Mon, Jun 14, 2021 @ 09:21 GMT
HomeContributorsFundamental AnalysisOpening Of UK Economy Aiding Monthly GDP Data

Opening Of UK Economy Aiding Monthly GDP Data


  • UK Monthly GDP surging with focus on planned reopening of the economy.
  • German Bundesbank raises its 2021 and 2022 GDP and inflation forecasts higher; see the domestic economy is poised for a strong upswing.
  • Markets continue to shrug off concerns over inflation; dovish commitment from ECB sets the tone.


  • Japan Q2 BSI Large All Industry Q/Q: -4.7 v -5.5e; Large Manufacturing Q/Q: -1.4 v +1.6 prior.
  • BOK Gov Lee stated that would normalize policy if economic recovery was solid; to communicate sufficiently with markets on policy. Economic recovery to become clearer in H2.


  • Three ECB policymakers were said to seek a reduction in the pace of the Pandemic Bonds Buying Program (PEPP) at the Jun meeting.


  • Bipartisan Group of 10 senators: (5 from each party) said to reach a bipartisan agreement on a compromise framework to modernize US infrastructure and energy technologies. The plan would be fully paid for and not include tax increases.
  • White House statement: To work with a bipartisan group of senators on an infrastructure bill.
  • Bank of Canada’s Lane saw 3% inflation through summer before falling.

Speakers/Fixed income/FX/Commodities/Erratum


  • Indices [Stoxx50 +0.3% at 4,108, FTSE +0.5% at 7,125, DAX +0.1% at 15,593, CAC-40 +0.5% at 6,576, IBEX-35 +0.7% at 9,193, FTSE MIB +0.1% at 25,659, SMI +0.3% at 11,843, S&P 500 Futures +0.1%].
  • Market Focal Points/Key Themes: European indices open generally higher (SMI notable exception in the red) and advanced firmly into the green as the session progressed; better-performing sectors led by technology and consumer discretionary; while laggard sectors include financials and materials; Scor reached a settlement with Covea; Sanne receives higher offer; Orphazyme shares moving higher on the back of ADR jump amidst speculation of a “Gamestop” play; focus on commentary from G7 meeting through the remainder of the day; no major equities events scheduled for the US session.


  • Consumer discretionary: WDL.DE +25% (German regulator cautions trading).
  • Energy: Enagas ENG.ES -1.0% (analyst action), Siemens Energy ENR.DE -1.3% (conference participation).
  • Financials: Sanne SNN.UK +11.7%% (revised offer), Scor SCR.FR +6.3% (settlement with Covea).
  • Healthcare: Orphazyme ORPHA.DK +45.7% (social media commentary), Diasorin DIA.IT +2.9% (analyst action).
  • Materials: K+S SDF.DE +7.5% (analyst action).


  • ECB’s Villeroy (France) stated that saw no need to change the monetary policy that was working. Inflation was moving higher in the region but remained below target.
  • ECB’s Knot (Netherlands) stated that needed a fiscal framework that enhanced coordination within the Euro Zone. EU fiscal rules should allow larges stimulus when needed and provide credible rules to keep debt levels in check. The success of the EU Recovery Fund could set precedent for more.
  • ECB’s Holzmann (Austria): Inflation above 3% would lead to a rethink of strategy.
  • German Bundesbank Semi-annual Economic Outlook saw the economy possibly reaching its pre-crisis growth in Q3. Raised its 2021 GDP growth from 3.0% to 3.7% and raised the 2022 GDP growth from 4.5% to 5.2%. Raised its 2021 CPI EU Harmonized (HICP) from 1.8% to 2.6% and the 2023 HICP from 1.3% to 1.8%.
  • G7 Leaders said to endorse the global minimum tax of at least 15%.
  • Ireland Fin Min Donohoe reiterated stance to vigorously make the case for Ireland’s 12.5% corporate tax case; confident to keep Ireland attractive for business.
  • Bank of Italy (BOI) Money and Bank Statistics: Apr Gross Non-performing Loans (NPLs) at €52.1B vs. €51.9B prior.
  • Turkey Fin Min Elvan stated that the rising divergence between producer and consumer prices was quite disturbing. A steep rise in PPI was resulting from the pass-through effect on FX and rising global commodity prices.
  • IEA Monthly Oil Report maintained its 2021 global oil demand growth at 5.4M BPD. It saw demand back at pre-pandemic levels by the end of 2022. OECD oil inventories moved below the 2015-19 Average for the 1st time in over a year. Saw room for OPEC+ to increase production by 1.4M BPD over the July 2021-Mar 2022 target and added that OPEC+ needed to open the taps to keep the world oil markets adequately supplied.

Currencies/Fixed Income

  • USD was steady and unable to capitalize from Thursday’s 5.0% CPI reading as markets continued to shrug off concerns over inflation.
  • EUR/USD steady at 1.2175 in quiet trading.
  • GBP/USD drifted slightly lower despite better monthly GDP data for April. Cable facing some headwinds as reports circulated that PM Johnson was considering delaying the end of virus restrictions for a month.
  • European bond yields continued to move lower taking their cue from the recent ECB decision to decide to maintain the “significantly higher” pace of pandemic emergency asset purchases in the third quarter.

