Asian markets are on track to record a 2% decline this week, and the reasons lie in the 'usual suspects': tensions in the Eurozone and uncertainty about support measures by central banks in both America and Europe . Measures largely discounted in the past weeks and which are now in doubt again. The appointment with Bernanke in Jackson Hole is imminent, and in the meantime the markets prefer to err on pessimism. This was also helped by falling industrial production in Japan (where today's data on consumer prices continue to show stubborn deflation) and South Korea.
Yesterday's US data is positive: real consumption in July increased – month on month – by 0,4% and prices (in the version of the consumer price deflator excluding food and energy – the measure preferred by the Fed) remained unchanged , lowering annual inflation to 1,6%. On this side, there is a clear call for further stimulus measures, given that inflation is below the (informal) 2% limit and unemployment is above 8%.
Read also Bloomberg
