Greater Calm

January 10, 2017

Not much is happening this Tuesday. Several data releases corroborate other recent indications of improving global growth, mounting confidence, and rising inflation around the world.

The dollar is unchanged against the euro and Swiss franc, up 0.1% versus the Australian and Canadian monies as well as sterling but down 0.2% relative to the yuan and 0.1% vis-a-vis the yen. Larger moves include rises of 0.6% against the kiwi and 0.5% versus the Mexican peso.

Ten-year German bunds, Japanese JGBs and British gilt yields are all unchanged.

Comex gold at $1,184.60 per ounce is unchanged, while West Texas Intermediate crude oil has strengthened 0.4% to $52.17 per barrel.

Share prices fell 0.8% in Japan and Australia, 0.3% in China, and 0.2% in South Korea but advanced by 0.8% in Singapore, 0.7% in Hong Kong and India and 0.5% in New Zealand. Stocks in Europe are flat in France and Switzerland, up 0.4% in the U.K. and 0.1% in Germany but down 0.6% in Spain.

Chinese CPI inflation which rose to a 7-month high of 2.3% in November, settled back in December to October’s 2.1% pace. But PPI inflation continued to accelerate, rising 2.1 percentage points more to 5.5% from 3.3% in November, 1.2% in October, 0.1% in September and negative 5.3% last January.

Consumer confidence in Japan improved 2.2 points to print at a 39-month high of 43.1 in December.

Small business sentiment in the United States leaped to 105.8 on the NIFB index from readings of 98.4 in November and scores ranging from as low as 92.5 to as much as 94.9 in the first ten months of 2016.

Contrary to numerous signs that the U.S. labor market is tightening, the Fed’s proprietary labor market conditions index printed in the red last month with a score of -0.3 and posted its greatest on-year decline, 5.8%, since the beginning of 2010.

French industrial production jumped 2.2% on month in December, four times more than had been forecast, and was 1.8% greater than at the end of 2015.

Australian retail sales grew 0.2% in November, less than assumed. But the 12-month rate of increase, 3.4%, accelerated for a third straight time.

The Russian manufacturing purchasing managers index edged up 0.1 point to a 69-month high of 53.7 in December.

At the end of 2016, PPI and CPI inflation in Norway stood at 7.2% and 3.5%. Czech CPI inflation of 2.0% was at its highest level in four years. Danish CPI inflation of only 0.5% was 0.1 percentage point greater than November’s level, and Cypriot inflation moved above zero to 0.1% from -0.8% the month before.

Finnish industrial production in November exceeded its year-earlier level by 3.7%. Swedish industrial output climbed 1.2% in November but was up a mere 0.1% compared with a year before.

Brazilian retail sales increased 2.0% on month in November, five times more than forecast. This cut the on-year drop to 3.5% from 8.1%.

Same-store sales in the U.K. rose 1.0% on year in December, and shop prices jumped 1.0% on month in December as well.

The Swiss jobless rate increased to 3.5% last month from 3.3% in November.

The U.S. IBD/TIPP optimism index and Labor Dept JOLTS data on job openings and separations arrive later today. So do Canadian figures on building permits.

Copyright 2017, Larry Greenberg. All rights reserved. No secondary distribution without expressed permission.

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