Time | Country | Event | Period | Previous value | Forecast |
---|---|---|---|---|---|
01:30 (GMT) | Australia | Trade Balance | July | 10.496 | 10.2 |
06:30 (GMT) | Switzerland | Retail Sales (MoM) | July | -3.5% | |
06:30 (GMT) | Switzerland | Retail Sales Y/Y | July | 0.1% | |
06:30 (GMT) | Switzerland | Consumer Price Index (MoM) | August | -0.1% | 0.1% |
06:30 (GMT) | Switzerland | Consumer Price Index (YoY) | August | 0.7% | 0.8% |
07:00 (GMT) | Switzerland | Gross Domestic Product (YoY) | Quarter II | -0.5% | 9% |
07:00 (GMT) | Switzerland | Gross Domestic Product (QoQ) | Quarter II | -0.5% | 2% |
09:00 (GMT) | Eurozone | Producer Price Index, MoM | July | 1.4% | 1.1% |
09:00 (GMT) | Eurozone | Producer Price Index (YoY) | July | 10.2% | 11% |
12:30 (GMT) | U.S. | Continuing Jobless Claims | August | 2862 | 2775 |
12:30 (GMT) | Canada | Building Permits (MoM) | July | 6.9% | 0.3% |
12:30 (GMT) | U.S. | Initial Jobless Claims | August | 353 | 345 |
12:30 (GMT) | U.S. | Unit Labor Costs, q/q | Quarter II | -2.8% | 0.9% |
12:30 (GMT) | U.S. | Nonfarm Productivity, q/q | Quarter II | 4.3% | 2.5% |
12:30 (GMT) | Canada | Trade balance, billions | July | 3.23 | 1.4 |
12:30 (GMT) | U.S. | International Trade, bln | July | -75.7 | -71 |
14:00 (GMT) | U.S. | Factory Orders | July | 1.5% | 0.3% |
22:30 (GMT) | Australia | AiG Performance of Construction Index | August | 48.7 |
The
Commerce Department announced on Wednesday that construction spending increased
0.3 percent m-o-m in July after a revised flat reading in June (originally a
0.1 percent m-o-m uptick).
Economists
had forecast construction spending growing 0.2 percent m-o-m in July.
According
to the report, spending on private construction rose 0.3 percent m-o-m, while
investment in public construction climbed 0.7 percent m-o-m.
On a
y-o-y basis, construction spending surged 9.0 percent in July.
The
U.S. Energy Information Administration (EIA) reported on Wednesday that crude
inventories plunged by 7.169 million barrels in the week ended August 27,
following a decline of 2.979 million barrels in the previous week. Economists
had forecast a decrease of 3.088 million barrels.
At
the same time, gasoline stocks rose by 1.290 million barrels, while analysts
had expected a fall of 1.633 million barrels. Distillate stocks reduced by 1.732
million barrels, while analysts had forecast a draw of 0.650 million barrels.
Meanwhile,
oil production in the U.S. increased by 100,000 barrels a day to 11,500 million
barrels a day.
U.S.
crude oil imports averaged 6.3 million barrels per day last week, up by 183,000
barrels per day from the previous week.
A
report from the Institute for Supply Management (ISM) showed on Wednesday the
U.S. manufacturing sector’s activity continued to grow in August at a slightly
stronger pace than in July.
The
ISM's index of manufacturing activity came in at 59.9 percent last month, up 0.4
percentage point from an unrevised July reading of 59.5 percent. The August reading pointed to the expansion
in the manufacturing sector for the 15th straight month but at the weakest pace
since January.
Economists'
had forecast the indicator to drop to 58.6 percent.
A
reading above 50 percent indicates expansion, while a reading below 50 percent
indicates contraction.
