SHANGHAI, Aug. 15 (SMM) –Market will eye UK retail sales and CPI for July and US retail sales for July today.
Pound has been doing not well against US dollar recently, mainly due to poor UK economic data and slowing UK economy. Moreover, the BOE’s dovish statement in July added to uncertainty to expectations for this year’s rate hike. Brexit is still impacting UK’s economic outlook. The unexpected decline in June’s UK CPI reduced expectations for rate hike. If UK’s CPI rebounded in July, expectations for rate hike will strengthen. Otherwise, expectations will weaken further, which will pressure pound. Annual rate of UK’s retail sales should hold stable in July after falling in June, which will have little impact on market.
Better-than-expected US non-farm payrolls, strong labor market and rising wages suggest US economy is recovering. US CPI, albeit below forecast, but rose 0.1 percentage point MoM. If current situation could maintain, it is only a matter of time before 2% inflation target is reached. So, monthly rate of US retail sales should rise in July.
See SMM price forecast, please click: SMM Price Outlook for Base Metals on SHFE (Aug. 15, 2017)