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Twenty minutes after the Shanghai index closed, the PBOC raised reserve requirements by another 50 bps to a record high of 21.5 after May CPI rose 5.5%, in line with estimates but at the fastest pace since July ’08. PPI rose 6.8%, .3% higher than expected. Boosting optimism on the Chinese growth side were the solid Retail Sales and IP reports and it’s specifically these two data points that has copper back above its 200 day moving average and is leading to the rise in European stocks and the S&P futures. The Hang Seng index though was open during the PBOC move and sold off immediately after in a knee jerk reaction. Ahead of the next RBI meeting on Thurs, India’s wholesale inflation for May rose 9.06% which was above expectations. The BoJ took another, albeit modest, step to help the Japanese economy by initiating a new $6b (500b yen) 2 yr lending program at a borrowing rate of just .1%. With enormous pressure on the BoE to hike rates, May CPI rose 4.5% y/o/y, in line but matching the highest since Oct ’08. As EU Finance Ministers meet today, Greek bond yields are rising to fresh record highs. In the US, the NFIB small business optimism index fell to 90.9 from 91.2, the slowest since Sept as Plan to Hire went negative and other internals were weak while those that expect Higher Selling Prices rose.

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