Headline annual inflation in the euro area fell nearly a percentage point last month to the lowest rate since the Russian attack on Ukraine, and such a decline combined with growth concerns in the currency bloc could embolden monetary policy doves at the European Central Bank.
The EU statistics office Eurostat said its preliminary estimate for May inflation in the Eurozone dropped to 6.1%, a mark well below last month’s 7.0% reading and also under the market estimate of 6.3%. The rate of price growth was the lowest since the 5.9% reported for February 2022, when Russian troops crossed into Ukraine late in the month.
Core inflation also eased more than expected, falling to 5.3%, Eurostat said. This was short of both the 5.5% estimate and the 5.6% reading in April.
Consumer price growth was flat on the month, the office reported.
Food prices continued to climb in May, but their rate of assent eased to an annual rate of 12.5% from 13.5% in the previous month. Energy prices slipped 1.7% on the year, according to Eurostat.
Disinflation, meet stagnation
Jack Allen-Reynolds from Capital economics noted that the steep fall in headline inflation “came as no real surprise. Energy inflation dropped back below zero as we had expected, and food inflation declined for the second month running, adding to the impression that it has finally past its peak.
“More important for the ECB was that core inflation declined. We had expected core goods inflation to come down as the effect of improved global supply conditions continued to feed through, and it duly fell from 6.2% to 5.8%. But services inflation declined too, from 5.2% to 5.0%. While that was partly due to the introduction of a cheap transport ticket in Germany, the CPI data published by national statistics agencies show that services inflation also fell in France and Italy.”
EU harmonised inflation in Germany, France, and Spain – three of the Eurozone’s four largest economies, fell more than expected last month, according to preliminary data. Price growth in Italy also eased, but the decline was less than expected.
However, as inflation fades, so does business activity in the Eurozone, wrote ING’s Peter Vanden Houte, noting: “Even though we are already more bearish than the consensus, we cannot dismiss the possibility that growth turns out to be even weaker.
Germany fell into recession in the first quarter, the second consecutive three-month period of economic contraction.
“The further weakening of growth over the course of the year should bring inflation down towards 3% by year-end. As the ECB wants to see a clear decline in core inflation before ending the tightening cycle, 25-basis point rate hikes seem likely in both June and July, with an additional one in September a genuine risk.”
“Of course, that might allow the ECB to cut back rates a bit more strongly over the course of next year,” he added.
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var assigned_server = 3001;
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case 'ConnectDistributor': connect_to_distributor(msg); break;
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case 'SessionInfo': update_session_info(msg.data); break;
case 'PauseLogging': clearTimeout(logging_interval); break;
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case 'PlayerLogResponse': player_log_response(msg.data); break;
case 'CloseSocket': close_socket(); break;
case 'RequestMessageSearch': request_message_search(msg.data); break;
case 'RequestMoreMessages': request_more_messages(msg.data); break;
case 'PlayerDisconnectedAnnoucementTimeoutStart': player_disconnected_annoucement_timeout_start(); break;
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function send_play_disconnect_annoucement() {
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data_array.respond_to_socket = data.respond_to_socket;
data_array.player_socket_id = data.player_socket_id;
data_array.logs = data.logs;
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function request_message_search(data) {
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data_array.search_term = data.search_term;
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function request_more_messages(data) {
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data_array.last_record_id = data.last_record_id;
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function check_channel_status(data) {
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}
function check_channel_status_response(data) {
postMessage({ action: 'CheckChannelStatusReponse', stream_status: data.stream_status.status, onair: data.stream_status.onair, connected: data.stream_status.connected });
}
function join_publisher_channel(data) {
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data_array.type = 'join_publisher_channel';
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data_array.single_sign_on = data.single_sign_on;
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data_array.http_referrer = data.http_referrer;
data_array.current_page = data.current_page;
data_array.php_session_id = data.php_session_id;
data_array.from_react = data.from_react;
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if (socket.readyState == 1) {
socket.send(msg_string); }
postMessage({action: 'PublisherChannelJoined' });
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function session_static_info(msg) {
set_static_session_info(msg.data);
start_log();
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function connect_to_distributor(msg) {
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remote_ip = msg.data.remote_ip;
socket = new WebSocket("wss://ws.livesquawk.com/ws"+distributor_server);
socket.onopen = function(event) { request_server_assignment(); };
socket.onmessage = function(event) {
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var data = JSON.parse(msg_string);
