SHANGHAI, May 10 (SMM) – Attention should be on US’s API and EIA crude oil inventories from the week ending May 5 and April IPI, China’s April CPI and France’s March industrial production on Wednesday. Base metals declined from highs on Tuesday’s night trading and were mixed. Those metals will remain divergent on Wednesday.
China’s CPI growth is expected to increase slightly in April, due largely to falling decline of food price in April and rising non-food price, while PPI growth will drop. However, IPI of official manufacturing PMI dropped sharply in April, with PPI of raw materials at 51.8 and PPI at 48.7, the low level since July 2016. Hence, annual PPI faces strong downward pressure in April.
Federal Reserve Bank of Dallas Chairman Robert Kaplan indicated that US approaches full-employment. US’s unemployment is at low, but salary growth is falling. Low interest will contribute to economic imbalance. Kaplan held his opinion of 3-time rate hike in the year. But, he also pointed out that as economic data still dominants rate hike, if economic growth is higher than expected , Fed will increase rate hikes, and vice versa.
US’s API crude oil inventory fell 5.79 million bbls from the week ending May 5, which was higher than anticipation, but gasoline inventory increased unexpectedly. Crude oil output in US and Libya are revised up in 2017 EIA Monthly Report. COMEX 1706 oil thus dropped from highs.