Dentalfloss
Legendary member
- Messages
- 63,404
- Likes
- 3,726
Good Morning: The Long & the Short of it and The Bigger Picture - 16 October 2019 - ADM ISI
- Busy day for data, central bank speakers and US earnings, but US/China
Trade and Brexit news still the pivotal influences: digesting Korea rate
cut, PBOC 1-yr MLF injection, HK policy address; awaiting UK & Canada
inflation, US Retail Sales & Beige Book; Germany to sell 30-yr
- UK CPI: energy to drag, maybe offset clothing and leisure prices, headline
and core seen a little below target, inflation subdued, but Brexit still
key in terms of BoE policy outlook
- US Retail Sales: modest gains seen across all measures, implying solid
pace of PCE in Q3, though slower than Q3; market Oct Fed rate expectations
likely to shift on any miss/beat (net of revisions)
- Audio preview: attached (mixcloud not working today ;( )
..........................................................................
********************
** EVENTS PREVIEW **
********************
********************
** EVENTS PREVIEW **
********************
It will be another busy day for data, central bank speakers and US corporate earnings, but once again a tweet from Trump, Chinese officials comments (see the overnight denial that China did not actually commit the $40-50 Bln of Agri purchases, at least not without a reduction in US tariffs, & watch the HK bill going through Congress aimed at supporting Hong Kong Protests, which the House has already passed), or an EU or UK 'source' 'briefing' on Brexit can put a big fat redline through any considerations about macro and micro data. Be that as it may, there are EU New Car Registrations to digest ahead of the full gamut of UK inflation data, Eurozone Trade and final CPI, Canadian CPI and the potentially key US Retail Sales data. The IMF/World Bank meetings continue in Washington, and a consequence there will be a further deluge of BoE, ECB, Fed and Riksbank speakers, following from the expected overnight 25 bps rate cut in South Korea, while the Fed publishes its Beige Book. Germany will auction an as usual modestly sized EUR 1.0 Bln of 30-yr Bund, while the US Corporate Earnings run again features a slew of financials - Bank of America Merrill Lynch, Bank of New York Mellon, PNC Financial Services, US Bancorp & Ally Financial - with Abbot Laboratories, Alcoa, IBM, Kinder Morgan and Netflix are the highlights among non-financials.
** U.K. - September CPI, RPI & PPI **
- Following on from the weaker than expected labour data, which suggested that Brexit uncertainty is finally starting to weigh on labour demand with surveys hinting at a further deterioration in coming months, the focus turns to inflation data. CPI is seen up 0.2% m/m tro edge the y/y rate up to 1.8%, with core CPI seen unchanged in y/y terms at 1.7%; much will depend on how much the downward pull from petrol and energy prices are offset by rises in leisure (recreation/culture, airfares) and clothing & footwear, but ultimately a small miss in either direction would still leave a picture of inflation pressures remaining very subdued. The same picture has been and will likely continue to be conveyed by PPI, which has suggested little or nothing in the way of pipeline pressures. Eminently there has been some dovish BoE coo-ing from the likes of Vlieghe and Saunders, but this looks to be the sort of inflation micro-management that is frankly preposterous in the face of the potentially very binary Brexit outcomes.
** U.S.A. - September Retail Sales **
- August's Retail Sales appeared to suggest that the strength in consumer spending seen since the end of Q1 through July was losing momentum, above all the flat m/m reading ex-Autos, though the commentary chatterarti appeared rather too eager to jump all over one month's data, which in truth suggested a non-negligible impact from Hurricane Dorian. As already reported, stronger than expected Auto Sales should give headline sales a boost (consensus 0.3% m/m), despite a drag from a further fall in gasoline prices (generally a positive for consumer spending, especially when aligned with lower mortgage rates), with the core 'control group' seen reprising August's 0.3% m/m, which implies a 3-mth annualized pace for Q3 of 6.0%, slower than Q2's 7.2%, but hardly suggesting consumers are pulling in their horns. Be that as it may, with markets pricing in a 74.9% probability of a rate cut at the Oct FOMC meeting, today's data could be pivotal along with this evening's Beige Book.