According
to the report, the New Orders Index increased 1.8 percentage points to 66.7 percent
in August, while the Production Index rose 1.6 percentage points to 60.0 percent,
the Backlog of Orders Index went up 3.2 percentage points to 68.2 percent and the
Inventories Index surged 5.3 percentage points to 54.2 percent. Meanwhile, the
Employment Index fell 3.9 percentage points to 49.0 percent, pointing to contraction
and the Supplier Deliveries Index dropped 3.0 percentage points to 69.5 percent.
On the price front, the Prices Index declined 6.3 percentage points to 79.4 percent;
this marked its first drop below 80 percent since December 2020.
Timothy
R. Fiore, Chair of the ISM Manufacturing Business Survey Committee, noted that
the Survey Committee members reported that their companies and suppliers
continued to struggle to meet increasing demand levels. “All segments of the
manufacturing economy are impacted by record-long raw-materials lead times,
continued shortages of critical basic materials, rising commodities prices and
difficulties in transporting products,” he said. “The new surges of COVID-19
are adding to pandemic-related issues - worker absenteeism, short-term
shutdowns due to parts shortages, difficulties in filling open positions and
overseas supply chain problems - that continue to limit manufacturing-growth
potential. However, optimistic panel sentiment remained strong, with eight
positive comments for every cautious comment.”
Fiore
also noted that the past relationship between the PMI and the overall economy
indicated that the PMI for August (59.9 percent) corresponds to a 4.8-percent
increase in real gross domestic product (GDP) on an annualized basis.
The
latest report by IHS Markit revealed on Wednesday the seasonally adjusted IHS
Markit final U.S. Manufacturing Purchasing Managers’ Index (PMI) came in at 61.1
in August, down from 63.4 in July and marginally lower than the earlier
released “flash” reading of 61.2. The August reading pointed to a noticeable
improvement in operating conditions, which, however, was the softest in the
last four months.
Economists
had forecast the index to stay unrevised at 61.2.
According
to the report, the August expansion was supported by steep upturns in
production and new orders. Nevertheless, output growth was reportedly hampered
by capacity constraints and material shortages. In addition, lead times for
inputs extended further as cost burdens soared, with the pace of inflation
reaching a fresh series high. Elsewhere, employment growth eased as firms
struggled to retain staff and find suitable candidates for current vacancies.
FXStreet reports that Karen Jones, Team Head FICC Technical Analysis Research at Commerzbank, notes that gold's moves higher are still viewed as corrective only while the yellow metal remains below the $1835 region.
“Gold has spent the past week consolidating around the 200-DMA at $1810. Dips back from here are indicated to remain shallow and should be contained ideally by $1781.”
“While above $1750, the 29th June low it will remain neutral to positive.”
“Key resistance is the mid-July high at $1834, and the 55-week ma at $1835.41, a move above here is needed to retest the $1856/57 4th June low and the $1871 2020-2021 downtrend.”
“Below $1750, support is found at $1679.80/$1677.83, and is reinforced by the $1670 June 2020 low.”
U.S. stock-index futures traded rose on Wednesday, as interest in buying stocks was preserved ahead of the main event of the week - the release of the U.S. August jobs report, which is due on Friday and could provide clues on the Federal Reserves’ taper timing.
