SHANGHAI, Jul 15 (SMM) – This is a roundup of global macroeconomic news last night and what is expected today.
The US dollar fell to its lowest in more than a month against a basket of rivals on Tuesday as stocks on Wall Street gained.
The weaker dollar was partly attributable to a move higher in the euro on hopes the European Union will agree on a rescue financing package that will limit the economic damage to the bloc from the coronavirus pandemic.
US stock futures moved higher in overnight trading on Tuesday after Moderna said its coronavirus vaccine produced antibodies in all patients in an early trial.
Moderna’s report came after German biotech company BioNTech and US pharmaceutical giant Pfizer announced that two of their experimental vaccines for the coronavirus had been granted the US Food and Drug Administration’s “fast track” designation.
Concerns over mounting coronavirus cases globally that have prompted many regions to reintroduce curbs to restrict the outbreak, and escalated tensions between the US and China, meanwhile, kept a lid on investor sentiment, as gold prices firmed above the key $1,800 level on Tuesday.
US President Donald Trump said Tuesday that he signed legislation to impose sanctions on China in response to its interference with Hong Kong’s autonomy.
Earlier in the day, the UK announced it will ban Huawei from its 5G networks, in a significant U-turn by the government that could significantly dent relations with China while appeasing the US.
Oil prices rose slightly on Tuesday as OPEC and its allies cut production by more than agreed to in June.
The Organization of the Petroleum Exporting Countries and its allies led by Russia, collectively known as OPEC+, have delivered compliance of 107% with their agreed oil output cuts in June, an OPEC+ source said on Tuesday.
The market are keenly awaiting news from OPEC+ on the next level of production cuts. OPEC’s Joint Technical Committee meets on Tuesday, with the Joint Ministerial Monitoring Committee due to meet on Wednesday.
The American Petroleum Institute (API) reported late Tuesday that US crude supplies fell by 8.3 million barrels for the week ended July 10. The API data also showed gasoline stockpiles down by 3.6 million barrels, while distillate inventories climbed by 3 million barrels. Crude stocks at the Cushing, Okla., storage hub, meanwhile, edged up by 548,000 barrels for the week.
Inventory data from the Energy Information Administration (EIA) will be released Wednesday.
Nonferrous metals fell across the board on Tuesday, reversing strong performance in the previous session. On the LME, zinc plunged 2.8% to lead losses, lead tumbled 1.8%, nickel dropped 0.9%, copper fell 0.7%, tin shed nearly 0.6% and aluminium sank 0.4%.
On the SHFE, zinc was also the worst performer and fell 1.1% in overnight trading, aluminium dropped 0.9%, tin shed 0.5%, nickel lost 0.4%, lead dipped 0.3% and copper edged down less than 0.1%.
The pull-back in the nonferrous complex came despite upbeat China trade data for June. China’s exports unexpectedly rose in June as overseas economies reopened after lockdowns, while imports grew for the first time this year, reinforcing views the recovery from the pandemic is gaining traction in the world’s second-largest economy.
Dollar-denominated exports in June edged up 0.5% from a year earlier, customs data showed on Tuesday, beating analysts’ expectations for a 1.5% drop and compared with 3.3% decline in May.
Imports also rose 2.7%, confounding market expectations for a 10% drop. They had fallen 16.7% the previous month.
US consumer prices rebounded by the most in nearly eight years in June, according to consumer price index data from the Labor Department released Tuesday, but a resurgence in new COVID-19 cases after the reopening of businesses suggests a moderation in demand that could keep inflation muted and allow the Federal Reserve to keep injecting money into the ailing economy.
In Europe, official figures revealed that UK gross domestic product (GDP) expanded by 1.8% in May following April’s historic 20.4% contraction. Economists had expected a monthly rebound of 5.5%.