News Announcement & Chart Analysis by PlexyTrade

[MiloPlexyTrade]

23rd August 2024

Friday

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Canada is about to release its latest Core Retail Sales and Retail Sales data for the month, which are critical indicators of consumer spending and overall economic health. Following this, focus will turn to the United States, where the upcoming Home Sales report is anticipated to shed light on the condition of the U.S. housing market and broader economic trends. These important economic updates are likely to impact market sentiment and investor decisions in both countries. Additionally, market attention will be on the U.S. as Federal Reserve Chair Powell is set to deliver a speech, followed by a speech from Bank of England Governor Bailey in the UK.​

​

CAD - Core Retail Sales m/m (High Impact)​

The Core Retail Sales measure, excluding automobiles, tracks monthly changes in the total retail sales value, offering a clearer view of spending trends by removing the volatility of auto sales, which constitute about 20% of total sales. Released monthly by Statistics Canada, this measure is a key indicator of consumer spending. A higher-than-forecast reading is typically bullish for the Canadian Dollar (CAD), while a lower reading is bearish. The month-over-month (MoM) percentage change compares sales values between consecutive months.


Canada's core retail sales, excluding autos, dropped 1.3% month-over-month in May 2024, a sharper decline than the forecasted 0.5% fall, and followed a downwardly revised 1.7% rise in April. This significant decrease highlights the impact of high interest rates on consumer spending, with notable reductions in discretionary purchases such as furniture, electronics, and sporting goods. The trend continued into June, with an advance estimate showing a 0.3% decrease in retail sales overall. The second quarter saw a 0.2% drop in core retail sales after a 0.4% decline in the first quarter. Despite a rate cut by the Bank of Canada to 4.75% last month, restrictive monetary policy continues to weigh on Canadian consumers. Sales fell in eight of nine subsectors in May, with only auto dealers seeing gains. This data supports expectations of another rate cut by the Bank of Canada next week, amid projections of below-2% GDP growth for the second quarter and slowing inflation.​

TL;DR

Metric	Value/Change	Details
Core Retail Sales (May 2024)	-1.3% month-over-month	Sharper decline than the forecasted -0.5%; follows a revised 1.7% rise in April.
Retail Sales (June 2024, Estimate)	-0.3% month-over-month	Continued decline in retail sales overall.
Core Retail Sales (Q2 2024)	-0.2%	Follows a 0.4% decline in Q1 2024.
Impact of High Interest Rates	Significant	Reduced consumer spending on discretionary items such as furniture, electronics, sporting goods.
Bank of Canada Interest Rate	4.75%	Despite the rate cut, restrictive monetary policy still affects consumers.
Sector Performance (May 2024)	Sales fell in 8 of 9 subsectors	Only auto dealers saw gains.
GDP Growth Expectation (Q2 2024)	Below 2%	Slow GDP growth anticipated.
Inflation Trend	Slowing	Reflects the impact of monetary policy.
Expectation for Bank of Canada	Another rate cut likely	Due to the economic conditions described above.

The forecast for Core Retail Sales month-over-month stands at -0.2%, an improvement from the previous result of -1.3%.

CAD - Retail Sales m/m (High Impact)​

The Retail Sales m/m measure, released monthly by Statistics Canada about 50 days after the month ends, tracks the change in the total value of goods sold by Canadian retailers. This measure is a key indicator of consumer spending, which significantly impacts overall economic activity. A higher-than-expected reading is seen as positive for the Canadian Dollar (CAD), while a lower-than-expected result is viewed as negative. The report is closely monitored by traders as it provides insights into the health of the economy and consumer behavior.


Canada's retail landscape faced a downturn in June 2024 as sales slipped by 0.3%, exacerbating a 0.8% decrease in May and resulting in the steepest two-month decline seen in over a year. The latest data reflects broad challenges across the retail sector, with eight of nine subsectors experiencing downturns. Particularly hard-hit were sellers of building materials and garden equipment, which saw a 2.7% drop, followed by food and beverage outlets and clothing and accessory stores, which declined by 1.9% and 1.5%, respectively. Excluding gas stations, core retail sales took a significant hit, plunging 1.4%. After a brief respite with a 0.6% increase in April, the retail sector ended the second quarter with a 0.2% decrease in sales, compounding a 0.4% fall in the first quarter.​

TL;DR

• June 2024: Retail sales declined by 0.3%, marking the steepest two-month decline in over a year.
• May 2024: Retail sales decreased by 0.8%, contributing to the significant two-month downturn.
• April 2024: Retail sales saw a brief increase of 0.6% before the downturn resumed.
• Q2 2024: Retail sales declined by 0.2%, following a 0.4% decrease in Q1 2024.
• Subsectors Affected:
  • Building Materials & Garden Equipment: Declined by 2.7% (hardest hit in June 2024).
  • Food & Beverage Outlets: Decreased by 1.9%.
  • Clothing & Accessory Stores: Dropped by 1.5%.
• Core Retail Sales (Excluding Gas Stations): Fell by 1.4% in June 2024.

The expected monthly change in Retail Sales is forecasted to be -0.3%, an improvement from the previous month’s result of -0.8%.

The upcoming Core Retail Sales m/m and Retail Sales m/m reports are scheduled for release on Friday at 12:30 PM GMT.

Fed Chair Powell Speaks (High Impact)
​

Federal Reserve Chair Jerome Powell, a 2024 FOMC voting member, speaks on the U.S. economic outlook at the Jackson Hole Economic Policy Symposium in Wyoming. As the head of the central bank, Powell's remarks are closely monitored by traders for insights into future monetary policy. A more hawkish stance than expected is typically seen as positive for the currency.


Fed Chair Jerome Powell's upcoming keynote at the Jackson Hole symposium is drawing significant attention due to troubling labor market data. With unemployment unexpectedly rising to 4.3% and July witnessing only 114,000 new jobs—the second-lowest monthly gain since December 2020—analysts are concerned about economic stability. Recent revisions have further deepened worries, showing 818,000 fewer jobs in March than initially reported. This backdrop sets the stage for Powell's speech, which many anticipate will hint at a substantial Fed rate cut in September. Investors and economists are watching closely, as Powell's address could decisively influence future Fed policies and economic forecasts.

TL;DR​

• Fed Chair Jerome Powell's upcoming keynote at the Jackson Hole symposium is highly anticipated.
• Concerns are growing due to troubling labor market data:
  • Unemployment has unexpectedly risen to 4.3%.
  • Only 114,000 new jobs were added in July, the second-lowest monthly gain since December 2020.
  • Recent revisions revealed 818,000 fewer jobs in March than initially reported.
• Analysts worry about economic stability, leading to speculation about a substantial Fed rate cut in September.
• Powell's speech could significantly influence future Fed policies and economic forecasts.

USD – New Home Sales (Medium Impact)​

New single-family home sales, which constitute about 10 percent of the US housing market, are key indicators of economic health. These sales, reported monthly and derived from building permits data, include homes in any stage of construction and significantly influence the economy by triggering purchases of furniture, appliances, and mortgages. The sales data is highly volatile, with preliminary figures frequently revised. An actual sales figure surpassing the forecast is generally seen as a positive sign for the economy.


New home sales remained weak in June, with a slight decline of 0.6% to an annualized rate of 617,000 units, marking the lowest pace since November 2023. High mortgage rates, averaging around 7% in June, have kept many buyers from entering the market, contributing to a 7.4% year-over-year drop in new home sales. Despite a 9.3-month supply of new homes and an increase in completed homes ready for occupancy, overall inventory remains tight due to low resale home availability. The median price of new homes rose to $417,300, up 2.5% from the previous month but stable compared to last year. Regional variations show a 5.5% decline in new home sales in the Northeast and a 6.7% drop in the South, while sales increased by 25.5% in the Midwest and 5.7% in the West.​

TL;DR

• New Home Sales (June 2024): Declined by 0.6% to an annualized rate of 617,000 units, the lowest pace since November 2023.
• Mortgage Rates (June 2024): Averaging around 7%, contributing to reduced buyer activity.
• Year-over-Year Change: New home sales dropped by 7.4% compared to the previous year.
• Inventory Supply: 9.3-month supply of new homes available.
• Completed Homes: Increase in completed homes ready for occupancy, but overall inventory remains tight due to low availability of resale homes.
• Median Price of New Homes: Rose to $417,300, up 2.5% from the previous month, but stable compared to last year.
• Regional Sales Variations:
  • Northeast: Sales declined by 5.5%.
  • South: Sales declined by 6.7%.
  • Midwest: Sales increased by 25.5%.
  • West: Sales increased by 5.7%.

The projected forecast for New Home Sales is 624,000, slightly up from the previous figure of 617,000.

The upcoming speech by Fed Chair Jerome Powell and the New Home Sales report are scheduled for release on Friday at 2:00 PM GMT.

GBP - BOE Gov Bailey Speaks (High Impact)
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Bank of England Governor Andrew Bailey is set to deliver a highly anticipated speech at the Jackson Hole Economic Policy Symposium in Wyoming. As the head of the central bank, Bailey's words carry significant weight, with traders closely monitoring his remarks for any hints about future monetary policy. His statements are particularly influential because they can signal the direction of interest rates, which in turn affects the value of the British pound. Market participants often react strongly to any unexpected hawkish tones, as these are generally seen as positive for the currency. Bailey's appearance at the symposium is expected to provide crucial insights into the Bank of England's approach in the current economic climate.
​

Bank of England Governor Andrew Bailey's speech is scheduled to begin at 3:00 PM GMT on Friday.

 

[MiloPlexyTrade]

26th August 2024

Monday

​

On August 26th, notable economic data releases from both Germany and the United States are expected to influence market movements. Germany will unveil its Ifo Business Climate index, a key indicator of business sentiment, while the U.S. will report its Core Durable Goods Orders month-over-month and Durable Goods Orders month-over-month figures. Both sets of data are anticipated to have a moderate impact on market trends, as investors closely monitor these indicators for insights into the economic health and future outlooks of the two major economies.​

​

EUR - German ifo Business Climate (Medium Impact)​

The IFO Business Climate Index, a key indicator of business sentiment in Germany, surveys 9,000 firms monthly across manufacturing, services, trade, and construction. It evaluates current business conditions and expectations for the next six months, deriving a Business Climate Balance that ranges from -100 (indicating complete pessimism) to +100 (signifying complete optimism). This balance is normalized to the base year of 2015, allowing for a consistent assessment of economic and business trends within the country. This index plays a crucial role in analyzing the economic climate and guiding business and policy decisions.


German business sentiment unexpectedly worsened in July, with the Ifo institute's Business Climate index falling to 87.0 from 88.6 in June, marking the third consecutive monthly decline and the lowest level since February. The drop was sharper than analysts' expectations, who had forecasted a rise to 88.9. Both the current conditions index, which decreased to 87.1 from 88.3, and the expectations index, which fell to 86.9 from 88.8, showed increased pessimism. Ifo president Clemens Fuest remarked that the German economy appears "stuck in the crisis," reflecting growing concerns about the performance of Europe's largest economy.​

The Ifo Business Climate forecast stands at 100.1, slightly down from the previous figure of 100.3.

The Ifo Business Climate Index from Germany is scheduled for release on Monday at 8:00 AM GMT.

USD - Core Durable Goods Orders m/m (Medium Impact)​

Core Durable Goods Orders m/m measures the change in the total value of new purchase orders for durable goods, excluding transportation items. It is a key indicator of manufacturing activity, as an increase in orders suggests higher future production. Traders pay attention to this figure because if the actual orders exceed forecasts, it typically signals a stronger economy, which is positive for the currency.


In June 2024, durable goods orders excluding transportation in the United States rose by 0.5% from the previous month, marking a recovery from a 0.1% decline in May. However, this increase fell short of the forecasted 0.2% gain. Historically, such orders have averaged a modest 0.23% increase since 1992, with peaks reaching 6.30% in March 2004 and troughs falling to -10.20% in January 2009.​

The forecast for Core Durable Orders month-over-month is projected to be 0.0%, compared to the previous 0.5% result.

USD - Durable Goods Orders m/m (Medium Impact)​

Durable Goods Orders represent the change in the total value of new purchase orders placed with manufacturers for goods expected to last at least three years. This economic indicator is watched closely by traders because it serves as a leading indicator of production. When the actual value of orders exceeds the forecast, it suggests an increase in manufacturing activity, which is typically seen as positive for the currency. Rising orders indicate that manufacturers are ramping up production to meet the demand, reflecting broader economic momentum.


In June 2024, new orders for manufactured durable goods in the United States dropped by 6.6% to $264.5 billion, primarily due to a 20.5% plunge in transportation equipment orders. This decline reversed a trend of four consecutive monthly increases and fell short of market expectations. While orders for transportation equipment, including motor vehicles, aircraft, and parts, saw significant reductions, there were increases in categories such as fabricated metal products, machinery, communications equipment, and electrical equipment. Notably, new orders for non-defense capital goods excluding aircraft rose by 1%, surpassing forecasts and suggesting stronger business spending plans.​

The anticipated forecast for Durable Goods Orders on a month-to-month basis is 4%, an improvement from the previous outcome of -6.6%.

The Durable Goods Orders m/m and Core Durable Goods Orders m/m are set to be released on Monday at 12:30 PM GMT.

 

[MiloPlexyTrade]

26th August 2024

Monday

​

On August 26th, notable economic data releases from both Germany and the United States are expected to influence market movements. Germany will unveil its Ifo Business Climate index, a key indicator of business sentiment, while the U.S. will report its Core Durable Goods Orders month-over-month and Durable Goods Orders month-over-month figures. Both sets of data are anticipated to have a moderate impact on market trends, as investors closely monitor these indicators for insights into the economic health and future outlooks of the two major economies.​

​

EUR - German ifo Business Climate​

The IFO Business Climate Index, a key indicator of business sentiment in Germany, surveys 9,000 firms monthly across manufacturing, services, trade, and construction. It evaluates current business conditions and expectations for the next six months, deriving a Business Climate Balance that ranges from -100 (indicating complete pessimism) to +100 (signifying complete optimism). This balance is normalized to the base year of 2015, allowing for a consistent assessment of economic and business trends within the country. This index plays a crucial role in analyzing the economic climate and guiding business and policy decisions.


