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June 20, 2024

Chartbook: Chart USD/CHF: Expected to remain under pressure into the coming weeks
Paying Article

June 20, 2024 5:01 PM UTC

The anticipated rally from just above critical support at the 0.8320 multi-year Fibonacci retracement has met anticipated selling interest just shy of the 0.9245 high of October 2023

Preview: Due June 21 - U.S. May Existing Home Sales - A third straight decline
Paying Article

June 20, 2024 1:49 PM UTC

We expect May existing home sales to fall by 3.4% to 4.00m. This would be a third straight fall and complete a reversal of a sharp 9.5% rise seen in February. In 2023 February also saw a sharp rise that preceded a steady trend lower in the following months. 

Preview: Due June 21 - U.S. June S&P PMIs - Corrections seen from surprising strength in May
Paying Article

June 20, 2024 1:34 PM UTC

We expect June’s S and P PMIs to show slippage after surprising improvements seen in May, though we do not expect June’s data to show any clear signs of weakness. 

U.S. Initial Claims, Housing Starts, Philly Fed and Current Account all disappoint
Paying Article

June 20, 2024 1:11 PM UTC

The latest round of US data is all on the weak side of expectations (though the Philly Fed survey saw higher price indices), with initial claims being of most significance in that this is the survey week for June’s non-farm payroll. While slightly lower on the week, at 238k, last week’s 14k spik

Chartbook: Chart EUR/USD: Extending cautious trade
Paying Article

June 20, 2024 12:08 PM UTC

Little change, as prices extend consolidation beneath congestion resistance at 1.1000

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BoE Review: MPC Splits Enlarge to Suggest Cut Soon
Paying Article

June 20, 2024 11:48 AM UTC

As widely Bank Rate was kept at 5.25% for the seventh successive MPC meeting this month, with its rhetoric largely unchanged.  But while there were still only two formal dissents, the minutes clearly suggested that for some of the remaining seven members the policy decision at this meeting was fine

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Commodities Outlook: Fundamentals Kick In
Paying Article

June 20, 2024 10:00 AM UTC

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Norges Bank Review: Excessive Last Mile Caution?
Paying Article

June 20, 2024 9:04 AM UTC

It was always the very high likelihood that the thrust of recent data and the Board’s clear caution would mean that the Norges Bank would leave its policy rate at 4.5% for a fourth successive meeting and this is what duly occurred.  Perhaps more notable was that the it was more explicit in stress

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SNB: 25bps Cut and Next Cut in September
Paying Article

June 20, 2024 8:34 AM UTC

The SNB cut by 25bps to try and stop inflation undershooting.  We look for a further 25bps cut in September, as the new inflation forecasts remains too far below target for SNB comfort. CHF strength will also not ebb quickly given the prospect of prolonged French political uncertainty.  

June 19, 2024

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BCB Review: A Pause in the Cutting Cycle
Paying Article

June 19, 2024 10:17 PM UTC

The Brazilian Central Bank kept the policy rate at 10.5%, citing economic uncertainty and a need for caution. Inflation expectations for 2025 are 3.8%, above the 3.0% target. Political interference concerns persist, but the unanimous decision indicates a technical approach. The BRL's depreciation ma

Chartbook: Chart USD Index DXY: Consolidating - potential for a minor test lower in the coming weeks
Paying Article

June 19, 2024 11:42 AM UTC

There has been little change in price action in 2024Q2

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China Outlook: 2024 on Track, but 2025 Headwinds

June 19, 2024 9:35 AM UTC

Public investment and industrial production in high tech and renewables are helping to support growth and should get the economy close to 5% in 2024.  However, underneath the surface, consumption is slowing, private sector investment and employment growth is sluggish, and residential property inves

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Eurozone Outlook: The Last (Disinflation) Mile
Freemium Article

June 19, 2024 8:48 AM UTC

·       Our still soft EZ GDP outlook remains only a little below consensus and ECB thinking as we still suggest ECB 2022-23 policy has caused a clear increase in the cost of credit alongside a fall in supply of credit. The result is that while the economy is now growing afresh but is doing s

Chartbook: U.S. Chart S&P 500: Extending bullish gains
Paying Article

June 19, 2024 8:07 AM UTC

Break of the Q1 high at 5265 further extend the bullish break at the start of the year to fresh all-time high

