Marking Time Ahead of the Jackson Hole Central Banking Symposium

August 24, 2017

The annual retreat of world central bankers in Northwest Wyoming kicks off this evening and runs through Saturday. This year’s conference topic is “Fostering a Dynamic Global Economy.” Fed Chair Yellen delivers a speech on financial stability at 14:00 GMT Friday. ECB President Draghi’s scheduled speech five hours later is attracting even more interest.

Meantime, the dollar rose overnight by 0.4% against the yen and peso, 0.2% relative to the Australian and New Zealand dollars, and 0.1% versus the euro, but the greenback also edged 0.1% lower against the Swiss franc, loonie and sterling. The yuan is unchanged.

Stocks fell 0.5% in China, 0.4% in Japan, 0.3% in Indonesia and 0.2% in New Zealand but rose 1.0% in reopened Hong Kong, 0.8% in Taiwan, and 0.4% in Singapore and South Korea. Equities in Europe have risen 1.1% in Italy, 0.6% in Spain, 0.5% in the U.K. and Greece, 0.3% in Germany and 0.2% in France.

Gold fell back 0.3% to $1,291.20 per ounce, and WTI oil is 0.5% weaker at $48.17 per barrel.

Ten-year German bund and British gilt yields are a basis point firmer, whereas the 10-year Japanese JGB yield dipped a basis point.

Several British economic indicators were reported:

  • U.K. Real GDP grew 0.3% last quarter (and 1.7% from a year earlier), led by government spending. Personal consumption ticked up just 0.1%, and business investment was flat. Exports and imports each advanced 0.7% and had neither an upward nor downward impact on GDP growth.
  • The monthly index of service sector activity went up 0.4% in June.
  • The CBI’s monthly distributive trades survey swung to a 13-month low of -10 in August from a 3-month high reading of +22 in July.
  • The British Bankers Association’s estimate of mortgage approvals in July was 41,587, somewhat higher than in May or June.

Total business sentiment in France according to the government statistical bureau rose for a fourth month, printing at 109, which is the best score since April 2011. Manufacturing sentiment jumped 3 points to 111, best since December 2007. Services went up 2 points to a score of 106, but retail fell back 4 points to 108.

Industrial production in Switzerland was 2.9% greater in 2Q than a year earlier, the biggest on-year advance in 3 years. Orders rose 2.8%.

Spanish GDP increased 0.9% on quarter and 3.1% on year in 2Q, which was marginally better than first-quarter results on both counts. GDP got a big lift from all elements of private demand.

Norwegian GDP grew 1.1% last quarter, spurred by a 3.2% increase in gross fixed capital formation and advances of 1.0% each in export and personal consumption.

July unemployment rates were reported in Poland (7.1%), Sweden (6.6%) and Iceland (1.8%).

Czech business sentiment improved 0.9 points to 16.3, and consumer confidence went up 2.2 point to 5.5 in August, lifting overall economic sentiment this month to a 7-month high.

Finnish producer price inflation rose half a percentage point to 3.7% in July.

Japan’s June index of leading economic indicators was revised downward to 105.9, but that’s still at a 2-year high. The index of coincident economic indicators printed at 117.1, a 2-month high, and the index of lagging economic indicators was at its best level since October 2008.

New Zealand recorded an NZD 85 million surplus in July that trimmed the 12-month running deficit to NZD 3.21 billion.

Scheduled U.S. data releases today are existing home sales, the K.C. Fed manufacturing index and weekly jobless insurance claims.

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


Tags: , ,


Comments are closed.