European Periphery Macro Daily 23/01/2019

Macro update

- BoJ. The BoJ kept unaltered its monetary policy both in terms of interest rate and quantitative policy (yield-curve control programme). However, the underlying message delivered was dovish, with the inflation forecast slashed (for the fourth consecutive time in its quarterly outlook).

- Bank of China TLTRO. Yesterday, the PBOC injected c.CNY257bn (c.USD38bn) of liquidity into the banking system through the new Targeted Medium-term Lending Facility which was announced some weeks ago, and which is earmarked to foster bank lending to SMEs.

- Spain bank lending (November). Total outstanding loans to the non-financial private sector dropped by 2.8% YoY in November, slightly below the figure registered in October of -3% YoY. Meanwhile, the stock of non-performing loans continued to fall at -27.7% YoY in November (on average, the rate of decline has been -25% YtD).

- Spain trade balance (November). Spain’s trade deficit worsened in September both in monthly terms (EUR2.6bn vs. a EUR3.8bn deficit in October) and also in YtD cumulative terms (EUR30.6bn vs. EUR24.2bn printed in the same period last year). This was due to a bigger increase in imports (+7% YoY in YtD terms) than exports (+3.4% YoY).                                                                                                                                                                                                - Germany Zew expectations survey (January). Yesterday the Zew indicator printed some improvement  to -15 from -17.5 in December, above Bloomberg consensus expectations (-18.5). The Zew survey indicator for the EMU also increased slightly, at -20.9 from -21.0 in December.                                                                                                                                                                      - Macro releases today. There are no relevant macro releases today.

PLEASE SEE IMPORTANT DISCLOSURES ON THE LAST FOUR PAGES OF THE REPORT.