Five Things World Business Will be Talking About Today

(Bloomberg) 

The debt ceiling debate heats up, Jackson Hole begins, and U.K. consumer spending barely grows. Here are some of the things people in markets are talking about today.

Wall, ceiling, House

President Donald Trump’s threat to shutdown the government if Congress refuses to approve funding for a wall with Mexico could complicate efforts to raise the U.S. debt ceiling. While House Republicans did pass a package of spending bills that includes $1.6 billion in border-wall funding, there isn’t enough support in the Senate to make it to the President’s desk. Treasury Secretary Steven Mnuchin is urging Congress to act soon to increase the nation’s debt limit, with Senate Majority Leader Mitch McConnell saying there is “zero chance” it won’t be raised. Still, concerns about U.S. policy did weigh on markets yesterday, with stocks closing lower and the yield on 10-year U.S. Treasuries hitting the lowest since June.

Gone fishing

The annual Jackson Hole conference hosted by the Kansas City Fed kicks off in Wyoming today, with the main event for markets coming tomorrow when both Fed Chair Janet Yellen and European Central Bank President Mario Draghi are due to speak. While this year’s theme is “Fostering a Dynamic Global Economy,” the big question for global monetary policy makers remains the lack of global inflation despite falling unemployment and rising growth. Draghi’s address will be particularly closely watched as the ECB is due to discuss the future of its monetary policy at its September meeting amid persistently low inflation and a strengthening currency.

Consumer holidayThe U.K. consumer did very little to boost British growth in the second quarter, with data from the Office for National Statistics showing spending increased only 0.1 percent in the period as the economy expanded an unrevised 0.3 percent. That spending slowdown seems to be showing up in mobile phone sales, with Dixons Carphone Plc dropping as much as 32 percent in trading after forecasting an unexpected drop in earnings this year.

Markets still waiting for direction

Overnight, the MSCI Asia Pacific Index fell less than 0.1 percent, while Japan’s Topix index dropped 0.5 percent after the country’s steelmakers were hit by a report that top buyer Toyota Motor Corp. had won its first price reduction in about 18 months. In Europe, the Stoxx 600 Index was 0.4 percent higher as of 5:40 a.m. Eastern Time in a broad-based recovery, while S&P 500 futures were also gaining some ground. Oil steadied near $48 a barrel and the 10-year Treasury yield was at 2.182 percent.

Coming up…

U.S. weekly initial jobless claims data will be published at 8:30 a.m., with expectations for an increase to 238,000 from last week’s lowest-since-February figure of 232,000. Existing home sales data will also be closely watched when it’s released at 10:00 a.m. following yesterday’s surprise miss on new home sales. There are no major speeches scheduled for Jackson Hole today.