Data Watch - April 21

CANADA

Bank of Canada at 9 a.m.

in the Bank's FAQ page on its website, it distinguishes between quantitative easing and credit easing as follows:

What is quantitative easing?
Quantitative easing is the purchase by a central bank of financial assets through creation of central bank reserves. As a result, the price of the purchased assets (which can include government securities or private assets) rises and the yield on the assets falls. The expansion of reserves available to commercial banks also encourages them to increase the supply of credit to households and businesses. In economic terminology, quantitative easing uses 'unsterilized' funding; in other words, the reserves of the central bank are increased to finance asset purchases.

What is credit easing?
Credit easing is the targeted purchase by a central bank of private sector assets in certain credit markets which are important to the functioning of the financial system. The goal of credit easing is to reduce risk premiums and improve liquidity and trading activity in specific markets so that credit will flow and demand in the economy will expand. Credit easing can be done on a 'sterilized' basis; in other words, there is no need to increase central bank reserves in order to undertake credit easing. If undertaken on an unsterilized basis, this amounts to combining credit easing with quantitative easing.

so, clearly I was likely wrong about my guess that the Bank would be sticking to buying government bonds; it seems credit easing is in the cards


February wholesales sales fell 0.6% MoM (despite an increase in the month in auto sales), versus expectations of a 1% rise; that's the 6th decline in 7 months, though January's -4.2% was revised upwards to -3.9%; the YoY rate is now -4.4%, vs. -5.2% in January; the inventory-to-sales ratio, which was at 1.22 in July, has climbed abruptly to 1.44, highest since 1995, due to both the drop in sales and an increase in inventories

U.S.

just earnings reports (plus Geithner testifying in front of Congressional Oversight Panel)

INTERNATIONAL

German producer prices fell a worse-than-expected 0.7% in March, dragging the YoY rate into negative territory (-0.5%); energy prices dominated, although there were price declines in other areas as well

German ZEW survey, which measures institutional investors' expectations of German economic growth in the next 6 months, was upbeat, rising out of negative territory for the first time since July 2007 to 13

English March CPI came in as expected, at 0.2% MoM and 2.9% YoY, though the core surprised to the upside (1.7% YoY vs 1.5% expected); this despite the fact that the retail price index fell into negative ground for the YoY (by the by, public sector pay in the U.K. is tied to the RPI, not CPI; RPI includes housing while CPI does not)

Swedish Riksbank cut its benchmark rate, as expected, to 0.5% from 1.0%

India dropped its benchmark interest rate, the repo rate, by a quarter to 4.75% and is predicting growth of just 6% this year

Baltic Dry Index has been heading upwards again, up for 6 straight days