Tin tức thì trường

• My message today is twofold - of increased confidence and of continued attention
• With cases falling, rapid progress on vaccinations and easing containment measures, Governing Council is increasingly confident that growth will rebound strongly as economy once again reopens, and this time growth will be more durable
• There is continued need for careful attention to the dynamics of the recovery and inflation
• Globally, economic outlook remains highly dependent on course of the virus and new variants are a concern. In Canada, we still have some way to go to a complete recovery
• Process of reopening the economy won’t be entirely smooth
• As we reopen the economy, we expect to see some volatility, and we will continue to pay close attention to the progress of recovery and to evolution of inflation
• CAD is close to where it was in April relative to USD, but it is slightly stronger against a broader basket of currencies
• Consumption is expected to continue to lead the recovery
• Employment should continue to rebound over next few months as reopening process continues; we still have more than 500,000 jobs to recoup
• Supply bottlenecks are creating sharper movement in prices that is pushing inflation temporarily higher, and these supply issues now look more important than previously thought
• Inflation is now projected to be somewhat above the target band through 2021
• Temporary effects are forecast to dissipate near the end of this year and inflation is forecast to ease back toward 2 percent in 2022
• We expect the factors pushing up inflation to be temporary, but their persistence and magnitude are uncertain, and we will be watching them closely
• We decided to adjust QE program to a target of $2 billion weekly purchases of Government of Canada bonds, down from a target of $3 billion a week; this adjustment reflects continued progress towards recovery and the Bank’s increased confidence in the strength of the Canadian economic outlook
• Decisions regarding further adjustments to the pace of net bond purchases will be guided by Governing Council’s ongoing assessment of the strength and durability of the recovery
• If economy evolves broadly in line with our outlook, then over time it won’t need as much QE
• Further adjustments to our QE program will continue to be gradual, and we will be deliberate both in our assessment of incoming data and in communication of our analysis
• We will continue to provide the appropriate degree of monetary policy stimulus to support the recovery and achieve the inflation objective

eFXdata reports that analysts at MUFG Research discuss NZD outlook following the RBNZ's latest shift in the policy stance.

"At today’s monetary policy meeting the RBNZ announced that it would end QE by 23rd July while removing the previous reference to needing “considerable time and patience” in order to achieve its monetary policy objectives. The RBNZ clearly stated that the policy of “least regrets” that had warranted leaving the monetary stance loose for longer could in fact be removed sooner than previously indicated." 

"Market participants who may be reluctant to sell the US dollar may well see benefits in selling AUD/NZD given the current RBA guidance is for no rate hike until 2024."

The Bank of Canada (BoC) maintained its benchmark interest rates unchanged at 0.25 percent on Wednesday, as widely expected. At the same time, the Bank adjusted its quantitative easing (QE) program to a target pace of CAD2 billion per week, down from CAD3 billion per week earlier.

In its policy statement, the Canadian central bank noted:

• QE program’s adjustment reflects continued progress towards recovery and its increased confidence in the strength of the Canadian economic outlook;
• Falling COVID-19 cases, progress on vaccinations and easing containment restrictions all point to strong pickup in H2;
• Bank now expects GDP growth of around 6 percent in 2021 - a little slower than was expected in April - but has revised up its 2022 forecast to 4.5 percent and projects 3.25 percent growth in 2023
• Consumption is expected to lead recovery as households return to more normal spending patterns;
• Employment has once again begun to rebound, and the BoC expects the hardest-hit segments of the labour market to post strong gains as economy re-opens;
• With higher gasoline prices and on-going supply bottlenecks, inflation is likely to remain above 3 percent through H2 and ease back toward 2 percent in 2022, as short-run imbalances diminish and considerable overall slack in economy pulls inflation lower;
• Factors pushing up inflation are transitory, but their persistence and magnitude are uncertain and will be monitored closely;
• Governing Council judges that recovery continues to require extraordinary monetary policy support;
• BoC remains committed to holding policy interest rate at effective lower bound until economic slack is absorbed so that 2 percent inflation target is sustainably achieved. In the Bank’s July projection, this happens sometime in H2 of 2022;
• Decisions regarding further adjustments to the pace of net bond purchases will be guided by Governing Council's ongoing assessment of strength and durability of the recovery;
• BoC will continue to provide appropriate degree of monetary policy stimulus to support recovery and achieve inflation objective

FXStreet reports that economist at UOB Group Ho Woei Chen, CFA, assesses the recent export/import data in the Chinese economy.