Economic data

  • (FI) Finland Apr Current Account: -€0.6B v -€0.8B prior.
  • (UK) Apr Monthly GDP M/M: 2.3% v 2.4%e; GDP 3M/3M: 1.5% v 1.6%e.
  • (UK) Apr Industrial Production M/M: -1.3% v +1.2%e; Y/Y: 27.5% v 30.5%e.
  • (UK) Apr Manufacturing Production M/M: -0.3% v +1.5%e; Y/Y: 39.7% v 42.2%e.
  • (UK) Apr Construction Output M/M: -2.0% v +1.0%e; Y/Y: 77.9% v 83.4%e.
  • (UK) Apr Index of Services M/M: 3.4% v 2.8%e; 3M/3M: 1.4% v 1.3%e.
  • (UK) Apr Visible Trade Balance: -£11.0B v -£11.8Be; Overall Trade Balance: -£0.9B v -£2.5Be; Trade Balance Non EU: -£5.6B v -£6.6B prior.
  • (DE) Germany May Wholesale Price Index M/M: 1.7% v 1.1% prior; Y/Y: 9.7% v 7.2% prior.
  • (RO) Romania May CPI M/M: 0.5% v 0.3%e; Y/Y: 3.8% v 3.6%e (highest since jan 2020 with annual pace moving above target range).
  • (ES) Spain May Final CPI M/M: 0.5% v 0.4%e; Y/Y: 2.7% v 2.7%e.
  • (ES) Spain May Final CPI EU Harmonized M/M: 0.5% v 0.5%e; Y/Y: % v 2.4%e.
  • (ES) Spain May CPI Core M/M: 0.3% v 0.9% prior; Y/Y: 0.2% v 0.0% prior.
  • (ES) Spain Apr House transactions Y/Y: 65.9% v 32.4% prior.
  • (TR) Turkey Apr Industrial Production M/M: -0.9% v -0.5%e; Y/Y: 66.0% v 63.1%e.
  • (TR) Turkey Jun TCMB Survey of Expectations: next 12-month Outlook: 12.1% v 11.8% prior.
  • (CN) Weekly Shanghai copper inventories (SHFE): 181.0K v 201.7K tons prior.
  • (IT) Italy Q1 Unemployment Rate: 10.4% v 10.5%e.
  • (RU) Russia Narrow Money Supply w/e Jun 4th (RUB): 14.04T v 13.99T prior.
  • (GR) Greece Mar Unemployment Rate: 16.3% v 16.6% prior.

Fixed income Issuance

  • None seen.

Looking Ahead

  • (EU) Daily ECB Liquidity Stats.
  • 05:30 (IN) India to sell combined INR260B in 2023, 2030, and 2061 bonds.
  • 05:30 (ZA) South Africa to sell combined ZAR1.2B in I/L 2029, 2033, and 2046 Bonds.
  • 05:30 (PL) Poland switch auction.
  • 06:00 (UK) DMO to sell £3.0B in 1-month, 3-month and 6-month bills (£0.5B, £1.0B and £1.5B respectively).
  • 06:30 (RU) Russia Central Bank (CBR) Interest Rate Decision: Expected to raise Key One-Week Auction rate by 50bps to 5.50%.
  • 06:45 (US) Daily Libor Fixing.
  • 07:00 (MX) Mexico Apr Industrial Production M/M: 0.4%e v 0.7% prior; Y/Y: 37.3%e v 1.7% prior; Manufacturing Production Y/Y: 53.5%e v 6.2% prior.
  • 07:30 (IN) India Weekly Forex Reserve w/e Jun 4th: No est v $598.2B prior.
  • 08:00 (PL) Poland Central Bank May Minutes (two decisions ago).
  • 08:00 (BR) Brazil Apr IBGE Services Sector Volume Y/Y: 18.6%e v 4.5% prior.
  • 08:00 (IN) India Apr Industrial Production Y/Y: 121.1%e v 22.4% prior.
  • 08:00 (UK) Daily Baltic Dry Bulk Index.
  • 08:00 (IN) India announces upcoming bill issuance (held on Wed).
  • 08:00 (ES) Spain Debt Agency (Tesoro) announces upcoming bond issuance.
  • 08:30 (CA) Canada Q1 Capacity Utilization Rate: 80.5%e v 79.2% prior.
  • 09:00 (RU) Russia Apr Trade Balance: $11.2Be v $10.0B prior; Exports: $35.8Be v $35.7B prior; Imports: $25.5Be v $25.7B prior.
  • 10:00 (US) Jun Preliminary University of Michigan Confidence: 84.2e v 82.9 prior.
  • 11:00 (EU) Potential sovereign ratings after European close (Moody’s on Austria, Netherlands; S&P on Slovenia; Fitch on Spain).
  • 13:00 (US) Weekly Baker Hughes Rig Count.


  • (UK) G-7 summit in Cornwall.


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