The most important events and reports on the economy, central banks and politics from the Dow Jones Newswires program
US consumer sentiment improved in February
US consumer sentiment improved in February. The University of Michigan US consumer sentiment index rose to 66.4 in the mid-month survey. Economists polled by Dow Jones Newswires had expected a reading of 65.1. In the poll at the end of January it was 64.9. The index for the expectations was 62.3 (previous month: 62.7), the index for the assessment of the current situation was given at 72.6 (68.4).
As BoJ governor, Ueda wants to continue the low interest rate policy
The nominee-elect for the Bank of Japan (BoJ) leadership, a longtime advocate of aggressive monetary policy, said he wants to continue the current governor’s low-interest-rate policy. The government has decided to nominate Kazuo Ueda, a former University of Tokyo professor who served on the BOJ board from 1998 to 2005, as the next governor, a person familiar with the appointment and broadcaster NHK said. “Under the current circumstances, I believe it is necessary to continue monetary easing,” said Ueda, who was not considered a frontrunner for the post.
Schnabel: ECB wants core inflation to fall in time
The European Central Bank (ECB) will hike rates until it can see rates reaching the economy, ECB Director Isabel Schnabel said. Schnabel, in response to a question posed on Twitter about how far the ECB will hike interest rates and how long interest rates will have to stay high, wrote: “Interest rates must reach sufficiently restrictive levels. We must be able to see that our monetary policy is being transmitted to the economy becomes.”
Berlin wants to focus on investments in response to US law – circles
According to government circles, Germany wants to insist at the meetings of the European finance ministers in Brussels next week that the European answer to the US inflation reduction law is not primarily about subsidies. “It is important to us that, in terms of industrial policy, we focus on private investments and not first and foremost on subsidies, let alone debt-financed subsidies,” said a high-ranking representative of the Federal Ministry of Finance in Berlin. It’s about “that we really approach the topic in the right order”.
Pistorius wants to increase the Bundeswehr budget by 10 billion – report
According to a magazine report, the spending requests of his cabinet colleagues for the next year are jeopardizing the budget planning of Finance Minister Christian Lindner (FDP). According to a preliminary overview by its experts, the departments demanded more than 40 billion euros more than provided for in the financial plan for 2024, reported Der Spiegel. Defense Minister Boris Pistorius (SPD) alone is demanding an additional 10 billion euros. His budget would thus increase to around 60 billion euros. If it were up to him, it should remain at this level in the years to come. The Ministry of Finance initially did not comment on the report when asked.
Bundeswehr special fund shrinks by 13 billion euros – newspaper
According to a report, the budget experts in the Ministry of Defense assume that the sum available for the purchase of weapon systems from the 100 billion euro special fund for the Bundeswehr will be significantly lower than expected. The reason is an increasing interest burden, which has to be borne by the debt-financed fund itself, reported the world on Sunday.
German informal economy at its highest level since the Euro-Start report
According to estimates, Germany’s shadow economy will grow this year to its highest level since the introduction of the euro. According to an analysis by the Linz shadow economy expert Friedrich Schneider and his Tübingen colleague Bernhard Boockmann, which is available to the Frankfurter Allgemeine Sonntagszeitung (FAS), around 440 billion euros will be generated in undeclared work and illegal activities in 2023. That is 60 billion euros more than last year and more than since the introduction of the euro.
Habeck: There is a will to expand renewable energies
Federal Minister of Economics Robert Habeck (Greens) sees all levels of government determined to ensure the fastest possible progress in wind power expansion. “We have now passed the point where you can see the problems, to ‘now we are implementing the expansion of renewable energies’ – and that applies from south to north, from east to west,” said Habeck after an energy ministers’ conference with the federal states for wind power acceleration. This applies to the different conditions that the countries have given themselves. He had “rarely experienced such unity and determination” as with this video switch. “The will is there now.”
BDI complains about the “poor result” of the EU summit
The Federation of German Industries (BDI) criticizes the “poor result” of the EU summit. “Unfortunately, concrete measures for greater competitiveness are still a long time coming,” complained BDI General Manager Tanja Gönner. It is important to make the European Union more attractive in global competition. “Europe has no time to lose in this, attractive framework conditions for business and investment are the be-all and end-all. Companies need more speed and less detailed regulation,” said Gönner.
Poland closes border crossing with neighboring Belarus
Poland closed one of its three border crossings on the border with Belarus on Friday. In order to ensure the security of the country, the Bobrowiki border crossing is closed until further notice, the Interior Ministry in Warsaw said. Prime Minister Mateusz Morawiecki believes further closures are possible. “The reason for this is that tensions with Belarus are increasing and are being exploited by the Russians and the Kremlin,” he said in Brussels.
New pro-European prime minister appointed in Moldova
Moldova’s Prime Minister Natalia Gavrilita has handed in her resignation after a year and a half in office. “It’s time for me to go,” the 45-year-old told reporters, citing “a lack of support and trust in the country.” President Maia Sandu appointed Interior Minister Dorin Recean as her successor. Like Sandu and Gavrilita, Recean is pro-European.
+++ economic data +++
Canada Jan Labor force participation rate 65.7% (Dec: 65.4%)
Canada Jan Employed +152,500 gg Dec
Canada Jan hourly wages +4.5% yoy
Canada Jan Employees FORECAST: +15,000
Canada Jan Employed +150,000 gg Dec
Canada Jan Unemployment Rate FORECAST: 5.1%
Canada Jan Unemployment Rate 5.0% (Dec: 5.0%)
DJG/DJN/AFP/apo/sha
(END) Dow Jones Newswires
February 10, 2023 13:00 ET (18:00 GMT)