Heaviest Data Release Day of the Week Before Christmas Yields Mixed Results
December 23, 2022
The dollar traded lower by 0.6% against the kiwi, 0.5% versus the Australian dollar, 0.4% vis-a-vis the loonie, and 0.2% relative to the euro but has also risen by 0.4% against the yen, 0.3% vis-a-vis stereling and 0.1% against the yuan and Swiss franc.
Ten-year sovereign debt yields are up five basis points in the U.S. and U.K., four bps in France, Spain and Italy and three basis points in Germany but dipped two bps in Japan where the highest on-year CPI inflation since in 41 years was reported.
Asian stock markets closed mostly lower including drops of 1.8% in South Korea, 1.6% in India and 1.0% in Japan. U.S. and European share prices are marginally up.
News that Russia is considering a large 700k per day oil production cut sent WTI up 3.6%. Prices for gold and Bitcoin have firmed by 0.5% and 0.3%.
Overall Japanese CPI inflation of 3.8% in November was the highest since January 1991. Core CPI, which includes energy but excludes fresh foods, rose to 3.7%, most since December 1981, and consumer price inflation with energy also excluded accelerated 0.3 percentage points to an above-target 2.8%.
Several U.S. economic indicators have been reported:
- Monthly growth in personal consumption expenditures slowed much more than forecast to 0.1% in November from 0.9% in October, 0.7% in August and 0.6% in September. Personal income growth of 0.4% remained solid, however.
- The November PCE price deflator recorded its smallest month-on-month rise (0.1%) in 4 months and also a year-on-year increase of 5.5% versus 6.3% in Septembrer. Core PCE price inflation dropped to an 11-month low of 4.7%.
- The U. Michigan/Reuters monthly consumer sentiment index was revised upward to a 2-month high.
- New home sales unexpectedly climbed 5.8% in November to a 3-month high.
- On a gloomier note, durable goods orders plunged 2.1% last month, the most in 31 months.
CPI inflation in Singapore remained steady in October at September’s 4-month low of 6.7%. CPI inflation in Malaysia likewise held unchanged in November from October’s 7-month low of 4.0%.
French producer prices climbed 1.2% in November, but their 12-month rate of increase (21.5%) was the lowest so far in 2022.
Spanish PPI inflation of 20.7% last month constituted a 15-month low. Finnish PPI inflation of 18.8% was at a 13-month low.
Consumer prices in Belgium dropped 0.2% for a second straight time in December, depressing their 12-month increase to a 4-month low of 10.3%.
In Italy, overall economic sentiment and sentiment in the services sector and retail improved to a 4-month high in December, while construction rose to a 2-month high. Consumer confidence hit a 10-month high, but sentiment in manufacturing fell to a 2-month low.
Belgian consumer confidence and business confidence this month were at 4- and 3-month highs. Irish consumer confidence also improved to a 4-month high.
Spanish GDP growth last quarter has been revised lower to just 0.1%, but growth from 3Q 2021 was decent at 4.4%.
Monthly GDP growth in Canada subsided from 0.3% in August to 0.2% in September and a mere 0.1% in October when industrial production fell 1.0%.
Dutch GDP contracted 0.2% last quarter, matching the preliminary estimate but representing a big turn for the worse after growth of 2.4% in 2Q 2022.
The Central Bank of Egypt’s policy interest rate catapulted three percentage points to 16.25% after the final 2022 review of monetary policy. The increase exceeded street expectations by a factor of three and brought the cumulative increase since last March to 800 basis points. Egyptian consumer pjrice inflation of 18.7% in November was the most in 59 months and well above October’s 16.2% reading.
Copyright 2022, Larry Greenberg. All rights reserved. No secondary distribution without express permission.
Tags: Central Bank of Egypt, Japanese CPI, U.S. personal income and spending
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