1- #German Producer Price Inflation came as a shocker number this morning (+7.9% m-o-m vs 2.4% est., +45.8% y-o-y) ⚠️
This is a HUGE challenge for its global competitive position. The US, China and Japan are on DIFFERENT trajectories
This is a HUGE challenge for its global competitive position. The US, China and Japan are on DIFFERENT trajectories
2- NB: August was the PEAK in Gas and Power prices. So for September, this number likely comes DOWN
However, it likely remains in uncomfortable territory, as many companies HEDGE their energy exposure
There, higher gas/power prices only hit once these hedge roll off
However, it likely remains in uncomfortable territory, as many companies HEDGE their energy exposure
There, higher gas/power prices only hit once these hedge roll off
3- The pressure on Eurozone corporate earnings remains UNDERESTIMATED
Today, Austrian Chemicals company Lenzing profit warned on WEAKER demand and HIGHER input cost
Not priced in, stock down -20% after -40% YTD
lenzing.com/newsroom/press…
Today, Austrian Chemicals company Lenzing profit warned on WEAKER demand and HIGHER input cost
Not priced in, stock down -20% after -40% YTD
lenzing.com/newsroom/press…
4- There is a SILVER LINING:
- European companies will undergo tremendous EFFICIENCY efforts
- Gas is ubiquitous, eventually it will be CHEAP again
- Those who make it will be in GREAT SHAPE 2-3 years from now
- European companies will undergo tremendous EFFICIENCY efforts
- Gas is ubiquitous, eventually it will be CHEAP again
- Those who make it will be in GREAT SHAPE 2-3 years from now
• • •
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