Approvals for new loans rose to 84700 months, with German harmonised inflation falling to -0. 4%
The fall in German harmonized inflation to -0. 4% this month shows that Covid-19 has a disinflationary effect on economies, says Carsten Brzeski of ING.
He writes:
The negative base effect of low energy costs helps keep headline inflation low, but there is more: July’s VAT reduction is more visual in the costs of food, clothing, other customers’ goods and increasingly also in other recreational activities and package travel. At the same time, the fact that the increase in the costs of hotels and places to eat is still very much in line with the trend observed before the VAT reduction suggests that the tax cut is also being used for businesses and is not necessarily fully transferred to customers.
Going forward, German global inflation is expected to fall further before gradually recovering next year; at least if the German government sticks to the plan to cancel VAT collection in January. In July 2009, headline inflation was -0. 7% year-on-year; a record that can be damaged in October or November.
At the beginning of the crisis, it had been hypothesized that the existing crisis would be an inflationary or deflationary event. For the moment, for Germany, the conclusion is clear: it is disinflationary.
Inflation in Germany has fallen below zero, putting further pressure on the European Central Bank to stimulate the eurozone economy.
Consumer costs in Europe’s largest economy fell by 0. 4% in September compared to last year, when they were harmonised with the rest of the EU. Prices also fell by 0. 4% per month, the Federal Bureau of Statistics reports.
This is a steeper-than-expected decline, with economists predicting a 0. 1% decline in measures.
Minimization is partly due to VAT relief in Germany (to inspire spending). Cheap power is a factor, with crude oil costs well below those of a year ago.
Here’s a reaction:
It’s time to make a summary.
Mortgage approvals in the UK have reached their point since the credit crisis nearly thirteen years ago.
About 84,700 home loans were in August, the most active month since October 2007, according to new figures from the Bank of England. That’s about 66,000 in August, and much more than expected.
Real estate agents reported that August was exceptionally busy, thanks to the repressed call for following the closure and the holiday of the existing stamp duty. However, first-time buyers still face significant hurdle, with lenders taking strong action against major LTV mortgages.
Several British corporations have reported a decline in their operations as a result of the pandemic. The Greggs pastry chain is consulted with staff on how to reduce their hours, after The September earnings only three-quarters of last year’s levels.
Greggs also includes more pieces on the menu (good news for Belgian bun lovers) and still plans to open more outlets, but regularly on city exits than on the main streets.
However, the city is impressed: Greggs shares have now dropped by 8%.
The card and gift card distributor Card Factory has fallen to a loss of 22 million pounds due to closure, while sweet supplier Hotel Chocolat lost 7 million pounds after missing sales on Easter Main Street.
Airport facilities organization John Menzies warned that market situations would remain challenging for the winter.
On the front:
After a moderate morning, European stock markets often record small losses today.
The FTSE hundred has now dropped 25 points, or 0. 3%, in 5902, with banks and agencies between the falls.
The cautious monetary effects of corporations like Greggs this morning have tempered the mood, says Fiona Cincotta of city index:
Monday’s optimistic temperament was replaced by a sense of caution, which caused European stock markets to fall. Optimism around a U. S. fiscal stimulus agreement has faded, the temperament is deteriorating amid a series of disappointing corporate publications.
Greggs warned that they opposed dubious trade prospects, which is not unexpected given that running away from home turns out to be a way of life for at least the next six months, if not longer. is that the headwinds outweigh the positives.
German DAX (-0. 44%) and the French ACC (-0. 2%) they have also dropped, after the great gains of the MondayArray . . . and before the Trump-Biden debate overnight.
Back in town, Greggs fell to the back of the FTSE 250 index, amid considerations about his outlook for the coming months.
Stocks have now dropped by 6% to 11. 45 euros, closer to the two-year low last week, after the bakery chain announced that September’s sales were three-quarters of last year’s levels.
Despite Greggs’ plans to lower prices and open more stores, investors seem involved in long-term transactions.
Russ Mold, of stockbroker AJ Bell, says Greggs will return to the general, but remains vulnerable to the pandemic.
“Greggs has taken the decision to go ahead and verify that his operations return to normal. Plans to open new retail outlets have been reactivated and some existing retail outlets now allow consumers to eat. Pastry enthusiasts will rejoice in the news that Belgian bread is being reintroduced along with other pieces that have been missing while Greggs survived with a menu limited to the peak of the crisis.
