Anticipatory Mood as Calendar Year Winds Down
December 12, 2022
This will be the last week before financial market activity tucks into its lessening volume end-of-year closing of books period. There will be a big drop-off afterward in central banking news and meaningful economic data releases. But investors first have to get through this week’s heavily-laden menu of potential market-moving events.
The dollar has begun the week on an up note, climbing 0.8% against the Australian dollar, 0.6% versus the kiwi, 0.5% relative to the Japanese yen, 0.3% against the Chinese yuan, 0.2% vis-a-vis the Swiss franc and loonie, but just 0.1% against the euro.
Share prices fell in Asia by 2.2% in Hong Kong, 0.9% in China and New Zealand, 0.7% in South Korea, 0.5% in Australia, but just 0.2% in Japan. European bourses are about a half percent lower at the moment, but the U.S. key indices are showing green.
The 10-year U.S. Treasury yield slipped two basis points, while its German, Japanese and British counterparts span a marginal range from down a basis point to up a basis point.
The biggest financial changes concern commodities and crypto, with drops of 4.1% in oil, 0.8% in gold, and 0.4% in Bitcoin.
Price data reports this Monday have been mixed:
- Serbian consumer price inflation rose on month by at least 1.0% for an eighth straight time to set yet another record high of 15.1% in November compared to 7.5% a year earlier.
- Moldovian CPI inflation again surpassed 30% last month but, at 31.4%, printed significantly below October’s record of 35.0% and at a 6-month low. Nonetheless, inflation was more than double the 12.4% pace in November 2021.
- Japanese producer price inflation edged 0.1 percentage point lowr to a 4-month low of 9.3% in November, down from the recent high of 10.3% in September but above the year-earlier pace of 9.1%. Japanese import price inflation fell sharply to 28.2% from 42.3% in the prior month, 48.7% in September, and 43.1% in November 2021.
- CPI inflation in India slid below the top of the central bank’s 2-6% target to an 11-month low in November of 5.88% versus the year’s high of 7.79% last April.
- Czech CPI inflation re-accelerated to a 2-month high of 16.2% in November from 15.1% in October, 18% in September and 6.0% in November 2021.
- Danish CPI inflation slowed to a 3-month low of 8.9% last month from a 479-month peak in October of 10.1%.
Among other data releases today, Japan’s quarterly business confidence index compiled by the Ministry of Finance improved for the all-industries count to a value of -6.0 this quarter from -15.9 in 3Q 2022 but is projected to slide a bit next quarter. Japanese machine tool orders sank only 7.8% on year in November, the smallest such decline in 25 months and down from a 142% 12-month increase in June 2021.
British industrial production flat-lined in October, marking the fourth time in five months that such failed to rise month-on-month. That kept production 2.4% below its year earlier level. Factory output was 4.6% weaker than a year earlier, but construction output recorded its biggest on-year rise (7.4%) in nine months. Monthly British GDP compiled from the supply side increased 0.5% but the latest 3-month average change (-0.3%) stayed in the red. The October goods and services British trade deficit of GBP 1.79 billion was the smallest shortfall in 11 months but embodied a GBP 14.48 billion deficit among goods merchandise.
New yuan bank lending in China last month totaled CNY 1210 billion was twice the CNY 615 billion October total but only roughly half the September 2.47 trillion level. The stock of Chinese M2 money grew 12.4% on year, most in five months.
Ireland’s construction purchasing managers index softened to a 4-month low of 46.9 in November and was well below this year’s high point of 58.4 last February.
Indian industrial production dropped 3.3% on month and 4.0% on year in October.
Mexican industrial production rose for the first time in 3 months, climbing 0.4% in October. That equated to a 3.1% advance from a year earlier.
Spanish consumer sentiment improved 5.8 index points to a 4-month high in November of 60.5.
Turkey’s current account swung from a $4.1 billion current account surplus in October 2021 to a deficit of $3.39 billion in October 2022.
Copyright 2022, Larry Greenberg. All rights reserved. No secondary distribution without express permission.
Tags: British industrial production and trade deficit, Indian CPI, Japanese PPI
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