US Review

·        Retail sales posted a disappointing drop (0.9%) in December. While part of the decline to much lower inflation, the broad-based nature of the pullback remained a concern.

·        Three inflation measures, import prices, producer prices and consumer prices, pointed to continued fall of inflation as oil price declines. CPI increase 0.8%, while core CPI increase 1.6%.

Global Review

·        German economy grew at a slow pace of 1.5% in 2014, and industrial production in the Eurozone rose 0.2% in December.

·        The overall rate of CPI inflation in the Eurozone slipped into negative territory in December.

·        The combination of anemic growth and negative CPI inflation makes it likely that the ECB will announce a program of sovereign bond purchases.