Macro Roundup (Jul 9)

SHANGHAI, Jul 9 (SMM) – This is a roundup of global macroeconomic news last weekend and what is expected today.

Last weekend

The US dollar index hit a three-week low to around 93.9 and closed at 94 last Friday night. This was 0.52% lower from a week ago, marking the biggest loss in four weeks.

LME base metals traded under pressure on escalated tension between China and the US. Nickel led the losses and closed 1.7% lower, lead fell nearly 1%, tin and copper inched down, while zinc gained over 2%, and aluminium edged up. Copper registered the largest week-on-week loss since January 2015. SHFE base metals, however, mostly went up. Zinc rose 1.6%, whereas copper, aluminium, and tin inched up. Nickel fell 0.71% and lead went down slightly. 

The US total nonfarm payroll employment increased by 213,000 in June, higher from the expected 195,000 but lower from May's 244,000. The figure has grown by 2.4 million over the last 12 months. 

Employment increased in industries including health care, manufacturing and construction, though retail trade lost jobs.

The unemployment rate rose by 0.2% to 4% in June as more people returned to the job market. This compared with the expected and previous 3.8%, which was the lowest in 18 years. The labour force participation rate edged up by 0.2% over the month to 62.9%.  

The US trade balance improved in May, rising from -$46.1 billion to -$43.1 billion – the third month in a row that its export growth has outpaced imports. Trade deficit narrowed in May to its smallest since October 2016 on a surge in exports of soybeans and aircrafts amid the threat of retaliatory tariffs.

However, trade tensions between the US and China, the European Union, and Mexico may cause an impact on the trade prospects for the rest of the year. 

In May, the US trade deficit with China increased by 18.7% to $33.2 billion, and that with Mexico also increased by 18.8%.

The number of active US rigs for oil rose five units to 863 units over the week ended July 6 while natural gas rigs went flat at 187 units, according to data from Baker Hughes. This raised the overall active rigs by five units, to 1,052 units.

Day ahead

Key factors to watch today include China's economic data in June and the eurozone Sentix investor confidence index in July.