Macro: Sandcastle economics
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Morning Brew July 8 2021
Erik Schafhauser
Senior Relationship Manager
Good Morning,
The message from the FOMC minutes was less clear than hoped. The key messages were
- the recovery was strong but not completed,
- Inflation is high but largely transitory
- Unemployment still elevated
Probably the key message was that the Fed was that several Fed Members anticipate to start tapering earlier than previously anticipated but using a patient approach.
Almost more interesting than the FOMC Minutes was the fact that traders are expecting a raise if the debt ceiling in the near future. That will cause more bond issuances by the US. 10 Year Yields fell to below 1.30 % for the first time since February.
The USD Index fives up some gains in early Europe, currently 92.65 after a high at 92.80.
Equities could initially gain but futures came under pressure in the Asian session. Risk averseness was triggered by rising corona cases and worries that regulation may hurt tech shares as just seen with Didi.
Key Indexes are down 0.2-0.5% so not a huge move, EURUSD is trading at 1.1800 and Gold and Silver retreat to 27.90 and 1797. The Hang Seng fell below the 200 day Moving Average. Oil seems to have calmed a little after the Opec+ meeting/ Non-meeting turmoil, the CL contract seems to stabilize at around 72
The only key agenda item is the US Initial Jobless claims.
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Headlines:
- China is hinting at lower Reserve Ratio Requirements for banks to boost economic recovery
- Watch the Google stock after 37 US States filed a lawsuit against the company for abusing monopoly power in it`s play store.
- South Korea records the highest number of corona infections - though “only” (1275)
- Didi falls further to 11.93
Local Start Date | Local Time | Country/Region | Indicator Name | Period | Reuters Poll |
8 Jul 2021 | 01:50 | Japan | Current Account NSA JPY | May | 1,820.4B |
8 Jul 2021 | 14:00 | Brazil | IPCA Inflation Index MM | Jun | 0.60% |
8 Jul 2021 | 14:30 | United States | Initial Jobless Clm | 3 Jul, w/e | 350k |
9 Jul 2021 | 03:30 | China (Mainland) | PPI YY | Jun | 8.8% |
9 Jul 2021 | 03:30 | China (Mainland) | CPI YY | Jun | 1.3% |
9 Jul 2021 | 08:00 | United Kingdom | GDP Est 3M/3M | May | 3.9% |
9 Jul 2021 | 08:00 | United Kingdom | GDP Estimate MM | May | 1.5% |
9 Jul 2021 | 08:00 | United Kingdom | GDP Estimate YY | May | 25.9% |
9 Jul 2021 | 08:00 | United Kingdom | Manufacturing Output MM | May | 1.0% |
9 Jul 2021 | 08:00 | Norway | Consumer Price Index MM | Jun | 0.4% |
9 Jul 2021 | 08:00 | Norway | Consumer Price Index YY | Jun | 2.9% |
9 Jul 2021 | 09:00 | Turkey | Current Account Balance | May | -3.025B |
9 Jul 2021 | 14:30 | Canada | Employment Change | Jun | 195.0k |
9 Jul 2021 | 14:30 | Canada | Unemployment Rate | Jun | 7.7% |
12 Jul 2021 | 01:50 | Japan | Corp Goods Price MM | Jun | |
12 Jul 2021 | 01:50 | Japan | Corp Goods Price YY | Jun | |
12 Jul 2021 | 01:50 | Japan | Machinery Orders MM | May | |
12 Jul 2021 | 01:50 | Japan | Machinery Orders YY | May | |
12 Jul 2021 | 08:00 | Denmark | CPI YY | Jun | |
12 Jul 2021 | China (Mainland) | Total Social Financing | Jun | 2,800.00B | |
12 Jul 2021 | China (Mainland) | M2 Money Supply YY | Jun | 8.2% | |
12 Jul 2021 | China (Mainland) | New Yuan Loans | Jun | 1,800.0B |
(Refinitiv)
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