Macro Roundup (May 16)

SHANGHAI, May 16 - This is a roundup of global macroeconomic news last night and what is expected today.

The U.S. dollar fell from a five-week high on Monday, as investors consolidated gains made last week on the greenback and awaited news from Washington on how to address the debt ceiling issue, which could force the U.S. government to default on its debt if not resolved.

The euro was up 0.2% against the dollar at $1.087. Against the yen, the dollar was up 0.3% at 136.06, while sterling was 0.7% higher at $1.2527, rebounding after last week’s 1.5% fall.

The dollar’s decline on Monday came after it notched its best weekly performance on Friday since September last year.

Analysts have said many factors could be behind the dollar’s recent strength, including concerns about U.S. inflation and safe-haven buying driven by fears about the debt ceiling standoff and global economic growth, as well as more hawkish rhetoric from Fed officials.

U.S. stock futures were little changed on Monday evening, as all eyes on Wall Street turn to a Tuesday meeting between congressional leaders and President Joe Biden.

Futures tied to the S&P 500 slipped 0.08%, while Nasdaq 100 futures inched lower by 0.08%. Futures linked to the Dow Jones Industrial Average lost 33 points, or 0.1%.

Investors are anxiously awaiting progress on a deal to raise the debt ceiling before June 1, which is the earliest date the Treasury Department has said the U.S. could default on its debt obligations.

Biden has so far maintained that raising the debt ceiling is non-negotiable. McCarthy, however, has pushed for talks to broker a deal to raise the debt ceiling be tied to spending cuts.

In economic data, April’s retail sales are due at 8:30 a.m. ET on Tuesday, giving investors a peek into how consumers are faring. Economists polled by Dow Jones are anticipating an increase of 0.8%.

Oil prices rose a dollar a barrel on Monday after three straight sessions of declines, boosted by the prospect of tightening supplies in Canada and elsewhere, although recession fears kept pressuring the market.

Brent crude futures rose $1.06, or 1.4% to settle at $75.23 a barrel. U.S. West Texas Intermediate crude settled at $71.11 a barrel, up $1.07, or 1.5%.

Gold advanced on Monday on a weaker dollar as traders stuck to bets on interest rate cuts before year-end despite comments from Federal Reserve officials, with focus also on the U.S. debt ceiling talks.

Spot gold was up 0.2% at $2,015.55 per ounce, rebounding from its one-week low touched on Friday.

European markets were mixed on Monday, with investors following U.S. debt ceiling negotiations, Turkish elections and a higher forecast for EU inflation this year.

The pan-European Stoxx 600 index provisionally closed 0.2% higher, with U.S. stocks similarly cautious. Most sectors posted modest gains, as mining stocks led the pack with a 1.2% rise, while chemicals, media and retail all slipped around 0.2%.