Sun, Nov 17, 2019 @ 10:39 GMT
Live Comments

Live Comments

US retail sales rose 0.3%, ex-auto sales rose 0.2%

    US headline retail sales rose 0.3% mom in October to USD 526.6B, above expectation of 0.1% mom. But ex-auto sales rose 0.2% mom, missed expectation of 0.3% mom.

    Import price index dropped -0.5% mom in October, versus expectation of -0.2% mom. Over the year, import price index dropped -3.0% yoy.

    Empire State Manufacturing Index dropped to 2.9, down from 4 and missed expectation of 6.1. “The general business conditions index was sluggish for the sixth consecutive month”.

    - advertisement -

    Eurozone CPI finalized at 0.7%, core at 1.1%

      Eurozone CPI was finalized at 0.7% yoy in October, core CPI at 1.1%. The highest contribution to the annual Eurozone inflation rate came from services (+0.69%), followed by food, alcohol & tobacco (+0.29%), non-energy industrial goods (+0.07%), and energy (-0.32%),.

      EU28 CPI was finalized at 1.1% yoy. The lowest annual rates were registered in Cyprus (-0.5%), Greece (-0.3%) and Portugal (-0.1%). The highest annual rates were recorded in Romania (3.2%), Hungary (3.0%) and Slovakia (2.9%). Compared with September, annual inflation fell in fifteen Member States, remained stable in eight and rose in five.

      Full release here.

      - advertisement -

      New Zealand BuinessNZ PMI jumped to 52.6, new orders and production put manufacturing back on track

        New Zealand BusinessNZ Performance of Manufacturing Index improved drastically to 52.6 in October, up from 48.8. It’s now back in expansion after three months of contraction from July to September. Production rose notably from 46.6 to 52.6. New Orders also jumped from 50.9 to 56.2. But Employment stayed sluggish, up from 50.1 to 50.2.

        BusinessNZ’s executive director for manufacturing Catherine Beard said: “After a five month period of both lacklustre and negative growth, the pick-up in both new orders and production put the sector back on track.  If the remaining two months for 2019 are to keep up the momentum, it is important these key sub-indexes remain positive to finish the year on a more upbeat note.

        However, BNZ Senior Economist, Doug Steel said that “the October PMI is hardly what you would call strong. But it is certainly much better than the previous three months where the index languished below 50 which indicated a sector going backwards”.

         

        Full release here.

        - advertisement -

        WH Kudlow: We’re getting close to trade deal but it’s not done yet

          White House economic adviser Larry Kudlow said yesterday that “we’re getting close” to the phase one trade deal with China. And, “the mood music is pretty good, and that has not always been so in these things.” But he added that “it’s not done yet” even though “there has been very good progress and the talks have been very constructive.”

          China has resumed significant purchase of US products since October 11, when President Donald Trump announced the place for the phase one deal. Both sides have also lifted ban of poultry imports this week. US Trade Representative Robert Lighthizer said “this is great news for both America’s farmers and China’s consumers”.

          - advertisement -

          Fed Clarida: Rising wages not putting excessive upward pressure on inflation

            Fed Vice Chair Richard Clarida said in a speech that the US economy is “operating at or close to maximum employment and price stability.” But, “although the labor market is robust, there is no evidence that rising wages are putting excessive upward pressure on price inflation”. Wages growth is “broadly in line with productivity growth and underlying inflation”.

            He added that Fed’s monetary policy framework review seek to answer three questions:

            • Can the Federal Reserve best meet its statutory objectives with its existing monetary policy strategy, or should it consider strategies that aim to reverse past misses of the inflation objective?
            • Are existing monetary policy tools adequate to achieve and maintain maximum employment and price stability, or should the toolkit be expanded? And, if so, how?
            • How can the FOMC’s communication of its policy framework and implementation be improved?

            Clarida’s full speech here.

            - advertisement -

            US initial jobless claims rose to 225k, versus exp. 215k

              US initial jobless claims rose 14k to 225k in the week ending November 9, above expectation of 215k. Four-week moving average of initial claims rose 1.75k to 215.25k.

              Continuing claims dropped -1k to 1.683m in the week ending November 2. Four-week moving average of continuing claims was unchanged at 1.688mm.

              Also released. PPI rose 0.4% mom, 1.1% yoy in October, above expectation of 0.2% mom, 0.9% yoy. PPI core rose 0.3% mom, 1.6% yoy, versus expectation of 0.2% mom, 1.6% yoy.

              - advertisement -

              De Guindos said ECB needs wider toolkit, but monetary policy cannot address all problems

                ECB Vice President Luis De Guindos said today the central bank has to widen its monetary policy toolkit to ensure its effectiveness. Though, he emphasized that monetary policy alone cannot address all problems. He urged country with fiscal spaces to do more. He added that European economy is not going to fall into recession but growth will be below potential.