German business sentiment unexpectedly worsened in July, with the Ifo institute's Business Climate index falling to 87.0 from 88.6 in June, marking the third consecutive monthly decline and the lowest level since February. The drop was sharper than analysts' expectations, who had forecasted a rise to 88.9. Both the current conditions index, which decreased to 87.1 from 88.3, and the expectations index, which fell to 86.9 from 88.8, showed increased pessimism. Ifo president Clemens Fuest remarked that the German economy appears "stuck in the crisis," reflecting growing concerns about the performance of Europe's largest economy.​

TL;DR

• German business sentiment declined unexpectedly in July.
• Ifo institute's Business Climate index fell to 87.0 from 88.6 in June.
• This marks the third consecutive monthly decline and the lowest level since February.
• The decline was sharper than analysts' expectations, who predicted an increase to 88.9.
• Current conditions index decreased to 87.1 from 88.3.
• Expectations index dropped to 86.9 from 88.8, indicating increased pessimism.
• Ifo president Clemens Fuest noted that the German economy seems "stuck in the crisis," reflecting growing concerns about its performance.

The Ifo Business Climate forecast stands at 86.0, slightly down from the previous figure of 87.0.


The Ifo Business Climate Index from Germany is scheduled for release on Monday at 8:00 AM GMT.

USD - Core Durable Goods Orders m/m​

Core Durable Goods Orders m/m measures the change in the total value of new purchase orders for durable goods, excluding transportation items. It is a key indicator of manufacturing activity, as an increase in orders suggests higher future production. Traders pay attention to this figure because if the actual orders exceed forecasts, it typically signals a stronger economy, which is positive for the currency.


In June 2024, durable goods orders excluding transportation in the United States rose by 0.5% from the previous month, marking a recovery from a 0.1% decline in May. However, this increase fell short of the forecasted 0.2% gain. Historically, such orders have averaged a modest 0.23% increase since 1992, with peaks reaching 6.30% in March 2004 and troughs falling to -10.20% in January 2009.​

TL;DR

Metric	Value
Month	June 2024
Change in Durable Goods Orders	+0.5% from previous month
Previous Month Change	-0.1% (May 2024)
Forecasted Change	+0.2%
Historical Average Increase (Since 1992)	+0.23%
Peak Increase	+6.30% (March 2004)
Trough Decrease	-10.20% (January 2009)

The forecast for Core Durable Orders month-over-month is projected to be 0.0%, compared to the previous 0.5% result.

USD - Durable Goods Orders m/m​

Durable Goods Orders represent the change in the total value of new purchase orders placed with manufacturers for goods expected to last at least three years. This economic indicator is watched closely by traders because it serves as a leading indicator of production. When the actual value of orders exceeds the forecast, it suggests an increase in manufacturing activity, which is typically seen as positive for the currency. Rising orders indicate that manufacturers are ramping up production to meet the demand, reflecting broader economic momentum.


In June 2024, new orders for manufactured durable goods in the United States dropped by 6.6% to $264.5 billion, primarily due to a 20.5% plunge in transportation equipment orders. This decline reversed a trend of four consecutive monthly increases and fell short of market expectations. While orders for transportation equipment, including motor vehicles, aircraft, and parts, saw significant reductions, there were increases in categories such as fabricated metal products, machinery, communications equipment, and electrical equipment. Notably, new orders for non-defense capital goods excluding aircraft rose by 1%, surpassing forecasts and suggesting stronger business spending plans.​

TL;DR

• Total New Orders for Durable Goods (June 2024):
  • Decreased by 6.6% to $264.5 billion.
• Transportation Equipment Orders:
  • Experienced a significant decline of 20.5%.
• Trend Prior to June:
  • There were four consecutive monthly increases in orders.
• Market Expectations:
  • The decline fell short of market forecasts.
• Categories with Increases:
  • Fabricated Metal Products: Increased orders.
  • Machinery: Increased orders.
  • Communications Equipment: Increased orders.
  • Electrical Equipment: Increased orders.
• New Orders for Non-Defense Capital Goods Excluding Aircraft:
  • Increased by 1%, surpassing expectations and indicating stronger business spending plans.

The anticipated forecast for Durable Goods Orders on a month-to-month basis is 4.0%, an improvement from the previous outcome of -6.6%.

The Durable Goods Orders m/m and Core Durable Goods Orders m/m are set to be released on Monday at 12:30 PM GMT.

 

[MiloPlexyTrade]

27th August 2024

Tuesday

​

On the 27th of August, the United States is set to release several key economic indicators. These include the S&P/Case-Shiller Composite-20 Home Price Index (HPI) year-over-year data, the Conference Board (CB) Consumer Confidence Index, and the Richmond Manufacturing Index. Each of these metrics will provide insights into different aspects of the economic landscape, from real estate prices to consumer sentiment and manufacturing activity.​

USD - S&P/CS Composite-20 HPI y/y​

The S&P/CS Composite-20 HPI y/y measures the annual change in the selling prices of single-family homes across 20 metropolitan areas. This index is crucial for traders because when the actual figure surpasses the forecast, it positively impacts the currency. This data is considered a leading indicator of the housing industry’s health. Rising house prices are significant as they attract investors and encourage activity within the sector, indicating robust economic health and potential investment opportunities.


The S&P CoreLogic Case-Shiller 20-city home price index reported a 6.8% year-over-year increase in May 2024, continuing a trend of home price appreciation albeit at a slightly decelerated pace compared to previous months. Despite a drop from April's revised 7.3% gain, the results slightly surpassed market forecasts of a 6.7% rise. New York led the cities with the most significant annual increase at 9.4%, closely followed by San Diego and Las Vegas with 9.1% and 8.6% gains, respectively. In contrast, Portland saw the smallest increase, registering just a 1.0% gain. Brian D. Luke, Head of Commodities, Real & Digital Assets at S&P DJI, emphasized the encouraging nature of the market's performance, highlighting the fastest start to the year in two years with a 4.1% appreciation year-to-date and noting that all 20 cities reported gains for the last six consecutive months, a phenomenon last seen during the COVID-era housing boom.​

TL;DR

Metric	Value/Detail
Year-Over-Year Increase (May 2024)	6.8%
April 2024 Year-Over-Year Increase	7.3% (revised)
Market Forecast (May 2024)	6.7%
Leading Cities by Annual Increase	- New York: 9.4% - San Diego: 9.1% - Las Vegas: 8.6%
City with Smallest Increase	Portland: 1.0%
YTD Appreciation (Start of 2024)	4.1%
Consecutive Monthly Gains	6 months (across all 20 cities)
Last Seen During	COVID-era housing boom
Notable Comment	Brian D. Luke emphasized the fastest start to the year in two years and the encouraging market performance.

The expected forecast for the S&P/CS Composite-20 HPI on a year-over-year basis is 6.9%, a slight increase from the previous figure of 6.8%.

The next release of the S&P/Case-Shiller Composite-20 Home Price Index (year-over-year) is scheduled for Tuesday at 1:00 PM GMT.

USD - CB Consumer Confidence​

The CB Consumer Confidence Index is a crucial economic indicator derived from a survey of approximately 3,000 households. Participants assess current and future economic conditions, focusing on labor availability, business conditions, and the overall economic situation. Typically, a higher-than-expected index value positively influences the currency as it reflects financial optimism, which is a precursor to increased consumer spending—a major component of economic activity.


Recent economic data releases painted a more nuanced picture than initial headlines suggested. U.S. consumer confidence, as reported by the Conference Board, unexpectedly rose by 2.5 points in July to 100.3, but this gain failed to offset June’s downwardly revised figures, leaving the index at only a two-month high. Notably, while future expectations had surged to a six-month high, the assessment of the present situation fell for the second consecutive month to a three-year low. Job market sentiment also showed signs of strain, with the percentage of respondents finding it harder to secure jobs rising to its highest level since March 2021, potentially foreshadowing pressure on the 4.1% unemployment rate. Meanwhile, job openings declined for the third time in four months, though an upward revision to May data softened the overall drop. The reduction was concentrated in the private sector across multiple industries, with fewer people quitting or being hired, aligning with the Conference Board’s findings. This data hinted at potentially slower consumer spending and weaker job growth, which could have left the door open for a rate cut in September.​

TL;DR

• Consumer Confidence Index:
  • Rose by 2.5 points in July to 100.3.
  • Failed to offset June’s downward revision; index remains at a two-month high.
• Future Expectations:
  • Surged to a six-month high, indicating optimism about the future.
• Present Situation Assessment:
  • Fell for the second consecutive month to a three-year low, showing increasing concerns about current conditions.
• Job Market Sentiment:
  • More respondents found it harder to secure jobs, reaching the highest level of difficulty since March 2021.
  • Potential pressure on the 4.1% unemployment rate.
• Job Openings:
  • Declined for the third time in four months, though an upward revision in May softened the overall drop.
  • Decline concentrated in the private sector with fewer hires and quits.
• Potential Economic Implications:
  • Data suggests slower consumer spending and weaker job growth.
  • Possibility of a rate cut in September.

The Consumer Confidence forecast is projected at 100.2, slightly down from the previous figure of 100.3.

USD - Richmond Manufacturing Index​

The Richmond Manufacturing Index is a composite index derived from surveys of approximately 55 manufacturers in the Richmond area. The survey asks respondents to rate the relative level of business conditions, including shipments, new orders, and employment. An index level above zero indicates improving conditions, while a level below zero suggests worsening conditions. The index typically has a muted impact on the market because it follows earlier regional indicators related to manufacturing conditions. Generally, if the actual index value is greater than the forecasted value, it is considered positive for the currency.


Manufacturing activity in the Fifth District deteriorated in July, according to the latest survey from the Federal Reserve Bank of Richmond. The composite manufacturing index dropped significantly from -10 in June to -17 in July, with notable declines in shipments (from -9 to -21), new orders (from -16 to -23), and employment (from -2 to -5). Local business optimism also waned, with the index falling from -13 to -21, and future local business conditions slipping slightly from 9 to 7. Despite the overall downturn, future indexes for shipments and new orders remained positive, indicating some expectation of improvement in the next six months. The vendor lead time index edged into positive territory for only the second time in two years, while firms continued to report declining backlogs. The average growth rates of prices paid and prices received decreased, with firms projecting minimal change in price growth over the next 12 months.

TL;DR

Indicator	June	July	Change
Composite Manufacturing Index	-10	-17	↓ (-7)
Shipments	-9	-21	↓ (-12)
New Orders	-16	-23	↓ (-7)
Employment	-2	-5	↓ (-3)
Local Business Optimism	-13	-21	↓ (-8)
Future Local Business Conditions	9	7	↓ (-2)
Vendor Lead Time Index	Negative	Positive	↑
Backlogs	Declining	Declining	No Change
Average Growth Rate of Prices Paid	Decreasing	Decreasing	No Change
Average Growth Rate of Prices Received	Decreasing	Decreasing	No Change
Future Shipments Index	Positive	Positive	No Change
Future New Orders Index	Positive	Positive	No Change

The Richmond Manufacturing PMI is forecasted to be -14, an improvement from the previous reading of -17.

The next CB Consumer Confidence & Richmond Manufacturing Index release is set for Tuesday at 2:00 PM GMT.

 

[MiloPlexyTrade]

28th August 2024

Wednesday​

On August 28th, Australia is scheduled to release its monthly Consumer Price Index (CPI) data. Following this, there will be an update on Crude Oil Inventories, providing insights into current stockpile levels. This sequence of economic reports will offer important information for market analysts and investors alike, regarding inflation trends in Australia and energy supply dynamics globally.
​

AUD - Monthly Consumer Price Index Indicator​

The Monthly Consumer Price Index (CPI), issued monthly by the Australian Bureau of Statistics, tracks changes in the cost of a fixed basket of household goods and services, offering more frequent inflation data compared to the quarterly CPI. It includes a Year-over-Year (YoY) measure comparing current prices to those of the same month in the previous year. Traders monitor this indicator closely as higher CPI readings can prompt the central bank to increase interest rates to control inflation, potentially strengthening the Australian Dollar (AUD), whereas lower readings might lead to a weaker AUD.


In the second quarter of 2024, Australia witnessed a slight increase in its annual Consumer Price Index (CPI), rising to 3.8% from 3.6% in the previous quarter, marking the first rise since late 2022 and meeting market expectations. Despite a monthly decrease from May's six-month peak of 4% to 3.8% in June, underlying inflationary pressures persist. This moderation reflects declines in several categories including transport, health, recreation and culture, and education, attributed primarily to lower automotive fuel costs. Conversely, housing costs, particularly electricity prices, have seen an uptick. The core inflation rate, excluding volatile items, remained at 4%, still above the Reserve Bank of Australia's target range of 2-3%, signaling ongoing economic challenges.​

TL;DR

Category	Details
Period	Q2 2024
Annual CPI	3.8% (up from 3.6% in Q1 2024)
Monthly CPI (June 2024)	3.8% (down from May's peak of 4%)
Trend	First rise in annual CPI since late 2022
Market Expectations	Met expectations
Categories with Declines	Transport, Health, Recreation and Culture, Education
Reason for Decline	Lower automotive fuel costs
Categories with Increases	Housing costs, particularly electricity prices
Core Inflation Rate	4% (unchanged, above RBA target of 2-3%)
Economic Implication	Persistent underlying inflationary pressures and ongoing economic challenges

The projected year-over-year Consumer Price Index is forecasted to be 3.4%, slightly lower than the previous figure of 3.8%.

The upcoming year-over-year Consumer Price Index is set to be released at 1:30 AM GMT on Wednesday.

USD - Crude Oil Inventories​

Crude Oil Inventories measure the weekly change in the number of barrels of crude oil held by commercial firms, serving as a key indicator of supply and demand imbalances in the market. A lower-than-expected inventory figure is typically favorable for the currency, as it suggests tighter supply, which can lead to changes in production levels and increased price volatility.


