- According to the German Federal Statistics Office on Wednesday, import prices for the country advanced 0.6% month-over-month in July, slightly above forecasts for a 0.5% gain but slower than June's 1.5% increase. In annual terms import prices moved up 9.3%, also just above the projected 9.2% rate and

faster than June's 8.9% increase.

- Markets have been receiving regional German CPI data throughout Wednesday morning suggesting some deceleration in CPI growth. CPI for the Saxony, North Rhine West and Hesse regions declined 0.4% on the month while Bavaria and Brandenburg reported 0.3% declines in August. In annual terms, Hesse reported a 3.4% inflation rate, followed by Saxony growing 3.3%. Increases of 3.1% in CPI in Brandenburg and Bavaria and a 2.9% inflation rate in the North Rhine-West region were reported.

- Speaking in an interview with Bloomberg, Bundesbank President Axel Weber said talks about rate cuts are premature and that there was no guarantee that slowing economic growth would lead to lower inflation rates. The central banker added that inflation in the euro zone might not breach 2.0% by 2010 and that "considerable" price pressures remain in the pipelines. Future monetary policy would depend on incoming data, and thus far, the inflation outlook has not improved, Weber added.

- Speaking in an interview with Reuters, Central Bank of Malta President Michael Bonello said markets have rightfully understood the European Central Bank's message of no changes in interest rate in 2008 and that it was too early to say rates would come down in 2009. The central banker also explained his definition of the ECB's current 'no bias' stance on monetary policy as a possibility of rates moving either higher or lower.

- Oil prices are higher on Wednesday as Hurricane Gustav was downgraded to a tropical storm, but remains likely to return to hurricane status later today. The storm could be the first major system to strike oil platforms in the Gulf of Mexico since 2005.

- Consumer confidence in Finland rebounded in August, according to a report from the Statistics Office on Wednesday, whose consumer confidence index reached 8.7 compared despite expectations of a score of 8.0. In the previous month, the index declined to 6.5 from 10.2.

- Construction work done in Australia for the second quarter of 2008 failed to deliver the expected 1.5% quarterly increase, according to the Statistics Bureau on Wednesday which reported a 2.6% contraction in completed construction work done between April and June. On the other hand, first-quarter construction work done in Australia was revised from a 2.3% expansion to a 5.0% rate of growth.

- Confirming preliminary estimates, Spanish GDP in the second quarter posted a 0.1% gain on the quarter and a 1.8% rise on the year, according to the Instituto Nacional de Estadistica on Wednesday. The news came as no surprise given forecasts for no change to the preliminary forecasts.

- According to a report from the Institute for Studies and Economic Analyses (ISAE), Italian consumer confidence rebounded further than expected in August, with the headline index reaching 99.5 compared to July's 85.8 level and the consensus for a score of 96.4.

- According to the National Institute of Economic Research in Stockholm, consumer confidence in Sweden rebounded slightly further than expected in August while manufacturing optimism fell, in line with forecasts. The reports cite the consumer confidence index for August rising to a reading of -16.5 compared to July's -18.2. The consensus had been for a score of -17.0. Meanwhile, manufacturing confidence deteriorated to a reading of -12, compared to the previous month's revised reading of -11. Prior to revisions, July's score had been -10.

- Household lending in Sweden was little changed in July, according to a report from Statistics Sweden which reported housing lending advanced 10.6% year-over-year in July, little changed from June's 10.5% increase.

- According a report from Statistics Iceland, consumer prices rose 14.5% year-over-year in August compared to July's 13.6% increase and the consensus for a 14.6% gain.

- In an effort to continuing controlling inflation, the Bank of Thailand hiked its benchmark interest rate 25 bps to 3.75% on Wednesday, as expected by a majority of economists.

At 6:45 a.m. EDT:

The euro was up 1.12 cents to 1.4766 USD.

The U.S. dollar was down 0.49 cents to 1.0436 Canadian Dollars.

The U.S. dollar was down 84.00 cents to 108.76 Yen.

The pound sterling was up 0.87 cents to 1.8488 USD.

The Australian dollar was up 0.68 cents to 0.8626 USD.

The U.S. dollar index was down 44.10 points to 76.81.

The U.S. ten-year note was up 9.4 ticks to 116.69 with yields up 2.2 bps to 3.80%

The German ten-year bund was down 26.0 ticks to 114.39 with yields up 3.8 bps to 4.15%

The British ten-year gilt was down 31.0 ticks to 109.49 with yields up 1.5 bps to 4.51%

The Australian ten-year bond was up 0.5 ticks to 94.32 with yields down 3.4 bps to 5.72%

The Japanese ten-year government bond was up 15.0 ticks to 138.23 with yields up 2.6 bps to 1.45%

The Eurostoxx was trading down 20.57 points to 2840.86.

The FTSE 100 was trading down 11.90 points to 5458.80.

The Dax was trading down 76.57 points to 6263.95.

The Nikkei closed down 25.75 points to 12752.96.

The Australian ASX closed up 3.70 points to 5011.20.

The Hang Seng closed up 408.06 points to 21464.72.

The Shanghai Composite closed down 7.94 points to 2342.15.

Dow Jones Futures were down 35.00 points to 11377.00.

S&P 500 Futures were down 4.75 points to 1267.00.

WTI Crude oil is up $1.56 to $117.83.

AU Construction Work Done Q2 -2.6% vs. Exp: +1.5% Revised: +5.0% Prior: +2.3%

DE Import Price Index M/M July +0.6% vs. Exp: +0.5% Prior: +1.5%

DE Import Price Index Y/Y July +9.3% vs. Exp: +9.2% Prior: +8.9%

IT Consumer Confidence S.A. August 99.5 vs. Exp:96.4 Prior: 95.8

GE CPI- Hesse M/M -0.4% vs. Prior: +0.5%

GE CPI- Hesse Y/Y +3.4% vs. Prior: +3.7%

GE CPI- Bavaria M/M -0.3% vs. Prior: +0.6%

GE CPI- Bavaria Y/Y +3.1% vs. Prior: +3.3%

GE CPI- Brandenburg M/M -0.3% vs. Prior: +0.5%

GE CPI- Brandenburg Y/Y +3.1% vs. Prior: +3.2%

GE CPI- Saxony M/M -0.4% vs. Prior: +0.6%

GE CPI- Saxony Y/Y +3.3% vs. Prior: +3.6%

GE CPI- North Rhine-West M/M -0.4% vs. Prior: +0.6%

GE CPI- North Rhine-West Y/Y +3.9% vs. Prior: +3.3%

By Erik Kevin Franco, This email address is being protected from spam bots, you need Javascript enabled to view it , edited by Nancy Girgis, This email address is being protected from spam bots, you need Javascript enabled to view it

CEP Newswires - CEP News © 2008. All Rights Reserved. www.economicnews.ca

The Copying, Broadcast, Republication or Redistribution of CEP News Content is Expressly Prohibited Without the Prior Written Consent of CEP News.

A copy of CEP News disclaimer can be found at http://www.economicnews.ca/cepnews/wire/disclaimer.