Friday, 8 July 2011

Thursday macro news

European Central Bank hiked interest rate by a quarter of a percentage. Danmarks Nationalbank promptly followed with a similar increase, despite the fact that the country is sliding back into recession. Danish Central Bank simply shortly commented that move is as a result of the ECB hike.

While Denmark is a special case since its currency is tied into Euro with a 2,25% band and this forces Danmarks Nationalbanks hand to also hike rates, it illustrates the difficulties associated with large differences in EU countries current economic state and the inability to deal accordingly with monetary policy.

In the US, Weekly claims and ADP payroll report were better than expected. Reporting retailers quarterly earnings also surprised on the upside.

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