The Day at a Glance | Aug 17 2022

The Top

*Sales in the United States didn’t log any growth during July.

*Europe`s economy grew less than estimated in the 2Q22 (0.6% quarterly vs 0.7% prev.).

*Natural gas investors in Germany would barely cover 3 months of energy needs if Russia decides to cut its supply.

*Biden signed the inflation Reduction Act yesterday, which considers 437 billion dollars in spending and a minimum 15% tax rate for large corporations.

*There is high risk that demand for oil will exceed supply towards 2023: OPEC+.

*Inflation in the United Kingdom exceeded estimates during July and reached a 10.1% annual rate.

*Japan`s trade deficit reached a record level (15.9 billion dollars) due to increasing energy imports and a devaluated Yen.

Economic environment

Retail sales in the United States. Retail sales figures made  public in the United States this morning pointed towards null growth during July (0% monthly). The figure is mainly explained by contractions in automobile (-1.6% monthly) and gasoline (-1.8%) sales. Excluding these components, retail sales increased more than expected (0.7% monthly vs 0.6%e.). 9 of the 13 categories that make up the measurement logged growth in sales and still pointed towards strength on behalf of consumers. The largest monthly increase was seen in e-commerce – something that is attributed to Amazon`s Prime Day, which was held between July 12<sup>th</sup> and 13<sup>th</sup>. Retail sales make up an important part of indicators that the FED keeps an eye on in order to measure how effective its monetary policy is at containing inflation. Interest rate increases seek to cool down consumption, and given today`s data, it seems that there still hasn’t been a halt in overall consumer spending.