---
Posted without comment via @MacroMorning "Obviously, total coincidence biggest #money #market fund (JPM) in world yanked cash from o/n mkt start of Sep, doubling WAM in 10 days, right before all hell broke loose. @NewYorkFed & @federalreserve called in, less than one month later ! Heck of a trading strategy Jamie" - see attached chart
========================== ** THE DAY AHEAD ** ===========================
********************
| Inbox | x |
| 08:58 (35 minutes ago) |
|
- Busy day for data, central bank speakers and US earnings, but US/China
Trade and Brexit news still the pivotal influences: digesting Korea rate
cut, PBOC 1-yr MLF injection, HK policy address; awaiting UK & Canada
inflation, US Retail Sales & Beige Book; Germany to sell 30-yr
- UK CPI: energy to drag, maybe offset clothing and leisure prices, headline
and core seen a little below target, inflation subdued, but Brexit still
key in terms of BoE policy outlook
- US Retail Sales: modest gains seen across all measures, implying solid
pace of PCE in Q3, though slower than Q3; market Oct Fed rate expectations
likely to shift on any miss/beat (net of revisions)
- Audio preview: attached (mixcloud not working today ;( )
..........................................................................
********************
** EVENTS PREVIEW **
********************
********************
** EVENTS PREVIEW **
********************
It will be another busy day for data, central bank speakers and US corporate earnings, but once again a tweet from Trump, Chinese officials comments (see the overnight denial that China did not actually commit the $40-50 Bln of Agri purchases, at least not without a reduction in US tariffs, & watch the HK bill going through Congress aimed at supporting Hong Kong Protests, which the House has already passed), or an EU or UK 'source' 'briefing' on Brexit can put a big fat redline through any considerations about macro and micro data. Be that as it may, there are EU New Car Registrations to digest ahead of the full gamut of UK inflation data, Eurozone Trade and final CPI, Canadian CPI and the potentially key US Retail Sales data. The IMF/World Bank meetings continue in Washington, and a consequence there will be a further deluge of BoE, ECB, Fed and Riksbank speakers, following from the expected overnight 25 bps rate cut in South Korea, while the Fed publishes its Beige Book. Germany will auction an as usual modestly sized EUR 1.0 Bln of 30-yr Bund, while the US Corporate Earnings run again features a slew of financials - Bank of America Merrill Lynch, Bank of New York Mellon, PNC Financial Services, US Bancorp & Ally Financial - with Abbot Laboratories, Alcoa, IBM, Kinder Morgan and Netflix are the highlights among non-financials.
** U.K. - September CPI, RPI & PPI **
- Following on from the weaker than expected labour data, which suggested that Brexit uncertainty is finally starting to weigh on labour demand with surveys hinting at a further deterioration in coming months, the focus turns to inflation data. CPI is seen up 0.2% m/m tro edge the y/y rate up to 1.8%, with core CPI seen unchanged in y/y terms at 1.7%; much will depend on how much the downward pull from petrol and energy prices are offset by rises in leisure (recreation/culture, airfares) and clothing & footwear, but ultimately a small miss in either direction would still leave a picture of inflation pressures remaining very subdued. The same picture has been and will likely continue to be conveyed by PPI, which has suggested little or nothing in the way of pipeline pressures. Eminently there has been some dovish BoE coo-ing from the likes of Vlieghe and Saunders, but this looks to be the sort of inflation micro-management that is frankly preposterous in the face of the potentially very binary Brexit outcomes.
** U.S.A. - September Retail Sales **
- August's Retail Sales appeared to suggest that the strength in consumer spending seen since the end of Q1 through July was losing momentum, above all the flat m/m reading ex-Autos, though the commentary chatterarti appeared rather too eager to jump all over one month's data, which in truth suggested a non-negligible impact from Hurricane Dorian. As already reported, stronger than expected Auto Sales should give headline sales a boost (consensus 0.3% m/m), despite a drag from a further fall in gasoline prices (generally a positive for consumer spending, especially when aligned with lower mortgage rates), with the core 'control group' seen reprising August's 0.3% m/m, which implies a 3-mth annualized pace for Q3 of 6.0%, slower than Q2's 7.2%, but hardly suggesting consumers are pulling in their horns. Be that as it may, with markets pricing in a 74.9% probability of a rate cut at the Oct FOMC meeting, today's data could be pivotal along with this evening's Beige Book.
---
Posted without comment via @MacroMorning "Obviously, total coincidence biggest #money #market fund (JPM) in world yanked cash from o/n mkt start of Sep, doubling WAM in 10 days, right before all hell broke loose. @NewYorkFed & @federalreserve called in, less than one month later ! Heck of a trading strategy Jamie" - see attached chart
========================== ** THE DAY AHEAD ** ===========================
********************
