10 May, 2016
FX News Today
China CPI & PPI: CPI month on month (-0.2%) improved from previous (-0.4%) the year on year figure was a little short of expectations and remained unchanged at 2.3% (expectations were for a slight rise to 2.4%. It eases worries about deflation but the economy remains soft. Producer Price Index (PPI) continued to improve and beat expectations, actual number was -3.4% beating expectations of -3.8% and better than the March figure which was -4.3%.
German Industrial Production & Trade Balance: Worse than expected and was the second consecutive monthly drop. Industrial production was -1.3% from -0.7% last month and significantly weaker than expectations at -0.2%. Conversely the German trade balance exceeded expectations at 23.6bln euro but German exports declined by 0.5% and imports by 4.3% in March 2016 year on year.
Fedspeak: Minneapolis Fed’s Kashkari, monetary policy stance is appropriate and there’s room for improvement in the economy, he said, though non-monetary policies are more important than Fed policy to attain full employment. Indeed, he reiterates that monetary policy has its limits and there’s too much focus on near-term interest rate policy than the need for long-term solutions. Sounds like he continues to straddle the fence and would vote with the consensus in June (whatever that is) if he had a vote.
Japan FM Aso: Yesterday talked of potential intervention by the BOJ and that the US does not object to Japans FX policy, however, overnight he has been quoted “We’ve been saying that one-sided rapid currency moves are undesirable. As a result, the dollar is now moving around 108.00” All very interesting, USDJPY currently trading at 108.80.
Main Macro Events Today
US Wholesale Inventories: An improvement to -0.1% from -0.5% is expected.
UK Trade Balance: We expect a rise to -11.2bln GBP from -12Bln last month. Brexit remains the dominant factor for the GBP.
European Commission President Juncker and US President Trump agreed to suspend new tariffs during the negotiations which aim to lower barriers to transatlantic...
Nikkei gained 1.09% after a strong close on Wall Street and with the earnings season starting to overshadow lingering trade jitters at least for now. A weaker...
U.S. trade tariffs tightened market conditions. Coeure said that “while the effects of any tariffs on output and inflation may take time to materialise, falls...
China and Hong Kong alongside other markets were closed for Lunar New Year holidays, which muted trading, but the Nikkei gained 1.19%...
The U.S. currency has been correlating inversely with global stock market direction of late on the causation that risk-on phases have seen investors...
U.S. personal income rose 0.3% in November with spending up 0.6%. The 0.4% increase in October income was not revised. The 0.3% spending increase..
The FOMC meeting is front and center this week following the solid November jobs report on Friday, which provided the final bit of cover for...
Asian stock markets headed south again, as declines and energy and mining stocks led shares lower amid a further drop in metal prices. Concern China’s regulators may limit the flow...
The rout on Chinese bond and stock markets that dominated Thursday’s session faded and the Nikkei managed a 0.12% gain as the yen...