Macro Roundup (Oct 16)

SHANGHAI, Oct 16 (SMM) — This is a roundup of global macroeconomic news last night and what is expected today.

The dollar climbed on Thursday along with the safe-haven yen as signs the US economy was stalling while fiscal stimulus appeared unlikely before the US presidential election kept investors in a risk-off stance.

The dollar strengthened as US equities dropped on the heels of data that showed the labor market recovery is losing steam, while manufacturing activity in New York fell more than anticipated.

Weekly jobless claims rose to 898,000, up 53,000 from the prior week and above the 825,000 estimate, increasing concerns the COVID-19 pandemic was causing lasting damage to the labor market.

The British pound, lifted on Wednesday by signs of progress in Brexit talks, relinquished those gains on Thursday as concerns about trade talks with Europe resurfaced and London faced tighter coronavirus restrictions.

Sterling was last trading at $1.2893, down 0.91% on the day.

European Union leaders said agreeing to a “fair” new partnership with Britain was “worth every effort” but the bloc would not compromise at any cost and was ready for an abrupt split in trade worth a trillion euros every year.

Oil prices slipped on Thursday as new restrictions to stem a surge in COVID-19 infections increased uncertainty over the outlook for economic growth and a recovery in fuel demand. But prices bounced off their lows after better-than-expected inventory data.

Traders noted the price decline was limited by industry data showing a fall in US oil inventories last week. The US Energy Information Administration (EIA) said Thursday that inventory declined by 3.818 million barrels in the prior week, larger than the 1.9 million barrel draw analysts polled by FactSet had been expecting.

The American Petroleum Institute (API) industry group on Wednesday said U.S. crude, gasoline and distillate inventories all fell in the week to Oct. 9.

Some European countries are reviving curfews and lockdowns to try to contain the rise in new coronavirus cases, with Britain expected to impose tougher COVID-19 restrictions on London from midnight on Friday.

Gold prices edged up on Thursday after US President Donald Trump reignited hopes of a coronavirus stimulus package before the Nov. 3 elections, but a strong dollar kept the metal’s gains in check.

On Wall Street, Stock futures rose slightly in overnight trading on Thursday as investors await the latest retail sales data.

Futures on the Dow Jones Industrial Average gained about 70 points. The S&P 500 futures and the Nasdaq 100 futures both rose about 0.3%.

Retail sales data, due Friday at 8:30 a.m. ET, will offer an update on the recovery in consumer spending. Economists polled by Dow Jones expect retail sales to rise by 0.7% in September, following a 0.6% rebound in August. Excluding autos, sales were expected to rise by 0.4%.

Major averages suffered their third straight day of losses on Thursday, their longest losing streak in nearly a month.

Key economic data slated for release today include Eurozone’s consumer price index (CPI) for September and August adjusted trade data, and US retail sales and industrial production for September and preliminary University of Michigan's Consumer sentiment index for October.