“China’s export and import growth were both above expectation in June, lifting sentiment ahead of the release of 1Q21 GDP on Thursday as external demand has remained a key driver for China’s economy. This will help to offset a slower recovery in domestic demand.”

“In USD-terms, export growth strengthened to 32.2% y/y (Bloomberg est: 23.0%; May: 27.9%) while import growth moderated to 36.7% y/y as the favourable base effect eased (Bloomberg est: 29.5%; May: 51.1%). Trade surplus was at its highest in five months at US$51.53 billion in June, up from US$45.54 billion in May.”

“The recovery in global demand saw China’s trade surplus up sharply to US$251.52 billion in 1H21 from US$164.33 billion in year-ago period. Of this, around two-thirds or US$164.92 billion was trade surplus with the US, up from US$120.90 billion in the year-ago period.”

U.S. stock-index futures rose on Wednesday, as investors assessed dovish comments from Federal Reserve Chairman Jerome Powell that were released ahead of his Congressional testimony and a fresh batch of Q2 earnings reports from the U.S. biggest banks.

Global Stocks:

(company / ticker / price / change ($/%) / volume)

• Household spending is rising at especially rapid pace
• Housing demand remains very strong
• Overall business investment is increasing at solid pace
• Conditions in U.S. labor market have continued to improve, but there is still a long way to go
• Inflation has increased notably and will likely remain elevated in coming months before moderating
• To avoid sustained periods of unusually low or high inflation, the FOMC monetary policy framework seeks longer-term inflation expectations that are well anchored at 2 percent, its longer-run inflation objective
• Measures of longer-term inflation expectations have moved up from their pandemic lows and are in range that is broadly consistent with FOMC's longer-run inflation goal
• In assessing the appropriate stance of monetary policy, we will continue to monitor implications of incoming information for economic outlook and would be prepared to adjust stance of monetary policy as appropriate if we saw signs that path of inflation or longer-term inflation expectations were moving materially and persistently beyond levels consistent with our goal
• We are continuing to increase our holdings of Treasury securities and agency mortgage‑backed securities at least at their current pace until substantial further progress has been made toward our maximum-employment and price-stability goals
• While reaching the standard of "substantial further progress" is still a ways off, FOMC expects that progress will continue
• We will provide advance notice before announcing any decision to make changes to our purchases
• We at the Federal Reserve will do everything we can to support the recovery and foster progress toward our statutory goals of maximum employment and stable prices

Caterpillar (CAT) downgraded to Mixed from Positive at OTR Global

The Labor Department reported on Wednesday the U.S. producer-price index (PPI) climbed 1.0 percent m-o-m in June, following an unrevised 0.8 percent m-o-m gain in May. 

For the 12 months through June, the PPI surged 7.3 percent after an unrevised 6.6 percent jump in the previous month. That was the largest increase since 12-month data were first calculated in November 2010. since the 12 months ended November 2010.

Economists had forecast the headline PPI would increase 0.6 percent m-o-m last month and 6.8 percent over the past 12 months.

According to the report, nearly 60 percent of the June rise in the index for final demand can be traced to a 0.8-percent m-o-m gain in prices for final demand services. In addition, the index for final demand goods went up 1.2 percent m-o-m.

Excluding volatile prices for food and energy, the PPI went up 1.0 percent m-o-m and climbed 5.6 percent over 12 months (the largest advance since 12-month data were first calculated in August 2014). Economists had forecast advances of 0.5 percent m-o-m and 5.1 percent y-o-y.

Citigroup (C) reported Q2 FY 2021 earnings of $2.85 per share (versus $0.50 per share in Q2 FY 2020), beating analysts’ consensus estimate of $1.88 per share.

The company’s quarterly revenues amounted to $17.500 bln (-11.5% y/y), beating analysts’ consensus estimate of $17.182 bln.

С rose to $68.60 (+0.34%) in pre-market trading.

