Today we have a stream of interesting data from Europe and the USA, which will be mainly about prices, money in the economy, but also consumer budgets. The main information from the European continent will be the international development of the M3 money supply in March, in line with the market average growth of 0.6%, i.e. slightly accelerated compared to Norway (0.4%) and mainly continuing the trajectory from the second half of the year 2023, when the previous long-term downward trend began to reverse. At the same time, the results of the survey of inflation rates in the spring and 3-year horizons will be published, as well as in March. Expected inflation over the one-year horizon has fallen slightly above 3% in recent months in connection with the fading inflationary eye and signals from the ECB that price pressures are certainly easing. In this year’s horizon, the market therefore assumes that consumers will expect inflation to fall in line with the central bank’s target, and that the value of the inflation target will decrease from 2.5% to 2.4%.
In the afternoon, macroeconomic data will come from the US regarding personal finances. In the case of nominal consumer income, which includes all income including social security contributions, the average income increased by 0.5% (compared to the current 0.3% in Norway). Jet vt is growing, however, on the data side, when consumer data is expected to grow by 0.6% (however minus the dynamics from Norway’s 0.8%). The positive development of consumer activity could thus be a good sign for the American economy despite its weak dynamics in the 1st quarter.
Thursday brought the annualized estimate of the quarter-on-quarter growth of the American economy, which surprised the market very negatively, when it started with a growth of 2.5%, while the actual value was only 1.6% (it even missed 3.4%). The U.S. economy will perform even beyond the Fed’s forecast, which for this year will grow at 2%. Consumption did not help either, although it increased by 2.5%, but was still the same (3%). In connection with annual interest rates, it cannot be expected that the upswing in the economy in the 1st quarter would significantly change the probability of maintaining the monetary policy direction, since after deducting the volatile components of GDP, inflationary pressures remain in the form of strong sales to domestic consumers.
The public day was marked by 3 new publications of our research team. On the occasion of the 20th anniversary of the Czech Republic’s entry into the EU, we published a publication entitled Czech Republic 20 years in the EU rich, but not necessarily durable, which analyzes the impact of joining the EU on the economy, business environment and society. It can be concluded from the entry that the Czech Republic has become richer in the EU, but has not improved in terms of resilience, when some of our regions diverge economically from the EU average. While in the past, the Czech Republic has been leaning towards the EU mainly through a strengthening exchange rate, now we are converging mainly through prices, wages, the exchange rate of the koruna, and finally through value addition. In the V4 company, there are two investors.
Author: Vt Mikuek, analyst
Editor: Martin Kron, analyst
Tags: Morning window Growth slowed Fed remain cautious Gave set data today
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