- Poll shows 62 of 62 analysts expect a 25bp European Central Bank rate hike in June
- "New Zealand set to reveal bigger deficit in 'no frills' 2023-24 budget"
- AUD, NZD, CAD, EUR all lower after the disappointing China data
- China April Industrial output 5.6% y/y (expected +10.9%) Retail sales 18.4% y/y (21.0%)
- AUD/USD little changed after the RBA minutes
- RBA May meeting minutes: Little room for upside risks to inflation
- PBOC sets USD/ CNY central rate at 6.9506 (vs. estimate at 6.9500)
- Australia Westpac Consumer Sentiment (May) -7.9% m/m (prior +9.4%)
- Morgan Stanley says US debt ceiling debate is a "lose-lose for markets"
- Threat of disruption to Canada's main oil-producing region is rising - wildfires
- Weekly Australian Consumer Confidence survey 75.9 (prior 77.7), weakest since April 2020
- BoE's Pill says he shouldn't have told people to accept being poorer
- PBOC: China's economy isn’t experiencing deflation, economic growth set to rebound sharply
- US House Speaker McCarthy says not in a good place on raising debt ceiling
- Paul Tudor Jones says the Fed is done hiking, stocks to grind higher for the rest of year
- North Korea has stolen US$721 million in Japanese cryptocurrency assets since 2017
- Westpac forecasts RBNZ will raise cash rate to 6%, keep it there until mid-2024
- ICYMI: US preparing to buy up to 3m bbl oil to begin refilling Strategic Petroleum Reserve
- US stock trading gets off to a positive start this week. Dow Jones snaps five-day slide
- Forexlive Americas FX news wrap: Empire Fed crumbles but the market shrugs
- Yellen repeats the June 1 date for possible US default without debt ceiling hike
- Fed's Barr says US banking system remains sound, resilient, deposits are safe
- Trade ideas thread - Tuesday, 16 May 2023
Chinese consumer spending and industrial activity grew at a faster pace in April than in March but at a slower pace than was expected. The data also showed urban unemployment a touch lower at 5.2% (March was 5.3%). Poor data from China can be taken two ways:
1. the economy is recovering slower than expected, which is not a positive
2. the prospect of further economic stimulus, fiscal and/or monetary is increased, which is a positive
The immediate response from the forex market leaned towards option 1 above. AUD, NZD, CAD, EUR all dropped. As I post there is some mixed recovery being seen, EUR/USD has clawed back its loss while AUD/USD is not a lot off its session lows.
From the Reserve Bank of Australia today we had May meeting minutes. The minutes are always eagerly awaited, perhaps today more than usual given the muddled messaging we have been receiving from the RBA. The minutes were not a lot clearer, the Bank is hawkish on inflation but reiterated again its concerns not to damage labour markets too badly as rates rise. The Bank appealed for productivity gains. Fair enough, but this is well outside its remit and influence.
In US debt ceiling news, further talks between Biden and congressional leaders are scheduled for 3pm US Eastern time today, Tuesday, 16 May 2023.
Asian equity markets:
Japan’s Nikkei 225 +0.7%
China’s Shanghai Composite +0.1%
Hong Kong’s Hang Seng +0.6%
Australia’s S&P/ASX 200 -0.2%