Wells Fargo (WFC) reported Q2 FY 2021 earnings of $1.38 per share (versus -$0.66 per share in Q2 FY 2020), beating analysts’ consensus estimate of $0.91 per share.

The company’s quarterly revenues amounted to $20.270 bln (+10.8% y/y), beating analysts’ consensus estimate of $17.692 bln.

WFC rose to $43.60 (+0.86%) in pre-market trading.

FXStreet reports that economists at ING note that the Reserve Bank of New Zealand (RBNZ) surprised markets as it announced its QE programme will end on 23 July, acknowledging the brighter economic outlook no longer requires extensive monetary stimulus. Such a hawkish tone suggests an imminent hike, either in August or October, and NZD could therefore benefit from an attractive carry earlier than expected.

“After having significantly scaled back weekly asset purchases under the LSAP (Large Scale Asset Purchase), the RBNZ announced that the programme will end on 23 July. The move comes amid a significant improvement in New Zealand's economic outlook, with activity back above pre-pandemic levels, and household spending and investments also proving robust.”

“This meeting has paved the way for a rate hike in 2021. There are three RBNZ meetings left this year - 18 August, 06 October, 24 November - and market pricing suggests that an August hike (we're talking about 25bp hikes here) is around 65% priced in, an October hike is 86% priced in and a November hike is fully in the price. We think the probability of a rate hike already in August is approximately 50%, and will depend on incoming data.”

“We do not expect the current choppy environment for the kiwi to linger, especially considering the prospect of an earlier hiking cycle by the RBNZ. An August hike would surely prove very supportive for the NZD as this would convey the implicit message that the RBNZ is getting concerned about an overheating economy and thus prompt markets to retain aggressive hawkish bets for the coming quarters.” 

“Even if the rate hike is delayed to later in 2021, the RBNZ is clearly standing at the very hawkish end of the spectrum in the G10. In line with our view that a consolidation of the global reflationary story will allow local stories to push some activity currencies higher and revamp interest for carry trades, NZD looks set to benefit from its enviable rate profile.”

“We have pencilled in 0.75 as a year-end NZD/USD target. An earlier than expected hike by the RBNZ makes us more confident that the pair will be able to reach such a level.”

Bank of America (BAC) reported Q2 FY 2021 earnings of $1.03 per share (versus $0.37 per share in Q2 FY 2020), beating analysts’ consensus estimate of $0.76 per share.

The company’s quarterly revenues amounted to $21.500 bln (-3.6% y/y), missing analysts’ consensus estimate of $21.766 bln.

BAC fell to $39.09 (-1.93%) in pre-market trading.

GBP rose against most of its major rivals in the European session on Wednesday as investors weighed the hotter-than-expected UK’s June inflation data, which exceeded the Bank of England's (BoE) 2%-inflation target for the second straight month.

The Office for National Statistics (ONS) reported Britain’s annual inflation rate jumped to 2.5% in June from 2.1% in May. The latest reading was above economists’ forecast of 2.2% and was the highest since August 2018. Prices for food, second-hand cars, clothing and footwear, eating and drinking out, and motor fuel rose last month as the economy bounced back from a slump, caused by COVID-19 lockdown restrictions. On a m/m basis, the British consumer prices rose 0.5%, decelerating slightly from +0.6% in May. Economists had expected a gain of 0.2% m/m.

The June CPI data revived questions about whether the BoE’s will keep its massive stimulus in place. The British central bank's policymakers projected in June that the inflation would exceed 3%, as the economy reopens, but the pickup further above its 2%-target would only be "for a temporary period". There are concerns that persistently high inflation could force the BoE to scale back its GBP875 billion government bond-buying program earlier than expected. The Bank’s outgoing chief economist Andy Haldane voted at the last two meetings to stop the program early.

The Mortgage Bankers Association (MBA) reported on Wednesday the mortgage application volume in the U.S. surged 16.0 percent in the week ended July 9, following a 1.8 percent drop in the previous week. This marked the largest gain in total mortgage application volume since early January.

According to the report, refinance applications climbed 20.4 percent, while applications to purchase a home jumped 8.3 percent.

Meanwhile, the average fixed 30-year mortgage rate decreased from 3.15 percent to 3.09 percent, the lowest level since February 2021.