Global Stocks:
Index/commodity | Last | Today's Change, points | Today's Change, % |
Nikkei | 28,451.02 | +361.48 | +1.29% |
Hang Seng | 26,028.29 | +149.30 | +0.58% |
Shanghai | 3,567.10 | +23.16 | +0.65% |
S&P/ASX | 7,527.10 | -7.80 | -0.10% |
FTSE | 7,179.97 | +60.27 | +0.85% |
CAC | 6,780.65 | +100.47 | +1.50% |
DAX | 15,905.08 | +69.99 | +0.44% |
Crude oil | $68.66 | +0.23% | |
Gold | $1,817.90 | -0.01% |
(company / ticker / price / change ($/%) / volume)
3M Co | MMM | 195.1 | 0.36(0.18%) | 3019 |
ALCOA INC. | AA | 44.02 | -0.35(-0.79%) | 36028 |
ALTRIA GROUP INC. | MO | 50.41 | 0.18(0.36%) | 8058 |
Amazon.com Inc., NASDAQ | AMZN | 3,494.00 | 23.21(0.67%) | 33940 |
American Express Co | AXP | 167.25 | 1.29(0.78%) | 1173 |
AMERICAN INTERNATIONAL GROUP | AIG | 54.85 | 0.29(0.53%) | 106747 |
Apple Inc. | AAPL | 152.5 | 0.67(0.44%) | 1105705 |
AT&T Inc | T | 27.46 | 0.04(0.15%) | 37474 |
Boeing Co | BA | 220.35 | 0.85(0.39%) | 21473 |
Caterpillar Inc | CAT | 211.16 | 0.29(0.14%) | 5908 |
Chevron Corp | CVX | 97.33 | 0.56(0.58%) | 23081 |
Cisco Systems Inc | CSCO | 59.1 | 0.08(0.14%) | 5418 |
Citigroup Inc., NYSE | C | 72.26 | 0.35(0.49%) | 21008 |
Deere & Company, NYSE | DE | 379.25 | 1.22(0.32%) | 238 |
Exxon Mobil Corp | XOM | 54.78 | 0.26(0.48%) | 34437 |
Facebook, Inc. | FB | 378.09 | -1.29(-0.34%) | 206262 |
FedEx Corporation, NYSE | FDX | 267 | 1.31(0.49%) | 6260 |
Ford Motor Co. | F | 13.09 | 0.06(0.46%) | 517161 |
Freeport-McMoRan Copper & Gold Inc., NYSE | FCX | 35.85 | -0.54(-1.48%) | 94812 |
General Electric Co | GE | 105.83 | 0.42(0.40%) | 11623 |
General Motors Company, NYSE | GM | 49.2 | 0.19(0.39%) | 17804 |
Goldman Sachs | GS | 415.8 | 2.29(0.55%) | 9058 |
Google Inc. | GOOG | 2,923.26 | 14.02(0.48%) | 4163 |
Hewlett-Packard Co. | HPQ | 29.85 | 0.11(0.37%) | 4839 |
Home Depot Inc | HD | 324.8 | 0.27(0.08%) | 1371 |
HONEYWELL INTERNATIONAL INC. | HON | 232.5 | 0.59(0.25%) | 524 |
Intel Corp | INTC | 54.23 | 0.17(0.31%) | 197351 |
Johnson & Johnson | JNJ | 173.77 | 0.64(0.37%) | 2894 |
JPMorgan Chase and Co | JPM | 160.73 | 0.78(0.49%) | 23077 |
McDonald's Corp | MCD | 237.88 | 0.42(0.18%) | 633 |
Merck & Co Inc | MRK | 76.55 | 0.26(0.34%) | 11868 |
Microsoft Corp | MSFT | 302.83 | 0.95(0.31%) | 75274 |
Nike | NKE | 165.5 | 0.76(0.46%) | 3116 |
Pfizer Inc | PFE | 46.2 | 0.13(0.28%) | 151847 |
Starbucks Corporation, NASDAQ | SBUX | 118.06 | 0.57(0.49%) | 13673 |
Tesla Motors, Inc., NASDAQ | TSLA | 734.83 | -0.89(-0.12%) | 161389 |
The Coca-Cola Co | KO | 56.43 | 0.12(0.21%) | 14289 |
Twitter, Inc., NYSE | TWTR | 64.84 | 0.34(0.53%) | 16015 |
UnitedHealth Group Inc | UNH | 417.54 | 1.27(0.31%) | 4586 |
Verizon Communications Inc | VZ | 55.08 | 0.08(0.15%) | 18103 |
Visa | V | 230.2 | 1.10(0.48%) | 8971 |
Wal-Mart Stores Inc | WMT | 148.5 | 0.40(0.27%) | 401145 |
Walt Disney Co | DIS | 181.8 | 0.50(0.28%) | 28239 |
Yandex N.V., NASDAQ | YNDX | 76.45 | -0.45(-0.59%) | 8990 |
Facebook (FB) downgraded to Neutral from Buy at Rosenblatt; target $400
Apple (AAPL) upgraded to Peer Perform from Underperform at Wolfe Research; target raised to $155
Risks are clearly skewed towards higher inflation
Temporary factors causing inflation spike could lead to higher wages and inflation expectations
Expansionary monetary policy still appropriate but PEPP must end when the emergency is over
PEPP should be reduced step by step, should not end abruptly
PEPP's flexibility should be reserved for exceptional circumstances
The
employment report prepared by Automatic Data Processing Inc. (ADP) and Moody's
Analytics showed on Wednesday the U.S. private employers added 374,000 jobs in August.
