Germany sets target for fuel independence from Russia
Today's news headlines:
‘Truss wants to make No 10 ‘economic nerve centre’ if she becomes PM’. After initially refusing to rule out the division of the UK Treasury into distinct economic and finance ministries, Conservative leadership favourite Liz Truss has now made a U-turn and told allies it would be ‘mad’ to do such a thing during an economic crisis. To bridge the gap between the Prime Minister and Chancellor, the ‘joint economics unit’, initially created by former Downing Street advisor Dominic Cummings, was fully integrated into Rishi Sunak’s Treasury. However, Truss has stated publicly that the formation of this unit was not the right thing to do and that she wants to create a stronger economic capacity for No 10, pushing through policies of deregulation and tax cuts. (Financial Times)
‘Germany must cut gas use by 20% to avoid winter rationing, regulator says’. Since Russian energy corporation Gazprom heavily reduced gas supply through the Nord Stream 1 pipeline in June to just a fifth of its operating capacity, Germany has feared an inescapable winter fuel crisis. Federal Network Agency President, Klaus Muller, has said that in order to avoid a crippling winter shortage, German businesses and households must reduce their gas usage by 20% over the coming months. Muller has also said that Europe’s largest economy will need an extra ten gigawatts of gas supply from other countries such as the US to account for the missing volumes from Russia. Germany has set the target of weaning itself off Russian gas by summer 2024. However, the long-term effect of ending its dependence on Russia will be very high gas prices which will likely have a profound impact on Europe’s consumers. (Financial Times)
The S&P 500 index grew by nearly 2 percent over the last 24 hours, and the US Dollar strengthened against the Pound overnight. The Euro also saw a negative trend against the US Dollar last night. The price of brent crude and natural gas fell by almost 1.5% overnight.
Japanese preliminary GDP q/q: 0.5% vs -0.1% previously
Chinese Retail Sales y/y: 2.7% vs 3.1% previously
German Wholesale Price Index m/m: -0.4% vs 0.1% previously
Swiss Producers Price Index m/m: -0.1% vs 0.3% previously
US Empire State Manufacturing Index: 1:30PM
French and Italian Bank Holiday: All day
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