Morning news

The GDP report for Q3 is out (available here) and it might seem good news. Q3 2013 growth is 2.8%, but it comes from inventory accumulation and that is not good. Firms added to inventories of goods which means they will need to produce less in Q4 so hiring may still be weak.

Jobless claims were down some 9,000 according to the Department of Labor (report). The labor market problem still seems to be an issue of job growth or job creation. Declining numbers on the job loss side are not too much a surprise when we cannot get more people hired.

In a surprise move the ECB (press release) cut a key rate from 0.5% to 0.25%. Why? They are worried about deflation. Inflation numbers have been low and some came in lower and they are trying to avoid that problem added to their others. Of course they are now getting into the realm of unconventional monetary policy of the sort the Federal Reserve employed over the last few years.

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