News Announcements & Chart Analysis by PlexyTrade

[MiloPlexyTrade]

6th August 2024

Tuesday

​

The financial world is set for a decisive day as Australia prepares to announce its Cash Rate, with a follow-up press conference that could influence global markets. Later, the UK's Construction PMI will provide key insights into the sector's performance, while the Eurozone will release its Retail Sales m/m figures, shedding light on consumer spending patterns. As the day progresses, New Zealand will unveil its Employment Change and Unemployment Rate data, offering fresh perspectives on the labor market. These crucial updates are poised to impact trading strategies and market movements.​

AUD – Cash Rate (High Impact)​

In Australia, the Reserve Bank of Australia's Board sets the official cash rate, which is the interest rate on overnight loans between financial institutions. This rate is crucial as it influences the money market, reflecting the balance between the demand and supply for short-term funds. Traders closely monitor these interest rates because they are a key determinant of currency value, with many other economic indicators being used primarily to forecast future rate changes.


The Reserve Bank of Australia (RBA) decided to keep the cash rate target unchanged at 4.35% and the interest rate on Exchange Settlement balances at 4.25%. Despite a significant decline in inflation from its 2022 peak, it remained above target, with the pace of reduction slowing. The latest data showed headline inflation at 3.6% and core inflation at 4.1%. Excess demand and high domestic cost pressures persisted, although wage growth had peaked. The economic outlook was uncertain, with weak GDP growth, rising unemployment, and persistent inflation posing risks. The RBA prioritized returning inflation to the 2-3% target, emphasizing the need for vigilance and data-driven decisions amid global and domestic economic uncertainties.

TL;DR

• RBA Cash Rate: Held at 4.35%.

• Interest on Exchange Settlement Balances: Held at 4.25%.

• Inflation: Headline at 3.6%, core at 4.1%.

• Economic Outlook: Uncertain with weak GDP growth and rising unemployment.

• RBA Focus: Returning inflation to 2-3% target.

The forecast for Australia's Cash Rate predicts it will remain unchanged at 4.35%, consistent with the previous rate.

The next interest rate decision is set to be announced on Tuesday at 4:30 AM GMT.​

AUD - RBA Press Conference (Medium Impact)​

The Reserve Bank of Australia's (RBA) press conferences are pivotal events for currency markets, often leading to significant fluctuations. A more hawkish tone from the RBA typically strengthens the Australian dollar, as traders keenly interpret the detailed explanations of recent interest rate decisions, economic conditions, and inflation. These conferences are highly anticipated, providing valuable insights into future monetary policy directions and shaping market expectations. Consequently, market participants meticulously analyze the RBA's statements to adjust their strategies in response to the central bank's outlook.

The RBA Press Conference is scheduled for Tuesday at 5:30 AM GMT.​

GBP – Construction PMI (Medium Impact)​

The Construction PMI, derived from a survey of approximately 150 purchasing managers in the construction sector, measures business conditions through a diffusion index. A reading above 50.0 indicates industry expansion, while a reading below suggests contraction. Traders closely watch this index because a figure exceeding forecasts is favorable for the currency, as it serves as a leading economic indicator. It reflects current business sentiment, with purchasing managers providing timely insights into employment, production, new orders, prices, supplier deliveries, and inventories.


The UK construction sector continued to grow in the second quarter, though at a reduced pace, closing with a PMI of 52.2 in June, down from 54.7 in May. The slight deceleration in growth was due to a drop in housing activity and a slower increase in new orders, attributed partly to election-related uncertainty. Despite these challenges, employment in the sector grew robustly, the fastest since last August, and sub-contractor use expanded for the third consecutive month. Input cost inflation rose slightly, influenced by higher raw material costs, yet remained below average levels. Confidence in the sector remains positive, buoyed by expectations of decreasing interest rates, with a majority of firms anticipating an increase in activity over the next year.​

TL;DR

Aspect	Details
PMI (June)	52.2
PMI (May)	54.7
Growth Pace	Reduced
Key Factors for Deceleration	Drop in housing activity, slower increase in new orders, election-related uncertainty
Employment Growth	Robust; fastest since last August
Sub-contractor Use	Expanded for the third consecutive month
Input Cost Inflation	Slight rise, influenced by higher raw material costs; below average levels
Sector Confidence	Positive, buoyed by expectations of decreasing interest rates
Activity Expectation	Majority of firms anticipate an increase over the next year​

The forecast for the Construction PMI is indicating a rise to 52.7, compared to the previous outcome of 52.2.​

The next Construction PMI release is scheduled for Tuesday at 8:30 AM GMT.

EUR – Eurozone Retail Sales m/m (Medium Impact)​

In the Euro Area, retail sales track the total goods sold, with food, drinks, and tobacco having the largest share at 39.3%. Other significant categories include electrical goods and furniture (12%), computer equipment and books (11.4%), pharmaceutical goods (9.9%), textiles and clothing (9.2%), auto fuel (9.1%), non-food products (6%), and online sales (2.9%). Germany leads with the highest country share (25.9%), followed by France (21.7%), Italy (16.1%), and Spain (11.4%). Retail sales data is crucial for traders as it indicates consumer spending, a major component of economic activity, where a higher actual value than forecast is positive for the currency.


In May 2024, retail sales in the Euro Area experienced a modest increase of 0.1% month-over-month, recovering from a revised 0.2% decline in April but falling short of the anticipated 0.2% rise. The rebound was driven by a 0.7% increase in sales of food, drinks, and tobacco, following a 0.9% drop in the previous month, and a 0.4% rise in auto fuel sales, which had previously fallen by 0.7%. However, sales of non-food products saw a 0.2% decline, reversing the 0.5% gain observed in April. On an annual basis, retail sales grew by 0.3%, down from the 0.6% growth recorded in April.

TL;DR​

• May 2024 Retail Sales: Increased by 0.1% month-over-month.​
• April 2024 Revision: Revised to a 0.2% decline from the initial report.​
• Food, Drinks, and Tobacco Sales: Rose by 0.7% in May after a 0.9% drop in April.​
• Auto Fuel Sales: Increased by 0.4% in May following a 0.7% decrease in April.​
• Non-Food Products Sales: Declined by 0.2% in May, reversing a 0.5% gain in April.​
• Annual Change: Retail sales grew by 0.3% in May, down from a 0.6% growth in April.​
• Expectations vs. Actual: May’s increase fell short of the anticipated 0.2% rise.​

The forecast for month-over-month retail sales is expected to be -0.1%, down from the previous figure of 0.1%.​

The upcoming release of the month-over-month retail sales data is scheduled for Tuesday at 9:00 AM GMT.

NZD - Employment Change q/q (High Impact)​

The quarterly Employment Change report reveals the shift in the number of employed individuals, a critical metric for economic analysis. When the actual employment figures exceed forecasts, it generally strengthens the currency, signaling positive economic growth. Traders closely monitor these figures because robust job creation often indicates increased consumer spending, which drives a significant portion of overall economic activity. As a leading indicator, strong employment numbers suggest a thriving economy, influencing market expectations and currency valuations.


In March 2024, New Zealand experienced a 0.2% decline in employment, a reversal from the 0.4% growth seen in the previous period, indicating a cooling in the labor market amid economic slowdown. Historically, employment changes in New Zealand have shown fluctuations, with a record high growth of 2.6% in Q2 2016 and a significant drop of 1.8% in Q1 2009. Despite these challenges, Westpac New Zealand had anticipated a modest 0.4% growth for the March quarter, consistent with the previous quarter's performance. However, the actual decline highlights a gap where the increase in jobs has not kept pace with the surge in workforce numbers driven by high migration, leading to a projected rise in unemployment from 4.0% to 4.2%. This mismatch suggests that while new jobs are being created, they are insufficient to accommodate the growing pool of job seekers, impacting the overall employment dynamics in the country.​

TL;DR

• March 2024 Employment Change: -0.2%​
• Previous Period Employment Change: +0.4%​
• Historical Record High Growth: +2.6% (Q2 2016)​
• Historical Significant Drop: -1.8% (Q1 2009)​
• Westpac's Anticipated Growth: +0.4%​
• Projected Unemployment Rate: 4.2% (up from 4.0%)​
• Reason for Unemployment Rise: Insufficient job creation to match growing workforce due to high migration​

The forecast for the quarter-over-quarter Employment Change stands at -0.2%, compared to the previous outcome of -0.2%.

​

NZD - Unemployment Rate (High Impact)

The unemployment rate measures the percentage of the total workforce that is unemployed and actively seeking employment in the previous quarter. While it is often considered a lagging indicator, a lower-than-forecasted unemployment rate is generally positive for a currency. Traders pay close attention to this figure because it reflects overall economic health; a decrease in unemployment typically signals better labor-market conditions, which are closely linked to consumer spending and economic growth.


In New Zealand, the labor market showed signs of strain in the March 2024 quarter, with the unemployment rate climbing to 4.3% from 4.0% in the previous quarter, marking the highest level since early 2021. This increase exceeded market expectations, which had anticipated a rise to only 4.2%. Alongside this, the underutilisation rate, which measures the total unused labor capacity, worsened, reaching 11.2% from 10.7%. Additionally, the employment rate dipped to 68.4%, down from 69.0%, and the labor force participation rate fell slightly to 71.5% from 71.9%. The number of people not in the labor force also rose by 22,000 during the quarter, totaling an increase of 61,000 year-over-year. Despite these challenges, wage growth showed some resilience, with all salary and wage rates, including overtime, experiencing a year-on-year increase of 4.1%. Average weekly earnings for full-time equivalent employees climbed to $1,593, and average ordinary time hourly earnings reached $40.96.​

TL;DR

• Unemployment Rate: Increased to 4.3% from 4.0%, marking the highest level since early 2021, surpassing the expected 4.2%.
• Underutilisation Rate: Rose to 11.2% from 10.7%.
• Employment Rate: Declined to 68.4% from 69.0%.
• Labor Force Participation Rate: Fell slightly to 71.5% from 71.9%.
• Number Not in the Labor Force: Increased by 22,000 in the quarter and 61,000 year-on-year.
• Wage Growth: Showed resilience with a year-on-year increase of 4.1%.
• Average Weekly Earnings (Full-Time Equivalent): Rose to $1,593.
• Average Ordinary Time Hourly Earnings: Reached $40.96.
  

The forecasted unemployment rate stands at 4.7%, up from the previous rate of 4.3%.

