News
and Media
WEEKLY MARKET RECAP,
WEEK AHEAD, AND SCHEDULE
Mandus Invest SA. | 15, June, 2008 /
Sunday
EURO
The euro depreciated vis-a-vis the U.S. dollar last week
as the single currency tested bids around the $1.5300 level
and was capped around the $1.5845 level. The pair lost about
425 pips last week. Bush verbally intervened to support the
dollar. Bernanke remained hawkish saying “The Fed will strongly
resist an erosion in longer-term (inflation) expectations.”
Boston Fed’s Rosengren sees a “relatively low correlation
between oil price movements and the underlying core rate of
inflation.” Paulson said currency intervention remains a tool.
The Fed’s Beige Book pointed to a “generally weak” economy.
Traders are watching the G8 meeting in Osaka this weekend
with little expectation policymakers will move beyond their
April FX statement.
Germany’s RWI lifted its 2008 inflation forecast to 3.0%.
ECB’s Liikanen hawkishly said the ECB is in a “state of heightened
alertness.” Trichet said rates may move higher a “small amount”
from next month. Noyer said the markets expect a rate hike
while Stark said he doesn’t foresee a series of rate hikes.
Weber reiterated the “state of heightened alertness” mantra
as did Bini-Smaghi. The ECB’s monthly bulletin was very cautious
about negotiated wage deals. Germany’s RWI Institute lifted
its 2008 GDP growth forecast outlook to 2.2% from 1.7%. ECB’s
Gonzalez-Paramo and Quaden suggested the ECB may only hike
rates next month. Irish voters voted down the Lisbon Treaty.
Bank of France reduced its Q2 GDP growth estimate to 0.2%
from 0.3%.
Data released in the U.S. last week saw April pending home
sales were up 6.3% m/m and 13.1% y/y; the April trade deficit
increased 7.8% m/m to US$ 60.9 billion; may overall import
prices were up 2.3% with upward revisions to April’s and March’s
tallies; May import prices were up 17.8% y/y with the ex-petroleum
component up 0.5% m/m; weekly initial jobless claims were
up 58,000 to 3.139 million; May retail sales were up +1.0%;
April business inventories were up +0.5%; University of Michigan
preliminary June consumer sentiment fell to 56.7; May headline
CPI was up +0.6% m/m and +4.2% y/y with the ex-food and energy
component up +0.2% m/m and +2.3% y/y; and real hourly earnings
were up +0.3% in May.
Data released in the eurozone last week saw Germany’s April
trade surplus rise to €18.7 billion; French May CPI was up
0.5% m/m and 3.3% y/y; EMU-15 April industrial output was
up 0.9% m/m and 3.9% y/y; EMU-15 Q1 wage growth was up 3.7%
y/y; EMU-15 Q1 unemployment was up 0.3% q/q and 1.6% y/y;
and Germany final May CPI was up 0.6% m/m and 3.0% y/y.
Technical Outlook
Last week’s high (1) was above
the 23.6% retracement of the 1.4309-1.6018 range and last
week’s low (2) was below the 38.2% retracement of the same
range. The 1.5456/ 1.5650/ 1.5789/ 1.5854/ 1.5903 levels represent
upside resistance targets while the 1.5164/ 1.4962/ 1.4861/
1.4712 levels represent downside support targets.
CNY
The yen depreciated vis-a-vis the U.S. dollar last week as
the greenback tested offers around the Y108.40 level and was
supported around the Y104.40 level. The pair gained about
330 pips last week. The Nikkei 225 stock index gained 0.61%
on Friday to close at Y13,973.73. S&P affirmed Japan’s
long-term and short-term ratings with a stable outlook. The
G8 is not expected to mention FX at length in its communiqué
this weekend. BoJ’s Policy Board kept its overnight call rate
unchanged at 0.50% with Shirakawa cautioning about further
“downside risks.” BoJ’s Policy Board kept its economic assessment
unchanged.