Economists
had expected an increase of 613,000.
The July
number saw a downward revision to 326,000 from the originally reported 330,000.
“Our
data, which represents all workers on a company’s payroll, has highlighted a
downshift in the labor market recovery. We have seen a decline in new hires,
following significant job growth from the first half of the year,” noted Nela
Richardson, chief economist, ADP. “Despite the slowdown, job gains are approaching
4 million this year, yet still 7 million jobs short of pre-COVID-19 levels.
Service providers continue to lead growth, although the Delta variant creates
uncertainty for this sector. Job gains across company sizes grew in lockstep,
with small businesses trailing a bit more than usual.”
Meanwhile,
Mark Zandi, chief economist of Moody’s Analytics, said, “The Delta variant of
COVID-19 appears to have dented the job market recovery. Job growth remains
strong, but well off the pace of recent months. Job growth remains inextricably
tied to the path of the pandemic.”
FXStreet reports that economists at MUFG Bank believe that negative domestic risks are leading to the loonie underperformance, a trend that should continue in the coming weeks.
“The Canadian economy unexpectedly contracted in Q2 by an annualized rate of – 1.1% following the expansion of 5.5% in Q1.”
“The Bank of Canada (BoC) had been expecting the Canadian economy to expand by 2.0% (QoQ at annual rates) in Q2 and 7.3% in Q3 in their July Monetary Policy Report, and by 6.0% for 2021 as a whole. Those optimistic expectations will now need to be revised significantly lower and will encourage the BoC to be more cautious over their plans to continue tightening monetary policy.”
“The BoC is now unlikely to slow the pace of QE purchases further at their next meeting on 8th September and maintain at CAD2 B per week. At the same time, the Canadian interest rate market has pared back expectations for BoC rate hikes.”
“The weak growth data will add to uncertainty as well over the outcome from the snap election to be held on 20th September.”
“The Canadian dollar should continue to underperform in the coming weeks although our short-valuation model suggests that a lot of bad news is already priced in at levels above 1.2500 for USD/CAD.”
The
Mortgage Bankers Association (MBA) reported on Wednesday the mortgage
application volume in the U.S. dropped 2.4 percent in the week ended August 27,
following a 1.6 percent gain in the previous week.
According
to the report, refinance applications fell 3.8 percent, while applications to
purchase a home rose 0.6 percent.
Meanwhile, the average fixed 30-year mortgage rate remained unchanged at 3.03.
“Despite
low rates, refinance applications declined, with some borrowers still waiting
for rates to drop even lower,” noted Joel Kan, MBA Associate Vice President of
Economic and Industry Forecasting. “Recent uncertainty around the economy and
pandemic have kept rates low over the past month, which is why the refinance
index has oscillated around these levels.”
FXStreet reports that economists at Credit Suisse are still holding onto their medium-term 1.1600 EUR/USD target given that unless euro area economic data post consistent upside surprises in coming months, it is hard to get excited about the idea of a strong upward trend in EUR/USD.
