Narrowly Mixed Dollar and Downwardly Creeping Equities

January 10, 2022

The dollar climbed 0.4% versus the Swiss franc, 0.3% against the euro, and 0.2% on a weighted basis, while also slipping 0.3% against the yen, 0.2% versus the kiwi and 0.1% against sterling. The greenback stayed unchanged vis-a-vis the Canadian and Australian dollars.

U.S. stock futures and key European stock indices are a tad softer, extending losses during the first week of 2022. Japan’s Nikkei closed unchanged. Across other Pacific Rim stock exchanges, share prices lost ground in South Korea, New Zealand and Australia but closed higher in Hong Kong, Taiwan, China, India and Singapore.

The rise of long-term interest rates paused, with the 10-year U.S. Treasury, British gilt, and Japanese JGB yields all steady compared to their closing levels before the weekend.

WTI oil has dipped 0.2%, and the price of gold has firmed 0.2% so far today.

Unemployment in the euro area, which crested at 8.7% in August-September 2020, slid by 0.1 percentage point for a fourth straight time to a 20-month low of 7.2% in November.

Turkish unemployment in November, which was as high as 13.5% last April, stayed at October’s 4-month low of 11.2%. Italian unemployment of 9.2% in November reversed October 0.2 percentage point rise. The Czech jobless rate rose 0.2 percentage points to a 3-month high of 3.5%.

Many countries released industrial production figures. Swedish industrial production rose 0.5% on month and 4.2% on year in November. The 12-month increase of Greek industrial production halved to 8.0%, its smallest advance in four months, and an 8.9% on-year rise of Belgian industrial production was the least since February. After on-year advances of more than 20% in July, August and September, Irish industrial production dropped 12.9% in October and by a record 29.2% in November. Malaysian industrial production recorded a smaller 0.9% monthly rise in November but the biggest 12-month increase (9.4%) in six months. Monthly and year-on-year advances in Austrian industrial production of 2.0% and 7.4% during November were each larger than in October. Finnish production went up 0.6% and 5.9% compared to November 2020. Finally, Dutch factory output rose 1.1% that month (its seventh increase in a row) and was 7.4% greater than in the same month a year earlier.

South Africa’s Absa-compiled manufacturing purchasing managers index dropped 3.1 index points to a 2-month low of 54.1 last month, and the AIG-compiled Australian PMI rose a 4-month high of 54.8 from 50.4 in the prior month. Australian building permits were 3.6% greater in November after recording back-to-back monthly drops in the previous two months.

Danish consumer prices fell 0.5% in December, trimming the 12-month rate of inflation by 0.3 percentage points to a 2-month low of 3.1%.

But in Norway, consumer prices rose by at least 0.7% for the fourth time in six months, and this lifted on-year CPI inflation to a 158-month high of 5.3% (although core inflation stayed under 2%). Norwegian producer price inflation jumped another 10 percentage points to a record high of 68.7% in December.

Consumer confidence in Indonesia edged 0.2% lower in December but remained 53% above the recent low in August.

Copyright 2022, Larry Greenberg. All rights reserved. No secondary distribution without express permission.


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