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UK CPI Inflation Review: Inflation Back at Target
Paying Article

June 19, 2024 6:39 AM UTC

As labor market and particularly CPI data are crucial to BoE thinking about the timing and even the existence of any start to an easing cycle, this further drop in inflation is important but uncertain.  Indeed, largely meeting expectations, CPI headline inflation fell from 2.3% to 2.0% (actually ju

Chartbook: US Chart Crude Oil Futures: Extending correction above May 2023 channel
Paying Article

June 19, 2024 3:41 AM UTC

Saw bounce 72.50 low to sustain gains above the channel from the 63.63 low of May 2023

June 18, 2024

Preview: Due June 20 - U.S. Q1 Current Account - Deficit to correct higher
Paying Article

June 18, 2024 7:25 PM UTC

We expect a Q1 US current account deficit of $207.0bn, or 2.9% of GDP, up from $194.8bn in Q4 when the deficit was 2.8% of GDP. Trend in the deficit has been narrowing since Q1 2022 and it is unclear whether Q1’s deterioration marks a turning of trend.

Preview: Due June 20 - U.S. May Housing Starts and Permits - Neutral month within a slowing trend
Paying Article

June 18, 2024 7:19 PM UTC

We expect little change in May housing starts, where we expect a rise of 0.7% to 1370k, or permits, which we see unchanged at 1440k.  This is likely to be a pause before renewed slowing.

U.S. Fed talk - Musalem and Logan hawkish, others more balanced but few sounding dovish
Paying Article

June 18, 2024 6:58 PM UTC

There has been plenty of Fed talk today, with Musalem, Logan and Collins sounding quite hawkish, and Williams, Barkin and Kugler more balanced. Few are sounding dovish. Even the usually dovish Goolsbee, while like several welcoming recent inflation data, made few hints about easing. 

U.S. Fed's Collins - Appropriate to remain patient
Paying Article

June 18, 2024 3:58 PM UTC

Preview: Due June 27 - U.S. Final (Third) Estimate Q1 GDP - Higher on construction and net exports
Paying Article

June 18, 2024 2:36 PM UTC

We expect the third (final) estimate for Q1 GDP to be revised up to 1.5% from the second (preliminary) estimate of 1.3%. The revision will come on construction and net exports. 

U.S. May Industrial Production - Improvement above trend may be difficult to sustain
Paying Article

June 18, 2024 1:37 PM UTC

May industrial production has seen a surprisingly strong rise of 0.9%, both overall and in manufacturing, the latter more than reversing a 0.4% decline in April. This is stronger than a previously near flat trend, though that may prove difficult to sustain.

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U.S. May Retail Sales suggest consumer spending losing momentum
Paying Article

June 18, 2024 12:49 PM UTC

May retail sales with a 0.1% increase are weaker than expected and the downside surprise is larger when noting modest downward revisions to May and April. May sales fell by 0.1% ex autos and rose by only 0.1% ex autos and gasoline. 

Chartbook: Chart GER 10 Year Yield: Prices under pressure
Paying Article

June 18, 2024 12:03 PM UTC

Anticipated minor gains have met selling interest at 2.707%, with prices pulling back towards congestion support at 2.300%.

RBA Review: Recognized slower inflation moderation
Paying Article

June 18, 2024 5:06 AM UTC

The RBA meeting on June 18th has kept rates on hold and see the moderation of inflation slower than expected

June 17, 2024

U.S. Fed's Harker - Expects one rate cut in 2024, two or none possible
Paying Article

June 17, 2024 6:17 PM UTC

Chartbook: US Chart 10 Year Yield: Yield coming under pressure
Paying Article

June 17, 2024 4:32 PM UTC

The anticipated corrective bounce from the 3.783% monthly low of 28 December has met fresh selling interest at 4.739% and brought yields lower.

Preview: Due June 27 - U.S. May Advance Goods Trade Balance - Deficit to correct lower within a deteriorating trend
Paying Article

June 17, 2024 3:05 PM UTC

We expect May’s advance goods trade deficit to fall to $95.6bn after increasing to $98.0bn in April. Trend in the deficit has been moving higher since August 2023 but April’s deterioration was sharper than trend and that makes a correction likely in May. 