“Unless euro area economic data post consistent upside surprises in coming months, especially on the inflation front, it is hard to get excited about the idea of persistently rising euro area rates and associated rate differential tightening between the US and euro area, and by extension a strong upward trend in EUR/USD.”
“It is difficult to imagine a central bank that is relying on a weaker exchange rate to offset any upward pressure on rates that comes from tightening spillovers from the US being readily accepting of much narrower US – euro area rate differentials and a EUR/USD rate that’s moving persistently higher.”
“We are still holding onto our medium-term 1.1600 EUR/USD target, and we would be minded to sell on a rally above 1.2000 spurred by the idea that a reduction in PEPP purchases implies systematic and long-lasting tightening.”
FXStreet reports that FX Strategists at UOB Group suggest that further losses appear on the cards on a break below 6.4500 for USD/CNH.
24-hour view: “Our view for USD to ‘trade between 6.4600 and 6.4730’ was incorrect as it plummeted briefly to 6.4472 before rebounding sharply. While downward momentum has eased somewhat after the rebound, there is room for USD to retest the 6.4470 level before a more sustained recovery can be expected. On the upside, a break of 6.4710 (minor resistance is at 6.4640) would indicate that the downside risk has dissipated.”
Next 1-3 weeks: “USD cracked 6.4500 yesterday (31 Aug) as it plummeted briefly to 6.4472 before rebounding to close at 6.4540 (-0.18%). While the downside risk has increased further, we prefer to wait for a daily closing below 6.4500 before adopting a negative stance in USD. The chance for USD to close below 6.4500 appears to be quite high as long as it does not move above 6.4820 within these few days.”
Time | Country | Event | Period | Previous value | Forecast | Actual |
---|---|---|---|---|---|---|
06:00 | Germany | Retail sales, real unadjusted, y/y | July | 6.5% | 3.7% | -0.3% |
06:00 | Germany | Retail sales, real adjusted | July | 4.5% | -0.9% | -5.1% |
07:30 | Switzerland | Manufacturing PMI | August | 71.1 | 67.3 | 67.7 |
07:50 | France | Manufacturing PMI | August | 58 | 57.3 | 57.5 |
07:55 | Germany | Manufacturing PMI | August | 65.9 | 62.7 | 62.6 |
08:00 | Eurozone | Manufacturing PMI | August | 62.8 | 61.5 | 61.4 |
08:30 | United Kingdom | Purchasing Manager Index Manufacturing | August | 60.4 | 60.1 | 60.3 |
09:00 | Eurozone | Unemployment Rate | July | 7.8% | 7.6% | 7.6% |
EUR traded mixed against other major currencies in the European session on Wednesday, as investors assessed the latest reports on Eurozone’s manufacturing PMI and unemployment rate for July.
The single European currency rose against JPY, and CHF, declined against CAD, AUD and NZD, and changed little against USD and GBP.
The latest report by IHS Markit revealed that the growth in Eurozone’s manufacturing activity decelerated slightly more than initially estimated in August. IHS Markit’s seasonally adjusted final Eurozone Manufacturing PMI came in at 61.4 in August, being fractionally lower than the earlier “flash” reading of 61.5 and down from 62.8 in July. This was the lowest reading since February and marked the second consecutive month, in which growth has slowed since June’s survey-record expansion. Economists had forecast the index to stay unrevised at 61.5.
Eurostat announced the unemployment rate in the euro area dropped to 7.6 percent in July from an upwardly revised 7.8 percent in June. That was the lowest rate since May 2020 and in line with economists’ forecast.
In addition, investors had to contend with disappointing July retail sales data out of Germany, the region’s largest economy. Destatis reported that Germany's retail sales plunged by 5.1 percent m/m in July, following an upwardly revised 4.5 percent m/m surge in June . This represented the first monthly drop in retail sales in the last three months and was much worse than economists' forecast for a 0.9 percent m/m drop.