Crude oil inventories in the United States saw a significant decline of 4.649 million barrels for the week ending August 16, 2024, surpassing market expectations of a 2.72 million barrel reduction. The Cushing, Oklahoma delivery hub also experienced a drop in stocks by 560 thousand barrels, following a previous decrease of 1.665 million barrels. Gasoline inventories similarly fell by 1.606 million barrels, exceeding the anticipated 1 million barrel decrease. Distillate fuel inventories recorded a substantial decline of 3.312 million barrels, sharply contrasting with the expected modest increase of 0.04 million barrels.​

TL;DR

• Crude Oil Inventories: Decreased by 4.649 million barrels (Market expectation: -2.72 million barrels).
• Cushing, Oklahoma Hub: Stocks declined by 560 thousand barrels.
• Gasoline Inventories: Fell by 1.606 million barrels (Market expectation: -1.0 million barrels).
• Distillate Fuel Inventories: Dropped by 3.312 million barrels (Market expectation: +0.04 million barrels).

The next update on Crude Oil Inventories is set to be published on Wednesday at 2:30 PM GMT.

 

[MiloPlexyTrade]

29th August 2024

Thursday
​

On August 29th, a series of significant economic data releases will take place across various global markets. Starting in the Euro area, Spain will announce its Flash Consumer Price Index (CPI) year-over-year, followed by Germany reporting both its monthly and annual inflation rates. Attention will then shift to the United States, where several key indicators will be disclosed: the preliminary Gross Domestic Product (GDP) quarter-over-quarter, weekly Unemployment Claims, the preliminary GDP Price Index quarter-over-quarter, and Pending Home Sales. The day will conclude with Japan releasing its Core CPI year-over-year, Unemployment Rate, monthly Industrial Production, and Retail Sales year-over-year.
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EUR - Spanish Flash CPI y/y​

The Spanish Flash CPI y/y measures the annual change in the price of goods and services bought by consumers, which significantly impacts overall inflation. Typically, a CPI figure higher than forecasted is positive for the currency, as it suggests rising inflationary pressures. This, in turn, may prompt the central bank to increase interest rates to fulfill its mandate to contain inflation.


In July 2024, Spain experienced a significant decrease in its annual inflation rate, dropping to 2.8%—the lowest in five months and a notable decline from June's 3.4%. This easing in inflation was primarily attributed to reduced price increases in sectors such as food and beverages, housing, and recreation. Additionally, core inflation also cooled to 2.8%, marking the lowest rate since January 2022. Concurrently, the monthly Consumer Price Index (CPI) fell by 0.5%, with the EU harmonized index showing a similar decline of 0.7%.​

TL;DR

• Spain's Annual Inflation in July 2024: Dropped to 2.8%, the lowest in five months, down from 3.4% in June.
• Sectors Influencing Decline: Reduced price increases in food and beverages, housing, and recreation.
• Core Inflation Rate: Also cooled to 2.8%, marking the lowest since January 2022.
• Monthly Consumer Price Index (CPI): Decreased by 0.5%.
• EU Harmonized Index: Showed a decline of 0.7%.

The expected year-over-year Flash CPI is forecasted at 2.4%, a decrease from the previous rate of 2.8%.

The upcoming Spanish Flash CPI y/y is set to be released on Thursday at 7:00 AM GMT.

EUR - German Prelim CPI m/m​

The German Preliminary CPI m/m, issued monthly by Destatis, tracks the change in consumer prices for household goods and services. This measure is crucial for assessing inflation and shifts in consumer spending. A rise in the CPI suggests increasing prices, which can prompt the central bank to hike interest rates to control inflation. Such increases are generally seen as positive for the Euro, as they indicate economic stability and growth, with a higher CPI being bullish for the currency and a lower one being bearish.


In July 2024, Germany experienced a notable increase in inflation, as indicated by a 0.3% rise in the Consumer Price Index (CPI) from the previous month, the largest such increase in three months. This acceleration in inflation, based on preliminary estimates, surpassed the modest gains of 0.1% observed in both May and June, as well as exceeding market expectations which had forecasted a rise of only 0.2%. This unexpected uptick suggests that inflationary pressures remain persistent within the German economy, signaling potential challenges ahead in terms of economic stability and cost-of-living adjustments.​

TL;DR

• Germany's Consumer Price Index (CPI) rose by 0.3% in July 2024, marking the most significant monthly increase in three months.
• This increase exceeded the previous months' gains of 0.1% in both May and June.
• The inflation rate also surpassed market forecasts, which had anticipated a 0.2% rise.
• The higher-than-expected inflation suggests ongoing inflationary pressures within the German economy.
• This trend indicates potential future challenges for economic stability and cost-of-living adjustments in Germany.

The projected figure for the monthly change in Germany's Preliminary Consumer Price Index is 0.0%, a decrease from the previous value of 0.3%.

EUR – German Inflation Rate y/y​

The Consumer Price Index (CPI), issued monthly by Germany's Destatis, tracks the average change in prices for goods and services consumed by households, serving as a primary gauge of inflation and shifts in consumer purchasing patterns. Year-over-year comparisons of CPI readings assess changes against the same month in the previous year, with higher figures typically supporting the Euro (EUR) and lower figures suggesting bearish trends.


In July 2024, Germany witnessed a slight uptick in its annual inflation rate to 2.3%, up from 2.2% in June, aligning with initial forecasts. The increase in prices was notably influenced by a rise in the cost of food, which escalated to 1.3% from 1.1% the prior month, primarily due to higher prices for edible fats, oils, sugar, and confectionery products. Meanwhile, service-related inflation held steady at 3.9%, and the decline in energy prices moderated, with a reduction of 1.7% compared to the previous 2.1% decrease. The Consumer Price Index (CPI) also experienced its most significant monthly gain in three months, increasing by 0.3% after consistent 0.1% rises in the preceding two months. Additionally, the EU-harmonised index of consumer prices advanced to 2.6% on an annual basis and 0.5% monthly, reflecting slight increases from the previous figures of 2.5% and 0.2%, respectively.​

TL;DR

Category ​	July 2024 ​	June 2024 ​	Change​
Overall Inflation Rate​	2.3%​	2.2%​	+0.1%​
Food Inflation​	1.3%​	1.1%​	+0.2%​
Service-Related Inflation​	3.9%​	3.9%​	No change​
Energy Prices​	-1.7%​	-2.1%​	+0.4%​
Consumer Price Index (CPI) Monthly Gain​	0.3%​	0.1%​	+0.2%​
EU-Harmonised Index (Annual)​	2.6%​	2.5%​	+0.1%​
EU-Harmonised Index (Monthly)​	0.5%​	0.2%​	+0.3%​

The forecast for Germany's year-over-year inflation is 2.1%, down from the previous rate of 2.3%.


The German inflation rate data, both month-over-month and year-over-year, will be released this Thursday at 12:00 PM GMT.

USD - Prelim GDP q/q​

The U.S. Bureau of Economic Analysis releases the Real GDP Annualized quarterly, representing the value of all final goods and services produced domestically. Expressed as an annualized rate, it adjusts quarterly GDP changes to reflect a yearly growth rate. This data is crucial for traders as it's a key indicator of economic health, with high values typically bolstering the U.S. Dollar and low values suggesting economic downturns.


The U.S. economy grew at a modest 1.3% annual rate in the first quarter of 2024, marking the weakest quarterly growth since spring 2022, according to a revised estimate from the Commerce Department. This represents a downgrade from the initially reported 1.6% growth. The slowdown was primarily driven by a surge in imports and a reduction in business inventories, which collectively shaved more than 1.5 percentage points off the growth rate. Consumer spending, which drives approximately 70% of the economy, increased by 2%, though this was down from previous estimates and prior quarters. While spending on goods fell sharply, spending on services grew at its fastest pace since mid-2021. Business investment, particularly in housing and research and development, contributed positively to growth. Inflation pressures also intensified, with consumer prices rising at a 3.3% annual rate, the highest in a year.
​

TL;DR

• U.S. economy grew at a modest 1.3% annual rate in Q1 2024.​
• This growth rate is the weakest since spring 2022 and was revised down from the initially reported 1.6%.​
• The slowdown was due to a surge in imports and a reduction in business inventories, which reduced the growth rate by more than 1.5 percentage points.​
• Consumer spending increased by 2%, but this was lower than previous estimates and prior quarters.​
• Spending on goods fell sharply, while spending on services grew at its fastest pace since mid-2021.​
• Business investment in housing and research and development had a positive impact on growth.​
• Inflation pressures intensified, with consumer prices rising at a 3.3% annual rate, the highest in a year.​

The economy is expected to experience a growth rate of 2.8% in its Gross Domestic Product (GDP) for the upcoming quarter.​

The Preliminary GDP quarter-over-quarter figures are scheduled for release at 12:30 PM GMT on Thursday.

USD - Unemployment Claims​

Initial Jobless Claims track the number of people filing for unemployment benefits for the first time in a week, serving as an early indicator of U.S. economic health. While the impact on the market can vary, a higher than expected number is usually seen as negative for the USD, and a lower than expected number as positive. Traders monitor these figures closely as they reflect labor market conditions, which are directly linked to consumer spending and are crucial for shaping monetary policy.


The U.S. Department of Labor reported that for the week ending August 17, initial jobless claims rose by 4,000, reaching 232,000. This increase was higher than anticipated, reflecting slight fluctuations in the job market. Despite this weekly rise, the 4-week moving average of claims saw a decrease of 750, settling at 236,000. Meanwhile, the insured unemployment rate held steady at 1.2% for the week ending August 10, unchanged from the previous week. However, the number of insured unemployed increased by 4,000 to 1,863,000, marking the highest level since late November 2021. Additionally, the 4-week moving average for insured unemployment increased by 4,750, reaching 1,865,500. These figures suggest a nuanced labor market scenario, where underlying stability is punctuated by slight increases in unemployment claims.​

TL;DR

Metric	Value	Change	Reference Period
Initial Jobless Claims	232,000	+4,000	Week ending August 17
4-week Moving Average (Claims)	236,000	-750	Up to week ending August 17
Insured Unemployment Rate	1.2%	No change	Week ending August 10
Number of Insured Unemployed	1,863,000	+4,000	Week ending August 10
4-week Moving Average (Insured Unemployment)	1,865,500	+4,750	Up to week ending August 10

The forecast for Unemployment Claims is projected to remain steady at 232,000, unchanged from the previous figure.

USD - Prelim GDP Price Index q/q​

The Preliminary GDP Price Index measures the quarterly change in the prices of all goods and services produced domestically in the U.S., excluding imports. Published by the Bureau of Economic Analysis, this index is a key inflation indicator. Higher-than-expected index values suggest bullish trends for the U.S. Dollar, indicating potential interest rate hikes, while lower values imply bearish trends.

In the second quarter of 2024, the US GDP Deflator rose 2.3% quarter-over-quarter to a record high of 124.9 index points, a slowdown from the previous quarter's 3.1% increase. The US economy grew at an annualized rate of 2.8%, surpassing expectations and improving from a revised 1.4% growth in the first quarter. The core Personal Consumption Expenditures index also exceeded forecasts, rising 2.9% despite easing from the prior quarter’s 3.7% gain. This economic data suggests that the Federal Reserve may have the flexibility to delay interest rate cuts, with markets anticipating a rate reduction by the end of September.​

TL;DR

• US GDP Deflator Q2 2024:
  • Rose 2.3% quarter-over-quarter, reaching 124.9 index points.
  • This increase represents a slowdown from the previous quarter's 3.1% rise.
• US Economic Growth:
  • Annualized growth rate of 2.8% in Q2, exceeding expectations.
  • Improvement from a revised 1.4% growth in Q1.
• Core Personal Consumption Expenditures (PCE) Index:
  • Increased by 2.9% in Q2, surpassing forecasts.
  • Slowed down from the previous quarter’s 3.7% gain.
• Federal Reserve Policy Implications:
  • Economic data suggests possible flexibility for the Fed to delay interest rate cuts.
  • Markets anticipate a potential rate reduction by the end of September.

The projected quarterly change in the Preliminary GDP Price Index is 2.3%.

The Preliminary Quarterly GDP, Unemployment Claims, and Preliminary GDP Price Index are scheduled for release on Thursday at 12:30 PM GMT.​

USD - Pending Home Sales m/m​

The Pending Home Sales measure tracks the change in the number of homes under contract but not yet closed, excluding new construction, with a higher-than-forecast result generally being positive for the currency because it indicates economic health through the wide-reaching ripple effects of home sales, such as renovations, mortgage transactions, and brokerage fees.


Pending home sales increased by 4.8% in June 2024, according to the National Association of REALTORS (NAR), with all four U.S. regions showing monthly gains in transactions. The Pending Home Sales Index (PHSI) rose to 74.3, though it remains 2.6% lower year-over-year. Regionally, the West saw a 3.4% increase to 58.4, up 1.0% from the previous year, while the Northeast, Midwest, and South experienced declines compared to the same month last year. NAR Chief Economist Lawrence Yun attributed the rise in contract signings to increased housing inventory and noted that buyers are benefiting from less intense competition. Yun also anticipated more inventory in the coming months before the typical winter slowdown.​

TL;DR

• June 2024 Pending Home Sales: Increased by 4.8% across the U.S.
• Pending Home Sales Index (PHSI): Rose to 74.3, still down 2.6% year-over-year.
• Regional Breakdown:
  • West: Increased by 3.4% to 58.4, up 1.0% year-over-year.
  • Northeast, Midwest, South: Declined compared to the same month last year.
• Comments from NAR Chief Economist, Lawrence Yun:
  • Attributed the rise in sales to increased housing inventory.
  • Buyers are facing less competition.
  • Expects more inventory before the typical winter slowdown.

The forecast for Pending Home Sales stands at 0.2%, compared to the previous result of 4.8%.

The forthcoming release of the Pending Home Sales month-over-month data is scheduled for Thursday at 2:00 PM GMT.

JPY – Tokyo Core CPI y/y​

Tokyo Core CPI y/y measures the fluctuation in prices of goods and services bought by consumers in Tokyo, excluding fresh food. It serves as a vital indicator for traders because higher-than-expected actual figures compared to forecasts tend to benefit the currency. This metric is significant because consumer prices constitute a major component of overall inflation. Currency valuation hinges on inflation trends because increasing prices prompt central banks to adopt tighter monetary policies to fulfill their mandate of controlling inflation.


