The fundamental news on the economic calendar in Europe this morning centred around two principle pieces of news, the ZEW sentiment figures and the CPI data, both of which provided a mixed picture on the broader economy.  The first of these provided a view of the German economy which was in stark contrast to recent comments from the German Chamber of Commerce which suggested that the credit crisis was about to return thereby proving the almost worthless nature of sentiment indices such as this, which came in “better” than expected at 44.8 against a forecast of 35.1.  This view was also reflected in the broader ZEW index for Europe which was also better than expected at 42.7 versus 34.1 – I will leave you to draw your own conclusion from these “numbers”.   There are times when I truly believe markets respond just as much to the placebo effect!  Of slightly more value were the CPI figures and Core CPI with the first coming in absolutely flat at 0% replicating last month’s results once again and indicative of possible deflationary pressures.  Core CPI came in marginally worse than expected at 1.5% against a forecast of 1.6%.

Turning to the US today we have a wide variety of data sets starting with building permits which showed a small increase on last month coming out at 0.52m against a forecast of 0.50m which was also last month’s figure.  At the same time we have PPI and Core PPI figures released which offset the goods on building permits by coming in worse than expected at 0.2% and -0.1% respectively.   Up until this month the PPI index had fallen by 5% since last year which according to the US government is the biggest year on year decline since August 1949 suggesting once again that deflation may be a bigger problem than inflation in the medium term.   The next item of news were the Housing Start numbers which came in better than expected at 0.53m against a forecast of 0.48m and the day rounds off with the Capacity Utilization Rate forecast at 68.5% and Industrial Production which is forecast to be negative once again at -0.7% (some real numbers””).  The final item of news is a speech from FOMC member Warsh who is due deliver a speech entitled “Economic Policy and Financial Markets Developments” at a meeting in New York.

You can keep up to date with all the latest fundamental news on the economic calendar, latest currency news and live currency charts by simply following the links.  I have also included details on an excellent ECN broker.