SHANGHAI, Jul. 11 (SMM) – On Tuesday, attention should be on final reading of US’s monthly wholesale inventory in May, Federal Reserve official Lael Brainard’s speech and EIA monthly report. US dollar index dropped from highs on Monday’s night trading and base metals diverged, and will keep diverging on Tuesday.
Lael Brainard, dovish representative, indicated to reassess US’s rate hike pace if the sign of falling inflation growth keeps, though labor market closed to full-employment. This, combined weak salary growth released last Friday, raised market concerns on rate hike pace. If Lael Brainard keeps releasing dovish comment, US dollar index will hit the lowest level since October 2016.
SMM Price Outlook for Base Metals on SHFE (Jul. 11, 2017)
US’s wholesale inventory will be flat at 0.3 in May on a monthly basis. US’s retail sales, missing market expectation, dropped 0.3% MoM in May, the largest decline since January 2016, which depressed market anticipation on rising US’s economy in Q2. If wholesale inventory stays high in May, it will strengthen the prediction, weighing down US dollar index.
Russia’s Minister of Energy Alexander Novak pointed out on Tuesday that OPEC and non-OPEC countries are able to extend and expand output cut, sending COMEX 1708 oil up slightly.
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