Macro Roundup (Sep 17)

SHANGHAI, Sep 17 (SMM) – This is a roundup of global macroeconomic news last weekend and what is expected today.

Last weekend

The US dollar index rebounded last Friday, after a positive showing for consumer sentiment, and increased 0.46% to close at 94.96. 

Base metals, except for tin, fell across the board. LME zinc slumped 1.66%, nickel lost 1.43%, copper slid 1.41%, and aluminium declined 0.51%. SHFE nickel plunged 1.21%, zinc dipped 1.16%, and lead fell 0.74%. Other base metals closed lower. 

The confidence of Americans in the US economy and their well-being rose towards the end of summer and stood near a 14-year high, according to University of Michigan’s consumer sentiment index. The index rose to 100.8 in September from 96.2 in August.

The jump in consumer sentiment was "largely due to more favourable prospects for jobs and incomes", according to Richard Curtin, chief economist for the Surveys of Consumers. "Consumers anticipated continued growth in the economy that would produce more jobs and an even lower unemployment rate during the year ahead."

"Concerns about the negative impact of tariffs on the domestic economy were spontaneously mentioned by nearly one-third of all consumers in the past three months, up from one-in-five in the prior four months," Curtin said.

US import prices sank 0.6% in August following a dip of 0.1% in July, the US Bureau of Labor Statistics announced on Sep 14. This marked the biggest decline since January 2016 as fuel prices slumped. The stronger dollar also weighed on import prices as it made it cheaper for Americans to purchase foreign goods.

The country’s industrial output advanced 0.4% last month after gaining the same amount in July. Economists had forecast industrial production rising 0.3%. A strong output in auto manufacturing made up for the lacklustre production in the rest of manufacturing, and this grew industrial output. 

In August, retail sales recorded their smallest growth in six months, at 0.1% as consumers purchase fewer motor vehicles and clothing. However, upward revisions to July’s data are likely to keep intact expectations of strong economic growth in the third quarter. 

Data for July was revised higher to show sales rising 0.7% instead of the previously reported 0.5%. Dallas Federal Reserve President Robert Kaplan said that the US economy was strong and retail sales were robust. 

China’s total retail sales of consumer goods increased by 9% from a year earlier, beating a forecast of 8.8%, the National Bureau of Statistics (NBS) said. Value-added for industries above a designated size rose 6.1% year on year in August, compared with a gain of 6% in July. 

"Major economic data, including targets for growth, employment, pricing, and exports have been relatively steady," NBS spokesperson Mao Shengyong told a press conference on Friday.

Day ahead

Market participants should monitor the eurozone consumer price index (CPI) for August.