Data released in Japan this week saw the May economy watchers’
index decline at 32.1; the April leading indicator printed
at 30.0 with the coincident index at 22.2; May bank lending
was up 1.6%; M2+CD money supply growth was up 2.0%; May corporate
failures were off 1.9%; May corporate bankruptcies were down
2.2% y/y; April machinery orders rose 5.5% m/m to Y1.0 trillion
with core orders for the first time in three months; the May
domestic corporate goods price index was up +4.7% y/y; real
GDP was up +1.0% q/q in the January – March period; the April
current account surplus was off 29.6% y/y to Y1.381 trillion;
May consumer sentiment fell to 33.9; and April industrial
output was downwardly revised 0.2% m/m.
In Chinese news, the Chinese yuan appreciated
vis-a-vis the U.S. dollar as the greenback closed at CNY 6.9018
in the over-the-counter market, down from CNY 6.9230. PBoC
lifted the reserve requirement on bank deposits to 17.5%,
its fifth hike this year and pledged action to “prevent prices
from growing too rapidly.”
Data released in China last week saw the May trade surplus
print at US$ 20.21 billion; May PPI was up 8.2% y/y; May CPI
was up 7.7% y/y; end-May M2 money supply was up 18.07%; January
– May actual foreign direct investment was up 54.97% to US$
42.778 billion; and May retail sales climbed 21.6% y/y to
CNY 870.4 billion
Technical Outlook
Last week’s high (1) was above
the 61.8% retracement of the 114.65-95.71 range and last week’s
low (2) was above the 38.2% retracement of the same range.
Upside resistance targets remain the 110.18/ 112.66/ 114.65
levels while downside support targets remain the 107.41/ 105.18/
103.44/ 102.42/ 100.18 levels.
GBP
The British pound depreciated vis-a-vis the U.S. dollar last
week as cable tested bids around the US$ 1.9410 level and
was capped around the $1.9800 level. The pair lost about 240
pips last week. BoE will unveil a new liquidity program later
this year. NIESR reported the U.K. economy “scarcely” grew
in the three months to May. BoE repo demand reached its highest
level since October 2007. BoE’s inflation survey revealed
the public believes inflation to be around 3.9%. MPC’s Tucker
warned the U.K. is “facing a nasty shock to costs from rising
commodity prices and sterling’s depreciation.” The government
is likely to revise its March economic growth and inflation
estimates.
Data released in the U.K. last week saw May input and output
prices were up 27.6% and 8.9%, respectively, with core output
prices up 5.9%; BRC May consumer confidence fell to 79 from
94 in November; BRC May retail sales were up more than expected;
RICS May house prices were higher with transactions at record
lows; April industrial production rose 0.2% m/m and 0.2% y/y;
the May claimant count of jobseekers rose 9,000 while April’s
was upwardly revised to 11,200; headline average earnings
were up 3.8% in the three months to April; the April trade
in goods deficit widened to £4.3 billion; April CML mortgage
loans for house purchases rose 9% m/m; and April new construction
orders fell 2% y/y
Technical Outlook
Last week’s high (1) was above
the 61.8% retracement of the 1.9336-2.0395 range and last
week’s low (2) was below the 76.4% retracement of the same
range. Upside resistance targets include the 1.9586/ 1.9741/
1.9877/ 1.9999/ 2.0033 while downside support targets include
the 1.9395/ 1.9336/ 1.9117/ 1.8631 levels.
CHF
The Swiss franc depreciated vis-a-vis the U.S. dollar last
week as the greenback tested offers around the CHF 1.0540
level and was supported around the CHF 1.0145 level. The pair
gained about 310 pips last week.
Data released in Switzerland last week saw May unemployment
fall to 2.4% from 2.6% in April.
Technical Outlook
Last week’s high (1) was above
the 38.2% retracement of the 1.1594-0.9647 range and last
week’s low (2) was above the 23.6% retracement of the same
range. Upside resistance targets include the 1.0620/ 1.0850/
1.1134 levels while downside support targets include the 1.0314/
1.0106/ 0.9647/ 0.9605/ 0.9535 levels.
