UK Retail Sales Data Highlights Recovery Losing Momentum

Aug 20 21, 09:49 GMT

Notes/Observations

Asia

Japan July National CPI Y/Y: -0.3% v -0.4%e; CPI ex-fresh food (core) Y/Y: -0.2% v -0.4%e.
China Monthly 1-year and 5-year Loan Prime Rate setting unchanged; but future rate cut expectations growing.
China said to have postponed a vote to add anti sanctions law to Hong Kong Law (unexpected). Legislation which would punish companies that abide by the US sanctions or do not carry out China’s law.

Coronavirus

Sydney lockdown extended until end of Sept.
New Zealand lockdown level 4 lockdown to be extended until at least early next week.
Three fully vaccinated Senators (Independent King, Republican Wicker and Democrat Hickenlooper) tested positive for C-19.

Europe

Germany Finance Ministry Monthly Report stated that the economy was on track for stronger growth in Q3.

Americas

Fed Chair Powell to deliver a speech on the economic outlook at the Jackson Hole Symposium on Aug 27th.
Treasury Sec Yellen letter to Senators noted the Delta variant might challenge local markets and the economy; States could use relief funds to assist the unemployed.

Speakers/Fixed income/FX/Commodities/Erratum

Equities

Indices [Stoxx600 -0.18% at 466.42, FTSE -0.19% at 7,045.44, DAX -0.35% at 15,709.90, CAC-40 -0.23% at 6,590.55, IBEX-35 +0.16% at 8,916.00, FTSE MIB -0.39% at 25,828.50, SMI -0.33% at 12,362.90, S&P 500 Futures -0.42%].
Market Focal Points/Key Themes: European indices open mixed; ; ; FTSE 100 supported by M&A; Morrisons agrees to be acquired by CD&R at improved price, Fortress yet to respond; Norway Royal Salmon to be acquired by SalMar; focus on release of EMA’s CHMP decisions later; earnings expected in the upcoming US session include Foot Locker, The Buckle and Deere.

Equities

Consumer discretionary: Marks & Spenser [MKS.UK] +11% (trading update), Norway Royal Salmon [NRS.NO] +14% (offer), WM Morrison Supermarkets [MRW.UK] +4% (confirms offer).
Healthcare: AstraZeneca [AZN.UK] -1% (COVID-19 drug trial results).
Industrials: Heijmans [HEIJ.NL] -9% (earnings).

Speakers

Netherlands Bureau for Economic Policy Analysis (CPB) updated its growth outlook which raised 2021 GDP growth from 3.2% to 3.8%and cut 2022 GDP growth from 3.3% to 3.2%.
Turkey Fin Min Elvan saw 2021 GDP growth over 8.0%; Reiterates govt’s priority was to reverse inflation tendency path.
Libya PM Dbeibah pledged to hold elections in December.

Currencies/ Fixed income

USD maintained its firm tone aided by safe-haven flows aide by worries about widespread coronavirus infections. Greenback also getting support from prospect of a looming Fed taper which continued to throw cold water on risk appetite.
GBP/USD holding above the 1.36 level after UK July retail sales registered its sharpest decline since the economy was in lockdown in January.
EUR/USD reproaching its 9-month low as the pair remained below the 1.17 handle.

Economic data

(DE) Germany July PPI M/M: 1.9% v 0.8%e; Y/Y:10.4 % v 9.2%e.
(UK) July Retail Sales (ex-auto/fuel) M/M: -2.4% v +0.1%e; Y/Y: 1.8% v 5.8%e.
(UK) July Retail Sales (including auto/fuel) M/M: -2.5% v +0.2%e; Y/Y: 2.4% v 5.9%e.
(UK) July Public Finances (PSNCR): -£2.3B v +£11.2B prior; Net Borrowing: £9.6B v £11.0Be; Central Government NCR: £1.8B v £19.2B prior; PSNB (ex-banking groups): £10.4B v £11.9Be.
(NO) Norway Q2 Overall GDP Q/Q: +1.1% v -0.6% prior; GDP Mainland Q/Q: 1.4% v 1.6%e.
(NO) Norway Jun Overall GDP M/M: 0.8% v 1.0% prior; GDP Mainland M/M: 0.7% v 1.3%e.
(MY) Malaysia mid-Aug Foreign Reserves: $111.3B v $111.1B prior.
(SE) Sweden Q2 Industry Capacity: 91.3% v 89.7% prior.
(SE) Sweden Q2 Total No. of Employees Y/Y: +1.6% v -1.5% prior.
(CN) Weekly Shanghai copper inventories (SHFE): 85.6K v 93.0K tons prior.
(TW) Taiwan July Export Orders Y/Y: 21.4% v 21.5%e.
(PL) Poland July Real Retail Sales M/M: 2.1% v 3.0%e ; Y/Y: 3.9% v 4.7%e; Retail Sales Y/Y: 8.9% v 8.1%e.
(PL) Poland July Construction Output Y/Y: 3.3% v 6.8%e.
(RU) Russia Narrow Money Supply w/e Aug 13th (RUB): 14.33T v 14.25T prior.
(TW) Taiwan Q2 Current Account Balance: $B v $26.0B prior.
(BE) Belgium Aug Consumer Confidence Index: 5 v 8 prior.

Fixed income issuance

Looking ahead

05:25 (EU) Daily ECB Liquidity Stats.
05:30 (IN) India to sell combined INR260B in 2023, 2031 and 2061 bonds.
05:30 (ZA) South Africa to sell combined ZAR1.2B in I/L 2033, 2038 and 2046 Bonds.
06:00 (IE) Ireland July PPI M/M: No est v 0.9% prior; Y/Y: No est v -5.3% prior.
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).
06:45 (US) Daily Libor Fixing.
07:00 (IN) India announces upcoming bill issuance (held on Wed).
07:30 (IS) Iceland to sell 2024 and 2030 RIKB Bonds.
07:30 (IN) India Weekly Forex Reserve w/e Aug 13th: No est v $621.5B prior.
08:00 (UK) Daily Baltic Dry Bulk Index.
08:30 (CA) Canada Jun Retail Sales M/M: +4.5%e v -2.1% prior; Retail Sales (ex-auto) M/M: +4.5%e v -2.0% prior.
11:00 (EU) Potential sovereign ratings after European close.
(AR) Argentina July Budget Balance (ARS): No est v -153.2B prior.
(MX) Mexico Citibanamex Survey of Economists.