Q1 GDP Up 2% on Domestic Spending, Export Drag
US GDP grew at an annual rate of 2% in Q1. Growth was mainly driven by consumer spending, business investment, and govt spending, which rebounded from a decline to an increase. Inventory changes also supported growth. However, net exports significantly...
ECB Holds Rates at 2%, Flags Inflation Upside, Growth Downside
#ECB keeps rates steady. Deposit rate at 2% as expected. Sees upside inflation risks, downside growth risks. https://t.co/wmrCEOkbf7
Germany's April Inflation Barely Rises, Core Dip Temporary
Germany’s #inflation edged up only slightly in April, rising from 2.7% to 2.9%, mainly driven by higher energy prices. So far, there are no clear signs that these higher energy costs are feeding through more broadly into other prices. Core...