• I'm Not Worried About Inflation

Prices for U.S. imports increased 0.5 percent in September, the U.S. Bureau of Labor Statistics reported today, after declining 0.4 percent in August and 0.1 percent in July. The September advance was led by higher fuel prices. U.S. export prices recorded no change in September following declines of 0.2 percent and 0.5 percent the previous 2 months.

Import prices advanced 0.5 percent in September, the first monthly increase since a 0.9-percent rise in May. The upturn reversed the declines in each of the previous 2 months. Prices for overall imports rose 3.5 percent from September 2017 to September 2018 and have not recorded an over-the-year decrease since the index fell 0.2 percent in October 2016.

• Some Parts of Real-Estate Markets Warrant Close Monitoring in Some Eurozone Countries

• No Sign of Excessive Credit Growth, Broad-Based Asset Price Misalignments

In August 2018 compared with July 2018, seasonally adjusted industrial production rose by 1.0% in the euro area (EA19) and by 0.8% in the EU28, according to estimates from Eurostat, the statistical office of the European Union. In July 2018, industrial production fell by 0.7% in the euro area and by 0.6% in the EU28. In August 2018 compared with August 2017, industrial production increased by 0.9% in the euro area and by 1.2% in the EU28.

In the euro area in August 2018, compared with July 2018, production of energy rose by 1.9%, durable consumer goods by 1.5%, both capital goods and non-durable consumer goods by 1.4% and intermediate goods by 0.4%. In the EU28, production of capital goods rose by 1.2%, non-durable consumer goods by 1.1%, energy by 0.9%, durable consumer goods by 0.8% and intermediate goods by 0.3%. Among Member States for which data are available, the highest increases in industrial production were registered in Malta (+9.9%), Ireland (+8.0%) and Hungary (+3.8%). A decrease was observed in Denmark (-4.5%).

• Uncertainty around inflation outlook is receding

• Economic indicators suggest that broad-based growth will continue

• Significant monetary policy stimulus is still needed

• Underlying inflation is expected to pick up towards the end of the year

• And it would then increase gradually over the medium-term

• Sees limited contagion from recent financial market volatility

• Cliff-edge Brexit could have potential to pose a more significant downside risk to financial stability - via forexlive.

• Over past 10 days been a measurable change in pace, engagement from both sides to solve problem instead of posturing on brexit

China's exports logged a double-digit growth in September, according to rttnews.

Exports grew 14.5 percent year-on-year in September, faster than the 9.8 percent increase seen in August.

At the same time, imports advanced 14.3 percent annually. As a result, the trade surplus increased to around $32 billion in September.

The big picture is the Chinese exports have so far held up well in the face of escalating trade tensions and cooling global growth, most likely thanks to the competitiveness boost provided by a weaker renminbi, Julian Evans-Pritchard, an economist at Capital Economics, said.

• Deal Is Subject to Completion of Ilva Acquisition

• Negotiations Still Ongoing for Assets in Belgium, Luxembourg

EUR/USD

Resistance levels (open interest**, contracts)

$1.1748 (1830)

$1.1709 (957)

$1.1676 (115)

Price at time of writing this review: $1.1588

Support levels (open interest**, contracts):

$1.1555 (2686)

$1.1526 (4460)

$1.1493 (3175)

Comments:

- Overall open interest on the CALL options and PUT options with the expiration date November, 19 is 79107 contracts (according to data from October, 11) with the maximum number of contracts with strike price $1,1600 (4460);

GBP/USD

Resistance levels (open interest**, contracts)

$1.3384 (2258)

$1.3351 (1023)

$1.3310 (388)

Price at time of writing this review: $1.3254

Support levels (open interest**, contracts):

$1.3144 (272)

$1.3118 (368)

$1.3088 (713)

Comments:

- Overall open interest on the CALL options with the expiration date November, 19 is 22801 contracts, with the maximum number of contracts with strike price $1,3500 (3537);

- Overall open interest on the PUT options with the expiration date November, 19 is 25807 contracts, with the maximum number of contracts with strike price $1,2900 (2121);

- The ratio of PUT/CALL was 1.13 versus 1.22 from the previous trading day according to data from October, 11

* - The Chicago Mercantile Exchange bulletin (CME) is used for the calculation.

** - Open interest takes into account the total number of option contracts that are open at the moment.

The trend estimate for the total value of dwelling finance commitments excluding alterations and additions fell 0.6%. Owner occupied housing commitments fell 0.2% and investment housing commitments fell 1.2%.

In seasonally adjusted terms, the total value of dwelling finance commitments excluding alterations and additions fell 2.1%.

In trend terms, the number of commitments for owner occupied housing finance fell 0.4% in August 2018.

In trend terms, the number of commitments for the purchase of new dwellings fell 1.9%, the number of commitments for the purchase of established dwellings fell 0.4%, while the number of commitments for the construction of dwellings rose 0.2%.

In original terms, the number of first home buyer commitments as a percentage of total owner occupied housing finance commitments fell to 17.8% in August 2018 from 18.0% in July 2018.

The inflation rate - measured by the consumer price index - thus increased. A higher inflation rate was last recorded in November 2011 (+2.4%). Compared with August 2018, the consumer price index rose by 0.4% in September 2018. The Federal Statistical Office (Destatis) thus confirms its provisional overall results of 27 September 2018.

As in the preceding months, the increase of energy product prices had a considerable effect on the inflation rate. Energy prices rose 7.7% in September 2018 on September 2017. The rate of energy price increase thus increased again (August 2018: +6.9%). In September 2018, the prices of heating oil (+35.6%) and motor fuels (+13.0%), in particular, were higher than a year earlier. While the prices of mineral oil products rose sharply, relatively moderate price developments were observed for other energy products (for example, charges for central and district heating: +2.4%; electricity: +0.9%; gas: -1.5%). Excluding energy prices, the inflation rate would have been +1.6% in September 2018.

• Fed Rates Still Below Long-Run Levels

• Current Fed Policy Could Allow Inflation to Heat Up

• Fed's Job and Inflation Goals Have Largely Been Achieved

• Risks to Economic Outlook Are 'Balanced'

• Fed Policy Can't Be on Preset Course Right Now