Eurozone inflation falls to 0.3% and unemployment remains stuck at 11.5%

Earlier:

6.42pm GMT

|￣￣￣￣￣￣￣￣￣￣ | | OIL IS A LEVERED | BET ON GLOBAL | GDP EXPECTATIONS | ＿＿＿＿＿__________| (\__/) || (•ㅅ•) || / 　 づ

6.40pm GMT

A late update — the sell-off in the oil price is picking up pace tonight.

The price of a barrel of Brent crude has dropped under the $70 per barrel, for the first time since May 2010.

Massive selling hit into the floor close with WTI crude down $7.54 to $66.15, down 10.23% on the session. Ouch.

4.40pm GMT

European stock markets ended the day flat, as investors divested the implications of the oil price slide (great for consumers, tricky for central bankers, bad for vulnerable producers, end of an era for Opec?).

Chris Beauchamp of IG sums it up:

It it looks like the power of OPEC to maintain a balance in the market has been severely weakened, if not broken entirely. Supply gluts are set to stay with us into 2015, and the geopolitical ramifications will be felt throughout the globe, not least in relation to Russia and Putin’s attempts to reconstruct a Moscow-led sphere of influence.

Europe closes flat after CPI data, oil stocks fall http://t.co/9lPCJhxQLS

IG closing market comments – energy stocks hit around the globe: https://t.co/NlMpJBCgE5

2.54pm GMT

Time for a recap:

Falling energy prices have helped to drag inflation across the eurozone down to a five-year low.

Lots of drivel, incl from eminent ecos, that lower oil prices=bad news re deflation, Europe, coming crash.Ok, lets get ’em back to $120 asap

Very disappointing that major stores did not learn lessons from last year – our officers have enough to do already

2.44pm GMT

Greece has reached a deal with its creditors after weeks of disagreement over its 2015 budget plans, according to media reports.

Details are vague, but it could be enough to get the troika back to Athens to review the state of play.

At the eleventh hour prime minister Antonis Samaras’ two-party coalition appears to have come to some agreement with the country’s “troika” of creditors at the EU, ECB and IMF. Officials say Greece agreed to roll back on several of its “red lines” after Samaras worked the phones last night. The leader cut the deal after conversing with European Commission president Jean Claude Juncker, German chancellor Angela Merkel, ECB president Mario Draghi, IMF managing director Christine Lagarde and EU Economic commissioner Pierre Moscovici, all of whom emphasized that it was imperative international inspectors returned to Athens ASAP.

Samaras, is currently in behind-door discussions with his deputy, Evangelos Venizelos, and it remains to be seen how the socialist leader will react to the news. Venizelos had repeatedly ruled out concessions that would further hit austerity blighted Greeks. Local media reports suggest that Samaras has agreed to further cut pensions – abolishing all for those under the age of 62, the crossing of a huge “red line” if true.

GREECE UPDATE: Moscovici urges Athens to ‘take necessary measures,’ make way for troika’s return http://t.co/UqLYf5jOuT via @ekathimerini

1.34pm GMT

Canada’s economy grew by 0.7% in the third quarter of this year, data just released shows.

That’s slower than in April-June, when GDP expanded by 0.9%.l, but beats forecasts.

Canada Q3 GDP Advanced 2.8% Annualized, Beating Market Expectations and the Bank of Canada Forecast

1.10pm GMT

The European Central Bank’s hawk-in-chief, Jens Weidmann, has rejected calls for a new monetary stimulus programme.

“One must be clear that central banks do not have an Aladdin’s Lamp that you just have to rub to make all wishes come true.

“In particular, it is an illusion to think that one can raise the growth potential of an economy for the long term or create jobs sustainably with the means of monetary policy.”

Buba’s Weidmann says drop in #Oil prices is like ‘Mini Stimulus’ plan.

“Calls for a public fiscal stimulus plan in Germany to boost the eurozone economy are amiss.”

12.39pm GMT

This morning’s fall in eurozone inflation to a five-year low has not spooked the financial markets.

This won’t however lessen the concern felt by ECB policy members as the downward trend for inflation continues unabated.

Falling energy prices have been a large source of this deflationary pressure in the 18-nation bloc, and yesterday’s landmark decision by OPEC to not cut production will likely see energy prices fall further still.

12.22pm GMT

Over in America, traders are rousing themselves from their post-Thanksgiving torpor and heading back to Wall Street.

At least, some are. Many have awarded themselves a four-day weekend by taking today off too.

12.11pm GMT

The prospect of a glut of oil seeping across the global economy has hit energy firms hard today, driving European stock markets into the red.

More than $32bn has been wiped off the European oil and gas sector, according to Reuters data.

“We are seeing continued oversupply,”

“I think $70 a barrel will be the new norm. We could see oil go considerably lower.”