CAD
The Canadian dollar depreciated vis-a-vis the U.S. dollar
last week as the greenback tested offers around the C$ 1.0320
level and was supported around the C$ 1.0150 level. The pair
gained about 95 pips last week. BoC kept its key overnight
rate unchanged at 3.0% and noted inflation projections have
“shifted slightly to the upside” adding monetary policy is
“appropriately accommodative.”
Data released in Canada last week saw April housing starts
increased 3.5% m/m to an annualized rate of 221,300 units;
Q1 capacity utilization fell to 79.8% from 81.8% in Q4; April
new house price growth moderated to +5.2% y/y; and April manufacturing
shipments were up 2%
Technical Outlook
Last week’s high (1) was above
the 76.4% retracement of the 1.0378-0.9709 range and last
week’s low (2) was below the 61.8% retracement of the same
range. Upside resistance targets include the 1.0378/ 1.0439/
1.0797 levels while downside support targets include the 1.0202/
1.0129/ 1.0044/ 0.9965/ 0.9867/ 0.9752 levels.
AUD
The Australian dollar depreciated vis-a-vis the U.S. dollar
last week as the Aussie tested bids around the US$ 0.9335
level and was capped around the US$ 0.9645 level. The pair
lost about 250 pips last week. RBA Governor Stevens hawkishly
said strong growth in commodity prices means vigilance must
be maintained on inflation.
Data released in Australia last week saw ANZ May job advertisements
post their largest decline in eight years; April owner-occupied
dwelling financings fell 3.0% to 57,303; April NAB business
confidence was up +4 points; June consumer sentiment printed
at -5.6%; and the May unemployment rate held steady at 4.3%
Technical Outlook
Last week’s high (1) was near
a new multi-decade high and last week’s low (2) was below
the 38.2% retracement of the 0.8952-0.9653 range. Upside resistance
targets include the 0.9385/ 0.9487/ 0.9648/ 0.9920/ 1.0053
levels while downside support targets include the 0.9302/
0.9263/ 0.9120/ 0.9003/ 0.8887 levels.
SCHEDULE
Sunday, 15 June 2008
all times GMT
(last release in parentheses)
2245 NZ Q1 manufacturing activity (8.3%)
Monday, 16 June 2008
all times GMT
(last release in parentheses)
N/A Japan Monthly Cabinet Office economic report
0000 NZ May performance of services index
0400 Japan May Tokyo-area condominium sales (-29.7% y/y)
0715 CH April retail sales (9.7% y/y)
0800 Italy Q1 labour costs (2.5% y/y)
0900 Eurozone May consumer price index (0.3% m/m)
0900 Eurozone May consumer price index (3.6% y/y)
0900 Eurozone May consumer price index, core (1.6% y/y)
1230 US June Empire State manufacturing index (-3.2)
1300 US April net long-term TIC capital flows (US$ 80.4 billion)
1300 US April total net TIC capital flows (-US$ 48.2 billion)
1400 US Federal Reserve Chairman Bernanke speaks
1700 US Richmond Federal Reserve President Lacker speaks
1700 US June NAHB housing market index (19)
2350 Japan April tertiary industry index (0.3% m/m)
Tuesday, 17 June 2008
all times GMT
(last release in parentheses)
N/A U.S. U.S. and Chinese financial officials convene
0130 Australia Reserve Bank of Australia board meeting minutes
0600 Japan May machine tool orders (1.4% y/y)
0715 CH Q1 industrial production (6.8% q/q)
0715 CH Q1 industrial production (9.1% y/y)
0800 Italy April trade balance
0830 UK May consumer price index (3.0% y/y)
0830 UK May consumer price index, core (1.4% y/y)
0830 UK May retail price index (0.9% m/m)
0830 UK May retail price index (4.2% y/y)
0830 UK May RPIX (4.0% y/y)
0900 Germany June ZEW survey, current situation (38.6)
0900 Germany June ZEW survey, economic sentiment (-41.4)