Tokyo’s inflation accelerated for the third consecutive month in July, with consumer prices excluding fresh food rising 2.2%, up from 2.1% in June, driven largely by a 19.7% increase in electricity prices. This persistent inflation keeps the Bank of Japan’s (BOJ) option for an interest rate hike in play ahead of its policy meeting next week. While the BOJ is set to detail its bond-buying reduction plan and update its inflation forecasts, the data presents a mixed picture: inflation excluding fresh food and energy slowed to 1.5%, and weak consumer spending complicates the rate hike decision. Amid a backdrop of weak yen and ongoing discussions about wage growth and consumer demand, market watchers are split on whether the BOJ will hike rates or not, although over 90% anticipate the possibility.​

TL;DR

Metric	Details
Inflation Rate (excl. fresh food)	Increased to 2.2% in July from 2.1% in June
Primary Inflation Driver	Electricity prices, which rose by 19.7%
Inflation excluding food and energy	Slowed to 1.5%
Consumer Spending	Weak, complicating the decision for a rate hike
Bank of Japan's Next Steps	Planning to detail bond-buying reduction and update inflation forecasts
Market Expectation	Divided on BOJ rate hike decision, though over 90% see a hike as possible
Economic Context	Weak yen, discussions on wage growth and consumer demand

The forecasted year-over-year Core CPI is expected to be 2.2%, an increase from the previous figure of 2.2%.

JPY – Unemployment Rate ​

In Japan, the calculation of the unemployment rate involves determining the proportion of individuals who are actively seeking employment relative to the total labor force. This percentage reflects the number of job seekers in comparison to those who are either employed or actively looking for work. The unemployment rate serves as a key economic indicator, providing insights into the job market and the overall economic health of the nation.


In June 2024, Japan's unemployment rate fell to a six-month low of 2.5%, surpassing expectations by a slight margin. The decline in unemployment was supported by a decrease of 60,000 unemployed individuals and a significant addition of 250,000 jobs, lifting total employment to a record high of 67.86 million. The labor force slightly grew, while the number of individuals detached from the labor force decreased. Additionally, the labor force participation rate reached its highest since May 1999 at 63.7%. However, the job market showed signs of tightening as the jobs-to-applications ratio dropped to 1.23, the lowest since April 2022, indicating a minor contraction in job availability.​

TL;DR

• Unemployment Rate Decline: Japan's unemployment rate dropped to 2.5% in June 2024, a six-month low.
• Change in Employment Numbers: The total employment rose by 250,000, reaching a record high of 67.86 million.
• Decrease in Unemployed Individuals: There was a reduction of 60,000 unemployed people.
• Labor Force Dynamics:
  • The labor force grew slightly.
  • The number of individuals not in the labor force decreased.
• Labor Force Participation Rate: It reached 63.7%, the highest since May 1999.
• Jobs-to-Applications Ratio: Dropped to 1.23, indicating a minor contraction in job availability, marking the lowest ratio since April 2022.

The forecast for the Unemployment Rate is expected to remain unchanged at 2.5%, the same as the previous outcome.

JPY - Industrial Production m/m​

Japan's industrial production index is a vital economic indicator that measures output in key sectors like manufacturing, mining, and utilities. It helps assess the health of the industrial sector, guiding economic policies and forecasting future trends, crucial for economic planning and development.


In June 2024, Japan's industrial output experienced a sharp decline, falling 4.2% from the previous month, surpassing initial estimates of a 3.6% drop and marking a significant reversal from the 3.6% increase observed in May. This downturn represents the most severe contraction seen since the beginning of the year and the fourth instance of declining industrial production in 2024. The decrease was primarily influenced by a substantial reduction in the manufacturing of motor vehicles, which plummeted by 8.9%, reversing a strong growth of 18.1% in May. Additionally, production machinery and general-purpose as well as business-oriented machinery also saw significant declines of 9.0% and 8.2%, respectively. On an annual basis, industrial production in June contracted by 7.9%, making it the most pronounced decline since September 2020 and the fifth contraction in 2024.​

TL;DR

• Japan's Industrial Output in June 2024:
  • Fell by 4.2% from the previous month, exceeding initial estimates of a 3.6% decrease.
  • Represents the steepest drop since the start of the year.
  • Fourth decline in industrial production in 2024.
• Sector-Specific Declines:
  • Motor vehicles manufacturing decreased by 8.9%, after a significant increase of 18.1% in May.
  • Production machinery saw a decline of 9.0%.
  • General-purpose and business-oriented machinery production decreased by 8.2%.
• Yearly Comparison:
  • Industrial production contracted by 7.9% on an annual basis.
  • This is the most significant decline since September 2020 and marks the fifth contraction in 2024.

The forecast for Industrial Production is projected to rise to 3.3%, a significant improvement from the previous outcome of -4.2%.

JPY - Retail Sales y/y​

In Japan, the year-over-year change in retail sales measures the difference in total sales of retail goods and services during a specific month compared to the same month in the previous year. This metric provides insight into the country's economic performance and consumer behavior by highlighting shifts in purchasing patterns and overall retail activity over time. By comparing the sales figures from one year to the next, analysts and policymakers can better understand trends in consumer spending and make informed decisions about economic policy and business strategies.


In June 2024, Japan's retail sales surged by 3.7% year-on-year, outpacing expectations of a 3.3% increase and marking the highest rise in four months. This growth extends a 27-month streak of retail expansion, fueled by rising wages that have stimulated consumer spending. The most significant gains were seen in machinery & equipment, with sales jumping 10.1%, followed by department stores at 7.7%, and various other retail sectors also showing robust growth. However, month-over-month growth decelerated to 0.6% in June, down from May's 1.7% increase.​

TL;DR

• Retail Sales Increase: Japan's retail sales in June 2024 surged by 3.7% year-on-year, surpassing the forecasted 3.3% rise.
• Four-Month High: This increase is the highest in four months.
• Continuous Growth: The growth in June extends a 27-month streak of retail expansion.
• Driver of Growth: Rising wages have stimulated consumer spending, contributing to the surge in sales.
• Sector Highlights:
  • Machinery & Equipment: Sales jumped 10.1%.
  • Department Stores: Sales increased by 7.7%.
  • Other Retail Sectors: Also showed robust growth.
• Month-over-Month Growth: However, growth decelerated to 0.6% in June from May's 1.7%.

The Retail Sales year-over-year forecast is projected to be 2.9%, a significant decrease from the previous figure of 3.7%.

 

[MiloPlexyTrade]

30th August 2024

Friday​

On August 30th, Australia will release its month-over-month Retail Sales data. This will be followed by the Eurozone releasing its year-over-year Core CPI Flash Estimate and CPI Flash Estimate. Subsequently, Canada will announce its month-over-month GDP data. Lastly, the U.S. will release its month-over-month Core PCE Price Index, Chicago PMI, and the Revised UoM Consumer Sentiment.​

AUD – Retail Sales m/m​

In Australia, the Retail Sales report is vital as it details the sales of retail goods and services, reflecting consumer spending which significantly influences the nation's economy. This report is closely watched by traders and analysts due to its implications on economic trends and forecasting, given its role as a primary indicator of economic health.


Australia's retail sales saw a 0.5% increase in June 2024, surpassing market expectations of a 0.2% rise but slowing slightly from May's four-month peak of 0.6%. The growth was led by a notable acceleration in "other retailing," which surged to 1% from 0.3%. However, sales in food retailing and clothing, footwear, and personal accessories experienced a slowdown, rising 0.2% and 0.7% respectively, compared to previous gains. Sales in cafes, restaurants, and takeaway food services remained flat, while household goods retailing stayed steady at 1.1%. Regionally, New South Wales, Northern Territory, and Australian Capital Territory saw increased sales, while Victoria, Western Australia, and Queensland experienced slower growth.​

TL;DR

Category	June 2024 Growth	Previous Month Growth
Overall Retail Sales	0.5%	0.6%
Other Retailing	1.0%	0.3%
Food Retailing	0.2%	Higher than 0.2%
Clothing, Footwear, Personal Accessories	0.7%	Higher than 0.7%
Cafes, Restaurants, Takeaway Food Services	Flat	Varies
Household Goods Retailing	1.1%	1.1%

Region	Sales Performance
New South Wales	Increased
Northern Territory	Increased
Australian Capital Territory	Increased
Victoria	Slower Growth
Western Australia	Slower Growth
Queensland	Slower Growth

The monthly Retail Sales forecast shows a 0.3% increase, compared to the previous outcome of 0.5%.

The upcoming Retail Sales m/m will be released on Friday at 1:30 AM GMT.

EUR - Core CPI Flash Estimate y/y​

The Core CPI Flash Estimate y/y tracks changes in the prices of goods and services, excluding food, energy, alcohol, and tobacco. If the actual data exceeds forecasts, it is typically favorable for the currency. Traders closely monitor this measure because it reflects underlying inflation trends. Rising consumer prices can lead central banks to raise interest rates to combat inflation, which in turn can impact currency valuation.


In July 2024, the Euro Area's annual core inflation rate, which excludes volatile components such as energy, food, alcohol, and tobacco, held steady at 2.9% for the third consecutive month, defying expectations of a slight decline to 2.8%, according to preliminary estimates. This stability in the core inflation rate comes despite a month-on-month decrease of 0.2% in core consumer prices, following a rise of 0.4% in June. The persistence of the inflation rate suggests underlying economic pressures that continue to influence the Euro Area's financial stability.​

The Core CPI Flash Estimate is forecasted at 2.8% year-over-year, slightly down from the previous outcome of 2.9%.

TL;DR

• Euro Area Core Inflation July 2024: Remained stable at 2.9% annually for the third consecutive month.
• Expectations vs. Reality: Inflation rate defied expectations, which predicted a slight decrease to 2.8%.
• Monthly Core Consumer Prices: Experienced a decrease of 0.2% from the previous month, after a rise of 0.4% in June.
• Economic Implications: The steady core inflation rate indicates ongoing economic pressures affecting the financial stability of the Euro Area.

EUR - CPI Flash Estimate y/y​

The CPI Flash Estimate (y/y) measures the annual change in consumer prices for goods and services. If the actual CPI figure exceeds forecasts, it is typically seen as favorable for the currency. Traders focus on this indicator because rising consumer prices can lead to higher inflation, which often prompts central banks to raise interest rates to manage inflation. Consequently, higher interest rates can strengthen the currency, making this data crucial for currency valuation.

In July 2024, the Euro Area's annual inflation rate unexpectedly increased to 2.6% from 2.5% in June, surpassing forecasts of a decline to 2.4%, according to preliminary estimates. The rise was driven by a 1.3% increase in energy costs, up from 0.2% in June, and a faster 0.8% rise in non-energy industrial goods. However, inflation moderated for services (4.0% vs. 4.1%) and for food, alcohol, and tobacco (2.3% vs. 2.4%). Excluding energy, inflation eased to 2.7% from 2.8%, while the core rate, excluding food, energy, alcohol, and tobacco, remained steady at 2.9%, higher than the anticipated 2.8%. Among major economies, inflation accelerated in Germany, France, and Italy, but slowed in Spain.

TL;DR​

• Euro Area Inflation July 2024: Rose to 2.6%, up from 2.5% in June, defying expectations of a decline to 2.4%.
• Energy Costs: Increased by 1.3% in July, a significant rise from 0.2% in June.
• Non-Energy Industrial Goods: Inflation for these goods quickened to 0.8%.
• Moderation in Other Sectors:
  • Services inflation slightly decreased to 4.0% from 4.1%.
  • Food, alcohol, and tobacco inflation moderated to 2.3% from 2.4%.
• Core Inflation Metrics:
  • Excluding energy, inflation eased to 2.7% from 2.8%.
  • Core inflation (excluding food, energy, alcohol, and tobacco) held steady at 2.9%, above the forecasted 2.8%.
• Regional Variations:
  • Inflation rates increased in Germany, France, and Italy.
  • Spain experienced a slowdown in inflation.

The CPI Flash Estimate year-on-year is projected to be 2.2%, down from the previous figure of 2.6%.

The Core CPI Flash Estimate y/y and CPI Flash Estimate y/y are set to be released on Friday at 9:00 AM GMT.

CAD – GDP (Gross Domestic Product) m/m​

The GDP month-over-month (m/m) measures reflect the change in the inflation-adjusted value of all goods and services produced by the economy. An 'Actual' value that exceeds the 'Forecast' is generally seen as favorable for the currency. Traders pay close attention to this indicator because it is the broadest measure of economic activity and serves as the primary gauge of the overall health of the economy.

Canada's economy demonstrated resilience with continued growth in the second quarter of 2024, despite a slight deceleration. May's GDP outperformed expectations with a 0.2% increase, bolstered by robust manufacturing output and the activation of the Trans Mountain pipeline, which compensated for a retail sector slowdown. This led to a preliminary estimate of a 2.2% annualized growth rate for the quarter, eclipsing the Bank of Canada's prediction of 1.5%. Amidst this growth, the Bank of Canada reduced its benchmark interest rate for a second consecutive session, adjusting its focus towards the risk of inflation falling below the 2% mark. With inflation expected to stabilize, economists believe that while the strong GDP data may prompt revised economic forecasts, it is unlikely to halt the trend of further interest rate reductions.​

TL;DR

• Economic Overview:
  • Canada's economy grew by an annualized rate of 2.2% in the second quarter of 2024.
  • Growth was slightly slower than previous quarters but still robust.
• GDP Performance in May:
  • GDP increased by 0.2%, surpassing expectations.
• Key Growth Drivers:
  • Strong manufacturing output.
  • Activation of the Trans Mountain pipeline.
• Challenges:
  • A slowdown in the retail sector.
• Bank of Canada's Monetary Policy:
  • Reduced the benchmark interest rate for a second consecutive session.
  • Shifted focus to preventing inflation from falling below the 2% target.
• Future Expectations:
  • Inflation is expected to stabilize.
  • Despite strong GDP data, further interest rate reductions are anticipated.
• Economic Forecasts:
  • Current growth exceeded the Bank of Canada's forecast of 1.5% for the quarter.