11.52am GMT

If you strip out all the volatile factors, such as energy, food, alcohol & tobacco, then core eurozone inflation was unchanged this month at +0.7%.

11.37am GMT

Danae Kyriakopoulou, CEBR economist, says “the time has come” for the ECB to start a sovereign bond-buying quantitative easing programme.

Kyriakopoulou explains how the weak inflation and high unemployment are two sides of the same euro:

The main contributions to weakening price growth are coming from food and energy prices – energy prices fell by 2.5% year-on-year in November, today’s data showed.

These are hardly the type of goods that consumers can decide to forgo in the expectation that they will be cheaper in the near future. Even so, weak demand and elevated unemployment are also playing a part in keeping inflation subdued – which is why inflation in the Eurozone is so much lower that other advanced markets such as the US and the UK where the energy and food price dynamics are largely similar.

11.21am GMT

This chart, via the CEBR, shows how inflationary pressures in the eurozone have been falling for the last two years, while the unemployment rate has stuck stubbornly high.

11.21am GMT

Over in Brussels, the new European Commission has given France and Italy some breathing space to hit European budget targets.

Our correspondent Ian Traynor reports that Paris and Rome have got until next spring to deliver on their pledges of sweeping changes to labour markets and other structural reforms.

“As a new commission, we’re not seeing it as a priority to punish countries,” Valdis Dombrovskis of Latvia, the new commission vice-president in charge of the euro, told The Guardian and other European newspapers.

Fines still possible for #France? "All options on the table," @VDombrovskis says. Sounds like how #Pentagon used to talk about #Iran!

11.11am GMT

Just in – Brazil has pulled out of recession, narrowly.

GDP rose by a meagre 0.1% in the third quarter of 2014, having shrunk in the first six months of this year. The economy is still 0.2% smaller than a year ago.

Brazil’s economy grows 0.1% in Q3; out of recession but only just. #gdp #brasil #economy @BBCBusiness

11.00am GMT

Holger Schmieding of Berenberg has warned that euro inflation will remain below the ECB’s target “for as far as the eye can see”.

10.42am GMT

The fall in eurozone inflation is bad, although not unexpected, news for the ECB, says Howard Archer of IHS Global Insight.

The only crumb of comfort for the ECB – and it is not much of one – is that November’s renewed drop in inflation was entirely due to an increased year-on-year drop in energy prices.

There is likely to be more of that on the way given the slump in oil prices!

10.27am GMT

Behind the headline jobless rate of 11.5% are stark differences in unemployment across the eurozone.

The lowest unemployment rates were recorded in Germany (4.9%) and Austria (5.1%), and the highest in Greece (25.9% in August 2014) and Spain (24.0%).

10.18am GMT

There are currently 24.413 million men and women out of work across the European Union, Eurostat says. That’s the population of Netherlands and Switzerland put together.

And in the eurozone, there are 18.395m out of work.

10.10am GMT

There’s no respite in Europe’s jobless crisis. The unemployment rate was unchanged at 11.5% last month, partly due to the rise in Italy’s jobless rate (see earlier)

10.06am GMT

The drop in eurozone inflation isn’t sharp enough to force dramatic new action from the European Central Bank next week, reckons Frederik Ducrozet of Credit Agricole.

No sovereign QE for Christmas then.

10.02am GMT

Falling energy prices were the main factor dragging eurozone inflation down month.

They’ve shrunk by 2.5% over the last year — and are likely to keep falling given Opec’s decision.

Euro area annual inflation down to 0.3% in November 2014 – flash estimate from #Eurostat http://t.co/ztBKMdqwgZ pic.twitter.com/YdZx7EvbrB

10.01am GMT

Breaking: The eurozone has slipped closer to deflation. Prices across the single currency rose by just 0.3% this month, compared to November 2013, down from 0.4% a month ago.

9.54am GMT

The surge in Italy’s unemployment rate today is a grim reminder that its economic situation has worsened over the last year:

A creepy chart –> unemployment rate in Italy (Oct 2014) pic.twitter.com/QDVxZtzhkK

9.51am GMT

And here’s why the Russian stock market is sliding:

Russian GDP seen -3% next year with oil at $70. Or almost -6% at $50. Forecasts from @RencapMan: pic.twitter.com/oX1S0Xx5dX

9.49am GMT

The Russian stock market is also feeling the Opec blues this morning.

The RTS index has tumbled by 3.4% this morning, in a broad-based selloff, following warnings that the weak oil price will trigger a deep recession this year:

Russian RTS index. #splat pic.twitter.com/tOZqN9p6de

9.37am GMT

Russia Economy Minister Says Will Lower 2015 Oil Price Forecast — Interfax >> horse. bolted. etc

9.35am GMT

Newsflash from Moscow — the economy minister has said that Russia’s oil price forecast for 2015 will be cut, following yesterday’s Opec meeting.

