On this U.S. Holiday, Share Prices Closed up 2.9% in Hong Kong, 2.6% in Taiwan, and 1.2% in South Korea
June 19, 2024
U.S. financial markets will be shut today for Juneteenth Day.
A number of Asian stock markets closed sharply higher, reflecting AI euphoria, yesterday’s advance in U.S. share prices, new hope regarding prospects for the Fed cutting interest rates later this year, and Japanese trade data showing stronger-than-expected Japanese export and import growth in May.
The dollar was narrowly mixed in overnight trading, slipping 0.2% against sterling and by 0.1% versus the Canadian dollar and euro but rising 0.1% versus the Swiss franc. There’s been no net dollar movement relative to the yen.
Ten-year British gilt and German bund yields are up 3 and 1 basis points.
The Central Bank of Chile’s policy interest rate was reduced by a further 25 basis points. This cut was smaller in size than the three earlier easings in 2024 that had totaled 225 basis points. Those moves followed ones during the second half of last year totaling three percentage points from a peak of 11.25% maintained from October 2022 until July 2023. At 5.75%, the new interest rate level is its lowest since March 2022. A released statement explaining today’s move suggests that most of the likely rate reduction in 2024 has now been completed. Chilean consumer price inflation of 4.1% overall and 3.5% core was still above the central bank’s 3% target.
The National Bank of Georgia’s key interest rate remains at 8.0% after the latest policy review. Such was cut by 150 basis points in 2023 and another 150 bps earlier this year. 8.0% also matches the rate’s pandemic low maintained from August 2020 to March 2021. Consumer price inflation in Georgia had receded from 13.9% in January 2022 to zero percent this past February but has subsequently risen to 2.0% as of last month, a 13-month high. A released statement observes some upside creeping in expected inflation and expresses concern about the risk of imported inflation caused by the dollar’s appreciation against the Georgian lari.
Japan’s JPY 1.22 trillion trade deficit in May was 11.6% narrower than a year earlier, reflecting a larger-than-anticipated 13.5% increase in exports.
Indonesia’s trade surplus in January-May of $13.1 billion was 3.5 billion dollars smaller than the surplus a year earlier.
New Zealand’s NZD 4.36 billion current account deficit last quarter was the smallest shortfall in three quarters.
Euroland’s current account surplus in the first third of 2024 of EUR 142 billion seasonally adjusted was 64% greater than the monthly pace of the EUR 260 billion surplus in full-2023 and equivalent to around 3% of GDP.
British consumer price inflation fell to a 34-month low in May of 2.0% (matching the Bank of England target) from 8.7% in May 2023 and a peak of 11.1% reached in October 2022. Core CPI inflation dropped 0.4 percentage points to a 31-month low of 3.5%, roughly half the record high of 7.1% touched in May 2023. British retail price inflation of 3.0% was down from 14.2% in October 2022 and constitutes a 37-month low. Producer output prices dipped 0.1% on month in May but recorded the largest on-year advance (1.7%) in a year. Core PPI-O inflation tripled to a 9-month high of 1.0%. Producer input price inflation has been in sub-zero percent territory since June 2023, but May’s 12-month decline of the PPI-I index was just 0.1%.
South African CPI inflation in May matched April’s 4-month low of 5.2%.
Construction output in the euro area slid 0.2% on month and 1.1% on year during April. April construction was also 0.5% lower than the first-quarter monthly average.
U.S. mortgage applications rose just 0.9% last week after surging 15.6% in the first week of June. The 6.94% 30-year fixed mortgage rate was below 7.0% for the first time since the week of March 29th and down from the recent high of 7.26% in the week of April 26.
Copyright 2024, Larry Greenberg. All rights reserved. No secondary distribution without express permission.
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