Macro Roundup (Sep 14)

SHANGHAI, Sep 14 (SMM) — This is a roundup of global macroeconomic news last night and what is expected today.

The dollar climbed to a two-week peak against a basket of currencies on Monday, bolstered by expectations the US Federal Reserve could reduce its asset purchases by the end of the year despite a surge in COVID-19 cases.

The greenback, however, came off its highs in afternoon trading. The dollar index earlier rose to 92.887, its highest since Aug. 27. It was last up slightly at 92.664. A round of US economic data is due out this week, starting with consumer prices on Tuesday, which will give the latest update on how hot inflation has been ahead of next week’s Fed meeting.

Philadelphia Fed President Patrick Harker became the latest official to say he wants the central bank to start tapering this year, saying in a Nikkei interview that he was keen to scale back asset purchases.

Tapering talk has boosted the dollar, said Erik Nelson, macro strategist at Wells Fargo Securities in New York.

On Wall Street, US stock index futures were modestly higher during overnight trading on Monday, after the S&P 500 finished in the green, snapping a five-day losing streak.

Futures contracts tied to the Dow Jones Industrial Average rose 75 points. S&P 500 futures gained 0.2%, while Nasdaq 100 futures were up 0.13%.

The Dow and S&P both advanced during regular trading for the first time in six sessions as investors bet that some recent selling looked overdone. The Dow gained about 260 points, or 0.76%, after at one point during the session rising nearly 1%. The S&P advanced 0.23%.

The Nasdaq Composite, however, bucked the trend and slid 0.07% for its fourth straight negative session. The tech-heavy index is on its longest daily losing streak since mid-July.

Oil rose on Monday, supported by concerns over shut output in the United States because of damage from Hurricane Ida, with analysts expecting prices to remain rangebound in a stable market over the coming months.

Brent crude rose 0.81% to settle at $73.51 per barrel and US West Texas Intermediate (WTI) crude gained 1.05% to finish the session at $70.45 per barrel.

Brent has held between $70 and $74 a barrel over the past three weeks.

"Oil prices may not have much room to rise in the near term, but at the same time are not expected to crash soon,” said Stephen Brennock of broker PVM.

A US Energy Information Administration (EIA) last week said it expected Brent prices to remain near current levels for the remainder of 2021, averaging $71 a barrel during the fourth quarter.

Gold prices rose on Monday in the run-up to the release of key US economic data including readings on inflation that could dictate the path of Federal Reserve monetary policy.

Spot gold rose 0.4% to $1,795.20 per ounce, while US gold futures were little changed at $1,792.60.

Focus will be on the monthly US consumer price index - the Fed’s preferred gauge of inflation - due on Tuesday. The August retail sales and production figures are also set for release this week.

The pan-European Stoxx 600 provisionally ended the session up 0.3% after the benchmark slumped 1.2% last week. Oil and gas stocks led the gains on Monday, adding 2.8%.

Traders continued to digest the ECB’s decision to slow down bond buying under its pandemic stimulus program.