Christmas Eve All Silent

December 24, 2013

Europe is now closed for the Christmas break, and trading desks in North America will shut early.

Overnight movements in the dollar were minimal.  The greenback firmed 0.3% against the Swiss franc, 0.2% relative to the euro, and 0.1% against the yen and commodity-sensitive Canadian, Australian and New Zealand dollars.  Sterling edged 0.1% higher against the U.S. currency, while the yuan is unchanged.

Equities are modestly higher in the United States.  In Europe, increases of 0.2% in the British Ftse and 0.1% in the Paris Cac underperformed gains of 0.9%, 0.7% and 0.6% in German, Italian, and Spanish share prices.  In the Pacific Rim, stocks rose 1.1% in Hong Kong, 0.7% in Australia, 0.4% in Singapore, 0.3% in Indonesia and the Philippines and 0.1% in China but dipped by 0.3% in India and 0.1% in Taiwan.

The 10-year Treasury yield advanced another three basis points to 2.96% and is fast approaching its high in early September.  Ten-year German bund and British gilt yields edged up a basis point each, while Japanese JGBs were steady.

Gold and WTI crude oil prices went up 0.4% and 0.3% to $1,201.30 per troy ounce and $99.13 per barrel.

The People’s Bank of China injected funds through repo for the first time in three weeks, causing the 7-day rate to post its largest daily decline in 34 months.

While leaving the Japanese growth assessment unchanged, the monthly cabinet assessment failed to cite deflation for the first time in four years.  The Bank of Japan monthly assessment was also published today, repeating comments embodied in its last post-Board meeting statement – the economy will continue to recover moderately on the whole but will be affected by front-loaded spending and subsequent lessening demand associated with April’s planned three-percentage point sales tax hike.

U.S. durable goods orders jumped 3.5% in November following a 0.7% dip in October and a 4.2% increase in September.  Orders were 10.0% greater than in November 2012.  Orders for non-defense capital goods and excluding aircraft leaped 4.5% on month but were just 3.4% greater on year.

The FHFA house price index rose 0.5% in October and recorded a similar 8.2% 12-month increase to those of 8.5% in August and September.

U.S. new home sales in November dipped less (2.1%) that projected after a 17.6% upsurge in October.

The Richmond Fed manufacturing index stayed at a reading of +13 this month, just a point under August’s reading and well above the outcomes in September and October.

U.S. mortgage applications last week fell 6.3% on top of a 5.5% decline in the prior week.  The 30-year fixed mortgage rate edged up another two basis points.

The weekly Johnson Redbook and ICSC-Goldman Sachs measures of U.S. chain store sales produced mixed results.

French GDP growth in 3Q was confirmed at negative 0.1% after +0.6% in 2Q.  GDP was 0.2% greater than  in 3Q12.  Inventory building, apparently unintended, augmented growth in 3Q by 0.5 percentage points, while net foreign demand exerted a 0.6-percentage point drag.  Final domestic demand stagnated.

French real consumer spending increased 1.4% in November and 1.5% from a year earlier.

British mortgage approvals climbed to a 4-year high of 45,044 in November according to BBA figures, 4.0% above October’s level.

Dutch GDP growth last quarter was revised to +0.2% from 0.1% reported initially.  GDP had stagnated in 2Q and was still 0.4% lower than a year before in the third quarter.  Belgian producer prices fell by 2.5% between November 2012 and November 2013. Greece recorded a EUR 1.06 billion trade deficit in October, 2.8% narrower than in September.

The Conference Board index of leading economic indicators for the euro area improved 0.5% in November, whereas the index of coincident economic indicators was unchanged on the month. 

Malaysia’s jobless rate increased to 3.5% in October, and Taiwanese industrial production unexpectedly posted a dip of 0.1% from a year before in November.

The Turkish central bank announced a predictable pace of daily intervention support for the lira over the final week of 2013 and into the month of January.  The lira is vulnerable because of Turkey’s large current account deficit.

Copyright 2013, Larry Greenberg.  All rights reserved.  No secondary distribution without express permission.

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