Many Data Releases… Stock Prices Up
January 9, 2020
A mixed dollar overnight leaves the U.S. currency unchanged against the euro, up 0.5% versus the kiwi, 0.4% relative to sterling, 0.3% vis-a-vis the yen, 0.2% against the loonie and 0.1% versus the Aussie dollar but down 0.2% against the yuan and peso and 0.1% softer versus the Swiss franc.
Share prices advanced 2.3% in Japan, 1.6% in South Korea and India, 1.7% in Hong Kong and 1.3% in Taiwan. Equity markets in Europe so far have risen today by 1.2% in Germany, 0.8% in Italy and 0.4% in Great Britain.
WTI crude oil recovered 0.3% but is still trading below $60/barrel. Gold settled back another 0.4%.
Ten-year British gilt and U.S. Treasury yields are down 3 and 1 basis points, while their Japanese and German counterparts are up a basis point.
Fed Vice Chairman Clarida made optimistic comment about the U.S. economy at the turn of the year, called last year’s rate cuts well-timed to keep the expansion humming, indicated continuing flexibility in the Fed’s approach to policy, but said the current stance likely will remain appropriate.
Bank of England Governor Carney made a number of dovish comments and said a rate cut could be in play if British economic activity stays weak.
The National Bank of Serbia‘s policy rate was left unchanged as expected at 2.25%. There were three 25-basis point cuts last year (July, August and November) and reductions totaling 50 basis points each in 2016, 2017, and 2018. “The Executive Board expects that y-o-y inflation will move around the lower bound of the target tolerance band until mid-2020 and that it will gradually approach the target midpoint thereafter under the impact of rising aggregate demand. Low inflationary pressures are also indicated by the inflation expectations.”
A 1.1% monthly rise in German industrial production in November was the largest increase in a year and a half but merely reverses October’s decline. Output was 2.6% lower than a year earlier, the smallest 12-month drop in 8 months.
The EUR 18.2 billion seasonally adjusted German trade surplus in November was a 5-month low. The October-November average pace was closely aligned with the third-quarter average. Germany’s January-November current account surplus of EUR 237.7 billion was EUR 14 billion or 6-1/4% wider than a year earlier. Merchandise trade exports and imports recorded both month-on-month and year-on-year declines in November.
Chinese CPI inflation ended 2019 at November’s 94-month high of 4.5%, but producer prices in December were 0.5% lower than at end-2018.
The downtrend in Euroland’s unemployment seems to have flattened. The jobless rate was steady at 7.5% in November (15.6% for young workers). That’s still 0.4 percentage points lower than in November 2018. Italian unemployment stayed at 9.7%, just marginally above August’s 7-1/2 year low.
The Australian trade surplus of A$ 5.8 billion in November lay between October’s 10-month low of A$ 4.075 billion and September’s surplus of A$ 6.118 billion. The year-to-November surplus of A$ 63.26 billion was 3.3 times wider than a year earlier.
British same-store sales grew 1.7% on year in November, the most in eight months but following a sharp 4.9% plunge in October.
Industrial production in Brazil fell 1.2% on month in November (most since March) and was 1.7% weaker than a year earlier. Irish industrial production also recorded monthly and on-year declines in November, which were slides of 4.0% and 2.6%). Ditto for South Africa, where industrial production fell in November by 1.5% compared to October and by 3.6% compared to November 2018. And double ditto for Greece where industrial production fell 3.6% versus October and by 8.1% compared to a year earlier. That was the greatest on-year plunge since December 2011.
Mexican consumer price inflation slowed somewhat further to a 39-month low of 2.83% in December, having been as high as 4.4% last April.
Dutch CPI inflation ended 2019 at 2.7%, having fluctuated between 2.5% and 2.8% since June.
November trade surpluses were reported in Portugal of EUR 1.735 billion, the Czech Republic of CZK 49 billion, and Austria of EUR 301 million. Merchandise trade deficits occurred that month in Cyprus of EUR 412 million, Romania of EUR 1.491 billion, and Greece of EUR 1.608 billion.
Denmark experienced a slightly smaller current account surplus in November than October, but such exceeded the November 2018 surplus by 23.5%.
Canadian housing starts at a 201.3k pace in November virtually matched October’s pace but was well down from 244.4k last June. Canadian building permits fell 2.4% on month and 2.7% on year.
Mystery surrounds the crash of the Ukrainian plane yesterday near Tehran. Iranian officials suggest there must have been some kind of mechanical problem, while Ukraine is exploring the possibility that the flight was struck by a surface-to-air missile.
U.S. jobless insurance claims fell 9k last week to 214k and averaged 224k over the past four weeks, same as in the previous four-week period through December 7.
Copyright 2019, Larry Greenberg. All rights reserved. No secondary distribution without express permission.
Tags: Chinese CPI and PPI, German industrial production and current account, National Bank of Serbia