US economic reports released Thursday did little to change the likely trajectory of the country’s interest rate policy next week, with labour data highlighting an ever-looser jobs market, whilst the national inflation gauge remained elevated last month.

Monthly headline inflation rose 0.4% in August, a tenth of a percentage point faster than forecast and above July’s 0.2% reading. The unrounded read was 0.382% versus 0.197%. Core CPI, which excludes food and energy, increased 0.3% to match both the forecast and prior value, 0.345% unrounded up from 0.322%. On an annual basis, the headline rate rose an in-line 2.9%, two-tenths higher than last month. Core prices increased 3.1%, mirroring the estimate and July's figure.

The Bureau of Labor Statistics said the most significant driver of the monthly rise was shelter costs, which rose 0.4% in August. Food was another notable gainer, with all six major grocery store food group indices higher in August. Energy was up 0.7%, rebounding from a 1.1% fall last month. (LiveSquawk – Continue Reading)

Barring major shifts in EU and global economics and politics, it could be a long time before European Central Bank interest rates move lower again.

The ECB kept its key rates unchanged Thursday as inflation expectations were largely steady and the growth forecast for this year was raised from its June projection. More importantly, bank president Christine Lagarde told journalists assembled for the press conference after the rate decision: “The disinflationary process is over.”

This can be taken to mean that the bank believes inflation has largely bottomed out, which would preclude further rate cuts, thus ending the cycle of reductions that began in June of last year. (LiveSquawk – Continue Reading)

The sudden collapse of a Texas subprime car lender is sending shock waves from border-town dealerships all the way to the upper echelons of Wall Street, ensnaring giants including JPMorgan Chase and BlackRock and raising concern that pain in the multibillion-dollar market for bundled auto loans is starting to mount.

Just hours after reports emerged late Tuesday of an alleged fraud scheme, Tricolor Holdings filed for bankruptcy and said it plans to liquidate, marking the latest and most painful blow yet to a risky lending business that’s been buffeted by a surge in interest rates and weakening jobs market. Federal prosecutors are now looking into allegations of fraud by Tricolor, according to people with knowledge of the matter. (Bloomberg – Continue Reading)

In just a few weeks, U.S. farmers will begin harvesting tens of millions of tons of soybeans. But they have a big problem on their hands: The world’s biggest buyer doesn’t want any.

Over the years, China had become one of the biggest buyers of American agricultural products, as the country’s growing middle class developed a taste for pork and poultry that are fattened, in part, on soybean meal. U.S. farmers in turn rushed to cash in on China’s ravenous demand. (WSJ – Continue Reading)