Spanish bonds are well bid and the IBEX is trading higher on talk in Europe that Spain may ask for the long awaited bailout money this weekend. I don’t know the source of the rumor but based on comments from the Spanish Deputy PM yesterday saying “we need to know various elements including the extent of it, its implications, and especially that the final result be assured, that the aid would materialize,” it doesn’t seem like something is imminent. Italian 2 yr and 10 yr yields are falling to near their lowest since March in sympathy. Industrial Production in the Euro zone unexpectedly rose .6% m/o/m but is still down 9 months in a row y/o/y.
In Asia, China reported loan growth of 623.2B yuan in Sept, below expectations of 700b. Year to date, loans have totaled 6.7T yuan, about 100b above the 1st 9 mo’s of ’11 and vs 8.6T yuan in the same time frame in ’09 when China was juicing growth to an extraordinary extent. The yuan also rose to a new 19 yr high vs the US$. Singapore’s monetary authority didn’t change currency/rate policy after South Korea cut and Indonesia did nothing yesterday. India’s IP in Aug rose 2.7% y/o/y, above the estimate of 1.1%.