The projected monthly GDP growth rate is 0.1%, down from the previous rate of 0.2%.

The upcoming monthly GDP data is set to be released this Friday at 12:30 PM GMT.

USD - Core PCE Price Index m/m​

The Core PCE Price Index, excluding food and energy, is the Federal Reserve's main measure of inflation. An increase above forecasts typically strengthens the currency as it prompts the Fed to raise interest rates to control inflation, affecting economic and currency stability. This index is crucial for traders monitoring potential shifts in monetary policy.

In June 2024, the US Core PCE Price Index, the Federal Reserve's preferred measure of underlying inflation, rose by 0.2% month-over-month, in line with market expectations. This represented an acceleration from the 0.1% increase recorded in May, which was the smallest monthly gain since November 2023. The headline PCE Price Index also edged up by 0.1%. On an annual basis, core PCE inflation remained steady at 2.6%, unchanged from the previous month, despite forecasts predicting a slight decrease to 2.5%. This data indicates continued underlying inflationary pressures in the economy.

TL;DR​

• US Core PCE Price Index for June 2024: Increased by 0.2% month-over-month, matching market expectations.
• Comparison with Previous Month: This was an acceleration from a 0.1% rise in May, the lowest since November 2023.
• Headline PCE Price Index: Rose by 0.1% from the previous month.
• Annual Core PCE Inflation: Remained constant at 2.6%, against predictions of a decrease to 2.5%.
• Economic Insight: Indicates persistent underlying inflationary pressures in the economy.

The forecast for the Core PCE Price Index month-over-month remains unchanged at 0.2%, the same as the previous outcome.

The next release of the Core PCE Price Index month-over-month is scheduled for this Friday at 12:30 PM GMT.

USD - Chicago PMI​

The Chicago PMI, derived from a survey of approximately 200 purchasing managers in the region, measures the level of economic activity in the manufacturing sector through a diffusion index. A reading above the forecasted level typically benefits the currency, as it signals stronger-than-expected economic conditions. Traders closely follow this indicator because it offers a timely glimpse into the economic climate, with purchasing managers' assessments providing crucial insights into business sentiment and market trends.


The Chicago Business Barometer, or Chicago PMI, dropped to 45.3 in July 2024, down from a seven-month high of 47.4 in June and slightly above market expectations of 45. This decline, marking the eighth consecutive month of contraction, was driven by decreases in four of the five subcomponents, with production showing the most significant drop. New orders, order backlogs, and employment also declined, though supplier deliveries saw a slight increase. Additionally, prices paid continued to decrease, reaching their lowest level since June 2023. The latest reading reflects ongoing challenges in Chicago's economic activity despite some areas of minor improvement.​

TL;DR

• Chicago Business Barometer Decline: Fell to 45.3 in July 2024 from 47.4 in June.
• Consecutive Monthly Contractions: Marks the eighth consecutive month of economic contraction.
• Subcomponent Performance:
  • Significant decline in production.
  • Decreases also noted in new orders, order backlogs, and employment.
  • Slight improvement in supplier deliveries.
• Prices Paid: Continued to decrease, hitting the lowest level since June 2023.
• Market Expectations: The index slightly exceeded expectations of 45.
• Economic Challenges: Reflects ongoing difficulties in Chicago's economic activity despite some areas showing minor improvements.

The forecast for the Chicago PMI is 45.0, up from the previous value of 45.3.

The Chicago PMI is scheduled for release on Friday at 1:45 PM GMT.

USD - Revised UoM Consumer Sentiment​

The Revised University of Michigan Consumer Sentiment Index, derived from a survey of approximately 500 consumers who assess current and future economic conditions, measures the level of a composite index based on consumer perceptions. An 'Actual' reading that exceeds the 'Forecast' is typically positive for the currency because financial confidence serves as a leading indicator of consumer spending, which constitutes a majority of overall economic activity.


Consumer confidence in the United States showed a slight improvement in August 2024, with the University of Michigan's Index of Consumer Sentiment rising to 67.8 from 66.4 in July, surpassing expectations of 66.9. This marks the first increase in five months, driven by strengthened expectations for personal finances and a more optimistic five-year economic outlook, the highest in four months. The Index of Consumer Expectations also improved to 72.1, while the Current Economic Conditions index saw a slight decline to 60.9 from 62.7. Inflation expectations remained steady, with year-ahead expectations at 2.9% and five-year expectations at 3%, unchanged from the previous month. The report suggests that while election developments may influence future expectations, they are unlikely to impact current economic assessments.

TL;DR​

• Consumer Sentiment Index: Increased to 67.8 in August 2024 from 66.4 in July, surpassing the expected 66.9.
• Consumer Expectations Index: Improved to 72.1 in August.
• Current Economic Conditions Index: Declined slightly to 60.9 from 62.7.
• Inflation Expectations:
  • Year-ahead remained steady at 2.9%.
  • Five-year expectations stable at 3%.
• Overall Outlook: Marks the first increase in sentiment in five months, fueled by positive views on personal finances and a brighter five-year economic forecast. Election developments are seen as potentially influential but not currently affecting economic assessments.

The forecast for the Revised University of Michigan Consumer Sentiment is 68.0, up from the previous value of 67.8.

The Revised University of Michigan Consumer Sentiment report is scheduled for release on Friday at 2:00 PM GMT.

 

[MiloPlexyTrade]

31st August 2024

Saturday​

CNY - Manufacturing PMI​

The Manufacturing PMI, based on surveys of 3,000 purchasing managers, measures industry conditions such as employment, production, and new orders. An 'Actual' figure higher than the 'Forecast' benefits the currency, with values above 50 indicating expansion and below 50 indicating contraction. This measure significantly impacts currency markets, especially if released before the Caixin Manufacturing PMI, due to China's global economic influence. Traders use this index as a leading economic indicator since purchasing managers have the most current insights into business conditions.


China's manufacturing sector continued to contract in July, with the National Bureau of Statistics reporting a slight dip in the Manufacturing Purchasing Managers' Index (PMI) to 49.4, down from 49.5 in June and below the market forecast of 49.3. This marks the third consecutive month of shrinking factory activity due to subdued demand and adverse weather conditions. The Non-Manufacturing PMI also fell to 50.2, its lowest since November, reflecting a slowdown in construction and infrastructure spending. In response to the economic slowdown, China has introduced measures including interest rate cuts and substantial subsidies to stimulate consumption and upgrade equipment. The central government is also considering shifting consumption tax collection to local governments to bolster their revenue. Despite these efforts, analysts predict that achieving the 5% GDP growth target for the year will be challenging, with some banks revising their growth forecasts downward.​

TL;DR

• Manufacturing PMI:​
  • July value: 49.4​
  • June value: 49.5​
  • Market forecast: 49.3​
  • Marks the third consecutive month of contraction, influenced by subdued demand and adverse weather conditions.​
• Non-Manufacturing PMI:​
  • July value: 50.2​
  • Represents the lowest level since November, indicating a slowdown in construction and infrastructure spending.​
• Government Response:​
  • Introduced measures such as interest rate cuts and substantial subsidies aimed at stimulating consumption and upgrading equipment.​
  • Considering shifting consumption tax collection to local governments to increase their revenue.​
• Economic Forecast:​
  • Analysts find it challenging to achieve the 5% GDP growth target for the year.​
  • Some banks have revised their growth forecasts downward in response to the economic slowdown.​

The forecast for the Manufacturing PMI is 49.5, slightly up from the previous result of 49.4.

CNY - Non-Manufacturing PMI​

The Non-Manufacturing PMI measures the level of a diffusion index derived from a survey of approximately 1,200 purchasing managers in the services sector. An 'Actual' result greater than the 'Forecast' is generally favorable for the currency. A reading above 50.0 indicates industry expansion, while a reading below 50.0 signals contraction. Chinese data, due to China's significant impact on the global economy and investor sentiment, can notably influence currency markets. Since April 2012, the series has been reported on a seasonally adjusted basis. Traders monitor this indicator closely as it provides early insights into economic health through the purchasing managers' assessments of business conditions, including employment, production, new orders, prices, supplier deliveries, and inventories.


China’s Non-Manufacturing Purchasing Managers' Index (PMI) experienced a slight decrease in July, as reported by the National Bureau of Statistics (NBS). The index dropped to 50.2 from 50.5 in June, meeting market expectations precisely. Despite the slight decline, the Non-Manufacturing PMI still indicates a marginal expansion in the sector, remaining above the critical 50-point threshold that distinguishes growth from contraction. This comes at a time when the Manufacturing PMI has also edged down, highlighting subtle pressures across both sectors of China's economy.​

TL;DR

• China's Non-Manufacturing PMI: Dropped slightly to 50.2 in July from 50.5 in June, aligning with market forecasts.​
• Marginal Expansion: Despite the decrease, the index remains above the 50-point mark, indicating continued, albeit slight, growth in the non-manufacturing sector.​
• Comparison with Manufacturing Sector: This report comes as the Manufacturing PMI also decreased slightly, suggesting overall mild pressures within both sectors of China's economy.​

The projected Non-Manufacturing PMI is 50.0, slightly lower than the previous figure of 50.2.

The Manufacturing and Non-Manufacturing PMI reports are scheduled for release on Saturday at 1:30 AM GMT.

 

[MiloPlexyTrade]

3rd September 2024

Tuesday
​

​

On September 3rd, Switzerland will announce its latest inflation rate data on a month-over-month basis, providing key insights into the country's economic health. Simultaneously, the United States is scheduled to release its ISM Manufacturing PMI figures, which are critical for assessing the strength and overall activity level of the manufacturing sector.​

CHF - CPI m/m ​

The Consumer Price Index (CPI) measures the change in the price of goods and services purchased by consumers, with its monthly release occurring approximately three days after the end of the month. This indicator is crucial for currency valuation, as a CPI reading that exceeds forecasts typically signals favorable conditions for the currency. Consumer prices are a significant component of overall inflation, which in turn influences central bank policies; rising inflation often prompts the central bank to increase interest rates to maintain price stability. CPI is derived by sampling and comparing the average prices of a variety of goods and services from one period to the next.


In July 2024, Switzerland witnessed a decline in consumer prices, with the Consumer Price Index (CPI) dropping by 0.2% from the previous month, settling at 107.5 points based on December 2020 levels, according to the Federal Statistical Office (FSO). This reduction was primarily influenced by decreased costs in international package holidays, air transport, and clothing and footwear due to seasonal sales. Despite the overall decline, certain sectors such as supplementary accommodation and fruiting vegetables saw price increases, along with the hire of private means of transport. Annually, inflation stood at 1.3%. Core inflation, which excludes volatile components, also fell by 0.3% month-over-month, registering a 1.1% rise from July 2023. In contrast, prices for domestic products slightly increased by 0.2% compared to the previous month and showed a more substantial year-over-year increase of 2.0%. Meanwhile, imported products experienced a significant monthly decline of 1.3%, with an annual decrease of 1.0%.​

TL;DR

• CPI Overall:
  • Monthly change: -0.2%
  • Annual inflation: 1.3%
  • CPI points: 107.5
  • Influenced by an overall price drop
• International Package Holidays, Air Transport, Clothing & Footwear:
  • Monthly change: Decrease
  • Influenced by decreased costs due to seasonal sales
• Supplementary Accommodation, Fruiting Vegetables, Private Transport Hire:
  • Monthly change: Increase
  • Influenced by price increases in specific sectors
• Core Inflation:
  • Monthly change: -0.3%
  • Annual rise: 1.1%
  • Excludes volatile components
• Domestic Products:
  • Monthly change: +0.2%
  • Annual change: +2.0%
  • Slight increase in prices
• Imported Products:
  • Monthly change: -1.3%
  • Annual change: -1.0%
  • Influenced by a significant price decline

The projected CPI month-over-month increase is anticipated to be 0.1%, up from the previous outcome of -0.2%.

The next monthly Consumer Price Index report will be released on Tuesday at 6:30 AM GMT.

USD - ISM Manufacturing PMI​

The ISM Manufacturing PMI, also known as the Manufacturing ISM Report On Business, is a diffusion index based on a survey of approximately 300 purchasing managers in the manufacturing sector, and it measures the level of business conditions such as employment, production, new orders, prices, supplier deliveries, and inventories; a reading above 50.0 indicates industry expansion and is favorable for currency if it surpasses forecasts, as it serves as a leading indicator of economic health due to the purchasing managers' up-to-date insights into their company's view of the economy.


Fears of a US economic slowdown intensified after the ISM Manufacturing index for July plummeted to 46.6 from 48.5 in the previous month, significantly missing expectations and signaling the sharpest contraction in factory activity since November 2023. This marked the 20th decline in the index over the past 21 months, reflecting the persistent impact of high interest rates on goods demand. Employment metrics were notably weak, falling to 43.4—the lowest since June 2020—raising concerns ahead of the upcoming non-farm payrolls data. New orders and production also contracted sharply, while input prices rose due to increased costs for metals and electrical components. The disappointing data bolstered market expectations of multiple Fed rate cuts this year, with over 75 basis points of reductions fully priced in.​

TL;DR

Data Point	July Value	Comparison to Previous Data/Expectations
ISM Manufacturing Index	46.6	Dropped from 48.5 last month; sharp contraction since November 2023
Trend	20th decline in last 21 months	Indicates ongoing economic slowdown
Employment Metrics	43.4	Lowest since June 2020; concerns for non-farm payrolls data
New Orders	Contracted	Sharp contraction noted
Production	Contracted	Sharp contraction noted
Input Prices	Rose	Increased costs for metals and electrical components
Market Expectations	75+ basis points cuts	Anticipated Fed rate cuts fully priced in

The ISM Manufacturing PMI is projected to be 47.5, up from the previous figure of 46.8.

The ISM Manufacturing PMI is scheduled for release on Tuesday at 2:00 PM GMT.