switch(data.type) {
case 'server_assignment_response': server_assignment_response(data); break;
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};
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function session_info_interval() {
postMessage({action: 'RequestSessionInfo' });
logging_interval = setTimeout(session_info_interval,logging_interval_time);
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function server_assignment_response(data) {
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socket.close();
connect_to_assigned_server();
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function request_server_assignment() {
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socket = new WebSocket("wss://ws.livesquawk.com/ws"+assigned_server);
socket.onopen = function(event) {
postMessage({ action: 'VisibleConsole',console_string: "Connected to server "+assigned_server });
console.log("Connected to server "+assigned_server);
postMessage({ action: 'ConnectedToAssigned' });
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postMessage({ action: 'RejoinPlayerChannel' });
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var data = JSON.parse(msg_string);
if (data.type != 'server_ping') { /* console.log(data.type); */ }
switch(data.type) {
case 'reconnect': postMessage({ action: 'VisibleConsole',console_string: "Reconnected" }); break;
case 'reload': postMessage({ action: 'Reload' }); break;
case 'start_log_response': start_log_response(data); break;
case 'application_refresh_start': application_refresh_start(data); break;
case 'application_refresh_stop': application_refresh_stop(data); break;
case 'player_log_request':
case 'check_channel_status_response': check_channel_status_response(data); break;
case 'PlayerLogRequest':
case 'new_tweet':
case 'new_latest_news':
case 'delete_report':
case 'add_report':
case 'add_ref_doc':
case 'calendar_change':
case 'calendar_insert':
case 'calendar_delete':
case 'new_note':
case 'AppStart':
case 'AppStop':
case 'BroadcasterStarted':
case 'BroadcasterStopped':
case 'added_cme_report':
case 'updated_cme_report':
case 'added_cme_commentary':
case 'updated_cme_commentary':
case 'server_assignment_response':
case 'initial_messages':
case 'message_categories':
case 'more_messages':
case 'matched_messages':
pass_straight_to_post_message(data);
break;
case 'output':
case 'server_ping':
case 'reconnect':
case 'disconnect':
break;
}
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socket.onerror = function(event) {
postMessage({ action: 'VisibleConsole',console_string: "LS Socket Error" + event.type });
console.log(event);
postMessage({ action: 'LSSocketConnectionError' });
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socket.onclose = function(event) {
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reconnection_delay = reconnection_delay*reconnectionDelayGrowFactor;
connected_to_assigned = false;
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clearTimeout(socket_close_timeout);
socket_close_timeout = null;
socket.onclose = function(event) {};
socket.onmessage = function(event) {};
socket.onerror = function(event) {};
socket.close(1000);
console.log('Socket Closed');
}
function pass_straight_to_post_message(data) {
data.action = data.type;
postMessage(data);
}
function join_player_channel(data) {
var data_array = {};
data_array.type = 'join_player_channel';
data_array.player_channel = data.player_channel;
data_array.remote_ip = data.remote_ip;
data_array.username = data.username;
data_array.app_name = data.app_name;
data_array.onair_status = data.onair_status;
data_array.http_referrer = data.http_referrer;
data_array.current_page = data.current_page;
data_array.php_session_id = data.php_session_id;
var msg_string = JSON.stringify(data_array);
if (socket.readyState == 1) { socket.send(msg_string); }
postMessage({action: 'PlayerChannelJoined' });
playing = true;
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function start_log_response(data) {
session_info.session_id = data.log_record_id;
session_info_interval();
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function application_refresh_start(data) {
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function application_refresh_stop(data) {
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function set_static_session_info(data) {
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session_info.browser_name = data.browser_name;
session_info.user_agent = data.user_agent;
session_info.browser_version = data.browser_version;
session_info.cookies_enabled = data.cookies_enabled;
session_info.platform = data.platform;
session_info.player_version = data.player_version;
session_info.stream = data.stream;
session_info.connection_protocol = data.protocol;
session_info.delay_target = data.delay_target;
session_info.session_email = data.session_email;
session_info.remote_ip = data.remote_ip;
session_info.php_session_id = data.php_session_id;
session_info.application_name = data.application_name;
session_info.http_referrer = data.http_referrer;
}
function start_log() {
var session_start_date = new Date();
session_start_time = session_start_date.getTime();
var months = ['Jan','Feb','Mar','Apr','May','Jun','Jul','Aug','Sep','Oct','Nov','Dec'];
var session_start_date_string = session_start_date.getDate() + " " + months[session_start_date.getMonth()] + " " + session_start_date.getFullYear();
var data_array = {};
data_array.type = 'webrtc_start_log';
data_array.remote_ip = session_info.remote_ip;
data_array.username = session_info.session_email;
data_array.php_session_id = session_info.php_session_id;
data_array.webrtc_protocol = '';
data_array.session_start_time = (session_start_time/1000).toFixed(0);
data_array.stream_name = session_info.stream;
data_array.session_start_date = session_start_date_string;
