Day Ahead: Focus Shifts to US Inflation as Trade War Continues
June 12, 2019 1:41 pm
Today, traders will continue to focus on the ongoing trade dispute between United States and China. On Monday, Donald Trump said that the US will place tariffs on more goods from China if a meeting does not take place in the upcoming G20 meeting. China has yet to confirm if XI will meet with Trump. At the same time, a number of companies have announced plans to move their production for US-destined goods to other countries. Google will move its hardware manufacture to Taiwan while Apple’s biggest manufacturer announced that it had capacity to manufacture US phones outside China.
In New Zealand, in May, the electronic card retail sales declined by -0.5%, which was better than the expected increase of 0.7%. On a YoY basis, these sales increased by 3.2%, which was better than the expected increase of 1.6%. The external migration and visitors in April rose by 8.3%, which was better than the expected 3.3%. Visitor arrivals declined by -3.1% in April.
In Japan, the core machinery orders rose by an annualized rate of 2.5%. This was higher than the expected decline of -5.3%. On a MoM basis, the core machinery orders rose by 5.2%, which was better than the expected decline of -0.8%. This was an important read because of the ongoing global trade war. The PPI, which measures the change in price of manufactured goods rose by 0.7%, which was in line with expectations.
In China, the consumer prices were unchanged in May. The CPI rose by an annualized rate of 2.7%, which was in line with expectations and slightly higher than the previous 2.5%. The PPI rose by 0.6%, which was in line with expectations. This data comes at a time when the Chinese central bank has moved to weaken the yuan, in a bid to make exports more affordable.
Later today, investors will be following closely the monetary policy decision in Turkey. The Turkish central bank is expected to leave the late liquidity window rate at 24%, the one-week repo rate at 24%, the overnight borrowing rate at 22.5% and the overnight lending rate at 22.5%. The Turkish interest rates are among the highest as the central bank tries to tame the ballooning inflation rates.
In the US, traders will receive the inflation data. The CPI will rise at an annualized rate of 1.9%, which is slightly lower than the previous 2.0%. On a MoM basis, the CPI is expected to rise by 0.1%, which is lower than the previous 0.3%. The core CPI, which excludes the volatile food and energy products is expected to remain unchanged at 2.1%.
The EIA will also release the crude oil data. The crude oil inventories are expected to decline by 481K barrels. This will be lower than last week’s increase of more than 6.77 million barrels. Earlier today, data from API showed that inventories rose by more than 4.8 million barrels. The weekly distillate stocks are expected to rise by 1.138 million barrels while the gasoline inventories are expected to rise by 743K.
Today,
traders will continue to focus on the ongoing trade dispute between United
States and China. On Monday, Donald Trump said that the US will place tariffs
on more goods from China if a meeting does not take place in the upcoming G20
meeting. China has yet to confirm if XI will meet with Trump. At the same time,
a number of companies have announced plans to move their production for
US-destined goods to other countries. Google will move its hardware manufacture
to Taiwan while Apple’s biggest manufacturer announced that it had capacity to
manufacture US phones outside China.
In
New Zealand, in May, the electronic card retail sales declined by -0.5%, which
was better than the expected increase of 0.7%. On a YoY basis, these sales
increased by 3.2%, which was better than the expected increase of 1.6%. The
external migration and visitors in April rose by 8.3%, which was better than
the expected 3.3%. Visitor arrivals declined by -3.1% in April.
In
Japan, the core machinery orders rose by an annualized rate of 2.5%. This was
higher than the expected decline of -5.3%. On a MoM basis, the core machinery
orders rose by 5.2%, which was better than the expected decline of -0.8%. This
was an important read because of the ongoing global trade war. The PPI, which measures
the change in price of manufactured goods rose by 0.7%, which was in line with
expectations.
In
China, the consumer prices were unchanged in May. The CPI rose by an annualized
rate of 2.7%, which was in line with expectations and slightly higher than the
previous 2.5%. The PPI rose by 0.6%, which was in line with expectations. This
data comes at a time when the Chinese central bank has moved to weaken the
yuan, in a bid to make exports more affordable.
Later
today, investors will be following closely the monetary policy decision in
Turkey. The Turkish central bank is expected to leave the late liquidity window
rate at 24%, the one-week repo rate at 24%, the overnight borrowing rate at
22.5% and the overnight lending rate at 22.5%. The Turkish interest rates are
among the highest as the central bank tries to tame the ballooning inflation
rates.
In
the US, traders will receive the inflation data. The CPI will rise at an
annualized rate of 1.9%, which is slightly lower than the previous 2.0%. On a
MoM basis, the CPI is expected to rise by 0.1%, which is lower than the
previous 0.3%. The core CPI, which excludes the volatile food and energy
products is expected to remain unchanged at 2.1%.
The
EIA will also release the crude oil data. The crude oil inventories are
expected to decline by 481K barrels. This will be lower than last week’s
increase of more than 6.77 million barrels. Earlier today, data from API showed
that inventories rose by more than 4.8 million barrels. The weekly distillate
stocks are expected to rise by 1.138 million barrels while the gasoline
inventories are expected to rise by 743K.
The post Day Ahead: Focus Shifts to US Inflation as Trade War Continues appeared first on Forex.Info.
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