 

[MiloPlexyTrade]

4th September 2024

Wednesday​

On September 4th, Australia is poised to announce its quarterly Gross Domestic Product (GDP) figures, providing insights into the economic growth of the nation over the past quarter. Following this, attention will shift to Canada where the central bank is scheduled to release its latest interest rate decision, a key indicator of the country's economic policy moving forward. Shortly thereafter, the United States will publish its JOLTS Job Openings report, offering valuable data on labor market conditions and job vacancies. To cap off these significant economic disclosures, a press conference will be held in Canada, where officials are expected to discuss the implications of the interest rate decision and other economic developments.​

​

AUD - GDP q/q​

GDP quarter-over-quarter measures the real change in the value of all goods and services produced in the economy over a quarter, adjusted for inflation. It serves as a broad indicator of economic health and activity. Typically, when the actual GDP growth exceeds the forecasted figures, it positively influences the nation's currency. This makes it a crucial metric for traders as it provides a comprehensive gauge of economic vitality.


Australia's economy grew by 0.1% in Q4 2023, the weakest in six quarters, falling short of market forecasts and reflecting subdued domestic demand, declining fixed investment, and net trade drags. Household spending rose 0.4%, driven by essential items, while government expenditure increased by 1.0% due to extended household benefits. Conversely, fixed investment fell 0.9%, with private investment declining for the first time in five quarters. Imports surged by 5.1%, outpacing the 0.7% rise in exports, partially offset by inventory build-up. The household savings ratio dropped by 0.9%. Annually, GDP grew 1.1%, the slowest since Q4 2020. RBA Governor Michele Bullock indicated potential rate adjustments in response to economic conditions, with the possibility of cuts if growth remains weak and hikes if inflation persists, while Assistant Governor Christopher Kent noted the delayed impact of recent rate hikes on mortgage holders.​

TL;DR

Economic Indicator	Q4 2023 Change	Details
GDP Growth	+0.1%	Weakest in six quarters
Household Spending	+0.4%	Driven by essential items
Government Expenditure	+1.0%	Increase due to extended household benefits
Fixed Investment	-0.9%	Decline; private investment down for the first time in five quarters
Imports	+5.1%	Significantly outpaced exports
Exports	+0.7%	Modest rise
Inventory Build-up	Not specified	Partial offset for other economic drags
Household Savings Ratio	-0.9%	Decrease
Annual GDP Growth	+1.1%	Slowest annual growth since Q4 2020
RBA Governor's Remarks	Potential Adjustments	Possible rate cuts or hikes in response to growth and inflation conditions
Assistant Governor's Remarks	Delayed Impact	Noted delayed impact of recent rate hikes on mortgage holders

The GDP quarter-on-quarter forecast is 0.2%, up from the previous result of 0.1%.

The upcoming GDP quarter-on-quarter data will be released on Wednesday at 1:30 AM GMT.

CAD - Overnight Rate​

The overnight rate is a critical financial indicator showing the interest rate at which major institutions lend to each other overnight. It significantly influences currency values, with increases typically seen as positive. Traders prioritize this rate because short-term interest rates are crucial for currency valuation. The rate is determined by consensus among central bank Governing Council members and is essential in economic policy, often referred to as the interest rate or key interest rate.


The Bank of Canada has reduced its policy interest rate by 25 basis points to 4.5%, marking a continuation of its easing cycle following a similar cut in June. This decision, driven by signs of excess supply and moderating inflation, aims to support economic growth and address slack in the labor market. The Bank notes that inflation, although still elevated in areas like shelter costs, is gradually easing, with CPI inflation falling to 2.7% in June and core inflation measures below 3% for several months. Economic growth is expected to pick up in the latter half of 2024, driven by stronger exports and a recovery in household spending and business investment. The Bank forecasts GDP growth of 1.2% in 2024, 2.1% in 2025, and 2.4% in 2026, with inflation projected to stabilize around the 2% target by next year. The Governing Council remains committed to restoring price stability and will continue to adjust monetary policy based on incoming data.​

TL;DR

Aspect	Details
Interest Rate Cut	Reduced by 25 basis points to 4.5%
Previous Cut	Similar reduction in June
Reason for Decision	Excess supply, moderating inflation, supporting economic growth, addressing labor market slack
Inflation Rates	CPI inflation at 2.7% in June; Core inflation below 3% for several months
Economic Growth	Expected to pick up in H2 2024 due to stronger exports, recovery in household spending & investment
GDP Growth Forecast	1.2% in 2024, 2.1% in 2025, 2.4% in 2026
Inflation Forecast	Projected to stabilize around 2% target by next year
Monetary Policy Focus	Committed to restoring price stability, adjustments based on incoming data

The Interest Rate forecast stands at 4.25%, down from the previous rate of 4.50%.

The upcoming Interest Rate decision will be released on Wednesday at 1:45 PM GMT.

USD - JOLTS Job Openings​

The JOLTS Job Openings report measures the number of job openings during the reported month, excluding the farming industry; an 'Actual' figure greater than the 'Forecast' is positive for the currency because job creation is a crucial leading indicator of consumer spending, which constitutes a significant portion of overall economic activity.


In June 2024, U.S. job openings remained largely unchanged at 8.184 million, slightly down from an upwardly revised 8.23 million in May and falling short of forecasts of 8 million. This figure is notably lower than the 9.12 million reported a year earlier and below the 2021-2023 monthly average of 10.174 million. Job openings increased in accommodation and food services and in state and local government, excluding education, but decreased in durable goods manufacturing and the federal government. Meanwhile, hires and total separations remained stable at 5.3 million and 5.1 million, respectively. The number of job quits fell to 3.282 million, the lowest since November 2020. The report also noted minor revisions to May data and consistent job openings and separations rates across different establishment sizes.​

TL;DR

• Job Openings: Held steady at 8.184 million, slightly down from 8.23 million in May.
• Expectations: The figure fell short of forecasts, which anticipated 8 million.
• Yearly Comparison: Job openings decreased from 9.12 million reported in June 2023.
• Monthly Average: Below the 2021-2023 monthly average of 10.174 million.
• Sector Gains: Increases noted in accommodation and food services, and state and local government (excluding education).
• Sector Losses: Decreases observed in durable goods manufacturing and the federal government.
• Hires and Separations: Both metrics remained stable at 5.3 million and 5.1 million, respectively.
• Quits: Dropped to 3.282 million, the lowest since November 2020.
• Data Revisions: Minor revisions were made to May's data.
• Consistency Across Sizes: Job openings and separations rates were consistent across different establishment sizes.

The forecast for JOLTS Job Openings stands at 8.09 million, down from the previous figure of 8.184 million.

The JOLTS Job Openings report is set to be released on Wednesday at 2:00 PM GMT.

CAD - BOC Press Conference​

At the Bank of Canada (BOC) press conference, the Governor and Senior Deputy Governor address investors and the public, explaining the central bank's monetary policy decisions in detail. This event is a critical method for the BOC to communicate factors influencing its latest interest rate decisions, including the overall economic outlook and inflation trends. Traders pay close attention because a press conference that is more hawkish than expected typically strengthens the currency. The discussions also offer valuable insights into potential future monetary policies.


During a recent press conference, financial markets reacted with initial uncertainty, evidenced by a mix of bearish and bullish movements. The conference, where the Bank of Canada announced a cut in the key interest rate to 4.5%, prompted an initial drop in market values for the USDCAD pair, with the opening point at 1.37955 descending to a low of 1.37824, a decrease of 13.1 pips. This was followed by a reversal to a bullish trend, with the market climbing to a daily peak of 1.38165 since the beginning of the conference, an increase of 34.1 pips. The rate cut, aimed at stimulating economic growth and managing inflation, sparked varied reactions among traders, reflecting the balancing act the central bank is attempting between fostering economic growth and controlling inflation.

TL;DR​

• Bank of Canada Decision: Cut the key interest rate to 4.5%.
• Objective: Aimed to stimulate economic growth and manage inflation.
• Initial Market Reaction (USDCAD pair):
  • Opened at 1.37955 and dropped to 1.37824, a decrease of 13.1 pips.
• Subsequent Market Movement:
  • Reversed to a bullish trend, climbing to a daily peak of 1.38165, an increase of 34.1 pips.
• Overall Market Response: Mixed reactions, displaying initial uncertainty followed by a bullish trend.

The press conference is scheduled to start on Wednesday at 2:30 PM GMT.

 

[MiloPlexyTrade]

5th September 2024

Thursday​

AUD - RBA Gov Bullock Speaks​

RBA Governor Michele Bullock is scheduled to speak at the Anika Foundation in Sydney, with audience questions anticipated. Typically, a more hawkish stance than expected positively impacts the currency. As the central bank's head, Governor Bullock plays a pivotal role in setting short-term interest rates, making her the most influential figure concerning the nation's currency value. Traders pay close attention to her public appearances, as they frequently provide subtle hints about future monetary policy directions.

In a recent development in the currency markets, the AUDUSD pair exhibited a swift bearish movement at the start of RBA Governor Michele Bullock's speech at the Anika Foundation in Sydney. This initial downturn was quickly overtaken by a bullish surge, with the pair climbing to its daily high at 0.66714 from an opening point of 0.66126, marking a significant rise of 58.8 pips. This movement underscores the currency market's acute responsiveness to central bank communications and potential indicators of future monetary policy, as well as the influence of concurrent news releases that impacted the pair's trajectory.
​

TL;DR

• Event: RBA Governor Michele Bullock's speech at the Anika Foundation in Sydney.
• Initial Market Reaction: Swift bearish movement in the AUDUSD pair at the start of the speech.
• Subsequent Movement: The pair experienced a bullish surge, reversing the initial drop.
• Closing Figures: The AUDUSD climbed to a daily high of 0.66714 from an opening of 0.66126.
• Total Change: The currency pair rose by 58.8 pips.
• Market Dynamics: Reflects the sensitivity of currency markets to central bank communications and hints at future monetary policy.
• Additional Influences: Other concurrent news releases also impacted the AUDUSD's trajectory.

The speech is scheduled to start on Thursday at 2:00 AM GMT.

USD - ADP Non-Farm Employment Change​

The ADP Non-Farm Employment Change estimates the monthly change in employment numbers, excluding the agriculture sector and government employees. Generally, if the actual data surpasses the forecast, it positively influences the currency. This metric is closely watched by traders because job creation serves as a vital indicator of consumer spending, which significantly drives overall economic activity. The data is derived by analyzing payroll information from over 25 million workers to estimate employment growth.


In July 2024, US private businesses added 122,000 jobs, marking the smallest increase in six months and falling short of the forecasted 150,000, following a revised 155,000 in June, according to the ADP National Employment Report. The service sector saw gains of 85,000 jobs, driven primarily by trade/transportation/utilities (+61,000) and leisure/hospitality (+24,000), while the goods-producing sector added 37,000 jobs, mainly in construction (+39,000) but experienced a decline in manufacturing (-4,000). Annual pay gains for job-stayers slowed to 4.8%, the slowest in three years, and pay for job-changers decreased to 7.2% from 7.7%. ADP’s chief economist, Nela Richardson, noted that the slowdown in wage growth aligns with the Federal Reserve’s efforts to control inflation.​

TL;DR

Category	Details
Total Job Additions	122,000 (smallest increase in six months)
Forecasted Job Additions	150,000
Previous Month (June) Jobs	Revised to 155,000
Service Sector Job Gains	85,000
- Trade/Transportation/Utilities	61,000
- Leisure/Hospitality	24,000
Goods-producing Sector Job Gains	37,000
- Construction	39,000
- Manufacturing	-4,000 (decline)
Annual Pay Gains (Job-stayers)	4.8% (slowest in three years)
Pay Gains (Job-changers)	7.2% (down from 7.7%)
Comments by ADP Chief Economist	Slowdown in wage growth matches Federal Reserve's inflation control efforts

The forecast for ADP Non-Farm Employment Change is 143,000, up from the previous figure of 122,000.

The ADP Non-Farm Employment Change is scheduled for release on Thursday at 12:15 PM GMT.

USD - Unemployment Claims​

Unemployment claims measure the number of individuals filing for unemployment insurance for the first time in the previous week. While typically considered a lagging indicator, this data is crucial for assessing economic health because consumer spending closely tracks labor market conditions. Moreover, unemployment figures significantly influence monetary policy decisions, making them pivotal for policymakers. Traders closely monitor these statistics, as actual numbers differing from forecasts can impact currency valuations—lower actual claims relative to forecasts are generally favorable for a currency's strength.


In the week ending August 24, 2023, U.S. initial unemployment claims slightly decreased, with the seasonally adjusted figure dropping by 2,000 to 231,000, according to the latest report. This adjustment comes after the previous week's count was revised upwards from 232,000 to 233,000. The four-week moving average also fell, showing a reduction of 4,750, settling at 231,500. Meanwhile, the insured unemployment rate held steady at 1.2% for the week ending August 17, consistent with the prior week. However, the number of people receiving unemployment benefits rose by 13,000 to 1,868,000, even as the previous week's figures were adjusted downward. The four-week moving average for insured unemployment saw a minimal decrease of 250, indicating relative stability in the labor market.​

TL;DR

• Initial Unemployment Claims: Decreased by 2,000 to 231,000.
• Four-week Moving Average of Claims: Dropped by 4,750 to 231,500.
• Insured Unemployment Rate: Remained constant at 1.2%.
• Number of People Receiving Unemployment Benefits: Increased by 13,000 to 1,868,000.
• Four-week Moving Average for Insured Unemployment: Slightly decreased by 250, showing market stability.

The forecast for Unemployment Claims is 231,000, unchanged from the previous figure.

The Unemployment Claims report is set to be released on Thursday at 12:30 PM GMT.

USD - ISM Services PMI​

The Non-Manufacturing ISM Report On Business is a monthly index based on surveys from approximately 300 purchasing and supply executives nationwide. It tracks changes in indicators such as Business Activity, New Orders, and Employment, with readings above 50% signaling expansion and below 50% indicating contraction. Given that service orders account for about 90% of the US economy, the report provides crucial insights into economic health and business sentiment, making it a key leading indicator for traders.