The quarterly Employment Change and Unemployment Rate reports are scheduled for release on Tuesday at 10:45 PM GMT.​

 

[MiloPlexyTrade]

7th August 2024

Wednesday

​

On August 7th, Canada will unveil its Ivey Purchasing Managers' Index (PMI), offering a key glimpse into the country’s economic pulse.​

CAD - Ivey PMI (Medium Impact)​

The Ivey PMI Measures are diffusion indexes derived from a survey of around 175 purchasing managers across various sectors. These indexes gauge business conditions such as employment, production, and new orders, with values above 50 indicating industry expansion and below 50 indicating contraction. As a leading economic indicator, the Ivey PMI is valuable for traders because it reflects the most current business insights and market reactions. A higher-than-forecast PMI is typically positive for a currency.


In a robust show of economic resilience, the Ivey Purchasing Managers Index (PMI) in Canada leaped to 62.5 in June 2024, a sharp rise from 52 in May and well above the anticipated 53, signaling strong economic growth for the eleventh consecutive month. This performance, the second highest in the current growth sequence, was primarily driven by significant improvements in the inventories index, which climbed to 52.7 from 49.1, and the supplier deliveries index, which saw a modest rise to 48.6 from 47.9. Despite these gains, the employment index witnessed a decline, dropping to 52.9 from 56.4, indicating some cooling in job growth. Additionally, the pace of price increases slightly eased, with the price index moderating to 62.3 from a five-month high of 63.5. The unadjusted PMI also saw a decrease, settling at 62.4 in June down from 59.1 the previous month, reflecting a nuanced yet positive economic landscape.​

TL;DR

• Ivey Purchasing Managers Index (PMI) in Canada: Rose to 62.5 in June 2024, up from 52 in May and exceeding the anticipated 53.
• Economic Growth: Marked the eleventh consecutive month of strong economic growth and was the second highest in the current growth sequence.
• Inventories Index: Increased to 52.7 from 49.1, indicating improved inventory levels.
• Supplier Deliveries Index: Rose to 48.6 from 47.9, showing a slight improvement.
• Employment Index: Declined to 52.9 from 56.4, reflecting a slowdown in job growth.
• Price Index: Moderated to 62.3 from a five-month high of 63.5, with a slight easing in the pace of price increases.
• Unadjusted PMI: Decreased to 62.4 in June from 59.1 the previous month, showing a nuanced but positive economic landscape.

The forecast for the Ivey PMI stands at 60.0, down from the previous result of 62.5.

The upcoming Ivey PMI release is scheduled for Wednesday at 2:00 PM GMT.​

 

[MiloPlexyTrade]

8th August 2024

Thursday

​

In today's economic updates, all eyes are on Australia's Reserve Bank as Governor Michele Bullock is set to deliver an important speech shedding light on the nation's economic outlook. Meanwhile, New Zealand will reveal its latest quarterly Inflation Expectations, a key indicator of future price pressures that could influence market sentiment. Across the Pacific, the United States will release its weekly Unemployment Claims, offering fresh insights into the labor market's health and its implications for the broader economy.

AUD - RBA Gov Bullock Speaks (High Impact)​

Reserve Bank of Australia (RBA) Governor Michele Bullock is set to address the Annual Rotary Lecture in New South Wales, with audience questions anticipated. As the central bank's chief, Bullock holds significant sway over short-term interest rates and, consequently, the nation's currency value. Traders will closely analyze her remarks for potential hints about future monetary policy, as a more hawkish stance than expected could positively impact the currency. Her public appearances are closely watched for subtle clues that could influence market expectations and trading strategies.


Reserve Bank of Australia (RBA) Governor Michele Bullock is scheduled to speak at the Annual Rotary Lecture in New South Wales on Thursday, with audience questions beginning at 2:40 AM GMT.

NZD - Inflation Expectations q/q (High Impact)​

Inflation expectations (quarterly) gauge the percentage by which business managers predict the annual change in the price of goods and services over the next two years. If the actual inflation rate exceeds these forecasted expectations, it is typically favorable for the currency. Traders pay close attention to these expectations because they can lead to actual inflation; workers may demand higher wages if they anticipate rising prices. These expectations are derived from a survey of about 100 consumers, who are asked to estimate future price levels 24 months ahead.


In the latest Survey of Expectations conducted by Research New Zealand on behalf of the Reserve Bank of New Zealand, findings reveal shifts in economic forecasts among 37 business leaders and professional forecasters. Notably, short-term and medium-term Consumer Price Index (CPI) inflation expectations have declined, with one-year CPI forecasts dropping from 3.22% to 2.73%, and two-year expectations falling from 2.50% to 2.33%. Long-term expectations for five and ten years remain relatively stable at 2.25% and a slight increase to 2.19%, respectively. Additionally, wage inflation expectations for the next year decreased to 3.55% from 3.73%, though anticipated to rise slightly in two years to 3.23%. The unemployment rate is expected to increase to 4.90% in a year, then decrease marginally. The Official Cash Rate (OCR) is projected to be 5.46% by the end of June 2024, slightly below the current rate of 5.50%. House price inflation forecasts also show a slowdown, with a significant drop in one-year expectations from 4.82% to 3.43% and a two-year projection of 4.74%. These insights follow the CPI release from Stats NZ and the fieldwork was conducted between April 18 and 26, 2024.

TL;DR

Indicator​	Current Forecast​	Previous Forecast​	Notes​
1-Year CPI Inflation	2.73%	3.22%	Short-term inflation expectations decreased.
2-Year CPI Inflation	2.33%	2.50%	Medium-term inflation expectations decreased.
Long-Term CPI Inflation (5 years)	2.25%	2.25%	Long-term expectations stable.
Long-Term CPI Inflation (10 years)	2.19%	Slight increase	Long-term expectations slightly increased.
1-Year Wage Inflation	3.55%	3.73%	Expectations for wage inflation decreased.
2-Year Wage Inflation	3.23%	Slightly higher	Anticipated to rise slightly in two years.
Unemployment Rate	4.90% in one year	Expected to decrease	Projected to increase, then decrease slightly.
Official Cash Rate (OCR)	5.46% by June 2024	5.50%	Expected to decrease slightly by June 2024.
1-Year House Price Inflation	3.43%	4.82%	Significant slowdown in one-year expectations.
2-Year House Price Inflation	4.74%	Stable	Two-year projection remains unchanged.

Fieldwork Dates: April 18 to 26, 2024

Source: Survey of Expectations by Research New Zealand for the Reserve Bank of New Zealand

The forecast for quarterly Inflation Expectations stands at 1.9%, compared to the previous outcome of 2.33%.

The next quarterly Inflation Expectations report is scheduled for release on Thursday at 3:00 AM GMT.

USD - Unemployment Claims (High Impact)​

The "Unemployment Claims" measure represents the number of individuals who filed for unemployment insurance for the first time during the past week. Generally, when the 'Actual' figure is less than the 'Forecast,' it is considered positive for the currency. Although this is typically viewed as a lagging indicator, the number of unemployed people is a key signal of overall economic health, as consumer spending is closely linked to labor market conditions. Additionally, unemployment is a significant factor for those guiding the country's monetary policy.


In the week ending July 27, U.S. initial unemployment claims increased by 14,000 to 249,000, surpassing market expectations of 236,000 and reaching a near yearly high. The four-week moving average, which smooths out week-to-week volatility, also rose by 2,500 to 238,000. This data suggests a continued weakening in the U.S. labor market, potentially prompting the Federal Reserve to consider lowering interest rates by September. Additionally, the number of people claiming unemployment benefits increased by 33,000 to 1,877,000 for the week ending July 20, marking the highest level since November 2021. Despite this, non-seasonally adjusted claims saw a decline of 10,012, with significant decreases in Texas and Ohio.

TL;DR

Category	Details
Initial Unemployment Claims	249,000 (week ending July 27); +14,000 from prior week; exceeded market expectations of 236,000; near yearly high
Four-Week Moving Average	238,000; +2,500 from prior week
Number of Unemployment Benefits	1,877,000 (week ending July 20); +33,000 from prior week; highest since November 2021
Non-Seasonally Adjusted Claims	Declined by 10,012; notable decreases in Texas and Ohio
Potential Fed Action	Data suggests weakening labor market; potential for interest rate cut by September

The forecast for U.S. unemployment claims is expected to be 241,000, slightly lower than the previous outcome of 249,000.

The next unemployment claims report is scheduled for release on Thursday at 12:30 PM GMT.

 

[MiloPlexyTrade]

9th August 2024

Friday​

China is set to release its year-over-year Consumer Price Index (CPI) and Producer Price Index (PPI) figures, offering crucial insights into the country's inflationary pressures and manufacturing costs. Following this, attention will shift to Canada, where the latest data on Employment Change and the Unemployment Rate will be unveiled, providing a snapshot of the labor market's health and the broader economic landscape.​

CNY - CPI y/y (Medium)​

The CPI Year-over-Year (Y/Y) measures the annual change in prices for goods and services purchased by consumers. When the actual CPI exceeds forecasts, it typically strengthens the currency, as rising consumer prices contribute significantly to overall inflation. Higher inflation often leads central banks to raise interest rates, which can boost the currency's value. The CPI is calculated by comparing the average prices of a broad range of goods and services to those from the same period a year earlier.


In June, China's Consumer Price Index (CPI) inflation dropped to a three-month low of 0.2% year-on-year, marking a subtle decrease from the previous month's 0.3% and falling short of the expected 0.4%. This softer inflation reading was mainly due to significant declines in food prices, especially for fresh vegetables, fruits, beef, and mutton, which contrasted with a recovery in pork prices. Non-food categories also contributed to subdued inflation, with notable decreases in sectors like vehicles and household appliances. Given this backdrop of persistently low inflation, analysts predict potential monetary policy adjustments by the People's Bank of China to stimulate economic activity without increasing pressure on the yuan.​

TL;DR

• CPI Inflation Rate: 0.2% year-on-year, marking a three-month low.​
• Comparison with Previous Month: Slight decrease from the previous month's 0.3%.​
• Expected Rate: Below the expected rate of 0.4%.​
• Primary Contributors to Inflation Rate:
  • Significant declines in prices of fresh vegetables, fruits, beef, and mutton.​
  • Notable recovery in pork prices.​
• Non-Food Category Influences: Notable decreases in the sectors of vehicles and household appliances.​
• Economic Context: Persistently low inflation observed.​
• Analyst Prediction: Potential adjustments in monetary policy by the People's Bank of China to stimulate economic activity without adding pressure on the yuan.​

The projected annual Consumer Price Index increase stands at 0.3%, up from the previous measurement of 0.2%.