“Treasury yields have trended lower over the past month as investors remained concerned about the Covid-19 variant and slowing economic growth,” noted Joel Kan, MBA’s associate vice president of economic and industry forecasting. “Mortgage rates fell for the second consecutive week as a result, with the 30-year fixed rate hitting 3.09%, its lowest level since February 2021.” He also added that there may have been a delayed spillover of applications from the previous week, when rates also decreased but there was not much of response in terms of refinance applications.

FXStreet reports that gold (XAU/USD) remains above key in-range support at $1765/55. Strategists at Credit Suisse look for a fresh swing higher in the range.

“Gold is edging its way higher after holding key inrange price support at $1765/55, and we look for strength back to the 200-day average at $1827. A close above here is needed to open the door to a move back to more important resistance at $1917/66.”

FXStreet reports that economists at Société Générale note that USD/CAD is hovering around 1.25 and needs to surpass the 1.2650/1.2735 neighborhood to extend its rise.

“USD/CAD is heading gradually towards 1.2650/1.2735 representing the 200-DMA. This hurdle must be overpowered for the next leg of uptrend. A pause could develop after reaching these levels; 1.2360 and lower limit of an ascending channel at 1.2250 are short-term support levels.” 

“A break beyond 1.2650/1.2735 will affirm a larger up move towards 1.2840 and graphical hurdle of 1.2950/1.3030.”

• It is more difficult to assess inflation outlook in this unprecedented situation
• We need to understand context for high inflation as economy reopens
• Key question about inflation is whether demand surge and supply chain problems are persistent
• We will try to get better read of supply, demand for August forecasts
• We will reassess inflation rate in August
• We need to see if higher inflation is something persistent which we would need to act against
• It's more difficult to stimulate economy with rates near lower bound

Reuters reports that Finance Minister Christos Staikouras said that Greece expects to receive four billion euros ($4.7 billion) later this month in the first tranche of funds secured from the European Union's Recovery Fund. He said another 3.5 billion euros would come from the fund by the end of the year.

The country is to get about 31 billion euros in subsidies and loans from Europe's 750-billion-euro post-pandemic fund by 2026, mainly to make its economy greener and more digitalised.

Greece has spent about 40 billion euros to support companies and workers hit by lockdown restrictions during the COVID-19 pandemic.

The country has already raised nearly 12 billion euros from debt markets, and Staikouras said the government's cash reserves were unchanged from at the start of the pandemic crisis, at about 34 billion euros.

The Greek government expects the economy will grow by 3.6% this year, helped by tourism, after an 8.2% slump in 2020.

FXStreet reports that according to economists at Credit Suisse, USD/CHF is still likely to see a deeper move higher over the next couple of months.

“We stay biased towards a direct move to the confirmed downtrend at 0.9417/73, which remains a key medium-term inflection point.” 

“Longer term, the market is repeatedly breaking below flat averages and weekly MACD is oscillating around zero, signaling that the market is clearly in a broad range bound phase for now. If the broader USD bases out though, we would expect a trending phase and break above 0.9417/73 and would resultantly raise our core objective up to 0.9672.”

According to the report from Eurostat, in May 2021, the seasonally adjusted industrial production fell by 1.0% in the euro area and by 0.9% in the EU, compared with April 2021. Economists had expected a 0.2% decrease in the euro area. In April 2021, industrial production rose by 0.6% in the euro area and by 0.5% in the EU.

In May 2021 compared with May 2020, industrial production increased by 20.5% in the euro area and by 21.2% in the EU. Economists had expected a 22.2% increase in the euro area.

In the euro area in May 2021, compared with April 2021, production of non-durable consumer goods fell by 2.3%, energy by 1.9%, capital goods by 1.6% and intermediate goods by 0.2%, while production of durable consumer goods rose by 1.6%.

In the EU, production of energy fell by 2.0%, non-durable consumer goods by 1.7%, capital goods by 1.6% and intermediate goods by 0.1%, while production of durable consumer goods rose by 1.5%.

