Dollar Up and Stocks Mostly Down

June 12, 2015

The dollar rose overnight by 0.7% against the Australian dollar, 0.6% relative to the euro and kiwi, 0.3% versus the loonie, 0.2% against sterling and 0.1% vis-a-vis the Swiss franc.  The yuan was again kept steady.

Greek stocks dove 2.9%.  Stock markets have also lost 0.4% in London and Paris, 0.3% in Spain, and 0.2% in Switzerland and Germany.  In the Pacific Rim, equities fell 0.2% in Australia, New Zealand, and South Korea but rose 0.5% in China, 0.2% in India and Singapore and 0.1% in Japan.

The West Texas Intermediate crude oil price fell 0.9% to $60.22 per barrel.  Comex gold is 0.1% softer at $1,179.00 per troy unce.

The yields on 10-year sovereign debt slipped three basis points in Japan and two bps in Germany but firmed a basis point in Britain.

Officials at the central banks of Chile and Peru left their key policy interest rates unchanged as expected at 3.0% and 3.25%, respectively.

Japan’s tertiary index, a gauge of service sector activity, fell in April for a second straight month, slipping by 0.2% from March and by 0.8% compared to the first-quarter average.  The index was 2.0% higher than in April 2014, however.

Japanese April industrial production was revised to an increase of 1.2% from 1.0% reported originally.  April’s level was still 0.4% below the 1Q mean and up just 0.1% from a year earlier.  Shipments and inventories grew more than thought initially, and the inventory ratio dropped 1.0%, reversing March’s 0.9% increase.  Capacity usage fell 0.4% on month and by 2.7% compared to April 2014, while capacity posted a 0.1% monthly dip and surpassed its year-earlier level by 0.2%.

Industrial production in the eurozone edged up only 0.1% in April, less than forecast.  Energy output tumbled 1.6% on top of a 1.9% drop in March.  While production on month rose by 2.1% in Portugal, 1.3% in Ireland and 0.8% in Germany, such fell 2.3% in Greece, 1.9% in France, 1.5% in The Netherlands, 0.3% in Italy and 0.1% in Spain.  Production for the whole eurozone was 0.8% greater in April than a year earlier.

German wholesale prices increased for a fourth straight time in May, climbing 0.5% on month.  This trimmed the 12-month rate of decline to 0.4% from 0.9% in April and 2.6% in January.  Wholesale prices for mineral fuels jumped 4.1% on month but fell 8.8% on year.

Construction output in the U.K. recorded a drop of 0.8% in April, the third decline in four months, and the 1.5% on-year increase was the smallest since November 2013.

New Swiss macro forecasts were reported by government officials.  Real GDP is projected to rise 0.4% this year and 1.3% in 2016, while consumer prices are expected to posted declines of 1.1% in 2015 and 0.3% next year.

Spanish consumer prices fell 0.2% in the year to May.  Inflation has been less than zero since last July.  Greek import prices rose 1.4% on month and 1.5% on year in April.

New Zealand’s manufacturing purchasing managers index dipped 0.2 points to a four-month low of 51.5 in May.  New Zealand food prices advanced 0.4% on month in May, most since January, and 0.8% on year.

Industrial output in Hong Kong fell 1.5% between 1Q14 and 1Q15, while producer prices in the former British colony fell 0.6% in the same four-quarter span.

According to the Conference Board, Japan’s index of leading economic indicators was unchanged in April, while South Korea’s LEI went up 0.6%.  The index of coincident economic indicators dipped 0.1% in each of those economies.

Scheduled U.S. data releases today are producer prices and the U. Michigan consumer sentiment index.  Mexico’s LEI index will be released.

The news on the Greek debt front has not been good.  The IMF walked out over a lack of progress.

Copyright 2015, Larry Greenberg.  All rights reserved.  No secondary distribution without express permission.

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