CNY - PPI y/y (Medium)​

The Producer Price Index (PPI) year-over-year measures the change in the prices of goods that producers purchase and sell. This index is closely watched because it serves as a leading indicator of consumer inflation; when producers face higher costs, they often pass these expenses on to consumers, resulting in increased prices at the consumer level. Typically, if the 'Actual' PPI exceeds the 'Forecast,' it is considered positive for the currency, as it suggests rising inflationary pressures, which may lead to tighter monetary policy.


In June 2024, China's Producer Price Index (PPI) reported a contraction of 0.8% year-over-year, signaling the 21st consecutive month of deflation but also showing a slight improvement from the 1.4% decline seen in May. This reduction, which represents the softest fall since January 2023, aligns with market forecasts and may indicate a potential end to the deflationary period that has persisted since September 2022. Despite these hopeful signs, the overall decrease reflects ongoing fluctuations in global commodity prices and continued weak domestic demand for certain industrial goods. Breaking down the components, the costs in the means of production decreased less sharply at -0.8% compared to -1.6% in May, with mining and raw materials prices showing notable increases. However, consumer goods prices remained down by -0.8%, with specific declines in food, daily use goods, and durable goods, while clothing prices stayed flat. On a monthly basis, producer prices fell by 0.2%, reversing a previous gain seen in May, and cumulatively, producer prices in the first half of 2024 dropped by 2.1%.​

TL;DR

• China's PPI in June 2024: Recorded a year-over-year contraction of 0.8%.​
• Trend of Deflation: Marks the 21st consecutive month of deflation, though the decline has softened compared to the 1.4% decrease in May 2024.​
• Comparison to Previous Data: Represents the softest fall since January 2023.​
• Market Alignment: Matches market forecasts, suggesting a potential end to the ongoing deflationary period starting from September 2022.​
• Global and Domestic Factors: Reflects fluctuations in global commodity prices and weak domestic demand for some industrial goods.​
• Breakdown of Components:
  • Means of Production: Decreased by 0.8%, less sharp than May's -1.6%.​
  • Mining and Raw Materials: Noted for price increases.​
  • Consumer Goods:Continued to decline by 0.8%, including specific categories:
    • Food​
    • Daily Use Goods​
    • Durable Goods​
  • Clothing Prices: Remained flat.​
• Monthly Change: Producer prices fell by 0.2%, reversing a gain from May 2024.​
• Cumulative Data for 2024: First half of the year saw a 2.1% drop in producer prices.​

The forecast for the Producer Price Index year-over-year stands at -0.9%, compared to the previous result of -0.8%.

The upcoming Consumer Price Index year-over-year and Producer Price Index year-over-year are scheduled for release on Friday at 1:30 AM GMT.​

CAD - Employment Change (High Impact)​

Employment Change Measures track the monthly increase or decrease in the number of employed individuals. When the actual figures surpass forecasts, it is typically positive for the currency. Traders closely monitor this data because job creation is a crucial indicator of consumer spending, which is a major driver of overall economic activity.


In June, employment in Canada saw a marginal decline of 1,400 jobs, remaining virtually unchanged at a rate of -0.0%. Despite this slight dip, the employment rate fell by 0.2 percentage points to 61.1%, marking the eighth decrease in the past nine months and a 1.3 percentage point drop from its peak earlier in the year. Key sectors such as transportation and warehousing and public administration experienced job losses, while gains were noted in accommodation and food services and agriculture. The unemployment rate edged up to 6.4%, reflecting ongoing challenges in the labor market, particularly for young men and returning students.

TL;DR
​

• Employment Overview for June: Canada saw a marginal job decrease of 1,400, leading to an essentially unchanged employment rate of -0.0%.​
• Employment Rate Decline: There was a 0.2 percentage point decrease in the employment rate, lowering it to 61.1%. This marks the eighth decline in the past nine months, totaling a 1.3 percentage point reduction from its peak earlier in the year.​
• Sector-Specific Performance:
  • Job losses were observed in the transportation and warehousing sectors, as well as in public administration.​
  • Employment gains occurred in the accommodation and food services sector and in agriculture.​
• Unemployment Rate: The unemployment rate increased slightly to 6.4%, indicating persistent labor market challenges, particularly affecting young men and returning students.​

The forecast for Employment Change predicts an increase of 26,900 jobs, compared to the previous decrease of 1,400 jobs.​

CAD - Unemployment Rate (High Impact)​

The Unemployment Rate measures the percentage of the labor force that is unemployed and actively seeking work from the previous month. A lower 'Actual' rate compared to the 'Forecast' is typically favorable for the currency. Although it is often considered a lagging indicator, the unemployment rate is crucial for assessing overall economic health, as consumer spending tends to be closely linked to labor market conditions.


In June 2024, Canada's unemployment rate increased to 6.4%, marking its highest level since January 2022 and showing a significant uptick from 6.2% in May, according to Statistics Canada. This rise in unemployment comes as the economy lost a total of 1,400 jobs, with a notable decrease in full-time positions by 3,400, partially offset by an increase of 1,900 in part-time jobs. Significant job losses were recorded in transportation and warehousing, which shed 11,700 positions, and public administration, which dropped by 8,800 jobs. Meanwhile, there were gains in the accommodation and food services sector, which added 17,200 jobs, and agriculture, which saw an increase of 12,300 jobs. This shift in employment metrics occurs amidst a backdrop of declining employment rates, particularly among young men aged 15 to 24 and a slight increase in the average hourly wage by 5.4% year-over-year, highlighting ongoing adjustments in the labor market.

TL;DR​

• Unemployment Rate Increase: Canada's unemployment rate rose to 6.4% in June 2024, the highest since January 2022, up from 6.2% in May.​
• Job Losses Overall: The economy experienced a net loss of 1,400 jobs.​
• Full-time vs. Part-time Employment:
  • Loss of 3,400 full-time jobs.​
  • Increase of 1,900 part-time jobs.​
• Sector-Specific Impacts:
  • Transportation and warehousing saw a decrease of 11,700 jobs.​
  • Public administration jobs decreased by 8,800.​
  • Accommodation and food services sector gained 17,200 jobs.​
  • Agriculture sector saw an increase of 12,300 jobs.​
• Employment Rates: Decline noted in employment rates, especially among young men aged 15 to 24.​
• Wages: Average hourly wage increased by 5.4% year-over-year.​

​

The forecast for the unemployment rate is projected to remain stable at 6.5%, marginally higher than the previous rate of 6.4%.

The upcoming Employment Change and Unemployment Rate reports are scheduled for release on Friday at 12:30 PM GMT.

​

 

[MiloPlexyTrade]

13th August 2024

Tuesday

​

On August 13th, key global economic data releases will take center stage. Australia will report its Westpac Consumer Confidence and quarterly Wage Price Index, providing insight into wage trends and inflation. The UK will release crucial labor market data, including unemployment rates and wage growth. Germany's ZEW Economic Sentiment Index will measure investor confidence, while the US will unveil its Core PPI and PPI, essential for tracking inflation trends. These updates are expected to significantly impact financial markets and economic forecasts globally.​

AUD - Westpac Consumer Confidence (Medium Impact)​

The Westpac Consumer Confidence Index, from Melbourne Institute, gauges consumer sentiment on economic activity, including personal finances, future economic expectations, and major purchase conditions. A high reading supports the AUD, while a low one is bearish. This index is crucial for traders as it predicts consumer spending, a key economic driver, based on a survey of around 1,200 consumers.


Australia's consumer confidence took a hit in July 2024, with the Westpac-Melbourne Institute Consumer Sentiment Index dropping by 1.1% month-over-month to a six-month low of 82.7. This decline, the fifth of the year, reflects growing concerns over persistent inflation and rising borrowing costs, which overshadowed the positive impact of recent tax cuts and fiscal support measures. Notably, the ‘family finances vs a year ago’ sub-index saw a sharp drop of 8.4% to a weak 63.5, while expectations for finances in the next year also fell. Despite an uptick in sentiment regarding economic conditions over the next 12 months, broader worries about the economy's vulnerability to inflation and higher rates remained, according to Westpac senior economist Matthew Hassan.​

TL;DR

Category	Details
Consumer Confidence (July 2024)	Dropped by 1.1% month-over-month to a six-month low of 82.7
Number of Declines in 2024	Fifth decline of the year
Main Concerns	Persistent inflation, rising borrowing costs
Positive Factors	Recent tax cuts, fiscal support measures
'Family finances vs a year ago' sub-index	Sharp drop of 8.4% to 63.5
Expectations for finances in the next year	Declined
Sentiment on Economic Conditions (Next 12 months)	Increased
Overall Economic Concerns	Vulnerability to inflation and higher rates
Comment by Expert	Westpac senior economist Matthew Hassan

The forecast for Westpac Consumer Confidence indicates a projected increase of 0.5%, compared to the previous outcome of -1.1%.

The upcoming Westpac Consumer Confidence is set to be released on Tuesday at 12:30 AM GMT.​

AUD - Wage Price Index q/q (High Impact)​

The Wage Price Index (q/q) measures the change in labor costs paid by businesses and the government, excluding bonuses. A higher-than-expected result is typically favorable for the currency, as it signals potential inflationary pressures. Traders monitor this index closely because rising labor costs often lead to higher consumer prices, making it a key indicator of future inflation trends.


In the first quarter of 2024, Australia's seasonally adjusted wage price index experienced a slight decrease to 4.1% year-over-year, coming down from the 4.2% growth observed in the fourth quarter of 2023, which was the highest since the first quarter of 2009. This modest easing in wage growth was seen across both the public and private sectors, with public sector wages growing at 3.8%, down from 4.3%, and private sector wages at 4.1%, slightly lower than the previous 4.2%. The main sectors driving wage increases in original terms included healthcare and social assistance, which saw the highest increase at 5.3%, followed by electricity, gas, water, and waste services, retail trade, both at 4.4%, and administrative and support services along with transport, postal, and warehousing, each at 4.3%. Other significant contributors were construction at 4.2%, education and training at 4.1%, manufacturing at 4.0%, and mining at 3.8%. On a quarterly basis, the increase in wage prices softened to 0.8%, down from a revised 1.0% in the previous quarter and below market expectations of 0.9%, marking the lowest quarterly rise since the fourth quarter of 2022. This trend indicates a subtle deceleration in wage growth as the market adjusts to various economic pressures.​

TL;DR

• Overall wage growth in Q1 2024 decreased slightly to 4.1% from 4.2% in Q4 2023.​
• Public sector wage growth fell to 3.8% in Q1 2024 from 4.3% in Q4 2023.​
• Private sector wage growth decreased to 4.1% in Q1 2024 from 4.2% in Q4 2023.​
• Sectors with the highest wage increases in Q1 2024:​
• Healthcare & Social Assistance: 5.3%​
• Electricity, Gas, Water, Waste Services: 4.4%​
• Retail Trade: 4.4%​
• Quarterly wage price increase slowed to 0.8% in Q1 2024, down from 1.0% in Q4 2023.​

The Wage Price Index forecast for the next quarter is projected at 0.9%, up from the previous figure of 0.8%.