                Separately,chief economist Philip Lane said euro’s exchange rate is not a policy target for the ECB. But, “It’s plausible that the impact of rate cuts on the euro exchange rate has intensified over time.”

                - advertisement -

                Eurozone GDP grew 0.2%, employment grew 0.1%

                  Eurozone GDP grew 0.2% qoq in Q3, unchanged from Q2, matched expectations. Over the year, GDP grew 1.2% yoy. Employment grew 0.1% qoq, below expectation of 0.2% qoq. EU 28 GDP grew 0.3% qoq, 1.3% yoy. EU 28 employment grew 0.1% qoq.

                  Full release here.

                  - advertisement -

                  UK retail sales dropped -0.1%, fuel the only positive contributor

                    UK retail sales dropped -0.1% mom in October while ex-fuel sales dropped -0.3% mom. Over the month, fuel was the only positive contributor to growth in sales, up 0.2% mom. Non-store retailing was flat while non-food and food stores declined.

                    Full release here.

                    - advertisement -

                    German GDP grew 0.1% in Q3, avoided technical recession

                      Germany GDP grew 0.1% qoq in Q3, beat expectation of -0.1% qoq. Returning to growth suggests that the Eurozone’s largest economy had avoided a technical recession. Over the year, GDP grew 0.5% yoy, price and calendar adjusted. Economy Minister Peter Altmaier  said “we do not have a technical recession, but the growth numbers are still too weak.”

                      Full release here.

                      - advertisement -

                      China production, retail sales, investment all missed expectations

                        The batch of October economic data released from China today is way below expectations. Industrial production growth slowed to 4.7% yoy, below expectation of 5.5% yoy. Fixed asset investment slowed to 5.2% ytd yoy, below expectation of 5.4%. That’s also the worst January-October growth since record began in 1996. Retail sales grew 7.2% yoy, missed expectation of 7.8% yoy, matching the more than 16 year low hit in April.

                        The chance of a recovery in growth momentum hinges on the results of the trade negotiations with US. Tariff rollbacks would be the key for the “easier” phase one deal. Without removing some of the imposed tariffs, in particular the September ones, the deal would be rather meaningless to the real Chinese economy. Of course, the biggest challenges come in the second phase of negotiations when core and fundamental issues, like subsidies to state-owned enterprises, would be addressed.

                        The Hong Kong HSI drops sharply today in response to the poor Chinese data. It’s also following the steep selloff this week as unrest in the city escalates abruptly. Current development affirms our view that corrective rebound from 24899.93 has completed with three waves up to 27894.56. Deeper fall should be seen back to retest 24899.93 low next.

                        - advertisement -

                        RBNZ Bascand: The economy is somewhere near a turning point

                          RBNZ Deputy Governor Geoff Bascand said in an interview that “we actually think the economy is somewhere near a turning point.” He admitted the economy is “definitely going through a weaker stage” and “near-term risks “are probably more on the downside, but it’s a question of how long they persist,”

                          However, he added, “we’ve put a lot of stimulus in. We’ve got a bit longer to see how it’s transmitting. There’s time to see how that plays out and make a call in February if needed.”

                          The central bank surprised the markets by keeping the OCR unchanged at 1.00% yesterday. Governor Adrian Orr described the decision as a “tough one”, and the monetary policy committee had debated whether to “take one more insurance cut.”

                          - advertisement -

                          Japan GDP grow slowed to just 0.2% annualized in Q3

                            Japan GDP grew 0.1% qoq in Q3, slowed from Q2’s 0.3% qoq and missed expectation of 0.2% qoq. Annualized rate slowed sharply from 1.8% to just 0.2%, way below expectation of 0.9%. GDP deflator accelerated to 0.6% yoy, up from 0.4% yoy and beat expectation of 0.5% yoy. Private consumption growth slowed to 0.4%, down from 0.6%, despite pre-tax hike purchases. Capital spending, though, accelerated to 0.9%, up from 0.7%.

                            Economy Minister Yasutoshi Nishimura blamed the weak GDP growth on worsening relations with South Korea. He said that had a “big impact” on exports, while dropped -0.7% from the prior quarter. Also, declines in in-bound tourists from South Korea was a drag, along with some impact form the prolonged trade war between US and China.

                            - advertisement -

                            Australia unemployment rate rose to 5.3%, AUD/JPY completed corrective rebound

                              In seasonally adjusted terms, Australia employment contracted by -19k to 12.9m in October, way below expectation of 16.2k growth. That’s also the largest monthly drop in three years since late 2016. Full-time jobs dropped -10.3k while part time jobs dropped -8.7k. Unemployment rate rose 0.1% to 5.3%, above expectation of 5.2%. At the same time, participation rate dropped -0.1% to 66.0.

