Financial Markets Daily Report11 November 2021
Financial markets ended the day with mixed results, as stronger-than-expected inflation data in both the U.S. and China reinforced investors’ fears about the persistency of the pickup in prices.
- Financial markets ended the day with mixed results, as stronger-than-expected inflation data in both the U.S. and China reinforced investors’ fears about the persistency of the pickup in prices.
- CPI inflation in the U.S. rose to 6.2% y/y in October (5.4% in September), on the back of a sharp pickup in energy prices but also in the core components of the basket (which rose by 4.6% y/y). In China, PPI inflation edged up by 1.8 p. p. to 13.5% y/y while CPI inflation doubled to 1.5% y/y.
- As a result, sovereign yields rose across the board, ending a recent rally that started after the dovish rhetoric by central banks across developed markets. In addition, stock indices fell in the U.S. and were mixed across Europe, while the USD appreciated against its peers, dropping below 1.15 relative to the EUR.
- Today the EU Commission will release its forecast update. The bond market is closed in the U.S. (Veterans Day).