The upcoming Wage Price Index will be released at 1:30 AM GMT on Tuesday.
​

GBP - Claimant Count Change (High Impact)​

The UK Office for National Statistics' Claimant Count Change measures the month-to-month change in the number of people claiming unemployment benefits, serving as an early indicator of the labor market's health. This metric, released mid-month and covering the previous month, can impact GBP volatility. A rise in claimants is generally bearish for the Pound Sterling (GBP), signaling potential economic deterioration and looser monetary policy, while a drop is seen as bullish, reflecting improving economic conditions.


The UK's labour market is showing signs of strain as the number of people claiming unemployment benefits surged by 32.3 thousand to 1.66 million in June 2024, significantly exceeding market expectations and following a steep 51.9 thousand increase in May. Concurrently, the unemployment rate ticked up to 4.4%, indicative of a softening economy, despite a rise in payrolled employees which saw a monthly increase of 54,000 between April and May and an annual boost of 241,000. This period also recorded a decline in job vacancies, which fell by 30,000 in the quarter to 889,000—still higher than pre-pandemic levels. The employment rate marginally decreased to 74.4%, reflecting broader market uncertainties. Moreover, while earnings growth remains strong at 5.7% annually for both regular and total earnings, real earnings growth, adjusted for inflation, moderated to 2.5% and 2.2% respectively. The labour market's challenges are further highlighted by 49,000 working days lost due to labour disputes in May, signaling continuing tensions. This tumultuous environment is partly attributed to new policies that have raised the administrative earnings threshold for job seekers, influencing the Claimant Count and overall employment figures.​

TL;DR

Indicator	June 2024	Previous Period	Comments
Unemployment Benefits Claimants	1.66 million (up by 32.3 thousand)	51.9 thousand increase in May	Surpassed market expectations
Unemployment Rate	4.4%	Increase from previous period	Sign of a softening economy
Payrolled Employees	Monthly increase of 54,000	Annual increase of 241,000	Reflects growth despite overall market strain
Job Vacancies	889,000	Decline of 30,000 in the quarter	Still above pre-pandemic levels
Employment Rate	74.4%	Marginal decrease	Indicates market uncertainty
Earnings Growth (Annual)	5.7% (both regular and total earnings)	Strong growth	Real earnings growth adjusted for inflation: 2.5% (regular), 2.2% (total)
Working Days Lost Due to Labour	49,000	N/A	Highlights ongoing tensions
Policy Impact	New policies increased administrative earnings threshold	Influenced Claimant Count and employment figures

The projected Claimant Count Change is forecasted at 14,500, compared to the previous figure of 32,300.​

GBP – Employment Change (Medium Impact)​

The UK Office for National Statistics' Employment Change report reveals the shift in employment numbers over the three months leading up to the release. A consistent increase in employment is typically viewed as a positive sign for the Pound Sterling (GBP), suggesting economic strength and stability. Conversely, a decrease in employment figures is generally considered bearish for the GBP, indicating potential economic weakness.


In the three months to May 2024, the number of people employed in the UK rose by 19,000, reversing a decline of 139,000 in the previous period and surpassing market expectations of an 18,000 increase. This marked the first job growth since the three months ending December 2023, with gains driven by an increase in part-time employees and full-time self-employed workers. However, the latest data also showed decreases in both full-time employees and part-time self-employed workers during the same period.​

TL;DR

• In the three months to May 2024, UK employment rose by 19,000, reversing a previous decline of 139,000.​
• This increase surpassed market expectations, which anticipated an 18,000 rise.​
• It was the first job growth since the three months ending December 2023.​
• Employment gains were driven by increases in part-time employees and full-time self-employed workers.​
• There were decreases in full-time employees and part-time self-employed workers during the same period.​

The projected change in employment is forecasted to be -35,000, compared to the previous figure of 19,000.​

GBP - Average Earnings Index 3m/y (Medium Impact)​

The Average Earnings Index 3m/y, which tracks the change in the price businesses and the government pay for labor—including bonuses—has significant implications for the economy. When the 'Actual' figure surpasses the 'Forecast,' it is generally considered positive for the currency. Traders pay close attention to this indicator because it serves as a leading gauge of consumer inflation. Higher labor costs for businesses often translate into increased expenses for consumers, as companies pass on these costs through higher prices. Consequently, stronger-than-expected earnings data can signal rising inflationary pressures and influence currency markets.

In the UK, average weekly earnings, including bonuses, rose by 5.7% year-on-year to £689 in the three months to May 2024, aligning with market forecasts and marking a slight decrease from the 5.9% growth observed in the previous two periods. Public sector wage growth remained robust at 6.3%, while the private sector experienced a softening to 5.5% from 5.9%. Regular pay, which excludes bonuses, increased by 5.7%—the lowest rate since September 2022—and matched the anticipated 6% growth from prior months. The finance and business services sector led with a 7% increase in annual regular pay, followed by manufacturing at 6.4%, and services at 5.7%. When adjusted for inflation, real wage growth remained steady at 2.2% for total pay and improved marginally to 2.5% for regular pay, up from 2.4%, indicating sustained purchasing power amidst economic fluctuations.​

TL;DR

Category	Details
Average Weekly Earnings	+5.7% YoY to £689 (three months to May 2024)
Public Sector Wage Growth	+6.3%
Private Sector Wage Growth	+5.5% (down from 5.9%)
Regular Pay (Excluding Bonuses)	+5.7% (lowest since September 2022, matching prior 6%)
Finance and Business Services	+7% annual regular pay
Manufacturing Sector	+6.4% annual regular pay
Services Sector	+5.7% annual regular pay
Real Wage Growth (Total Pay)	Steady at +2.2%
Real Wage Growth (Regular Pay)	Improved to +2.5% from +2.4%

The forecast for the Average Earnings Index indicates a rate of 4.6%, down from the previous result of 5.7%.

GBP – Unemployment Rate (Medium Impact)​

The unemployment rate measures the percentage of the total workforce that is unemployed and actively seeking work over the past three months. Traders monitor this indicator closely because a rate lower than forecast is seen as favorable for the currency. Although considered a lagging indicator, the unemployment rate is crucial for assessing economic health, as it reflects labor market conditions closely tied to consumer spending. It also influences monetary policy decisions.


From March to May 2024, the UK's unemployment rate held steady at 4.4%, matching the previous three-month period and meeting market forecasts. This rate, the highest since late 2021, reflected an increase in the unemployed population by 88,000, reaching a total of 1.53 million. This rise was particularly notable among those unemployed for up to six months and those with longer durations of unemployment. In contrast, employment figures saw a slight improvement, with 19,000 more people employed, bringing the total to 33 million. This increase was largely attributed to a growth in part-time positions and self-employment. Additionally, the proportion of people holding second jobs rose to 3.8% of all employed individuals. On the other hand, the rate of economic inactivity decreased by 0.2 percentage points to 22.1%.​

TL;DR

• UK unemployment rate remained steady at 4.4% from March to May 2024, matching the previous three months and market forecasts.​
• The unemployment rate is the highest since late 2021.​
• The unemployed population increased by 88,000, reaching 1.53 million.​
• Notable rise in unemployment among those unemployed for up to six months and those with longer durations of unemployment.​
• Employment figures slightly improved, with 19,000 more people employed, totaling 33 million.​
• Employment growth largely driven by an increase in part-time positions and self-employment.​
• Proportion of people with second jobs increased to 3.8% of all employed individuals.​
• Economic inactivity rate decreased by 0.2 percentage points to 22.1%.​

The unemployment rate forecast stands at 4.5%, slightly up from the previous rate of 4.4%.

The next release of the Claimant Count Change, Employment Change, Average Earnings Index 3m/y, & Unemployment Rate is scheduled for Tuesday at 6:00 AM GMT.​

EUR - German ZEW Economic Sentiment (Medium Impact)​

The German ZEW Economic Sentiment Index, a key indicator of economic health, reflects the outlook of around 300 institutional investors and analysts in Germany. This diffusion index measures their expectations for the country's economic performance over the next six months. A reading above 0.0 signifies optimism, while a reading below indicates pessimism. Traders closely monitor this index as it often provides an early signal of future economic activity, with higher-than-forecasted results generally considered positive for the currency. The index is derived from a survey asking respondents to rate their economic expectations, making it a valuable gauge of investor sentiment and potential economic trends.


In July 2024, the ZEW Indicator of Economic Sentiment for Germany fell for the first time in a year, dropping by 5.7 points to 41.8, the lowest level in four months and below forecasts of 42.5. This decline reflects a worsening economic outlook due to falling exports, political uncertainty in France, and unclear future monetary policy by the ECB. Conversely, the assessment of current economic conditions in Germany slightly improved, with the corresponding indicator rising by 4.9 points to -68.9, the highest in a year and better than expected.​

TL;DR

• In July 2024, the ZEW Indicator of Economic Sentiment for Germany decreased for the first time in a year.
• The indicator dropped by 5.7 points to 41.8, marking the lowest level in four months and below the forecast of 42.5.
• The decline is attributed to a worsening economic outlook due to falling exports, political uncertainty in France, and unclear future monetary policy by the ECB.
• On the other hand, the assessment of current economic conditions in Germany slightly improved.
• The corresponding indicator for current conditions rose by 4.9 points to -68.9, the highest level in a year and better than expected.

The forecast for the ZEW Economic Sentiment Index is projected at 30.6, a decrease from the previous reading of 41.8.