                              Looking at some details, unemployment rate increased by 0.3 pts in New South Wales (4.8%), and by 0.1 pts in Victoria (4.8%). The seasonally adjusted unemployment rate decreased by 0.2 pts in Tasmania (5.9%), and by 0.1 pts in Queensland (6.5%), with Western Australia and South Australia recording no change.

                              Full release here.

                              The set of data suggests that Australia remains a long way from RBA’s full employment estimation, i.e., unemployment rate at around 4.5%. More monetary and fiscal stimulus is still needed to support the job and wage markets, and drive up inflation. RBA is still on track for more rate cuts or even QE next year.

                              Today’s sharp fall in AUD/JPY firstly suggests short term topping at 75.67. More importantly, the break of 55 day EMA argues that corrective rise from 69.95 could have completed with three waves up to 75.67, just ahead of 76.16 structural resistance. Further fall is now in favor back to 71.73 support. Break there will reaffirm medium term bearishness for a new low below 69.95 ahead.

                              - advertisement -

                              Fed Powell: Current monetary policy stance to remain as long as data are consistent with outlook

                                In the testimony to Joint Economic Committee, Fed Chair Jerome Powell said the baseline outlook is “favorable”. And current monetary policy stance will remain appropriate as long as the outlook is unchanged.

                                On the economy, Powell said “my colleagues and I see a sustained expansion of economic activity, a strong labor market, and inflation near our symmetric 2 percent objective as most likely”. But “noteworthy risks to this outlook remain”, including sluggish growth abroad and trade developments. Inflation pressures “remain muted” and long-term inflation expectations are at the “lower end of their historical ranges”.

                                Nevertheless, he added “we see the current stance of monetary policy as likely to remain appropriate as long as incoming information about the economy remains broadly consistent with our outlook”. “if developments emerge that cause a material reassessment of our outlook, we would respond accordingly”. But he emphasized “policy is not on a preset course”.

                                Full speech here.

                                - advertisement -

                                Fed Chair Powell’s testimony live stream

                                  - advertisement -

                                  US CPI picked up t 1.8%, but core slowed to 2.3%

                                    US CPI rose 0.4% mom in October versus expectation of 0.3%. Core CPI rose 0.2% mom, matched expectation. Annually, headline CPI accelerated to 1.8% yoy, up from 1.7% yoy and beat expectation of 1.7% yoy. CPI core, on the other hand, slowed to 2.3% yoy, down from 2.4% yoy and missed expectation of 2.4% yoy.

                                    Full release here.

                                    - advertisement -

                                    SNB Jordan emphasized negative rates and readiness to intervene as necessary

                                      SNB Chairman Thomas Jordan reiterated the stance on negative interest rate, and readiness for intervention at the meeting with the seven member Federal Council. the Council said in a statement that “inflation is down, the global low interest environment has grown further entrenched and the situation on foreign exchange markets remains fragile.” “Against this backdrop, Chairman Jordan emphasized that monetary policy with negative interest rates and the readiness to intervene is just as necessary as before.”

                                      - advertisement -

                                      Eurozone industrial production rose 0.1% mom, vs expectation of -0.2% mom

                                        Eurozone industrial production rose 0.1% mom in September, above expectation of -0.2% mom. Over the year, Eurozone industrial production dropped -1.7% yoy. Production of non-durable consumer goods rose by 1.0% mom and capital goods by 0.6% mom, while production of durable consumer goods fell by -0.7% mom, energy by -0.8% mom and intermediate goods by -0.9% mom.

                                        EU28 industrial production rose 0.2% mom, dropped -1.2% yoy. Among Member States for which data are available, the highest increases in industrial production were registered in Ireland (+8.8%), Hungary (+3.1%), Denmark, Croatia and Lithuania (all +2.5%). The largest decreases were observed in Malta (-3.7%), Portugal (-2.3%) and Estonia (-1.5%).

                                        Full release here.

                                        - advertisement -

                                        UK CPI slowed to 1.5% yoy, missed expectation of 1.6% yoy

                                          UK CPI slowed to 1.5% yoy in October, down from 1.7% yoy, missed expectation of 1.6% yoy. Core CPI was unchanged at 1.7% yoy, matched expectations. RPI slowed to 2.1% yoy, down from 2.4% yoy,missed expectation of 2.6% yoy.

                                          PPI input dropped -5.1% yoy in October versus expectation of -1.8% yoy. PPI output rose 0.8% yoy, missed expectation of 1.3% yoy. PPI output core rose 1.3% yoy, missed expectation of 1.9% yoy.

                                          - advertisement -
                                          - advertisement -