SHANGHAI, May 28 (SMM) – This is a roundup of global macroeconomic news last weekend and what is expected today.
The US dollar index touched a high of 94.3 last Friday and closed 0.62% higher at 94.24 due to robust US manufacturing data and a weaker euro.
LME base metals fell across the board except for zinc. LME lead closed over 2% lower, but its week-on-week gain of 4.5% was the highest in eight months due to declining inventory and concerns over tight supply. Aluminium lost over 1%, nickel dipped nearly 1%, copper dropped 0.76%, while tin edged down. SHFE zinc rose nearly 1%, lead lost 1.7%, and the rest base metals inched down.
The German business confidence index held unchanged at 102.2 in May, beating economists' forecast of 102, said the Munich-based Ifo Institute for Economic Research. This followed five consecutive months of drops.
"The downward trend has stopped," said Ifo economist Klaus Wohlrabe. "Above all, strength in the domestic economy contributed to the stabilisation of the economy... The global economic environment is difficult, but the German economy is holding its ground."
The US durable goods orders dipped 1.7% in April, compared with an expected 1.3% drop, as demand for transportation equipment slumped 6.1%.
New orders for key US-made capital goods rose higher than expected in April and shipments rebounded. This indicated that business equipment spending recovered after slowing down at the end of the first quarter.
Orders for non-defence capital goods excluding aircraft jumped 1% in April.
The University of Michigan Consumer Sentiment Index slipped to 98 in May from 98.8 in April, hitting a low in four months. Higher prices of homes and gasoline accounted for the decline.
The US oil rig count, an indicator of future production, rose 15 to 859 for the week ended May 25, the highest level since March 2015, Baker Hughes data showed. The natural gas rigs were down 2 units to 198 units for the week. This brought the overall active rigs up 13 units to 1,059 units.
China's total profits of industrial enterprises above certain sizes rose 21.9% year on year in April, the largest growth in six months. This compared with the 3.1% year-on-year growth in March.
Factors including accelerated production, price recovery, and a low base from the previous year accounted for the profit growth, said He Ping, official of the industry department at National Bureau of Statistics. Supply-side reforms continued to demonstrate its efficacy, and the quality and efficiency of these companies’ operations rose, he added.
The Germany retail sales in April and the US-North Korea summit are the key things to watch today.
The US dollar index is likely to stay firm today, and base metals are expected to weaken for the most part on a strong US dollar.
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