0900 Eurozone June ZEW survey, economic sentiment (-43.6)
0900 Eurozone April trade balance (-€2.3 billion)
1230 US Q1 current account balance (-US$ 172.9 billion)
1230 US May producer price index (0.2% m/m)
1230 US May producer price index (6.5% y/y)
1230 US May producer price index, ex-food and energy (0.4%
m/m)
1230 US May producer price index, ex-food and energy (3.0%
y/y)
1230 US May housing starts (1.032 million)
1230 US May building permits (978,000)
1230 US May industrial production (-0.7%)
1230 Canada April international securities transactions (C$
5.296 billion)
1315 US May capacity utilization (79.7%)
2350 Japan Bank of Japan Policy Board meeting minutes
Wednesday, 18 June 2008
all times GMT
(last release in parentheses)
0030 Australia April Westpac leading index (0.2% m/m)
0130 Australia May imports
0500 Japan April leading economic index
0500 Japan April coincident index
0530 Japan May Tokyo-area department store sales (-0.7% y/y)
0530 Japan May nationwide department store sales (-3.4% y/y)
0830 UK Bank of England Monetary Policy Committee meeting
minutes
0900 CH June ZEW survey, expectations (-60.4)
0900 Eurozone April construction output (-2.2% m/m)
0900 Eurozone April construction output (-1.4% y/y)
1000 UK June CBI monthly industrial trends
1100 US MBA mortgage applications (10.9%)
1230 Canada May leading indicators (0.1% m/m)
1545 US San Francisco Fed President Yellen speaks
2350 Japan Foreign purchases of Japanese stocks and bonds
2350 Japan Japanese purchases of foreign stocks and bonds
2350 Japan April all-industry activity index (0.5% m/m)
Thursday, 19 June 2008
all times GMT
(last release in parentheses)
N/A Australia Q1 quarterly wage agreements
0100 Australia Q2 Westpac industrial trends
0400 US Treasury Undersecretary McCormick speaks
0615 CH May trade balance (CHF 1.57 billion)
0730 CH Swiss National Bank interest rate decision
0800 Italy Q1 unemployment rate
0830 Italy April current account
0830 UK May retail sales (-0.2% m/m)
0830 UK May retail sales (4.2% y/y)
0830 UK May public sector net cash requirement (-£1.0 billion)
0830 UK May public sector net borrowing (-£500 million)
0830 UK May M4 money supply (0.6% m/m)
0830 UK May M4 money supply (11.1% y/y)
0830 UK May M4 sterling lending (£27.9 billion)
1100 Canada May consumer price index (0.8% m/m)
1100 Canada May consumer price index (1.7% y/y)
1100 Canada May Bank of Canada consumer price index, core
(0.3% m/m)
1100 Canada May Bank of Canada consumer price index, core
(1.5% y/y)
1230 US Weekly initial jobless claims (384,000)
1230 US Continuing jobless claims (3.139 million)
1230 Canada April wholesale sales (0.6% m/m)
1400 US June Philadelphia Fed survey (-15.6)
1400 US May leading indicators (0.1%)
1830 US Federal Reserve Vice Chairman Kohn testifies
Friday, 20 June 2008
all times GMT
(last release in parentheses)
N/A CH May M3 money supply
0600 Germany May producer prices (1.1% m/m)
0600 Germany May producer prices (5.2% y/y)
0645 France Q1 wages (1.1% q/q)
0700 Japan May convenience store sales (-0.2% y/y)
0715 CH May producer and import prices (0.7% m/m)
0715 CH May producer and import prices (3.6% y/y)
0800 Italy April industrial orders (-0.8% m/m)
0800 Italy April industrial orders (-3.7% y/y)
0800 Italy April industrial sales (-1.6% m/m)
0800 Italy April industrial sales (-4.3% y/y)
0800 Italy May trade balance
1230 Canada April retail sales (0.1% m/m)
1230 Canada April retail sales, ex-autos (0.0% m/m)
1430 Canada May money supply (7.3% y/y)
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