Market participants also digested the remarks of the ECB’s vice president Luis de Guindos, who reiterated his view that the surge in the Eurozone’s inflation is largely transient. Eurozone’s CPI climbed 3% in August, well above the ECB's 2% target, and de Guindos forecast a further rise before a decline in 2022. He also added that the bank’s future policy decisions will depend on how the economy and inflation develop. "If inflation and the economy recover, then there will logically be a gradual normalisation of monetary policy, and of fiscal policy, too," de Guindos noted. He also said that the ECB will publish revised projections in the coming days, which will reflect the better-than-expected performance of the economy in 2021.
FXStreet reports that economists at TD Securities note that gold outperforms silver in stagflation whereas the yellow metal is set to form an uptrend on a break above $1870 by the end of this year.
“Slowing global growth momentum and portfolio effects from tapering QE should impact silver more than gold.”
“Gold should benefit from rising central bank interest while presenting optionality for an inflation overshoot, as prices need only breach $1870/oz by year-end for an uptrend to form.”
Eurostat,
the statistical office of the European Union (EU), announced on Wednesday the unemployment rate in the euro area dropped to 7.6 percent in July from an
upwardly revised 7.8 percent in June (originally 7.7 percent). That was the lowest
rate since May 2020 and in line with economists’ forecast.
At
the same time, the EU27 unemployment rate fell to 6.9 percent in July from 7.1
percent in June.
Among
the Member States, the highest unemployment rates were observed in Greece (14.6
percent), Spain (14.3 percent) and Italy (9.3 percent), while Czechia (2.8
percent), Netherlands (3.1 percent) and Malta (3.3 percent) had the lowest unemployment
rates.
The
latest report by IHS Markit revealed on Wednesday the seasonally adjusted final
IHS Markit/CIPS Purchasing Managers’ Index (PMI) came in at 60.3 in August, up
slightly from the “flash” figure of 60.1 and down marginally from July's reading
of 60.4. The latest reading pointed to the weakest expansion in the manufacturing
sector since March.
Economists
had forecast the index to stay unrevised at 60.1.
According
to the report, shortages of inputs and delivery delays disrupted production
schedules, leading to slower output growth, and also resulted in marked gains
in input prices. Manufacturing output rose the least since February, while incoming
new business continued to rise at solid rates, reflecting increased inflows
from both domestic and overseas markets. Elsewhere, employment rose for the eighth
month in a row and to one of the greatest extents in the survey history, albeit
also the slowest since April. Average supplier lead times lengthened to the
second-greatest extent in the survey history during August. On the price front,
average purchase prices rose at the fourth-fastest rate in the survey history,
while average selling prices also increased at one of the quickest rates on
record.
The
latest report by IHS Markit revealed on Wednesday the seasonally adjusted final
Eurozone Manufacturing PMI stood at 61.4 in August, being fractionally lower
than the earlier “flash” reading of 61.5, and down from 62.8 in July. This was
the lowest reading since February and marked the second successive month in
which growth has slowed since June’s survey-record expansion.
Economists
had forecast the index to stay unrevised at 61.5.
According
to the report, goods production growth weakened to a six-month low, while total
new orders increased for the fourteenth straight month and new export business
also rose at a marked rate. Elsewhere, rate of job creation eased modestly from
July’s all-time high. supplier delivery times lengthened to a significant
extent amid strong demand for production materials and inputs, though the rate
of lengthening eased slightly further from May’s record. On the price front, cost
inflation slowed for the first time since input prices started rising again in
August 2020, but remained elevated; output charge inflation eased for the first
time since January, but remained historically sharp after July’s survey high.
Of
the monitored euro area constituents, the Netherlands once again recorded the strongest
improvement in manufacturing business conditions, despite growth here decelerates
to a five-month low. Weaker expansions were also registered in Germany, Ireland,
Austria and France.