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if (socket.readyState == 1) { socket.send(msg_string); }
}
function update_session_info(data) {
var data_array = {};
var msg_string = '';
var current_date = new Date();
var current_time = current_date.getTime();
session_info.protocol = data.protocol;
session_info.curr_delay = (data.effective_latency / 1000).toFixed(2);
session_info.session_length = current_time - session_start_time;
session_info.ping_time = data.ping_time;
session_info.jitter = data.jitter;
session_info.packet_loss = data.packet_loss;
session_info.effective_latency = data.effective_latency;
session_info.mean_opinion_score = data.mean_opinion_score;
session_info.restarts = data.restarts;
if (socket_emits == 0) {
data_array = {};
data_array.type = 'webrtc_log_data_full';
data_array.connection_protocol = session_info.protocol;
data_array.threshold = 0;
data_array.curr_delay = session_info.curr_delay;
data_array.session_length = session_info.session_length;
data_array.date = current_time;
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data_array.stream = session_info.stream;
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data_array.delay_target = 0;
data_array.op_sys = '';
data_array.flash_version = '';
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data_array.user_email = session_info.session_email;
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data_array.ping_time = session_info.ping_time;
data_array.jitter = session_info.jitter;
data_array.packet_loss = session_info.packet_loss;
data_array.effective_latency = session_info.effective_latency;
data_array.mean_opinion_score = session_info.mean_opinion_score;
data_array.session_id = session_info.session_id;
msg_string = JSON.stringify(data_array);
if (socket.readyState == 1) { socket.send(msg_string); }
}
else {
data_array = {};
data_array.type = 'webrtc_log_data';
data_array.session_id = session_info.session_id;
data_array.php_session_id = session_info.php_session_id;
data_array.connection_protocol = session_info.protocol;
data_array.restarts = session_info.restarts;
data_array.threshold = 0;
data_array.curr_delay = session_info.curr_delay;
data_array.session_length = session_info.session_length;
data_array.date = current_time;
data_array.webrtc_protocol = session_info.protocol;
data_array.ping_time = session_info.ping_time;
data_array.jitter = session_info.jitter;
data_array.packet_loss = session_info.packet_loss;
data_array.effective_latency = session_info.effective_latency;
data_array.mean_opinion_score = session_info.mean_opinion_score;
data_array.stream = session_info.stream;
msg_string = JSON.stringify(data_array);
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}
socket_emits++;
if (socket_emits == 100) { socket_emits = 0; }
}
- Headline, core rates lower than expected
- Major economies report slowdowns in price growth
- Analysts ponder future of ECB rate policy
By Eric Culp, European Editor
LiveSquawk News
@EricCulpLS
01 June 2023 | 09:50 GMT
Headline annual inflation in the euro area fell nearly a percentage point last month to the lowest rate since the Russian attack on Ukraine, and such a decline combined with growth concerns in the currency bloc could embolden monetary policy doves at the European Central Bank.
The EU statistics office Eurostat said its preliminary estimate for May inflation in the Eurozone dropped to 6.1%, a mark well below last month’s 7.0% reading and also under the market estimate of 6.3%. The rate of price growth was the lowest since the 5.9% reported for February 2022, when Russian troops crossed into Ukraine late in the month.
Core inflation also eased more than expected, falling to 5.3%, Eurostat said. This was short of both the 5.5% estimate and the 5.6% reading in April.
Consumer price growth was flat on the month, the office reported.
Food prices continued to climb in May, but their rate of assent eased to an annual rate of 12.5% from 13.5% in the previous month. Energy prices slipped 1.7% on the year, according to Eurostat.
Disinflation, meet stagnation
Jack Allen-Reynolds from Capital economics noted that the steep fall in headline inflation “came as no real surprise. Energy inflation dropped back below zero as we had expected, and food inflation declined for the second month running, adding to the impression that it has finally past its peak.
“More important for the ECB was that core inflation declined. We had expected core goods inflation to come down as the effect of improved global supply conditions continued to feed through, and it duly fell from 6.2% to 5.8%. But services inflation declined too, from 5.2% to 5.0%. While that was partly due to the introduction of a cheap transport ticket in Germany, the CPI data published by national statistics agencies show that services inflation also fell in France and Italy.”
EU harmonised inflation in Germany, France, and Spain – three of the Eurozone’s four largest economies, fell more than expected last month, according to preliminary data. Price growth in Italy also eased, but the decline was less than expected.
However, as inflation fades, so does business activity in the Eurozone, wrote ING’s Peter Vanden Houte, noting: “Even though we are already more bearish than the consensus, we cannot dismiss the possibility that growth turns out to be even weaker.
Germany fell into recession in the first quarter, the second consecutive three-month period of economic contraction.
“The further weakening of growth over the course of the year should bring inflation down towards 3% by year-end. As the ECB wants to see a clear decline in core inflation before ending the tightening cycle, 25-basis point rate hikes seem likely in both June and July, with an additional one in September a genuine risk.”
“Of course, that might allow the ECB to cut back rates a bit more strongly over the course of next year,” he added.