In July 2024, economic activity in the U.S. services sector expanded, with the Services PMI rising to 51.4%, up from June's 48.8%, according to the latest ISM Services Report On Business. This marks the fifth time the index has shown expansion in 2024. Key indicators contributing to the positive trend include the Business Activity Index at 54.5%, New Orders Index at 52.4%, and Employment Index at 51.1%. However, the Supplier Deliveries Index fell to 47.6%, indicating faster delivery times. The report also highlighted increased costs and stable but cautious business activity, with many sectors showing growth, while others like real estate and retail trade faced declines. Respondents expressed concerns about rising costs, inflation, and the potential impact of the upcoming presidential election on business decisions.​

TL;DR

• Services PMI: Increased to 51.4% from June's 48.8%, marking the fifth expansion in 2024.​
• Business Activity Index: Stood at 54.5%, indicating an increase in business activities.​
• New Orders Index: Rose to 52.4%, showing growth in new orders.​
• Employment Index: Increased to 51.1%, suggesting that employment within the sector is growing.​
• Supplier Deliveries Index: Dropped to 47.6%, signaling faster delivery times.​
• Economic Conditions: The report highlighted increased costs and stable yet cautious business activity, with varied growth across different sectors.​
• Sector Performance: Growth was evident in many sectors, though real estate and retail trade experienced declines.​
• Concerns: Respondents expressed worries about rising costs, inflation, and the potential impact of the upcoming presidential election on business decisions.​

The ISM Services PMI is forecasted to drop slightly to 51.2 from 51.4.

The upcoming ISM Services PMI is set to be released on Thursday at 2:00 PM GMT.

 

[MiloPlexyTrade]

6th September 2024

Friday
​

On Friday, September 6th, financial markets will closely monitor key economic indicators from Canada and the United States. Canada is set to release its Employment Change and Unemployment Rate data, providing insights into the country's labor market health. Subsequently, attention will shift to the U.S., where several high-impact announcements are scheduled. These include the monthly Average Hourly Earnings, Non-Farm Employment Change, and Unemployment Rate. Additionally, Federal Open Market Committee (FOMC) member Waller's speech will likely garner significant interest as investors seek clues about future monetary policy decisions. These releases are pivotal for market participants, as they can influence global financial markets.
​

CAD - Employment Change​

Employment Change Measures track the monthly variation in employment numbers. A higher-than-forecast 'Actual' figure is typically positive for the currency, as it indicates stronger job creation. Traders closely monitor this data because job growth is a crucial predictor of consumer spending, which significantly influences overall economic activity.


In July 2024, employment in Canada saw a slight decline, with a decrease of 2,800 jobs (-0.0%), marking the third consecutive month of little change in the labor market. The employment rate fell by 0.2 percentage points to 60.9%, continuing a downward trend observed since early 2023. Despite the overall stability, specific demographics, such as women and men aged 55 to 64, and young men aged 15 to 24, experienced notable job losses. Meanwhile, employment gains were recorded among men aged 25 to 54. The unemployment rate remained steady at 6.4%, unchanged from the previous month.​

TL;DR

Category	Change
Total Employment	Decrease of 2,800 jobs (-0.0%)
Employment Rate	Decreased by 0.2 points to 60.9%
Unemployment Rate	Steady at 6.4%
Demographic Changes:
- Women (55-64 years)	Notable job losses
- Men (55-64 years)	Notable job losses
- Young Men (15-24 years)	Notable job losses
- Men (25-54 years)	Employment gains

The projected Employment Change stands at 25,600, an improvement from the previous result of -2,800.

CAD - Unemployment Rate​

Unemployment Rate Measures represent the percentage of the workforce that is unemployed and actively seeking work from the previous month. A lower-than-forecast 'Actual' figure is generally favorable for the currency. Traders monitor this metric closely because, despite being a lagging indicator, the unemployment rate provides valuable insights into overall economic health, given that consumer spending is closely linked to labor market conditions.

In July 2024, Canada's unemployment rate remained unchanged at 6.4%, following consecutive increases in May and June. The stability in the unemployment rate masks underlying shifts in the labor market, with significant job losses in wholesale and retail trade, as well as among older workers and young men. Despite these losses, employment gains in public administration and core-aged men helped to offset further increases in unemployment. The unemployment rate for youth aged 15 to 24 reached 14.2%, the highest since 2012, reflecting a challenging job market for younger workers.​

TL;DR

Indicator	Details
Unemployment Rate (Overall)	6.4% (unchanged from previous month)
Job Losses	Significant in wholesale and retail trade; among older workers and young men
Employment Gains	Noted in public administration and among core-aged men
Youth Unemployment Rate (15-24)	14.2% (highest since 2012)
General Trend	Stability in overall unemployment rate despite sector-specific shifts

The Unemployment Rate is forecasted to be 6.5%, compared to the previous outcome of 6.4%.

The next release of the Employment Change & Unemployment Rate data is set for Friday at 12:30 PM GMT.

USD - Average Hourly Earnings m/m​

The Average Hourly Earnings m/m indicator measures the change in wages that businesses pay for labor, excluding the farming sector. If the 'Actual' figure exceeds the 'Forecast,' it generally benefits the currency. Traders pay close attention to this indicator because it acts as a leading indicator of consumer inflation; when businesses face higher labor costs, these increased expenses are often passed on to consumers in the form of higher prices.


In July, average hourly earnings for all employees on private nonfarm payrolls rose by 8 cents, or 0.2%, bringing the hourly rate to $35.07. Over the past year, these earnings have seen a 3.6% increase. Additionally, private-sector production and nonsupervisory employees experienced a 9-cent, or 0.3%, increase in their average hourly earnings, reaching $30.14 for the month.​

TL;DR

• All Employees on Private Nonfarm Payrolls:
  • July hourly earnings increased by 8 cents or 0.2%, reaching $35.07.
  • Annual earnings growth is 3.6%.
• Private-Sector Production and Nonsupervisory Employees:
  • July hourly earnings rose by 9 cents or 0.3%, totaling $30.14.
  • No annual increase rate provided for this category.

The forecast for month-over-month Average Hourly Earnings is projected at 0.3%, up from the previous figure of 0.2%.

USD - Non-Farm Employment Change​

The Non-Farm Employment Change measures the change in the number of employed individuals in the economy during the previous month, excluding those in the farming sector. This indicator is crucial for currency traders because a higher-than-expected 'actual' figure compared to the 'forecast' typically signals a positive economic outlook, leading to currency appreciation. Job creation is a key leading indicator of consumer spending, which drives a significant portion of overall economic activity. Thus, strong employment figures often suggest a robust economy and can influence currency values accordingly.


In July, U.S. nonfarm payrolls grew by a modest 114,000, falling short of the Dow Jones estimate of 185,000 and significantly below the revised 179,000 increase reported for June. This slower-than-expected job growth, coupled with a rise in the unemployment rate to 4.3%—the highest since October 2021—has intensified concerns about a potential economic slowdown. Health care led job creation with an addition of 55,000 positions, while construction, government, and transportation and warehousing also saw gains. Despite these increases, the overall job growth was well below the 12-month average of 215,000, prompting worries about weakening economic momentum and its potential impact on Federal Reserve policy.​

TL;DR

• U.S. Nonfarm Payrolls Growth for July: Increased by 114,000, which is below the Dow Jones estimate of 185,000 and June's revised figure of 179,000.
• Unemployment Rate: Rose to 4.3%, the highest since October 2021.
• Sector with Most Job Gains: Health care, with an addition of 55,000 positions.
• Other Gains Noted: Construction, government, and transportation and warehousing sectors also saw job increases.
• Comparison to Averages: The overall job growth was well below the 12-month average of 215,000, raising concerns about economic momentum.
• Impact on Policy: This weakening in job growth may influence Federal Reserve policy decisions.

The forecast for Non-farm Employment Change is projected at 164,000, an increase from the previous outcome of 114,000.

USD - Unemployment Rate​

The unemployment rate measures the percentage of the workforce that is unemployed and actively seeking employment over the previous month. When the actual rate is lower than the forecasted rate, it is generally positive for the currency. Traders pay close attention to this figure because, despite being a lagging indicator, it reflects overall economic health and is closely linked to consumer spending. Additionally, the unemployment rate is crucial for shaping monetary policy, making it a key concern for policymakers and investors alike.


In July, the U.S. labor market showed signs of strain as the unemployment rate rose to 4.3%, its highest level since October 2021, sparking concerns of a potential economic downturn. Nonfarm payrolls increased by just 114,000, well below expectations and the revised 179,000 figure from June. This unexpected slowdown in job growth has intensified fears of a broader economic weakening, despite recent gains in sectors like health care and construction. The rise in unemployment has also activated the Sahm Rule, which signals a recession when the jobless rate's three-month average climbs significantly above its 12-month low. Additionally, the number of people working part-time for economic reasons surged, contributing to a bleaker employment picture. These developments have put pressure on the Federal Reserve to consider rate cuts, as markets brace for further economic uncertainty.​

TL;DR

Indicator	Details
Unemployment Rate	Rose to 4.3%, highest since October 2021
Nonfarm Payrolls	Increased by 114,000, below expectations
Previous Month's Revision	Revised figure for June: 179,000
Economic Sectors with Gains	Health care and construction
Sahm Rule Activation	Indicates potential recession
Part-Time Work for Economic Reasons	Number of people surged
Federal Reserve Implication	Pressure to consider rate cuts
Market Outlook	Bracing for further economic uncertainty

The forecast for the Unemployment Rate is projected at 4.2%, down from the previous rate of 4.3%.

The upcoming release of the Average Hourly Earnings month-over-month, Non-Farm Employment Change, and Unemployment Rate is scheduled for 12:30 PM GMT on Friday.​

 

[MiloPlexyTrade]

10th September 2024

Tuesday

​

GBP – Claimant Count Change​

The UK Office for National Statistics' Claimant Count Change measures the month-to-month change in the number of people claiming unemployment benefits, serving as an early indicator of the labor market's health. This metric, released mid-month and covering the previous month, can impact GBP volatility. A rise in claimants is generally bearish for the Pound Sterling (GBP), signaling potential economic deterioration and looser monetary policy, while a drop is seen as bullish, reflecting improving economic conditions.


In July 2024, the UK experienced a significant increase in unemployment claims, with the Claimant Count climbing to 1.801 million. This marked an increase of 135,000 from June, which itself saw a revised rise of 36.2 thousand, significantly surpassing market expectations that predicted only a 14.5 thousand increase. This trend has been influenced by recent changes in policy by the Department for Work and Pensions, specifically the increase in the administrative earnings threshold for full work search conditionality, affecting around 180,000 claimants over six months. Despite the steep rise in unemployment claims, other aspects of the labor market showed mixed signals; while the number of payrolled employees modestly increased, job vacancies saw a continued decline. The overall employment and unemployment rates showed slight improvements, yet the dramatic rise in unemployment claims underscores the challenges and volatility within the UK labor market.​

TL;DR

• Claimant Count for July 2024: 1.801 million claims, an increase of 135,000 from June.
• June Revision: The number of claims in June was revised to a rise of 36.2 thousand.
• Market Expectations: The increase in July far exceeded the expected 14.5 thousand.
• Policy Change Impact: Changes by the Department for Work and Pensions increased the earnings threshold for work search conditionality, affecting around 180,000 claimants over six months.
• Employment Metrics:
  • Modest increase in the number of payrolled employees.
  • Continued decline in job vacancies.
  • Slight improvements in both the overall employment and unemployment rates.
• Labor Market Volatility: The dramatic rise in unemployment claims highlights ongoing challenges in the UK labor market.

The projected Claimant Count Change is expected to be 21,000.

The upcoming Claimant Count Change will be released on Tuesday at 6:00 AM GMT.

CAD - BOC Gov Macklem Speaks​

Bank of Canada Governor Tiff Macklem is scheduled to speak at the Canada-United Kingdom Chamber of Commerce in London. As the central bank's head, Macklem significantly influences the nation's currency value through interest rate control. Traders pay close attention to his speeches for hints about future monetary policy.


Bank of Canada Governor Tiff Macklem, speaking on Saint-Jean-Baptiste Day, outlined the challenges and strategies in managing the Canadian economy amidst fluctuating inflation rates and labour market conditions. He noted significant progress in controlling inflation, which peaked at over 8% in 2022 due to global supply chain issues and geopolitical tensions, but has since moderated below 3%. Macklem highlighted the central bank's recent decision to lower interest rates for the first time in four years, reflecting confidence in achieving the 2% inflation target. He also discussed the health of the labour market, emphasizing efforts to maintain price stability while supporting employment through careful monetary policies. The Governor stressed the importance of balancing labour market supply and demand, particularly as the economy navigates post-pandemic adjustments and ongoing global economic challenges.​

TL;DR

• Tiff Macklem spoke on Saint-Jean-Baptiste Day about managing the Canadian economy amid fluctuating inflation and labor market conditions.
• Noted progress in controlling inflation, which had peaked over 8% in 2022 due to global issues but has since fallen below 3%.
• Bank of Canada lowered interest rates for the first time in four years, showing confidence in reaching the 2% inflation target.
• Discussed the stable labour market, with efforts to maintain price stability while supporting employment through careful monetary policies.
• Emphasized balancing labour market supply and demand amid post-pandemic adjustments and ongoing global economic challenges.

The next speech by BOC Governor Macklem is scheduled for Tuesday at 12:10 PM GMT.

 

[MiloPlexyTrade]

11th September 2024

Wednesday

​

On September 11th, significant economic indicators are set to be released by both the United Kingdom and the United States, which are crucial for financial markets and policy decision-making. The UK will publish its monthly Gross Domestic Product (GDP) figures, providing insights into the economic performance and growth trends within the country for the past month. Simultaneously, the US will unveil several key inflation metrics, including the Core Consumer Price Index (CPI) on a monthly basis, alongside the general CPI for both monthly and annual comparisons. These data points are essential for assessing the inflationary pressures in the U.S. economy, which could influence future monetary policy decisions by the Federal Reserve. ​

​

GBP - GDP m/m​

The GDP month-over-month (m/m) measures the change in the total value of all goods and services produced by the economy. Generally, if the 'Actual' GDP exceeds the 'Forecast,' it is considered favorable for the currency. Traders closely monitor this indicator because it is the broadest measure of economic activity and serves as the primary gauge of the economy's health.