Time | Country | Event | Period | Previous value | Forecast | Actual |
---|---|---|---|---|---|---|
00:30 | Japan | Manufacturing PMI | August | 53.0 | 52.7 | |
01:30 | Australia | Gross Domestic Product (QoQ) | Quarter II | 1.9% | 0.5% | 0.7% |
01:30 | Australia | Gross Domestic Product (YoY) | Quarter II | 1.1% | 9.2% | 9.6% |
01:45 | China | Markit/Caixin Manufacturing PMI | August | 50.3 | 50.2 | 49.2 |
06:00 | Germany | Retail sales, real unadjusted, y/y | July | 6.5% | 3.7% | -0.3% |
06:00 | Germany | Retail sales, real adjusted | July | 4.5% | -0.9% | -5.1% |
USD strengthened against other major currencies in the Asian session on Wednesday, rebounding from the nearly three-week lows it hit on the Federal Reserve's “dovish” stance on tapering its monetary stimulus.
The U.S. Dollar Index (DXY), measuring the U.S. currency's value relative to a basket of foreign currencies, rose 0.14% at 92.76.
USD’s gains also reflected the markets’ reaction to the softening economic data from around the world, including the U.S. and China. The Conference Board reported on Tuesday its U.S. consumer confidence index tumbled 11.3 points to 113.8 in August, the lowest level since February. The Markit/Caixin’s survey revealed today that China's manufacturing PMI slipped into contraction territory at 49.2 in August for the first time since April 2020.
In addition, market participants remained cautious ahead of the U.S. August employment report, which will be released at the end of this week. Progress on employment is crucial for the U.S. central bank. The Fed's Chairman Jerome Powell suggested last week that he would like to assess incoming data on the labor market before committing to a taper timeline. That means the August NFP report could be more consequential than usual.
The
Federal Statistical Office (Destatis) reported on Wednesday that Germany's
retail sales plunged by 5.1 percent m-o-m in July, following a revised 4.5 percent
m-o-m surge in June (originally a 4.2 percent m-o-m jump). This represented the
first monthly drop in retail sales in last three months and was much worse than
economists’ forecast for 0.9 percent m-o-m drop.
According
to the report, retail sales of food, beverages and tobacco decreased 2.4
percent m-o-m, while sales at supermarkets, hypermarkets and hypermarkets fell
1.3 percent m-o-m and sales in the non-food retail sector shrank 7.1 percent
m-o-m.
In
y-o-y terms, retail sales fell 0.3 percent in July, following a revised 6.5
percent climb in the previous month (originally a 6.2 percent increase).
The
Australian Bureau of Statistics (ABS) reported on Wednesday that Australia’s
real gross domestic product (GDP) rose by 0.7 percent q-o-q (in seasonally
adjusted terms) in the second quarter of 2021, exceeding economists’ forecast
for a 0.5 percent q-o-q advance. That represented the weakest pace of growth in
four quarters. In the first quarter, the GDP recorded a 1.9 percent q-o-q
expansion (revised from the originally reported increase of 1.8 percent q-o-q).
According
to the ABS, the domestic economy drove growth in the last quarter, contributing
1.6 percentage points to the rise in GDP. Both private and public demand
increased, led by household spending (+1.1 percent q-o-q) and public investment
(+7.4 percent q-o-q). Meanwhile, net external demand contributed negatively to
the GDP, due to declines in exports of mining
commodities reflecting disruptions to both coal production and transportation
of iron ore to ports. Net exports Net trade detracted 1.0 percentage point from
GDP growth in the second quarter.
In
y-o-y terms, the GDP grew 9.6 percent after an unrevised 1.1 percent y-o-y gain
in the prior quarter. Economists had forecast a 9.2 percent y-o-y rise for
the last quarter. That was the strongest annual expansion rate on record.
Markit/Caixin’s
survey revealed Wednesday that activity in China’s manufacturing sector contracted
slightly in August.