Chartbook: DAX Chart: Room for a corrective pullback in dominant multi-month bull trend
Paying Article

June 17, 2024 2:06 PM UTC

The anticipated, (steepening), break higher has reached 18893

Preview: Due June 18 - U.S. May Industrial Production - A stronger month
Paying Article

June 17, 2024 1:22 PM UTC

We expect May industrial production to rise by 0.5% overall with a 0.3% increase in manufacturing, the overall figure boosted by utilities and manufacturing reversing a decline seen in April. 

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Preview: Due June 18 - U.S. May Retail Sales - Trend losing some momentum
Paying Article

June 17, 2024 1:09 PM UTC

We expect a modest 0.2% increase in May retail sales with ex auto sales increasing by only 0.1%. The data will however be restrained by lower gasoline prices and ex autos and gasoline we expect an increase of 0.3%.

U.S. June Empire State survey less weak, Prices slower
Paying Article

June 17, 2024 12:47 PM UTC

June’s Empire Sate manufacturing index of -6.0 is less weak than expected and up from -15.6 in May, though given the volatility of the index and that it remains negative we would not make any strong conclusions from this. Prices data is softer and that may be more significant.

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South Africa: ANC-DA-IFP-PA Coalition Will Run the Government
Paying Article

June 17, 2024 11:23 AM UTC

Bottom Line: As we predicted, African National Congress (ANC) and Democratic Alliance (DA) formed a government of national unity (GNU) with the ANC-lead on June 14, along with two smaller opposition parties, Inkatha Freedom Party (IFP) and Patriotic Alliance (PA). Lawmakers voted to put former presi

June 14, 2024

Preview: Due June 27 - U.S. May Durable Goods Orders - A correction lower in a near flat trend
Paying Article

June 14, 2024 6:08 PM UTC

We expect May durable orders to decline by 1.1% delivering the first decline in three months, while orders ex transport fall by 0.2% in a correction from a 0.4% increase in April. 

Preview: Due June 28 - Canada April GDP - Modest boost seen from autos
Paying Article

June 14, 2024 5:11 PM UTC

We expect Canadian GDP to increase by 0.2% in April, slightly below a 0.3% increase projected with March’s unchanged outcome. The data is expected to be supported by recovery in autos which saw restraint in March from retooling in Ontario.

U.S. June Michigan CSI - Lower on current conditions
Paying Article

June 14, 2024 2:11 PM UTC

June’s preliminary Michigan CSI showed an unexpected fall to 65.6 from 69.1, to its lowest since November. Significantly the fall was led by current conditions, a sign that the economy may be slowing, as also suggested by yesterday’s sharp rise in initial claims.

U.S. Fed's Mester - May CPI is welcome news
Paying Article

June 14, 2024 12:52 PM UTC

Chartbook: US Chart Gold (XAU): Room for deeper correction from the 2450 record high
Paying Article

June 14, 2024 8:15 AM UTC

Turned down from the May record high at 2450 as prices consolidate the bullish breakout at the start of Q2

BoJ Review: Pushing Hikes to July, if any
Paying Article

June 14, 2024 5:24 AM UTC

BoJ keep rates and bond purchase the same, suggesting the planning for bond purchase cut will be decided in July

June 13, 2024

U.S. Initial Claims up sharply, May PPI corrects April strength
Paying Article

June 13, 2024 1:04 PM UTC

May PPI with a 0.2% decline, and flat core rates ex food and energy and ex food, energy and trade, surprised on the downside and offsets the disappointment on a stronger than expected April increase. More significant however is a sharp increase in initial claims to 242k from 229k, hinting that the l

Chartbook: UK Chart FTSE 100 Update: Turning away from fresh highs - rising background studies to limit losses
Paying Article

June 13, 2024 12:14 PM UTC

The break above the 8047 year high of February 2023 has posted a fresh all-time high at 8474

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Norges Bank Preview (Jun 20): Continued Caution?
Paying Article

June 13, 2024 9:25 AM UTC

Given the thrust of recent data and the Board’s clear caution, the Norges Bank is very likely to leave the policy rate at 4.5% for a fourth successive meeting at its next Board meeting with the decision due on June 20.  It is also likely to retain the thinking first aired at the December meeting,