The next release of the German ZEW Economic Sentiment is scheduled for Tuesday at 9:00 AM GMT.​

USD - Core PPI m/m (High Impact)​

The Producer Price Index (PPI) excluding food and energy, as published by the Bureau of Labor Statistics, gauges the average changes in prices at the wholesale level across various stages of production in the United States. By excluding the more volatile categories of food and energy, this measure aims to provide a clearer picture of price trends. Typically, a high PPI reading is considered favorable or bullish for the US dollar, while a low reading is viewed as detrimental or bearish.


In a recent economic update, the U.S. Bureau of Labor Statistics had announced that core producer prices, which exclude volatile items such as food and energy, had risen by 0.4% in June 2024. This increase followed an upward revision to 0.3% in the previous month, surpassing market expectations that had anticipated a more modest 0.2% rise. Year-over-year, core producer inflation had accelerated to a peak of 3%, the highest rate in over a year, climbing from a revised figure of 2.6% and exceeding analyst forecasts of 2.5%. This surge indicated a significant and persistent inflationary trend within the core sectors of the economy, sparking concerns about potential impacts on future economic policy and inflation trajectories.​

TL;DR

Metric	Value	Details
Core Producer Price Increase (June 2024)	0.4%	Excludes volatile items like food and energy
Previous Month Revision (May 2024)	0.3%	Revised upward from earlier figures
Market Expectation (June 2024)	0.2%	Analysts anticipated a more modest rise
Year-over-Year Core Producer Inflation	3.0%	Highest rate in over a year, up from a revised 2.6%
Analyst Forecast (Year-over-Year)	2.5%	Expected lower than the actual 3.0%
Implications	Significant and persistent inflationary trend	Concerns about future economic policy and inflation trajectories

The projected month-over-month Core PPI is forecasted to be 0.2%, compared to the earlier figure of 0.4%.

USD – PPI m/m (High Impact)​

The U.S. Producer Price Index (PPI) for final demand, released monthly by the Bureau of Labor Statistics, tracks price changes from producers for goods and services in various sectors. It includes final demand goods, trade services, transportation, warehousing, and construction. Traders watch the PPI closely as it indicates future consumer inflation; higher readings are typically seen as positive for the USD, while lower readings are negative.


In June 2024, the U.S. Producer Price Index (PPI) recorded a modest increase of 0.2% month-over-month, surpassing the anticipated 0.1% rise, as reported by the Bureau of Labor Statistics (BLS). This uptick, primarily driven by a 0.6% increase in service prices, notably in sectors like machinery and vehicle wholesaling, outpaced a 0.5% decline in goods prices, led by a significant 5.8% drop in gasoline costs. Despite the decrease in goods, the inflationary pressures were evident in other areas, such as autos and auto parts retailing, and computer hardware and software sales. On an annual basis, the producer inflation climbed to 2.6%, marking the highest rate since March 2023. Excluding food and energy, the core PPI rose by 0.4% for the month and reached a year-over-year increase of 3.0%, exceeding forecasts and indicating persistent inflationary pressures that could impact consumer prices. This data highlights ongoing inflation concerns in the U.S. economy, as businesses face higher costs that may be transferred to consumers.​

TL;DR

Metric	Value/Change	Details
June 2024 PPI (Month-over-Month)	+0.2%	Higher than the anticipated 0.1% increase
Service Prices	+0.6%	Driven by machinery and vehicle wholesaling sectors
Goods Prices	+0.5%	Significant 5.8% drop in gasoline costs
Annual PPI (Year-over-Year)	+2.6%	Highest rate since March 2023
Core PPI (Excluding Food and Energy)	+0.4% (MoM), +3.0% (YoY)	Indicates persistent inflationary pressures
Notable Sectors	- Autos and auto parts retailing	- Computer hardware and software sales
Inflationary Pressure	Persistent	Businesses facing higher costs that could be passed on to consumers

The forecast for the PPI month-over-month is indicated at 0.2%, following a previous outcome of 0.2%.

The Core PPI m/m and PPI m/m are scheduled for release on Tuesday at 12:30 PM GMT.

​

 

[MiloPlexyTrade]

14th August 2024

Wednesday​

On Wednesday, the financial world will be abuzz with a series of pivotal economic updates. New Zealand will kick off the day by unveiling its Official Cash Rate, setting the stage for market reactions. As the day progresses, all eyes will turn to the United Kingdom for the release of its latest year-on-year Consumer Price Index (CPI) data, a key indicator of inflationary trends. In the afternoon, the United States will offer a fresh perspective on economic conditions with its inflation report. The day will wrap up with Japan revealing its quarterly GDP Growth Rate, providing a final piece of the global economic puzzle.​

NZD - Official Cash Rate (High Impact)​

The Official Cash Rate (OCR) is the interest rate at which banks borrow from the Reserve Bank of New Zealand (RBNZ) overnight. A higher OCR than forecast typically boosts the currency, as short-term interest rates are a key factor in currency valuation. Traders focus on this rate to gauge future currency movements, relying on other indicators to predict changes in interest rates. The OCR is set by the RBNZ Governor in consultation with senior bank staff and external advisers.


The Reserve Bank of New Zealand has decided to keep the Official Cash Rate (OCR) unchanged at 5.50% during its July 2024 meeting, marking the eighth consecutive rate hold. The decision comes as restrictive monetary policy continues to temper inflation, which has decreased to 4% in the first quarter of 2024—still above the target range of 1-3%. The Committee expects inflation to re-enter this target range in the latter half of the year. Despite a decrease in inflation, the Reserve Bank stated that monetary policy would need to remain restrictive to further reduce inflationary pressures, although adjustments will be made gradually. The easing of labor market pressures due to cautious hiring practices and an increased labor supply was also noted, aligning with the bank’s current economic strategy.​

TL;DR

Detail	Information
OCR Decision	Unchanged at 5.50%
Meeting Date	July 2024
Consecutive Rate Holds	8
Inflation Rate Q1 2024	4% (above the target range of 1-3%)
Expected Inflation Trend	Expected to re-enter target range of 1-3% in the latter half of 2024
Monetary Policy Stance	Remains restrictive to temper inflation; adjustments to be made gradually
Labor Market Condition	Easing pressures due to cautious hiring and an increased labor supply
Economic Strategy	Aligns with the current strategy of the Reserve Bank

The projected RBNZ Interest Rate Decision is expected to remain at 5.5%, unchanged from the previous rate.

The decision on the Official Cash Rate is scheduled for release on Wednesday at 2:00 AM GMT.

NZD – RBNZ Press Conference (Medium Impact)​

The RBNZ Press Conference, led by the RBNZ Governor, is crucial for traders as it communicates monetary policy details and offers clues about future policy. The conference, webcasted live on the RBNZ website, lasts about 30 minutes and consists of a prepared statement followed by a Q&A session, which can cause market volatility due to unscripted answers. A more hawkish stance than expected is beneficial for the currency. This event, also known as the Monetary Policy Statement Media Conference, provides insights into the latest interest rate decision and economic outlook.​

The Reserve Bank of New Zealand's press conference is scheduled for 3:00 AM GMT.

GBP - CPI y/y (High Impact)​

CPI y/y measures the annual change in consumer prices for goods and services. A higher-than-forecast CPI generally strengthens the currency, as it suggests rising inflation, leading central banks to potentially raise interest rates. Traders care about this data because inflation impacts currency value and interest rates, which influence trading decisions and market expectations.


In June 2024, the UK's annual inflation rate remained steady at 2%, unchanged from May and reflecting levels last seen in 2021. This stability occurred despite forecasts predicting a slight decrease to 1.9%. Notable influences on the rate included a significant rise in the cost of restaurants and hotels, particularly hotel prices, which rose to 6.2% from 5.8% the previous month. Additionally, transport costs increased, led by expenses related to second-hand cars, maintenance, and airfares. Conversely, there was a decline in the inflation rates for clothing and footwear, as well as for food and non-alcoholic beverages, with the latter reaching its lowest point since October 2021. Housing and utility costs continued their downward trend, while inflation for services and recreation and culture remained consistent.​

TL;DR

Category	Detail
General Inflation Rate	Remained steady at 2%, unchanged from May
Forecasts	Predicted a slight decrease to 1.9%, but actual was unchanged
Restaurants and Hotels	Significant rise, with hotel prices increasing to 6.2%
Transport Costs	Increased, led by expenses for second-hand cars, maintenance, and airfares
Clothing and Footwear	Decline in inflation rates
Food and Non-Alcoholic Beverages	Decline, reaching the lowest point since October 2021
Housing and Utilities	Continued downward trend
Services	Inflation remained consistent
Recreation and Culture	Inflation remained consistent

The forecast for CPI year-over-year is projecting 2.3%, compared to the previous outcome of 2.0%.

The UK's annual CPI will be released on Wednesday at 6:00 AM GMT.

USD - Core CPI m/m (High Impact)​

The Core Consumer Price Index year-over-year measure indicates how the prices of goods and services purchased by consumers change, excluding volatile items like food, energy, alcohol, and tobacco. This data is released monthly, roughly 16 days after the end of the month. Generally, if the 'Actual' figure exceeds the 'Forecast,' it is considered positive for the currency. However, in this context, Core CPI data has a relatively minor impact compared to other countries because the central bank primarily focuses on the overall CPI for its inflation target.


In June 2024, U.S. core consumer prices, which exclude volatile food and energy items, rose modestly by 0.1% from the previous month, according to the Bureau of Labor Statistics. This increase is below the market expectations of 0.2% and represents the softest rise in core CPI since February 2021. The data suggests a significant moderation in inflation, particularly in shelter costs which rose by only 0.2% compared to 0.4% in May, and transportation services which continued to decline. This slowdown in core inflation supports the growing expectations among traders for the Federal Reserve to begin lowering interest rates as early as September, as the trend indicates a move towards the Fed's target inflation rate of 2% annually.​

TL;DR

• Reporting Period: June 2024
• Core CPI Increase: 0.1%, below market expectations of 0.2%
• Last Comparable Rise: Softest rise in core CPI since February 2021
• Key Influences:
  • Shelter costs increased by 0.2%, down from 0.4% in May
  • Transportation services declined
• Federal Reserve Action: Expectations for interest rate cuts as early as September, driven by moderation in inflation
• Inflation Target: Current trends indicate a movement towards the Federal Reserve's annual target of 2% inflation

The forecast for Core CPI mm is projected at 0.2%, compared to the previous outcome of 0.1%.

