Holiday Closures in the United States and Great Britain

May 30, 2011

Markets are closed today in the United States for Memorial Day and Britain for a spring bank holiday.

Currency movements have been muted without the participation of all trading centers.  The dollar at 14:15 GMT shows gains from Friday’s close of 0.2% against the euro and 0.1% versus sterling, the yen and Canadian dollar, but it has eased 0.2% against the Aussie dollar and 0.1% against the kiwi, yuan and Swiss franc.  The yuan was fixed at 6.4856, a new high for the move.

Japan’s Nikkei slid 0.2%.  Stocks also fell 0.2% in Indonesia and India and by 0.3% in South Korea and China.  The Dax is 0.3% firmer, but the Paris Cac is unchanged.

The 10-year German bund yield is below 3% at 2.98%, and the Japanese JGB is steady by low at 1.13%.

Most commodity prices are softer.  Oil fell 0.4% but remains above $100 per barrel.

The Bank of Mexico late Friday announced it was keeping its key monetary policy rate steady at 4.5%.

Bank Rossii left Russia’s refinancing rate steady at 8.25% but surprised analysts with a 25-basis point hike of the deposit rate to 3.5% to combat elevated inflation and the risk of rising inflation expectations.

The State Bank of Vietnam retained a 15.0% repo rate.  The Central Bank of Colombia also holds a policy meeting today.

Canada’s current account deficit narrowed to CAD 8.916 billion last quarter (2.1% of GDP) from CAD 10.281 billion in the final quarter of 2010 (equal to 2.5% of GDP) and CAD 17.887 billion (4.4%) in 3Q10. 

Canadian real GDP expanded 3.9% at an annualized rate last quarter, more than twice as fast as the 1.8% U.S. pace.  Such followed a 3.1% rate of increase in 4Q10.  GDP was 2.9% greater than in the first quarter of 2010.  Inventory building and non-residential investment accounted for the entire rise of GDP last quarter.  Net exports exerted a significant drag as import growth of 9.1% annualized outpaced a 6.4% advance in exports.  Personal consumption edged up merely 0.2% annualized.  Inflation accelerated according to the price deflators.  The GDP deflator was 3.0% higher than a year earlier, and the personal consumption deflator rose by 1.9% versus a gain of 1.4% in the year to 4Q10.

Monthly Canadian GDP calculated from the supply side rose 0.3% in March after a 0.1% dip in February, and such was 2.8% higher than in March 2010.  Industrial production shot up 1.1% on month, but retail turnover fell by 1.0% in the month.

New Zealand’s trade surplus widened sharply to NZD 1.1 billion in April from NZD 464 million in March and was twice its expected size.  New home sales in Australia increased by a slight 0.2% in April.

On-year Filipino GDP growth slowed last quarter to a nine-month low of 4.9%.

Greece continues to dominate market psychology in Europe amid signs that the EU, IMF, and ECB may withhold the next tranche of aid.  Opposition parties in Greece so far are refusing to permit additional austerity.

Portuguese retail sales rebounded from an extremely sharp drop in March to rise 3.0% on month in April but were still 4.3% lower than a year earlier.

Euro area retail purchasing manager indicies in May were disappointing.  The whole region scored a sub-50 48.8, down 3.4 points and the weakest reading in seven months.  The German retail PMI was 51.1, down 3.5 points.  The French index fell to 51.7 from 56.3 in April, and Italian retail activity decelerated at a sharper rate, as that country’s index fell to 41.7 from 43.1.

The British Hometrack house price index slid 0.1% on month in May and by a deeper 3.7% on year.

German Chancellor Merkel announced a decision to shut down all nuclear power plants by 2022.

Swedish retail sales recovered more strongly than forecast in April, rising 1.6% on month and 5.2% on year.  Data were distorted in part by Easter.

Belgian consumer prices firmed 0.3% in May and were 3.4% higher than a year before.  Icelandic producer price inflation eased to a still-high 6.0% in April from 6.9% in March.  Hungary’s jobless rate averaged 11.4% in February-April.

Copyright Larry Greenberg 2011.  All rights reserved.  No secondary distribution without express permission.

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