The Day at a Glance | November 30 2022

*Inflation in Europe finally becomes more moderate.

*Jerome Powell will give a speech at the Brookings Institution; he will talk about inflation, the economy and the labor market.

*Growth in the US was revised upwards to 2.9% annualized in the 3Q22.

*Global debt reached 290 trillion dollars: IIF.

*Job creation in the US private sector surprised to the downside (ADP 127k vs 200k e.).

*OPEC+ will consider maintaining crude oil production quotas unchanged in its meeting on Sunday.

*House sales in China continued decreasing: (-) 25.5% annual in November.

Economic environment

Inflationary peak in Europe. For the first time in 18 months, inflation in the Eurozone became more moderate by recording a 10% annual increase during November. The figure set below the expected 10.4% figure and the 10.6% logged in October. Monthly inflation receded (-) 0.1% and underlying inflation didn’t log any changes (0%). More moderate increases were seen in energy and services, which explains the more moderate inflationary figure – despite the fact that food continued its increasing trend. Inflation in November only increased in 3 of the Eurozone`s countries, while it decreased in Germany, Italy, Spain and the Netherlands. Inflation remained stable in France. The data is good news for the ECB, which will make a monetary policy decision on December 15<sup>th</sup>. It`s possible that the data may even back a 50 bp interest rate increase after two consecutive 75bp increases were carried out in its previous meetings. However, the ECB is still worried about overall inflationary pressures as they are still affecting underlying inflation, which remains at the block`s highest historical levels (5% annual). Vice-President of the ECB, Luis de Guindos, acknowledged that an overall decrease in inflation is good news, but the most important sign of a moderation in prices must come from underlying inflation. President of the ECB, Christine Lagarde, said that she would be surprised if inflation has actually reached its peak. Meanwhile, Isabel Schnabel, member of the ECB, was even more blunt as she affirmed that there is no room for more moderate interest rate increases as the central bank`s objective is to ensure lower inflationary pressures at an underlying level; something that still cannot be seen.