SOme Global inflation concerns heating up a bit.
30-year: -10/32...6.089%.....GNMAs: unch...92-05
Following up on our last comment, we would note that aside from stronger than expected Japanese GDP data (which we will get to shortly) fueling talk of a more pronounced recovery in the global economy, inflation expectations are also beginning to have a more noticeable impact on price action.
Just last night, ECB member Guy Quaden told Belgian French-language magazine Tendences-Trends, that with increasing signs of recovery in the region, European central bankers need to keep a closer eye on inflationary trends, while noting that the next move in interest rates would be higher, despite providing any specific timetable.
Aside from such comments, we would note the continued run-up in commodity prices, which are expected to further pressure the markets today, as October Brent has surged as high as $22.60 a barrel (+$0.33) in London, a fresh 31-month high, following the a report by the American Petroleum Institute which noted a crude stock drawdown of roughly 6 mln barrels for the week ended September 3. The market was expecting a decline of only 2.6 mln barrels.
Oil also remains supported by recent assurances from OPEC that it will keep supply cuts intact until March, as well as from the possibility of a strike next Tuesday by Venezuela's largest oil union, Fedeptrol |
