Credit Suisse in a doom loop

<p>Kia ora,</p><p>Welcome to Thursday’s Economy Watch where we follow the economic events and trends that affect Aotearoa/New Zealand.</p><p>I'm David Chaston and this is the international edition from Interest.co.nz.</p><p>And today we lead with news the banking crisis has shifted to Europe, and investors are betting big on the Fed not changing rates next week. Oddly, some key UST yield inversions are being wound back sharply at the same time.</p><p>But first, we start with news that American <a href="https://www.mba.org/news-and-research/newsroom/news/2023/03/15/mortgage-applications-increase-in-latest-mba-weekly-survey" target="_blank"><strong>mortgage applications</strong></a> had another good rise last week, rising +6.5% from the prior week, the sixth rise in the past twelve weeks. Mortgage rates are unchanged.</p><p>American <a href="https://www.census.gov/retail/marts/www/marts_current.pdf" target="_blank"><strong>retail sales</strong></a> were expected to post a small slip in February from January and they did. Year-on-year they are up +5.4% nominal so not keeping up with inflation. It is car sales that are the drag.</p><p><a href="https://www.bls.gov/news.release/ppi.nr0.htm" target="_blank"><strong>Producer prices</strong></a> were up +4.6% in a year in February, a sharp reduction from the January rise. They fell month-on-month. Wholesale inflation is leaking away quite quickly now. The year-on-year rise hasn't been this low since early 2021. On a quarterly basis, producer prices are back to levels last seen in 2015/16.</p><p>US <a href="https://www.census.gov/mtis/www/data/pdf/mtis_current.pdf" target="_blank"><strong>business inventories were essentially stable</strong></a> in value in January, and that allowed their inventory-to-sales ratios to retreat slightly - and for the first time in a year. The Americans don't really have an excess inventory problem.</p><p>The <a href="https://www.newyorkfed.org/medialibrary/media/survey/empire/empire2023/esms_2023_03.pdf?la=en" target="_blank"><strong>New York