16 Jul 2014
The day ahead about to get busy – Rabobank
FXStreet (Guatemala) - Analysts at Rabobank pick out the potential movers for today.
Key Quotes:
“Today sees a slew of key Chinese data, with investment, retail sales, industrial production, and Q2 GDP. All of them are expected to show a slight uptick in YoY terms from May readings (and GDP to stay at 7.4% YoY), and risks are arguably to the upside after the staggeringly-large increase in aggregate financingyesterday (it surged to CNY1,970bn from CNY1,405bn, and the MoM pace of increase was up nearly 90% YoY!): that signal shows that China is still locked in to a build-it-and-they-will-come-don’t-spare-the-horses credit surge to drive growth, despite the fact that debt to GDP is already around 253% and rising fast, while the underlying productivity of the new lending is highly questionable”.
“In the UK there is the labour market report: the market expects another sharp fall in the jobless total, and yet still no sign of wage inflation (on that front alone the BOE’s passivity is justified)”.
“The US has PPI (seen +0.2% MoM and 1.7% YoY ex-food and energy), industrial production (seen +0.3% MoM), and the NAHB housing index (seen little changed at 50). Yellen also repeats her testimony again (so half of Congress has to pretend it didn’t hear it yesterday), while R Fisher speaks on monetary policy later: expect him to be more hawkish, as he usually is. We then conclude with the Fed’s Beige Book, which will no doubt underline that the US recovery is broadly continuing – while probably making no distinction that wages growth is not following in tandem”.
Key Quotes:
“Today sees a slew of key Chinese data, with investment, retail sales, industrial production, and Q2 GDP. All of them are expected to show a slight uptick in YoY terms from May readings (and GDP to stay at 7.4% YoY), and risks are arguably to the upside after the staggeringly-large increase in aggregate financingyesterday (it surged to CNY1,970bn from CNY1,405bn, and the MoM pace of increase was up nearly 90% YoY!): that signal shows that China is still locked in to a build-it-and-they-will-come-don’t-spare-the-horses credit surge to drive growth, despite the fact that debt to GDP is already around 253% and rising fast, while the underlying productivity of the new lending is highly questionable”.
“In the UK there is the labour market report: the market expects another sharp fall in the jobless total, and yet still no sign of wage inflation (on that front alone the BOE’s passivity is justified)”.
“The US has PPI (seen +0.2% MoM and 1.7% YoY ex-food and energy), industrial production (seen +0.3% MoM), and the NAHB housing index (seen little changed at 50). Yellen also repeats her testimony again (so half of Congress has to pretend it didn’t hear it yesterday), while R Fisher speaks on monetary policy later: expect him to be more hawkish, as he usually is. We then conclude with the Fed’s Beige Book, which will no doubt underline that the US recovery is broadly continuing – while probably making no distinction that wages growth is not following in tandem”.