9.22am GMT

Bad news from Italy… the country’s jobless rate has jumped to a new record high.

The Italian jobless rate jumped to 13.2% last month, as its recession continues to wreck havoc in its economy. This is the first time it’s been over 13% since records began in 1977.

Oof…. *ITALIAN OCT. UNEMPLOYMENT RATE RISES TO RECORD 13.2% FROM 12.9%

Italian unemployment rises above 13% for the first time since records began in 1977: pic.twitter.com/RPvq5xQKJB

9.09am GMT

Back in the financial markets, the Russian ruble has slumped to new record lows as the impact of Opec’s price war hits home.

The ruble slumped to the brink of 50 rubles to the US dollar this morning.

At $70 oil, Renaissance Capital sees Russia shrinking 3% in 2015 but the RUB to strengthen from here https://t.co/QtlLY0nccT

8.41am GMT

What has Britain become?

Take away people’s jobs and give them cut price Dysons – and make them into a circus show for those who disdain consumerism.

8.39am GMT

There were some frankly unpleasant scenes at Asda’s Wembley branch a few minutes ago, as these video clips from the FT’s Kadhim Shubber show:

Well this is awful #BlackFriday https://t.co/WwCyu1x6f1

Fights breaking out #BlackFriday https://t.co/r5jT1spiKj

Lady down #BlackFriday https://t.co/ruJ5XnXasM

8.33am GMT

I’m not sure this Black Friday frenzy is doing much for UK productivity:

Now crazy queues to pay.. pic.twitter.com/GFWLoSBwDM

8.31am GMT

Over in Wembley, Asda just threw open the doors at its store for Black Friday.

My colleague Sarah Butler is there, and reports that more than 400 people were queuing – one arrived at 1am., and another admitted crying off work sick.

Bonkers.. That is all.. pic.twitter.com/CzO6RM69i4

Devish been queuing from 6am and says he reckons he’ll spend £500 to £600. "Guess I’ll be a bit late for work".. pic.twitter.com/z9in2V2gjr

8.26am GMT

Online shopping may let you avoid the cold, but there’s no escape from the queues:

Currys PC World know what the British want from Black Friday! a 28 minute virtual queue on its website. Wait in line.

8.10am GMT

US retail giant Walmart has recorded its second-highest online sales day ever, as Americans flocked to buy bargains during Thanksgiving.

We saw lines for tablets and TVs snaking throughout the stores, and with our exclusive 1-Hour Guarantee, customers left happy.

We sold enough food storage containers to hold 4.5 million pounds of Thanksgiving leftovers and we sold enough towels to line the banks of the Mississippi River*.

7.56am GMT

Building society Nationwide has reported that the UK housing market continues to slow down this month.

Prices rose by 0.3% in November, down from 0.5% in October. That pulled the annual rate of house price inflation down to 8.5%, from 9.0% a month ago.

“Forward looking indicators, such as new buyer enquiries point to further softness in the near-term. However, if the economy and the labour market remain in good shape and mortgage rates do not rise sharply, activity is likely to pick up in the quarters ahead.”

7.40am GMT

Britain’s police forces are urging UK shoppers to calm down, having been called to several stores already today as people wrestle for a Black Friday bargain.

At least two people arrested at #BlackFriday sales events already this morning. Keep calm people!

*POLICE CALLED TO SEVEN TESCO STORES IN MANCHESTER ON ‘BLACK FRIDAY’ SCUFFLES

7.36am GMT

The latest American tradition to cross the Atlantic, Black Friday, got off to a bang, a few shoves and several phone calls to the police today.

More than a dozen police officers attended the Tesco store on Glover Drive, Upper Edmonton, as scuffles broke out between eager and frustrated shoppers. Customers were seen tearing down cardboard hoardings put in place to hold back sale items until the stroke of midnight.

Tesco delayed the sale of its most popular sale items – TVs – for almost an hour until police brought the situation under control. One officer was overheard criticising the manager for failing to ensure adequate security and suggested the sale should be suspended altogether.

7.25am GMT

Good morning, and welcome to our rolling coverage of the world economy, the financial market, the eurozone and business.

Brent and WTI keep falling in the wake of the Opec no cut decision. pic.twitter.com/4zVegIkq2R

The new reality is the US one of the largest oil producers in the world which they weren’t beforehand, and as such the balance of power has shifted with OPEC, Russia and the US as the largest producers of crude oil, which means that OPEC now only control about one third of global oil production.

As such we could well see Brent prices drop towards $60 a barrel, a level that Rosneft chief Igor Sechin suggested could be seen early next year, and a level that could well cause some major financial problems to some US shale producers as well as a lot of OPEC members.

If your going to Tesco Silverburn, don’t bother. Police have shut it down due to fighting over #BlackFriday sales.

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