By Lorcan Roche Kelly
European Central Bank Executive Board member Sabine Lautenschlaeger became the latest policymaker to add her voice to those saying the time is not right to restart the bank’s quantitative-easing program. Yesterday Dutch Governor Klaas Knot said the outlook isn’t weak enough to resume buying bonds while Bundesbank President Jens Weidmann has recently returned to typefollowing his failure to be selected as next ECB head. The hawkish rhetoric ahead of the bank’s Sept. 12 meeting could be viewed as somewhat at odds with the data as today’s inflation figures showed price growth in the euro-area remains stuck at 1%, well below the ECB’s own target.
President Donald Trump said he canceled a trip to Poland because Hurricane Dorian is poised to strike Florida where it could make landfall as the first major hurricane to hit the area in 15 years. Uncertainty over when and where the storm will hit means Florida’s governor has already expanded a state of emergency to 67 counties, from the original 26. Airlines are considering whether to cancel flights on the busy Labor Day weekend, while orange juice futures surged on estimates that about 60% of the state’s main producing region could be affected.
Prime Minister Boris Johnson’s move to suspend parliament for up to five weeks ahead of the Oct. 31 Brexit deadline was not overruled by a Scottish judge this morning. Despite the setback, lawmakers are confident that they have sufficient time to block the U.K. leaving the European Union without deal. There was more evidence of the damage the uncertainty over the future is doing to the British economy, with consumer confidence at a six-year trough and the lowest business optimism since 2011.
Overnight, the MSCI Asia Pacific Index gained 1.2% while Japan’s Topix index closed 1.5% higher as the lack of bad news on trade helped lift stocks higher on the last trading session of the month. In Europe, the Stoxx 600 Index was 0.8% higher at 5:50 a.m. Eastern Time with every industry sector advancing. S&P 500 futures pointed to a positive open ahead of the long weekend, the 10-year Treasury yield was at 1.528% and gold was relatively unchanged.
U.S. personal income and spending data for July are published at 8:30 a.m. The PCE deflator for July is released at the same time. At 10:00 a.m., the latest University of Michigan consumer confidence numbers are published. What has been a good week for the oil market is rounded off at 1:00 p.m. with the Baker Hughes rig count. Earnings today are from Campbell Soup Co. and Big Lots Inc.