November 7th – Top Stories

1/ US

 

- Cautious consumers seen curbing U.S. economic growth - Reuters – By Lucia Mutikani

 

U.S. economic growth likely slowed a bit in the third quarter as consumers kept a lid on spending, supporting the Federal Reserve’s decision to maintain its current pace of bond purchases to stimulate activity.
 
Gross domestic product probably expanded at a 2.0 percent annual rate, according to a Reuters poll of economists, moderating from a 2.5 percent clip in the second quarter.
Hatzius believes that the Fed will lower the unemployment threshold from 6.5% to 6.0%. This constitutes easing in that it implies low rates for a longer time.

 

2/ China

 

- China Swap Rate at Four-Month High as PBOC Halts Cash Injection - Bloomberg – By Bloomberg News

China’s interest-rate swaps climbed to the highest level since June as the central bank refrained from adding funds to the financial system.
 
The People’s Bank of China didn’t sell reverse-repurchase contracts today, according to three traders with primary dealers required to bid at the auctions. The monetary authority injected funds via reverse-repo agreements on Oct. 29, Oct. 31 and Nov. 5, after suspending the operations for two weeks, which drove the overnight and seven-day repurchase rates to four-month highs at the end of October as commercial banks struggled to meet month-end cash needs and deposit taxes with the central bank.

 

3/ Eurozone & UK

 

- Bank of Spain “Discovers” €20.50 Billion in Hidden Non-Performing Loans; Bank of Spain Translated - Mish’s Global Economic Trend Analysis – Posted by Michael Shedlock

 

Via translation, El Economista reports the Bank of Spain Discovers €20.50 Billion Hidden Delinquencies. Emphasis on the word “discovers” not added.