In the euro area in May 2021, compared with May 2020, production of durable consumer rose by 37.6%, capital goods by 27.6%, intermediate goods by 24.1%, non-durable consumer goods by 9.7% and energy by 7.1%. In the EU, production of durable consumer rose by 39.1%, capital goods by 29.6%, intermediate goods by 24.2%, non durable consumer goods by 10.1% and energy by 7.1%.

Reuters reports that industry association HDE said that German retailers are expected to increase their revenues by 1.5% year-on-year in 2021, assuming no further coronavirus lockdowns hitting consumers' appetite and shutting shops.

Online sales, boosted by COVID-19 restrictions last year, are expected to rise by around 20% this year to just over 87 billion euros ($103 billion), HDE said, up from the forecast of 17%.

HDE said three quarters of retail companies in Germany reported lower revenue in the first half of the year as a measures to curb coronavirus infections non-essential closed shops in the first four months of 2021.

Bloomberg reports that treasury Secretary Janet Yellen and Federal Reserve Chair Jerome Powell are slated to discuss the hot U.S. housing market and the risks it could pose to the financial system at a meeting with fellow regulators on Friday.

The aim of the closed-door session: To make sure the U.S. is not vulnerable to a crisis akin to the one it suffered more than a dozen years ago.

The meeting of the Financial Stability Oversight Council, or FSOC, that’s headed by Yellen will come on the heels of two days of testimony by Powell to Congress on the Fed’s semi-annual monetary policy report.

Friday’s session will be the first time that Yellen’s FSOC will discuss concerns about the housing market in a substantial way, according to people familiar with the matter. 

The Treasury is increasingly aware of the dangers that a sudden relapse in property prices could pose to the economy after a sharp run-up on the back of a low inventory of homes for sale, according to the people familiar with the matter.

But Yellen’s team is confident that any financial stability risks are manageable, the people said.

CNBC reports that a JPMorgan strategist said that the best time to buy Asia stocks could be now.

Mixo Das, Asia equity strategist at the bank, said U.S. markets have been hitting record levels while Europe and Japan are approaching their all-time highs. However, Asian markets have not seen the same trend.

“Ever since the highs in February we’re down quite a bit in Asian equities and the way we look at it is, our framework is telling us that now is probably the best time to be taking risks in Asia,” he said,

Das said investor positioning in Asia is currently “extremely, extremely light” while valuations have come down to more normal levels. If macroeconomic momentum in the region starts to stabilize, Asia stocks could move a lot higher, he added.

The strategist said second-quarter corporate earnings in Asia could grow 60% to 70% from a year ago — broadly in line with estimates. 

FXStreet reports that according to Lisa Shalett, Chief Investment Officer, Wealth Management at Morgan Stanley, treasury yields have fallen recently, but investors concerned about slowing economic growth may be overlooking other key factors at play in government bond markets.

“Treasuries have become disconnected from fundamental market conditions due to extreme technical factors that are keeping rates low. These include: Central-bank bond-buying. Slower issuance. Non-US bond-buying. Pension-fund rebalancing.”

“Investors should watch for 10-year nominal Treasury rates to rebound toward 1.75% in this third quarter. Rather than chase tech stocks higher, we urge investors to focus on stock-picking, emphasizing earning fundamentals and free cash flow. The financial sector, in particular, stands out as a quality and value-oriented hedge against rising rates.” 

During today's Asian trading, the US dollar fell against the euro, yen and pound. The leaders of the Federal Reserve System have repeatedly repeated that they consider the jump in inflation to be temporary. However, investors fear that the strengthening of consumer price growth may exceed the expectations of the Fed, which will force it to tighten monetary policy earlier than expected.

The focus of investors ' attention on Wednesday is the speech of Fed Chairman Jerome Powell at the Financial Services Committee of the House of Representatives of the US Congress, where he will present a semi-annual report on the state of the US economy. Traders are waiting for new signals from Powell about whether the Fed still considers the acceleration of inflation to be a temporary phenomenon.

The report, which was released last Friday, showed that the leadership of the US Fed is concerned about changing conditions in the US labor market. The Fed noted the risk that the pandemic will have "long-term consequences for the structure of the labor market," including due to the fact that it accelerated the introduction of new technologies.

The opinion of the Fed management about what will be "full employment" will be key for the central bank to make a decision on when to start raising rates, since inflation may already be close to the target level.