“These movements can put Greggs in a more powerful position assuming the coronavirus scenario doesn’t get worse. If this is the case, the store will need to temporarily return to its basic operations. The bad news for the staff is that Greggs is going to reduce prices by reducing schedules in stores.
“There is still a threat that the industry’s recent positive dynamics will continue. As the climate becomes bloody and rainy and unemployment is expected to rise, situations are favorable for consumers who want to stop buying. Local locks also obstruct Greggs’ recovery efforts. “
In Ireland, the unemployment rate has fallen since its recent highest record, but remains incredibly higher.
Reuters has the details:
Ireland’s unemployment rate, in addition to those receiving COVID-19 transitional unemployment benefits, fell to 14. 7% at the end of September from 15. 3% the previous month, reported on Tuesday.
The unemployment rate, which before the crisis was 4. 8%, reached a record 28. 8% in early May after another 600,000 people demanded special payment.
Excluding COVID-19 payments, due next April, the unemployment rate rose to 5. 4% in September from 5. 2% in August, according to the knowledge of the Central Bureau of Statistics.
Meanwhile, in the euro zone, economic confidence has stepped forward for the fifth consecutive month, it remains weak.
The European Commission’s monthly indicator of sentiment in the euro dominance increased to 91. 1 numbers this month from 87. 5 in August.
This is ahead of the forecast (for an increase of up to 89. 0), but continues to decrease than before the pandemic.
Confidence in the sector has recovered, despite the accumulation of Covid-19 instances over the summer, which is forcing new restrictions to be imposed in some countries.
The sector’s confidence index rose to -11. 1 from -17. 2, while trade confidence rose to -11. 1 from -12. 8.
The European public is also less pessimistic, with the customer’s confidence index emerging from -14. 7 to -13. 9.
Despite growing loan approvals, it is difficult to move up the asset scale.
Some lenders have withdrawn some loan donations for which they have small deposits, while Nationwide prevents others from borrowing from their parents.
Matthew Fleming-Duffy of the Independent Loan Cherry Mortgage
“Mortgage stakeholders, from structured banks and corporations to lawyers and surveyors, still have licensed staff and working tables. In other words, if the number of files is greater, lenders’ ability to function is lately limited.
“Product selection is still limited, especially for higher LTVs. There are a handful of lenders offering 90% LTV products, some that distinguish first-time buyers by exclusive eligibility and others that offer guarantee loans.
Summer is a quiet time for real estate agents and genuine lenders, as other people are more interested in summer vacations than asset visits. But not this year.
The Covid-19 pandemic “completely interrupted” the UK asset market in August, says Hina Bhudia, wife of Knight Frank Finance:
Interest rates remain incredibly low and the low debt charge is to blame for a percentage of this activity.
“Most of the activities we’re seeing are less than 75% of the loan-to-value ratio, and lenders need a higher percentage of that market. This means that product selection for borrowers at this time increases day by day.
“The increase in transactions at this point also means that delays between filing an application and obtaining approval vary greatly from lender to lender, so borrowers want to verify before proceeding.
“Relocation remains moderate, as many borrowers decide to go to insurance, stick to their existing bank, and avoid additional debt, especially when the gains of many consumers have been affected.
Here’s a reaction to UK loan figures:
The Bank of England issues that loan approvals continue to decline in 2020 than in 2019, despite a hot August.
Today it says:
The credit market continued to show more symptoms of recovery in August. In net terms, families borrowed another $3. 1 billion guaranteed for their homes, after borrowing 2. 9 billion pounds in July. the average of 4. 2 billion pounds in the six months ended February 2020. La accumulation during the month reflects a slightly higher gross indebtedness of 18. 8 billion pounds, still below the February Covid point of 23. 7 billion pounds.
The number of home loan approvals continued to increase considerably in August, from 84,700 to 66,300 in July.
This is the highest number of approvals since October 2007, but only partially compensates for the weakness observed between March and June: in total, there were 418,000 approvals in 2020, to 524,000 at the same time in 2019.
UK loan approvals peaked at almost 13 years in August, as the market recovered from its blockades.
At 84,700, lenders have signed more home loans than at any time since October 2007 (when the credit crisis began at the beginning of the currency crisis).
However, customers borrowed more moderately and higher at just three hundred million pounds last month. This shows that some families are cautious, fearing an increase in unemployment this winter.
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