USD - CPI m/m (High Impact)​

The Consumer Price Index (CPI) measures the monthly change in the prices of goods and services purchased by consumers. Typically, if the 'actual' CPI exceeds the 'forecast,' it is considered beneficial for the currency. This is because consumer prices make up a significant portion of overall inflation. Inflation, in turn, plays a crucial role in currency valuation, as increasing prices often prompt the central bank to raise interest rates to control inflation. The CPI is derived by sampling the average prices of various goods and services and comparing them to the previous month's data.


In June 2024, the U.S. Consumer Price Index (CPI) unexpectedly decreased by 0.1% month-over-month, marking the first such decline since May 2020 and deviating from the expected 0.1% increase. This reduction was significantly influenced by a 3.8% drop in gasoline prices, which more than compensated for the smaller rises in food and shelter costs, both of which increased by 0.2%. The core CPI, which excludes volatile food and energy prices, also increased by a modest 0.1%, below both the previous month's figures and forecasts. This unexpected dip in the CPI contributed to the lowest annual inflation rate in over three years at 3%, fueling market speculation about potential interest rate cuts by the Federal Reserve in the near future.

TL;DR​

• Overall CPI: Experienced an unexpected decline of 0.1% month-over-month, marking the first such drop since May 2020, against an anticipated increase of 0.1%.
• Gasoline Prices: Plunged by 3.8%, significantly driving the overall decline in the CPI.
• Food Costs: Recorded a modest increase of 0.2%.
• Shelter Costs: Likewise, increased by a modest 0.2%.
• Core CPI: Grew by only 0.1%, below both prior month's figures and expert forecasts.
• Annual Inflation Rate: Fell to 3%, the lowest in over three years, triggering market discussions about possible interest rate cuts by the Federal Reserve.

The forecast for CPI mm shows a notable shift, moving to 0.2% from a previous -0.1%.

USD - CPI y/y (High Impact)​

The Consumer Price Index (CPI) year-over-year (y/y) measures the change in the price of goods and services purchased by consumers. When the actual CPI exceeds the forecast, it is typically positive for the currency. This is because consumer prices account for a significant portion of overall inflation, which is crucial for currency valuation. Rising prices often prompt the central bank to raise interest rates to contain inflation. The CPI is derived by sampling the average price of various goods and services and comparing it to the previous sampling.


The annual inflation rate in the US fell for a third straight month to 3% in June 2024, the lowest since June 2023, compared to 3.3% in May and below forecasts of 3.1%. Energy costs rose at a slower pace (1% vs 3.7%), due to gasoline (-2.5% vs 2.2%) and fuel oil (0.8% vs 3.6%) while utility gas service (3.7% vs 0.2%) accelerated. Inflation also eased for shelter (5.2% vs 5.4%) and transportation (9.4% vs 10.5%) and steadied for apparel (0.8%). In addition, prices continued to decline for new vehicles (-0.9% vs -0.8%) and used cars and trucks (-10.1% vs -9.3%). On the other hand, food inflation edged up (2.2% vs 2.1%). Compared to May, the CPI unexpectedly declined 0.1%, the first fall since May 2020, following a flat reading and compared to expectations of a 0.1% rise. Meanwhile, annual core inflation also slowed to 3.3%, a fresh low since April 2021, from 3.4% in May and forecasts it would remain steady. The monthly rate edged down to 0.1% from 0.2%, below expectations of 0.2%​

TL;DR

• Total CPI: Fell to 3.0% in June from 3.3% in May, below the forecast of 3.1%.​
• Energy Costs: Overall growth slowed to 1.0%, with significant decreases in gasoline prices (-2.5%) and a modest slowdown in fuel oil (0.8%); utility gas service saw a sharp increase to 3.7%.​
• Shelter: Inflation slightly eased to 5.2% from 5.4%.​
• Transportation: Rates dropped to 9.4% from 10.5%, indicating a decrease in transportation cost inflation.​
• Apparel: Remained stable at an 0.8% rate.​
• New Vehicles: Continued to decline with a rate of -0.9%, showing further depreciation.​
• Used Cars & Trucks: Inflation rate accelerated in decline to -10.1%.​
• Food: Experienced a slight increase to 2.2% from 2.1%.​
• Monthly CPI Change: Unexpectedly declined by 0.1%, marking the first fall since May 2020 and falling below expectations of a 0.1% rise.​
• Annual Core Inflation: Slowed to 3.3% from 3.4%, reaching a new low since April 2021 and dropping more than the forecast which predicted it would hold steady.​
• Monthly Core Inflation: Edged down to 0.1% from 0.2%, also below the expected rate of 0.2%.​

The CPI y/y forecast remains steady at 3.0%, unchanged from the previous measurement.

The next set of US inflation data is due for release on Wednesday at 12:30 PM GMT.

JPY - Prelim GDP q/q (Medium Impact)​

Preliminary GDP (quarter-over-quarter) measures the change in the inflation-adjusted value of all goods and services produced by the economy. A higher-than-forecast 'Actual' figure is generally positive for the currency. Traders pay close attention to this because it is the most comprehensive indicator of economic activity and serves as the main gauge of the economy's overall health.


Japan's economy contracted by 0.5% quarter-on-quarter in the first quarter of 2024, reversing a previously revised 0.1% growth in the final quarter of 2023, and falling short of market expectations. This decline was largely driven by a steep 0.7% drop in private consumption, marking the fourth consecutive quarterly decrease as consumers faced high living costs and stagnant wages. Capital expenditure also weakened, down 0.4%, influenced by reduced auto production following a scandal at Daihatsu Motor. Additionally, net trade negatively impacted GDP, with exports falling more sharply than imports. Despite a slight 0.2% increase in government spending, overall GDP shrank by 2% year-on-year, a sharper contraction than anticipated and reflecting ongoing challenges in private spending and global demand.​

Economic Indicator	Q1 2024 Performance	Change from Previous Quarter	Notes
Overall GDP Growth	-0.5%	Reversal from +0.1% in Q4 2023	Year-on-year contraction of 2%
Private Consumption	-0.7%	Fourth consecutive decrease	High living costs and stagnant wages cited as causes
Capital Expenditure	-0.4%	Decrease from previous quarter	Affected by reduced auto production due to Daihatsu scandal
Net Trade	Negative impact	Exports fell more than imports	Contributed to GDP shrinkage
Government Spending	+0.2%	Slight increase	Insufficient to offset declines in other areas

The forecast for the quarterly GDP growth rate is 0.6%, a turnaround from the previous decline of -0.5%.

The preliminary quarterly GDP data is scheduled to be released on Wednesday at 11:50 PM GMT.

 

[MiloPlexyTrade]

15th August 2024

Thursday​

On August 15th, a series of pivotal economic indicators will be released, beginning with Australia, which will disclose its Employment Change and Unemployment Rate figures. This will be closely followed by China's announcement of its year-on-year Industrial Production and Retail Sales data. The focus will then shift to the UK, where the latest GDP data will be revealed on a month-on-month, quarter-on-quarter preliminary, and year-over-year basis. The day's reporting will conclude in the US, where the spotlight will be on its Core Retail Sales and Retail Sales on a month-on-month basis, alongside Unemployment Claims, the Empire State Manufacturing Index, and the Philly Fed Manufacturing Index. These releases are expected to provide crucial insights into the economic conditions of these key global players.​

AUD - Employment Change (High Impact)​

Employment change tracks the shift in the number of employed individuals from the previous month and is published monthly, usually about 15 days after the end of the month. This crucial economic data, because of its importance and early release, has a significant effect on the market. Generally, if the 'actual' number exceeds the 'forecast,' it is viewed positively for the currency. Job creation is a key leading indicator of consumer spending, which represents a substantial part of overall economic activity.


In June 2024, Australia's job market experienced substantial growth, surpassing expectations with an overall employment increase of 50,200—the largest in four months—to reach a total of 14,406,100 workers. This surge well exceeded market forecasts, which had anticipated a 20,000 job gain. The figures revealed a significant rise in full-time positions, adding 43,300 jobs to total 9,944,200, while part-time employment also rose by 6,800 to 4,461,800. Overall, employment grew by 387,600 over the past year, marking a 2.8 percent increase. In trend terms, monthly hours worked edged up by 6 million hours to 1,967 million hours. The employment-to-population ratio held steady at 64.1%, while the participation rate remained unchanged at 66.8% overall—70.9% for men and increasing to 62.9% for women. Notably, the underemployment rate was constant at 6.5%, and the underutilisation rate dropped slightly to 10.5%. These figures underscore a robust labor market showing significant full-time job creation and sustained participation rates.

TL;DR​

• Overall Employment Increase: 50,200
• Total Workers: 14,406,100
• Market Forecast (Job Gain): 20,000
• Full-Time Employment Increase: 43,300
• Total Full-Time Workers: 9,944,200
• Part-Time Employment Increase: 6,800
• Total Part-Time Workers: 4,461,800
• Employment Growth Over Past Year: 387,600
• Yearly Employment Growth Rate: 2.8%
• Monthly Hours Worked: 1,967 million hours
• Employment-to-Population Ratio: 64.1%
• Overall Participation Rate: 66.8%
• Men's Participation Rate: 70.9%
• Women's Participation Rate: 62.9%
• Underemployment Rate: 6.5%
• Underutilisation Rate: 10.5%

The forecast for Australia's Employment Change is expected to be 20,200, compared to the earlier figure of 50,200.

AUD - Unemployment Rate (High Impact)​

The Unemployment Rate gauges the percentage of the workforce that is unemployed and actively looking for a job in the previous month. This statistic is released monthly, roughly 15 days after the end of the month. While it is considered a lagging indicator, it remains crucial for assessing economic health because consumer spending closely aligns with labor market conditions. In currency trading, a lower actual unemployment rate compared to the forecast is seen as positive.

In June 2024, Australia's unemployment rate experienced a slight uptick, rising to 4.1% from the 4.0% reported in May, despite projections it would remain unchanged. This increase was accompanied by a rise in the number of job seekers, with total unemployment reaching 608.2 thousand—an increase of 9.7 thousand. This was driven by a notable rise in individuals searching for part-time work, which grew by 7.5 thousand to 206.4 thousand, while those seeking full-time positions increased by 2.2 thousand to 401.8 thousand. Despite the higher unemployment rate, the overall employment figures were robust, with an addition of 50.2 thousand jobs in June, marking the most substantial growth in four months and surpassing market expectations of a 20 thousand increase. This growth was primarily in full-time employment, which surged by 43.3 thousand to 9.94 million, while part-time positions also saw a gain of 6.8 thousand to reach 4.46 million. Moreover, the participation rate slightly increased to 66.9% from 66.8% in the previous month, indicating a larger pool of people either working or looking for work. Furthermore, the underemployment rate decreased to 6.5% from 6.7%, and total monthly hours worked in all jobs climbed by 15 million or 0.8%, totaling 1,967 million hours.