In June 2024, the UK's economy experienced no growth, halting the moderate growth trend observed in previous months, despite a quarterly rise of 0.6%. This stagnation was reflected in the services sector, which declined by 0.1% after five months of gains, significantly impacted by a 1.0% decrease in the wholesale and retail trade sector. However, there were positive developments in production and construction, which grew by 0.8% and 0.5%, respectively. The broader economic outlook remains positive with a 0.9% growth compared to the same quarter the previous year, signaling underlying resilience. Further data revisions and updates are anticipated in the forthcoming release of the National Accounts in October 2024.​

TL;DR

Sector	Monthly Change	Notes
Overall Economy	0% growth	No growth observed, halting previous trends
Services Sector	-0.1%	Declined after five months of gains
Wholesale & Retail Trade	-1.0%	Major factor in the services sector decline
Production	+0.8%	Positive growth
Construction	+0.5%	Positive growth
Overall Quarterly Growth	+0.6%	Compared to previous quarter
Yearly Growth	+0.9%	Compared to the same quarter the previous year

The monthly GDP growth is projected to be 0.2%.

The monthly GDP figures are set to be announced on Wednesday at 6:00 AM GMT.

USD - Core CPI m/m ​

The Core Consumer Price Index year-over-year measure indicates how the prices of goods and services purchased by consumers change, excluding volatile items like food, energy, alcohol, and tobacco. This data is released monthly, roughly 16 days after the end of the month. Generally, if the 'Actual' figure exceeds the 'Forecast,' it is considered positive for the currency. However, in this context, Core CPI data has a relatively minor impact compared to other countries because the central bank primarily focuses on the overall CPI for its inflation target.


In July, the Core Consumer Price Index (CPI), which excludes food and energy, rose by 0.2%, maintaining the same pace as the broader CPI but showing a slight uptick from the previous month's 0.1% increase, as reported by the U.S. Bureau of Labor Statistics. The increase in core CPI was primarily driven by higher costs in several categories including shelter, motor vehicle insurance, household furnishings and operations, education, recreation, and personal care. Conversely, indexes for used cars and trucks, medical care, airline fares, and apparel recorded declines. Over the past 12 months, the core CPI has increased by 3.2%, marking the smallest annual rise since April 2021, signaling a subtle deceleration in underlying inflationary pressures.​

TL;DR

• Core Consumer Price Index (CPI) for July: Rose by 0.2%, matching the broader CPI's increase, signaling a consistent pace with the previous month's slight uptick from 0.1%.
• Annual Core CPI Increase: Recorded a 3.2% rise over the past 12 months, the smallest annual increase since April 2021, indicating a subtle slowdown in underlying inflation.
• Primary Drivers of Increase:
  • Shelter
  • Motor Vehicle Insurance
  • Household Furnishings and Operations
  • Education
  • Recreation
  • Personal Care
• Categories with Declines:
  • Used Cars and Trucks
  • Medical Care
  • Airline Fares
  • Apparel

The Core CPI is expected to rise by 0.2% month-over-month.

USD - CPI m/m​

The Consumer Price Index (CPI) measures the monthly change in the prices of goods and services purchased by consumers. Typically, if the 'actual' CPI exceeds the 'forecast,' it is considered beneficial for the currency. This is because consumer prices make up a significant portion of overall inflation. Inflation, in turn, plays a crucial role in currency valuation, as increasing prices often prompt the central bank to raise interest rates to control inflation. The CPI is derived by sampling the average prices of various goods and services and comparing them to the previous month's data.


In July, the Consumer Price Index for All Urban Consumers (CPI-U) saw a modest increase of 0.2 percent, reversing a slight decline of 0.1 percent in June, according to the U.S. Bureau of Labor Statistics. This uptick was largely driven by a 0.4 percent rise in shelter costs, which contributed to nearly 90 percent of the monthly all-items increase. Food prices also climbed slightly by 0.2 percent, consistent with June's increase, while energy prices stabilized after two months of decreases. Notably, the index for all items excluding food and energy mirrored the broader index with a 0.2 percent increase. This period also observed varied movements across other sectors, with increases in expenses such as motor vehicle insurance and household furnishings, while indexes like used cars and trucks, medical care, and airline fares saw declines.​

TL;DR

• Overall CPI-U: Increased by 0.2%.
• Shelter Costs: Rose by 0.4%, contributing nearly 90% of the overall monthly increase.
• Food Prices: Increased slightly by 0.2%.
• Energy Prices: Remained stable after two months of declines.
• Excluding Food and Energy: Also saw a 0.2% increase.
• Motor Vehicle Insurance: Experienced an increase.
• Household Furnishings: Also increased.
• Used Cars and Trucks: Index decreased.
• Medical Care: Index decreased.
• Airline Fares: Index decreased.

The CPI is expected to rise by 0.2% month-over-month.

USD - CPI y/y​

The Consumer Price Index (CPI) year-over-year (y/y) measures the change in the price of goods and services purchased by consumers. When the actual CPI exceeds the forecast, it is typically positive for the currency. This is because consumer prices account for a significant portion of overall inflation, which is crucial for currency valuation. Rising prices often prompt the central bank to raise interest rates to contain inflation. The CPI is derived by sampling the average price of various goods and services and comparing it to the previous sampling.


The U.S. Bureau of Labor Statistics has announced that the Consumer Price Index for All Urban Consumers (CPI-U) rose by 2.9% in the year ending July, marking the smallest annual increase since March 2021. This slowdown in year-over-year inflation highlights a moderation in price growth across a broad range of goods and services. Core inflation, which strips out the often volatile food and energy sectors, also saw a decrease, with a rise of 3.2% over the past 12 months—the lowest rate since April 2021. This trend suggests a gradual easing of inflationary pressures, providing a nuanced picture of the current economic environment.​

TL;DR

• The CPI for All Urban Consumers rose by 2.9% in the year ending July, which is the smallest annual increase since March 2021.
• Core inflation, which excludes the often volatile food and energy sectors, increased by 3.2% over the past 12 months—this is the lowest rate since April 2021.
• The data indicates a moderation in price growth across a broad range of goods and services, suggesting a gradual easing of inflationary pressures.

The projected year-over-year Consumer Price Index increase is expected to be 2.6%.

The new inflation figures are set to be published this Wednesday at 12:30 PM GMT.

 

[MiloPlexyTrade]

12th September 2024

Thursday​

On September 12, the Eurozone will announce its interest rate decision, setting the stage for economic forecasts. Following this, the U.S. will release its Core Producer Price Index (PPI) and overall PPI for the month, along with unemployment claims data. Additionally, the European Central Bank will hold a press conference to discuss monetary policy updates and economic outlooks.​

​

EUR - Main Refinancing Rate​

The Main Refinancing Rate measures the interest rate on the primary refinancing operations that provide most of the liquidity to the banking system. Scheduled eight times per year, an 'Actual' value higher than the 'Forecast' is beneficial for the currency. This rate decision, typically factored into market expectations, is often overshadowed by the ECB Press Conference held 45 minutes later. Since January 2015, the release frequency was adjusted from monthly to eight times annually. Traders closely monitor short-term interest rates, the most critical factor in currency valuation, using other indicators to anticipate future rate changes. The rate is determined by a vote from the 6 members of the ECB Executive Board and 15 of the 19 governors of Euro area central banks, with the vote distribution kept confidential.


In July 2024, the European Central Bank's Governing Council decided to maintain its key interest rates unchanged, affirming the stability of the medium-term inflation outlook. Rates for main refinancing operations, marginal lending, and deposit facilities were held at 4.25%, 4.50%, and 3.75% respectively, in line with ongoing measures to guide inflation back to the ECB’s 2% target efficiently. Despite observing some temporary increases in certain inflation metrics in May, the overall trends either stabilized or declined by June. The ECB noted that the inflationary pressures from high wage growth were counterbalanced by corporate profits, maintaining restrictive monetary policies. Moreover, the ECB plans to phase out its pandemic emergency purchase program by 2024 while continuing to adapt its monetary strategies based on the evolving economic data and inflation trends, with a commitment to achieving and maintaining price stability across the Eurozone.​

TL;DR

Aspect	Details

Interest Rates

Main refinancing: 4.25%, Marginal lending: 4.50%, Deposit: 3.75%

Inflation Outlook

Stable medium-term outlook; recent trends show stabilization or decline

Inflation Metrics

Temporary increases in May; overall trends improved by June

Wage Growth vs. Corporate Profits

High wage growth offset by corporate profits, maintaining restrictive policies

Pandemic Emergency Purchase Program

Phased out by 2024

Future Strategy

Adapt monetary strategies based on evolving economic data, with a focus on price stability

The anticipated decision for the ECB Interest Rate is projected to be 3.65%.

The decision on interest rates will be announced at 12:15 PM GMT on Thursday.

USD - Core PPI m/m​

The Producer Price Index (PPI) excluding food and energy, as published by the Bureau of Labor Statistics, gauges the average changes in prices at the wholesale level across various stages of production in the United States. By excluding the more volatile categories of food and energy, this measure aims to provide a clearer picture of price trends. Typically, a high PPI reading is considered favorable or bullish for the US dollar, while a low reading is viewed as detrimental or bearish.


In July 2024, core producer prices in the United States, which exclude the volatile categories of food and energy, remained unchanged from the previous month, representing a slowdown from the 0.3% increase recorded in June and falling short of the anticipated 0.2% rise. This stagnation indicates a cooling of price pressures compared to the previous month. Over the year, core producer inflation also decelerated to 2.4%, down from a peak of 3% in June, which had been the highest rate in over a year. This slowdown suggests a moderation in the underlying inflationary trends within the U.S. economy.​

TL;DR

• Core Producer Prices (July 2024)
  • Remained unchanged from June
  • June: +0.3%
  • Expected: +0.2%
  • Indicates a slowdown in price pressures
• Yearly Core Producer Inflation
  • July: 2.4%
  • June: 3.0%
  • Decrease from peak rate of 3% in June
  • Suggests moderation in underlying inflation trends

The projected monthly increase in the Core Producer Price Index (PPI) is expected to be 0.2%.

USD - PPI m/m​

The U.S. Producer Price Index (PPI) for final demand, released monthly by the Bureau of Labor Statistics, tracks price changes from producers for goods and services in various sectors. It includes final demand goods, trade services, transportation, warehousing, and construction. Traders watch the PPI closely as it indicates future consumer inflation; higher readings are typically seen as positive for the USD, while lower readings are negative.


In July, the U.S. Producer Price Index (PPI) for final demand saw a modest increase of 0.1%, seasonally adjusted, as reported by the U.S. Bureau of Labor Statistics. This followed a 0.2% rise in June and no change in May. Over the past 12 months, the index has advanced 2.2% on an unadjusted basis. The rise in July was largely driven by a 0.6% increase in final demand goods, notably due to a 1.9% hike in energy prices, particularly gasoline (2.8%). Other notable increases included diesel fuel, meats, jet fuel, fresh fruits and melons, and basic organic chemicals, while electric power saw a decrease of 1.1%. In contrast, final demand services dipped by 0.2%, marked by a 1.3% fall in trade services. Excluding foods, energy, and trade services, prices edged up by 0.3% in July, and saw a year-on-year increase of 3.3%.​

TL;DR

• PPI Increase (July): 0.1% (seasonally adjusted)
• PPI Increase (June): 0.2%
• PPI Change (May): 0.0%
• Year-on-Year PPI Increase: 2.2% (unadjusted)
• Final Demand Goods Increase: 0.6%
• Energy Prices Increase: 1.9%
• Gasoline Price Increase: 2.8%
• Electric Power Decrease: -1.1%
• Final Demand Services Decrease: -0.2%
• Trade Services Decrease: -1.3%
• Excluding Foods, Energy, Trade Services (July): 0.3% (monthly), 3.3% (yearly)

The projected monthly increase in the Producer Price Index (PPI) is expected to be 0.1%.

USD - Unemployment Claims​

Initial Jobless Claims track the number of people filing for unemployment benefits for the first time in a week, serving as an early indicator of U.S. economic health. While the impact on the market can vary, a higher than expected number is usually seen as negative for the USD, and a lower than expected number as positive. Traders monitor these figures closely as they reflect labor market conditions, which are directly linked to consumer spending and are crucial for shaping monetary policy.


The U.S. labor market showed signs of tightening as initial unemployment claims dropped by 5,000 to 227,000 for the week ending August 31, marking a seven-week low and falling below the expected 231,000. This decline reflects a slight easing from previous highs earlier this year, though levels remain above early 2023 figures, indicating a somewhat softened market post-pandemic. Additionally, the total number of people receiving unemployment benefits also decreased by 22,000 to 1,838,000. The four-week moving average, which smooths out weekly fluctuations, fell by 1,750 to 230,000. Despite these changes, the unemployment insurance rate held steady at 1.2 percent, underscoring a labor market that, while cooling, still remains historically robust.​

TL;DR

• Initial unemployment claims dropped by 5,000 to 227,000 for the week ending August 31, a seven-week low.
• The drop was below the expected 231,000, indicating a slight easing from earlier highs.
• Total number of people receiving unemployment benefits decreased by 22,000 to 1,838,000.
• The four-week moving average fell by 1,750 to 230,000.
• The unemployment insurance rate remained steady at 1.2%.

Unemployment claims are projected to hit 227,000, unchanged from the previous outcome.

The Core PPI m/m, PPI m/m, and Unemployment Claims data will be released on Thursday at 12:30 PM GMT.

EUR - ECB Press Conference​

ECB Press Conference Speakers: ECB President and Vice President Usual Impact: A more hawkish stance than anticipated generally strengthens the currency. Significance for Traders: This conference is the main way the ECB communicates with investors about monetary policy. It elaborately discusses the considerations influencing recent policy decisions, including interest rates, the broader economic outlook, and inflation. Crucially, it offers insights into future monetary policy directions.


During the European Central Bank's press conference, the EUR/USD pair exhibited a bearish trend. As the conference commenced, the opening rate stood at 1.09316. Throughout the session, the currency pair continued to decline, touching a low of 1.08937 by the day's close. This movement marked a significant drop of 37.9 pips, reflecting investor reactions to the developments and statements made during the ECB's pivotal monetary policy discussion.​

The ECB Press Conference is scheduled for Thursday at 12:45 PM GMT.