Growth in bank lending was unexpectedly weak in June

European equities started the session with a rally that run fast into resistance and was followed by a slide towards yesterday's closing levels. The price action was driven by multiple earnings results that were mixed. US equities start positively on generally better than expected earnings.
The number of Americans filing for unemployment benefits rebounded from a three-month low last week (from 234k to 244k), but remained below a level consistent with a tightening labour market. The US trade deficit narrowed more than estimated in June (to $63.9 billion from $66.3 billion) in a positive sign for economic growth.
The US economy is experiencing steady but slower growth in business investment as orders for capital equipment eased last month (-0.1% M/M) following a May increase that was bigger than previously reported (0.7% M/M from 0.2 M/M).
Growth in bank lending was unexpectedly weak in June, a potentially worrying sign for policymakers even if a oneoff factor may have contributed to the slowdown. Lending to EMU non-financial corporations slowed to 2.1% Y/Y in June from 2.5% Y/Y in May. Lending to households meanwhile grew by 2.6% Y/Y in June, unchanged from May.
The head of the Financial Conduct Authority has called for Libor, the interbank lending rate at the heart of a multibillion banking scandal, to be phased out in 2021 and replaced by more reliable alternatives.
US President Trump's newly appointed communications director Scaramucci shook up relations both in the White House and on the international stage, dialling in to a live broadcast on CNN to warn that Mr Trump "may veto" the Russian sanctions bill, and that his relationship with chief of staff Priebus was potentially irreparable.
The BoE has appointed a veteran civil servant to become its new deputy governor. Dave Ramsden – currently the chief economic adviser to the Treasury and head of the Government Economic Service – will become the new deputy governor of markets and banking, starting his five-year term on September 4.

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