According
to the report, the Caixin/Markit manufacturing purchasing managers' index (PMI)
came in at 49.2 in August, down from 50.3 in July, signaling a slight
deterioration in business conditions in the manufacturing sector. This marked
the first contraction in factory activity since April 2020.
The
50 mark divides contraction and expansion.
Economists’
had predicted the reading to slip to 50.2.
The deterioration
was driven by a renewed decline in output and a further decrease in new work
amid the resurgence of the coronavirus in China and abroad and the imposition of subsequent
restrictions to contain its spreading. Manufacturers’ output shrank for the
first time since February 2020, while total new work fell for the second month
in a row and the rate of the decline was the steepest seen since April 2020. In
addition, employment recorded a fractional drop in August, after payrolls were
broadly unchanged in July, while the backlogs of work increased at the fastest
rate since May. On the price front, the rate of cost inflation rose for the first
time in three months and was sharp overall. At the same time, factory gate prices
increased only modestly, despite the rate of increase picking up since July.
Commenting
on the China General Manufacturing PMI data, Dr. Wang Zhe, Senior Economist at
Caixin Insight Group noted: The reappearance of Covid-19 clusters in several
regions beginning in late July has dealt a blow to manufacturing activity. Both
supply and demand in the manufacturing sector shrank as the Covid-19 outbreaks
disrupted production."
Raw materials | Closed | Change, % |
---|---|---|
Brent | 71.93 | -0.75 |
Silver | 23.871 | -0.53 |
Gold | 1814.007 | 0.23 |
Palladium | 2462.21 | -0.87 |
Time | Country | Event | Period | Previous value | Forecast |
---|---|---|---|---|---|
00:30 (GMT) | Japan | Manufacturing PMI | August | 53.0 | |
01:30 (GMT) | Australia | Gross Domestic Product (QoQ) | Quarter II | 1.8% | 0.5% |
01:30 (GMT) | Australia | Gross Domestic Product (YoY) | Quarter II | 1.1% | 9.2% |
01:45 (GMT) | China | Markit/Caixin Manufacturing PMI | August | 50.3 | 50.2 |
06:00 (GMT) | Germany | Retail sales, real unadjusted, y/y | July | 6.2% | 3.7% |
06:00 (GMT) | Germany | Retail sales, real adjusted | July | 4.2% | -0.9% |
07:30 (GMT) | Switzerland | Manufacturing PMI | August | 71.1 | 67.3 |
07:50 (GMT) | France | Manufacturing PMI | August | 58 | 57.3 |
07:55 (GMT) | Germany | Manufacturing PMI | August | 65.9 | 62.7 |
08:00 (GMT) | Eurozone | Manufacturing PMI | August | 62.8 | 61.5 |
08:30 (GMT) | United Kingdom | Purchasing Manager Index Manufacturing | August | 60.4 | 60.1 |
09:00 (GMT) | Eurozone | Unemployment Rate | July | 7.7% | 7.6% |
12:15 (GMT) | U.S. | ADP Employment Report | August | 330 | 575 |
13:45 (GMT) | U.S. | Manufacturing PMI | August | 63.4 | 61.2 |
14:00 (GMT) | U.S. | Construction Spending, m/m | July | 0.1% | 0.2% |
14:00 (GMT) | U.S. | ISM Manufacturing | August | 59.5 | 58.7 |
14:30 (GMT) | U.S. | Crude Oil Inventories | August | -2.979 | -2.833 |
Pare | Closed | Change, % |
---|---|---|
AUDUSD | 0.73117 | 0.25 |
EURJPY | 129.864 | 0.21 |
EURUSD | 1.18079 | 0.1 |
GBPJPY | 151.283 | 0.1 |
GBPUSD | 1.3755 | 0.01 |
NZDUSD | 0.70423 | 0.72 |
USDCAD | 1.26092 | 0.05 |
USDCHF | 0.91482 | -0.16 |
USDJPY | 109.979 | 0.08 |
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