Inflation remains broadly positive in the UK and US
- RBA meeting minutes released
- Australia HPI q/q 2.0% vs. 2.0%; y/y 10.7% vs. 10.2%
- UK Core CPI y/y 1.2% vs. 1.2%
- UK CPI m/m 0.0% vs. -0.1%; y/y 0.1% vs. 0.1%
- UK HPI y/y 7.0% vs. 6.1% previously
- UK PPI Input m/m -1.6% vs. -1.0%
- UK PPI Output m/m -0.2% vs. -0.1%
- Germany ZEW Economic sentiment 16.1 vs. 15.0
- Canada manufacturing sales m/m -1.1% vs. -0.5%
- US Core CPI m/m 0.2% vs. 0.2%; y/y 2.0% vs. 2.0%
- US CPI m/m 0.0% vs. 0.0%; y/y 0.5% vs. 0.4%
- Empire state manufacturing index -4.59 vs. -7.0
Later
- New Zealand GDT Price Index
- US HAHB housing market index
- BoC Financial review
- BoC Governor Poloz spech
- US Long term TIC net purchases
- New Zealand Current Account
With less than 24 hours to go the markets opened on a mixed note with the Aussie dollar continuing to decline across the board. The RBA’s meeting minutes released earlier today showed that the Central Bank was broadly positive on the economic front which signaled that the RBA could refrain from further rate cuts into the next quarter. The Australian Dollar was however weak after a failed attempt to rally with prices testing intraday highs near 0.727 before giving back the gains. At the time of writing, AUDUSD is down -0.36% for the day after prices managed to modestly rally late last night.
The NZDUSD which enjoyed a rather strong rally over the past few days was trading weaker after prices touched an intraday high to 0.682 and posting an 8-week high. NZDUSD retreated briefly off the session highs but remains up 0.30% at the time of writing. The New Zealand Global Dairy trade index data is due for release within the hour followed by the current account data later in the evening.
The Japanese Yen was starting to look a bit weaker against the Greenback with USDJPY currently up 0.08% for the day. Prices remain range bound within yesterday’s highs near 121.23. However, the Greenback looks a bit weak at current levels with a potential short term test back to 120.74 support being likely.
The European trading session opened with the UK consumer inflation data due. On a broad scale, UK core CPI ticked higher to 1.20% as expected while consumer inflation remained flat to mixed on the monthly basis. The producer prices index continue to remain weak signaling potential CPI weakness in the coming months. The British Pound was trading flat for the day but is modestly up 0.06% with prices consolidating below 1.516 region. GBPUSD remains range bound within yesterday’s high and low.
From the Eurozone, German ZEW economic sentiment increased to 16.1, more than the expected 15.0. The Euro which remains strong across the board was however showing signs of exhaustion after EURUSD made a second attempt to break above the 1.10 handle yesterday. At the time of writing the single currency is down -0.14% for the day.
The US trading session saw the consumer inflation data which was better than expected. On an annualized basis, the US core inflation rose to 2.0% as expected while the headline inflation increased to 0.50% from 0.40% expected. The US Empire State manufacturing index was also modestly higher at -4.59 against estimates of -7.0. Data from Canada included the manufacturing sales which fell -1.10% for the month. USDCAD is down -0.14% for the day after a brief test to 1.3724. Later in the evening, the Bank of Canada will be releasing its financial review followed up by a speech from BoC Governor Poloz.
The remainder of the evening will see the US NAHB housing price index data and the long term TIC purchases.