TL;DR​

Metric	June 2024	Change from May 2024
Unemployment Rate	4.1%	+0.1 percentage points
Total Unemployed	608.2 thousand	+9.7 thousand
Unemployed Seeking Part-Time Work	206.4 thousand	+7.5 thousand
Unemployed Seeking Full-Time Work	401.8 thousand	+2.2 thousand
Total Employment	50.2 thousand jobs added
Full-Time Employment	9.94 million	+43.3 thousand
Part-Time Employment	4.46 million	+6.8 thousand
Participation Rate	66.9%	+0.1 percentage points
Underemployment Rate	6.5%	-0.2 percentage points
Total Monthly Hours Worked	1,967 million hours	+15 million hours (or +0.8%)

The forecast for the Unemployment Rate is 4.1%, matching the previous outcome of 4.1%.

The upcoming release of the Employment Change and Unemployment Rate data is scheduled for Thursday at 1:30 AM GMT.

CNY - Industrial Production y/y (Medium Impact)​

The Industrial Production Year-over-Year Measures gauge the change in the inflation-adjusted output from manufacturers, mines, and utilities. When the actual data exceeds forecasts, it's often seen as a positive sign for the currency. Traders focus on this indicator because it provides insight into economic health and reacts swiftly to changes in the business cycle, making it a crucial tool for assessing economic trends.


In June 2024, China's industrial production increased by 5.3% year-on-year, exceeding market forecasts of 5.0% but decelerating from a 5.6% growth in May. This development marks the second consecutive month of moderated growth, recording the slowest pace since March, primarily due to a decrease in manufacturing activity, which grew by 5.5% compared to 6.0% in the previous month. The fragility of the economic recovery was evident across various sectors, although 35 out of 41 major industries still reported growth. Notable sectors include coal, mining & washing, and oil & natural gas, each expanding by 4.4%, while chemical products surged by 9.9%. Additionally, textiles advanced by 5.1%, and non-ferrous metal smelting and rolling processing jumped by 10.2%. Other transportation equipment led the gains with a remarkable 13.1% growth, and the automobile sector grew by 6.6%. Furthermore, sectors like computer, communication and other electronic equipment, and utilities saw increases of 4.4% and 4.1%, respectively. On a monthly basis, industrial activity edged up by 0.4%, following a 0.3% rise in May, bringing the year-to-date advance in industrial output to 6.0%.

TL;DR​

• Overall Industrial Production:
  • June 2024: Increased by 5.3% year-on-year (YoY)
  • May 2024: Increased by 5.6% YoY
  • Year-to-Date: 6.0% YoY growth
• Manufacturing Activity:
  • June 2024: 5.5% YoY
  • May 2024: 6.0% YoY
• Notable Sector Growth in June 2024:
  • Coal, Mining & Washing, Oil & Natural Gas: 4.4% YoY
  • Chemical Products: 9.9% YoY
  • Textiles: 5.1% YoY
  • Non-Ferrous Metal Smelting & Rolling: 10.2% YoY
  • Other Transportation Equipment: 13.1% YoY
  • Automobile Sector: 6.6% YoY
  • Computer, Communication & Electronic Equipment: 4.4% YoY
  • Utilities: 4.1% YoY
• Monthly Industrial Activity:
  • June 2024: Increased by 0.4%
  • May 2024: Increased by 0.3%

The forecast for year-over-year industrial production is 5.2%, a slight decrease from the previous 5.3%.

CNY - Retail Sales y/y (Medium Impact)​

The monthly Retail Sales data, released by China's National Bureau of Statistics, measures the total value of goods sold by retailers throughout China, providing a key indicator of consumer spending. This data shows the percentage change in sales by comparing figures from the current month to those from the same month the previous year. Generally, a higher reading signals positive momentum for the Chinese Renminbi (CNY), while a lower reading suggests a less favorable outlook.


In June 2024, China's retail sales growth slowed significantly to 2% year-over-year, missing forecasts of 3.3% and marking a decrease from the previous month's 3.7%. This represents the weakest growth in 17 months, with notable declines in sales of cosmetics, household appliances, and cultural items. Beverage and furniture sectors also saw reduced growth rates. Additionally, retail activity experienced a 0.12% decline on a monthly basis, the first since July 2023. Despite these downturns, the first half-year retail sales still grew by 3.7%.

TL;DR​

• Year-over-Year Growth in June 2024: 2%, down from 3.7% the previous month and below the forecast of 3.3%. Weakest growth in 17 months.​
• Monthly Change: Declined by 0.12%, marking the first monthly drop since July 2023.​
• Sector Declines: Significant reductions in sales for cosmetics, household appliances, cultural items, beverages, and furniture.​
• First Half-Year Growth: 3.7%, indicating positive overall growth despite recent downturns​

The forecast for year-over-year Retail Sales stands at 2.6%, up from the previous 2%.

The upcoming year-over-year Industrial Production and Retail Sales data will be released on Thursday at 2:00 AM GMT.

GBP – GDP y/y (Medium Impact)​

The Gross Domestic Product (GDP) is a key economic metric published by the Office for National Statistics both monthly and quarterly. It quantifies the entire value of goods and services produced in the UK over a specific period, serving as the principal indicator of economic activity in the country. The year-over-year (YoY) comparison assesses economic performance by comparing the data from a given quarter with the same quarter in the previous year. Typically, a higher GDP reading suggests positive momentum for the Pound Sterling (GBP), indicating a bullish scenario, whereas a lower GDP figure suggests a bearish outlook for the currency.


In a remarkable turnaround from the economic downturn, the UK economy exhibited a modest growth of 0.3% year-on-year in the first quarter of 2024, a slight improvement from the initial estimate of 0.2%. This positive shift marks a recovery from a 0.2% contraction in the previous quarter. The services sector, often seen as the economy's backbone, outperformed expectations with a growth rate of 0.4%, surpassing the preliminary estimate of 0.3%. While production gains were more modest than anticipated at 0.3% versus an expected 0.5%, it still represents a recovery from a previous decline of 0.1%. However, not all sectors fared well; construction continued its decline, falling by 0.4%, albeit at a slower pace than initially feared. On the expenditure front, while public spending surged by 3.4%, household consumption, business investment, exports, and imports all contracted. Yet, in a sign of resilience, the UK GDP grew by 0.7% compared to the previous quarter, officially exiting recession and surpassing initial estimates, heralding a cautiously optimistic outlook for the UK's economic future.

TL;DR​

• Overall GDP Growth: Increased modestly by 0.3% year-on-year, slightly above the initial estimate of 0.2%.​
• Recovery from Recession: Quarter-over-quarter growth was 0.7%, marking an exit from the previous quarter's recession.​
• Services Sector: Grew by 0.4%, outperforming the initial estimate of 0.3%.​
• Production: Increased by 0.3%, below the expected 0.5% but an improvement from the previous decline of 0.1%.​
• Construction: Continued to decline at a rate of -0.4%, though this was less severe than anticipated.​
• Public Spending: Showed a significant rise of 3.4%.​
• Private Sector Struggles: Household consumption, business investment, exports, and imports all contracted.​
• Overall Outlook: Indicates a cautiously optimistic future for the UK economy, with signs of resilience despite mixed sector performance.​

The GDP year-over-year forecast is projected at 0.9%, an increase from the previous figure of 0.3%.

GBP - GDP m/m (High Impact)​

The GDP month-over-month (m/m) measures the change in the total value of all goods and services produced by the economy. Generally, if the 'Actual' GDP exceeds the 'Forecast,' it is considered favorable for the currency. Traders closely monitor this indicator because it is the broadest measure of economic activity and serves as the primary gauge of the economy's health.


In May 2024, the UK's economy recorded a stronger-than-expected growth of 0.4%, surpassing the predicted 0.2% and recovering from a stagnant April. This boost was led by significant gains in consumer spending, with notable improvements in retail and wholesale sectors. The construction industry experienced its fastest growth rate in nearly a year, driven by increases in house building and infrastructure projects, as highlighted by Liz McKeown, ONS Director of Economic Statistics. Additionally, the manufacturing sector, particularly food and beverage production, contributed positively, reflecting a 0.4% increase. The services sector, primarily retail trade and professional activities, also saw growth, contributing to the overall economic expansion. This robust performance across various sectors led to a recovery in industrial production and marked one of the strongest three-month growth periods the UK has seen in over two years.

TL;DR​

Economic Indicator	Growth	Details
Overall Economic Growth	0.4%	Exceeded predictions (0.2%), strong recovery from stagnant April.
Consumer Spending	Significant	Major driver of growth, especially in retail and wholesale sectors.
Construction Industry	Fastest in nearly a year	Driven by house building and infrastructure projects.
Manufacturing Sector	0.4%	Led by food and beverage production.
Services Sector	Positive	Focused on retail trade and professional activities.
Industrial Production	Recovered	Contributed to overall economic expansion.
Performance (Last 3 Months)	Strongest in over 2 years	Marked one of the best quarterly performances recently.

The forecast for GDP month-over-month stands at 0.0%, while the previous figure was 0.4%.

GBP - Prelim GDP q/q (Medium Impact)​

The preliminary GDP quarter-over-quarter measures indicate the change in the inflation-adjusted value of all goods and services produced by the economy. Traders closely monitor these figures because a higher-than-expected actual GDP compared to the forecast is generally considered positive for the currency. This is because GDP is the broadest measure of economic activity and serves as the primary gauge of the economy's overall health.


