Good morning world:
There were no major economic announcements during the Asian and European sessions except for data released out of China during the weekend. Here’s a brief overview:
China released two data points during the weekend and both came in under consensus estimates. China IP rose 6% year-over-year (consensus 6.5%) and FAI growth was 10.5% year-over-year (consensus 11%). The markets in China were relatively unchanged while AUDUSD is up .25% to .729.
Japan’s leadership is starting to signal more stimulus is on the way. Japanese Prime Minister Abe told the parliament on Monday that more stimulus would likely be needed to improve demand. Unfortunately, there was a denial regarding the reports over the weekend that the consumption tax would be delayed. Chief Cabinet Sec. Suga denied the report of suspending the hike until 2017. The Nikkei225 finished up .73% in trading.
UK – The weekend gave BOE’s Governor Mark Carney the opportunity to defend his comments on the potential fallout from Brexit. He confirmed that the BOE’s forecast is to remain in the EU but felt obligated to explain what would happen if the referendum vote was cast to leave. He also added that it was “highly, highly, unlikely” for the BOE to cut rates if the economy were to substantially cool.
Europe – quiet in Europe due to them being on another holiday.
US is set to open with a slightly weaker dollar and the S&P 500 unchanged. On Friday, the USD strengthened and the equity market jumped due to a stronger-than-expected US retail sales number (actual: 1.3% month over month in April, consensus: 1.2%).
There are no major announcements during the US session. The NY Empire State Manufacturing index for May (EST 830 forecast 6.5, previous 9.56) and FOMC member Kashkari (non-voter) will speak in the afternoon. In Australia, the RBA Meeting Minutes will be released. All will be watching for clues signalling if Mr. Stevens and company are set on another .25 point cut this year.