The markets traded shaky grounds on Tuesday amid a host of concerns. Reports from Washington revealed that there was no progress on the critical issues with China. Both the United States and China have been holding trade negotiations to end the trade wars.
China signaled that it would add more stimulus measures in the near term. The trade war with the US was taking a toll on its trade sector risking a sharper slowdown in the economy.
Reports from Germany showed that preliminary GDP estimates for the year came in at 1.5%. This was the weakest pace of growth in over five years and slow compared to 2017’s GDP growth rate of 2.2%.
ECB President Mario Draghi signaled dovish comments to add that a Eurozone needs significant amount of stimulus.
In the United States, the producer prices index fell by 0.2% in December after rising 0.1% in November. The decline in the PPI was more than the forecasts of a 0.1% decline. The drops came due to a fall in energy prices.
The New York Empire State manufacturing index showed that activity in the region slowed to the slowest pace in a year in January. The index fell to 3.9 in January after a revised reading of 11.5 in December.
The Brexit parliamentary vote did not go through as widely expected. This raises the prospects of the UK inching closer to no deal along with a possible extension to the March 29 deadline. The Brexit deal received a vote down with a majority of 230 votes.
Earlier in the day, Japan’s PPI data showed that producer prices rose 1.5% on the year in December. The median estimates forecast an increase of 1.8%, and in November, Japan’s PPI advanced 2.3%.
The final inflation data for Germany is due to come out during the European trading session. Forecasts show that German inflation rose 0.1% on the month as per the flash estimates.
In the UK, the Bank of England Governor, Mark Carney will give to give a speech. The UK’s inflation data follow this. Forecasts show that consumer prices eased to 2.1% in December on the year. This marks a slowdown from the peak seen last year and inflation is inching closer to the BoE’s inflation target rate.
Core inflation is expected to rise by 1.8%, marking a steady pace of increase.