The ICE index, which tracks the dynamics of the dollar against six currencies (euro, swiss franc, yen, canadian dollar, pound sterling and swedish krona), fell by 0.13%.

FXStreet reports that FX Strategists at UOB Group said that USD/JPY is expected to trade between 110.00 and 111.15 in the next weeks.

Next 1-3 weeks: “We have expected USD to weaken since the middle of last week. After USD rebounded strongly from 109.52, we highlighted yesterday that ‘downward momentum is beginning to wane and a break of 110.55 would indicate that USD is not ready to move below 109.50 just yet’. USD rose to an overnight high of 110.64 and downward momentum has dissipated. From here, USD is likely to trade between 110.00 and 111.15 for a period of time.”

RTTNews reports that New Zealand central bank reduced its current monetary stimulus as the major downside risks of deflation and high unemployment receded amid improving economic activity.

The Monetary Policy Committee decided to halt additional asset purchases under the Large Scale Asset Purchase programme by July 23. The committee decided to hold the official interest rate at 0.25 percent and the Funding for Lending Programme unchanged.

The Committee agreed that a 'least regrets' policy now implied that the significant level of monetary support in place since mid-2020 could be reduced sooner, so as to minimize the risk of not meeting its mandate.

Policymakers observed that the economy remains robust despite the ongoing impact from international border restrictions. Aggregate economic activity is above its pre-COVID-19 level.

The MPC noted that medium-term inflation and employment would likely remain below its remit objectives in the absence of some ongoing monetary support. However, the committee agreed that the level of monetary stimulus could now be reduced to minimize the risk of not meeting its mandate.

EUR/USD

Resistance levels (open interest**, contracts)

$1.1926 (1357)

$1.1891 (1326)

$1.1863 (151)

Price at time of writing this review: $1.1792

Support levels (open interest**, contracts):

$1.1733 (1980)

$1.1705 (5517)

$1.1672 (10537)

Comments:

- Overall open interest on the CALL options and PUT options with the expiration date August, 6 is 59416 contracts (according to data from July, 13) with the maximum number of contracts with strike price $1,1700 (10537);

GBP/USD

$1.3953 (1037)

$1.3924 (702)

$1.3900 (313)

Price at time of writing this review: $1.3843

Support levels (open interest**, contracts):

$1.3786 (1537)

$1.3748 (252)

$1.3722 (667)

Comments:

- Overall open interest on the CALL options with the expiration date August, 6 is 9884 contracts, with the maximum number of contracts with strike price $1,4000 (1273);

- Overall open interest on the PUT options with the expiration date August, 6 is 14316 contracts, with the maximum number of contracts with strike price $1,3950 (1537);

- The ratio of PUT/CALL was 1.45 versus 1.45 from the previous trading day according to data from July, 13

* - The Chicago Mercantile Exchange bulletin (CME) is used for the calculation.

** - Open interest takes into account the total number of option contracts that are open at the moment.

According to the report from the Office for National Statistics, the Consumer Prices Index (CPI) rose by 2.5% in the 12 months to June 2021, up from 2.1% in May. Economists had expected a 2.2% increase. On a monthly basis, CPI rose by 0.5% in June 2021, compared with a rise of 0.1% in June 2020. Economists had expected a 0.2% increase.

The Consumer Prices Index including owner occupiers’ housing costs (CPIH) rose by 2.4% in the 12 months to June 2021, up from 2.1% in the 12 months to May.

The largest upward contribution to the CPIH 12-month inflation rate came from transport (0.80 percentage points).

On a monthly basis, CPIH rose by 0.4% in June 2021, compared with a rise of 0.1% in June 2020.

Prices for food, second-hand cars, clothing and footwear, eating and drinking out, and motor fuel rose in 2021 but mostly fell in 2020, resulting in the largest upward contributions to the change in the CPIH 12-month inflation rate between May and June 2021.

These were partially offset by a large downward contribution from games, toys and hobbies, where prices fell this year but rose a year ago.

The number of CPIH items identified as unavailable in June 2021 fell to 14, mostly relating to international travel, and accounting for 1.3% of the basket by weight; we collected a weighted total of 81.4% of the comparable coverage collected before the first lockdown in 2020 (excluding unavailable items).