The Day at a Glance | March 30 2023

*The European Central Bank made its Economic Bulletin public in which it revised its growth and inflation estimates upwards; they are expected to remain high throughout the year. 

*Pending home sales in the US recorded a slowdown in February with a 0.8% m/m reading (8.1% prev., highest in 31 months). With this, the annual rate decreased to -21.1%, the slowest annual setback since June of 2022. 

*Initial jobless claims in the US reached 198 thousand during the week ending March 25th, exceeding the expected 196 thousand figure. Recurring claims remained close to 13-month highs at 1.689 million. 

*Wall Street Journal reporter, Evan Gershkovich, was detained in Russia under suspicion of espionage. 

*Ukrainian Minister of Defense, Oleksii Reznikov, informed that Western tanks will likely be deployed as part of their counteroffensive campaign next month. Additionally, Germany pointed out that it will increase its military aid to Ukraine in 13 billion dollars. 

*US Senate voted in favor of putting an end to the national Covid-19 emergency on Wednesday. The resolution must now be signed by President Biden. 

*The Central Bank of Mexico will make its monetary policy decision known today (1:00pm Mexico City time). It´s expected to increase the rate in 25bp to 11.25%. 

·     *The MoF will make February´s public balance figures known. 

Economic environment

The European Central Bank made its Economic Bulletin public on Thursday. In the document, growth was revised upwards to 1.0% for 2023, boosted by a decrease in energy prices and greater economic strength amidst a difficult international environment. Although risks are slightly skewed downwards due to increased tension in financial markets, which could affect credit more than initially expected. Another point that stood out was that inflation is expected to remain high for a longer period of time. Forecasts indicate an average 5.3% rate of inflation in 2023, and 2.9% in 2024. On top of this, wage pressures have increased – along with a tighter labor market – as “employees aiming to recoup some of the purchasing power lost owing to high inflation”.