The UK's preliminary GDP figures for the first quarter of 2024 revealed a notable 0.7% growth, surpassing the initial estimate of 0.6% and marking the strongest expansion in over two years. This growth signals the end of the recession that began last year. The services sector led the recovery with a 0.8% increase, driven by significant contributions from scientific research and legal activities. The production sector grew by 0.6%, though this was slightly below the early estimate of 0.8% due to a revision in manufacturing growth. The construction sector also performed better than initially reported, with a decline of 0.6% compared to the earlier estimate of 0.9%. On a monthly basis, March 2024 saw a 0.4% GDP increase, fueled by services and production outputs, which mitigated the impact of declining construction activity. In terms of expenditure, imports fell by 2.7%, more than the 2.3% initially reported, while exports decreased by 1%. Household spending rose by 0.4%, up from the previous 0.2% estimate, mainly due to increased spending on recreation, housing, and food. Gross capital formation increased by 0.9%, less than the expected 1.4%, and government consumption was revised to show no growth. Year-on-year, the economy grew by 0.3%, slightly higher than the initially reported 0.2%, reflecting a broader economic recovery amidst ongoing adjustments.​

TL;DR

• Total GDP Growth: Increased to +0.7%, up from the initial estimate of +0.6%.
• Services Sector Growth: Led the recovery with a +0.8% increase, notably driven by scientific research and legal activities.
• Production Sector Growth: Revised down to +0.6% from an early estimate of +0.8%, primarily due to adjustments in manufacturing growth.
• Construction Sector Change: Improved performance with a decrease of -0.6%, better than the previously estimated -0.9%.
• Monthly GDP for March 2024: Recorded a +0.4% increase, fueled by gains in services and production despite a decline in construction.
• Imports: Declined by -2.7%, a steeper drop than the initially reported -2.3%.
• Exports: Fell by -1.0%, with no revision from initial estimates.
• Household Spending: Rose to +0.4%, an increase from the earlier +0.2% estimate, with more expenditures on recreation, housing, and food.
• Gross Capital Formation: Grew by +0.9%, less than the expected +1.4%.
• Government Consumption: Revised to show no growth, contrary to initial positive estimates.
• Annual GDP Growth: Year-on-year, the economy grew by +0.3%, slightly higher than the initially reported +0.2%.

The forecast for Preliminary GDP quarter-over-quarter stands at 0.6%, compared to the previous outcome of 0.7%.

The monthly, quarterly, and annual Gross Domestic Product (GDP) data will be released on Thursday at 6:00 AM GMT.

USD – Core Retail Sales m/m (High Impact)​

The Core Retail Sales measure, which tracks changes in retail sales values excluding automobiles, is an important economic indicator. It is often seen as more dependable than the overall Retail Sales data because automobile sales, which account for around 20% of retail sales, can be quite volatile and may obscure underlying trends. When the actual Core Retail Sales figure surpasses the forecast, it is generally interpreted as a positive sign for the currency, indicating stronger consumer spending trends.


In June 2024, U.S. retail sales excluding motor vehicles and parts increased by 0.4% month-over-month, following an upwardly revised 0.1% gain in the previous month, surpassing market expectations of a 0.1% rise. This indicates a stronger-than-anticipated consumer spending trend. On a year-over-year basis, retail sales in these categories rose by 3.4%, reflecting continued consumer resilience despite broader economic challenges. This data suggests a positive outlook for the economy, as core retail sales are a critical component of consumer spending and overall economic growth.

TL;DR​

• June 2024 Data for U.S. Retail Sales Excluding Motor Vehicles and Parts:
  • Month-over-month increase of 0.4%, surpassing the upwardly revised gain of 0.1% from the previous month.
  • Exceeded market expectations, which predicted only a 0.1% rise.
• Year-over-Year Comparison:
  • Sales in these categories rose by 3.4%.
• Economic Implications:
  • Indicates a stronger-than-anticipated trend in consumer spending.
  • Suggests continued consumer resilience despite broader economic challenges.
  • Positive outlook for the economy, as core retail sales are critical to consumer spending and overall economic growth.

The forecast for Core Retail Sales month-over-month is 0.1%, compared to the previous figure of 0.4%.

USD - Retail Sales m/m (High Impact)​

The monthly Retail Sales report tracks changes in the total value of retail sales and is crucial for assessing economic health. It reflects consumer spending, which is a major component of overall economic activity. An 'Actual' figure surpassing the 'Forecast' is typically viewed positively for the currency, as it indicates stronger consumer activity. Also known as Advance Retail Sales, this report is a key indicator for understanding economic trends and consumer behavior.


In June 2024, U.S. retail sales remained flat compared to May, despite Wall Street's prediction of a 0.3% decline amidst signs of economic slowing. This stagnation followed an upward revision of May's sales to a 0.3% increase from an initial 0.1%. Sales at gasoline stations dropped by 3%, and auto sales declined by 2.3%, with sporting goods, hobby, musical instrument, and book stores also seeing a slight decrease of 0.1%. However, gains were noted in nonstore retailers (1.9%), building materials (1.4%), health and personal care stores (0.9%), and various other categories. Excluding gasoline, sales rose by 0.2%, while the control group, which factors into GDP and excludes volatile categories, surged by 0.9%, the largest increase since April 2023. This data suggests consumer spending remains resilient, which could ease concerns about economic slowdown and affect future Federal Reserve interest rate decisions.

TL;DR

Category	Change in Sales
Overall Retail Sales	Flat (0% change)
Gasoline Stations	-3.0%
Auto Sales	-2.3%
Sporting Goods, Hobby, Books, Music	-0.1%
Nonstore Retailers	+1.9%
Building Materials	+1.4%
Health and Personal Care Stores	+0.9%
Sales Excluding Gasoline	+0.2%
Control Group (important for GDP)	+0.9%

The forecast for Retail Sales month-over-month stands at 0.4%, compared to the previous figure of 0%.

USD - Unemployment Claims (High Impact)​

Unemployment claims track the number of people filing for unemployment insurance for the first time each week. When the actual figure is lower than the forecast, it is considered positive for the currency. Traders pay attention to this metric because, while it is a lagging indicator, it provides valuable insights into economic health. Since consumer spending closely follows labor-market conditions, changes in unemployment claims can influence monetary policy decisions.


Unemployment claims in the U.S. dropped to a seasonally adjusted 233,000 for the week ending August 3, a decrease of 17,000 from the previous week's revised figure of 250,000. The four-week moving average rose slightly to 240,750, reflecting an uptick in claims. Despite the decline in initial claims, continuing claims for unemployment insurance increased by 6,000 to 1.875 million, marking the highest level since November 2021. The four-week average for continuing claims also reached its highest point since November 2021, rising to 1.862 million. The insured unemployment rate remained steady at 1.2%.

TL;DR
​

Data Point	Value
Initial Claims (Current Week)	233,000
Change in Initial Claims	Decrease of 17,000
Initial Claims (Previous Week)	250,000
4-Week Moving Average (Initial)	240,750
Continuing Claims	1.875 million
Change in Continuing Claims	Increase of 6,000
4-Week Moving Average (Continuing)	1.862 million
Insured Unemployment Rate	1.2%

The forecast for Unemployment Claims is projected to be 236,000, compared to the previous outcome of 233,000.

USD - Empire State Manufacturing Index (Medium Impact)​

The Empire State Manufacturing Index is a diffusion index derived from a survey of approximately 200 manufacturers in New York State, assessing their perception of general business conditions. Released monthly around the middle of the month, the index serves as a leading indicator of economic health, reflecting businesses' rapid response to market conditions. Values above 0.0 signify improving conditions, while values below indicate deterioration. An 'Actual' reading that exceeds the 'Forecast' is typically viewed as positive for the currency. This index, also known as the New York Manufacturing Index, offers valuable insights into future economic activities such as spending, hiring, and investment, helping traders gauge the economic environment.


Business activity in New York State continued its modest decline in July 2024, according to the latest Empire State Manufacturing Survey. The general business conditions index remained relatively stable at -6.6. New orders stayed flat, and shipments saw a slight increase. Delivery times shortened, and supply availability was unchanged, while inventories decreased. The labor market showed ongoing weakness, with employment contracting further and work hours holding steady. Input prices rose modestly, with only minor increases in selling prices. Despite these challenges, firms remained cautiously optimistic about future conditions, with 41 percent of respondents expecting improvements in the next six months, though employment growth and capital spending plans remained subdued.

TL;DR​

• General Business Conditions: Continued modest decline in New York State in July 2024; index stable at -6.6.
• New Orders: Remained flat.
• Shipments: Slight increase observed.
• Delivery Times and Supply: Shortened delivery times; supply availability unchanged.
• Inventories: Decreased.
• Labor Market: Further contraction in employment; work hours steady.
• Prices: Modest rise in input prices; minor increases in selling prices.
• Future Outlook: Cautiously optimistic; 41% of respondents expect conditions to improve over the next six months.
• Employment and Capital Spending: Plans for both remain subdued.

The forecast for the Empire State Manufacturing Index stands at -5.9, compared to the prior figure of -6.6.

USD - Philly Fed Manufacturing Index (Medium Impact)​

The Philly Fed Manufacturing Index is a monthly diffusion index published on the third Thursday, derived from a survey of approximately 250 manufacturers in the Philadelphia Federal Reserve district. A reading above 0.0 signifies improving conditions, whereas a reading below 0.0 suggests deteriorating conditions. Traders closely watch this index because a reading higher than forecast is considered favorable for the currency, indicating better economic health. The survey responses offer early insights into future economic activities like spending, hiring, and investment.


The Philadelphia Federal Reserve's Manufacturing Index surged to 13.9 in July 2024, marking a significant rise from June’s reading of 1.3 and surpassing expectations of 2.9. This uptick reflects an expansion in the region's manufacturing sector, as evidenced by positive movements in key areas: the shipments index leaped to 27.8 from a previous -7.2, the new orders index improved dramatically to 20.7 from -2.2, and the employment index turned positive at 15.2, reversing from -2.5 the prior month. Additionally, both indexes for prices paid and prices received showed continued increases, indicating sustained price pressures. The report also highlighted optimistic future projections, with most future activity indicators suggesting an expectation for sustained growth in the manufacturing sector over the next six months.

TL;DR​

• The Philadelphia Federal Reserve's Manufacturing Index rose sharply to 13.9 in July 2024 from 1.3 in June, exceeding forecasts of 2.9.
• This increase indicates an expansion in the region's manufacturing activities.
• Key improvements include:
  • Shipments index jumped to 27.8 from -7.2.
  • New orders index rose significantly to 20.7 from -2.2.
  • Employment index turned positive, reaching 15.2 after a previous -2.5.
• Both prices paid and received indexes increased, suggesting ongoing price pressures.
• Future activity indicators remain positive, projecting continued growth in the manufacturing sector for the next six months.

The forecast for the Philadelphia Fed Manufacturing Index stands at 5.4, compared to the previous outcome of 13.9.

The Core Retail Sales month-over-month, Retail Sales month-over-month, Unemployment Claims, Empire State Manufacturing Index, and Philly Fed Manufacturing Index are scheduled for release on Thursday at 12:30 PM GMT.​

 

[MiloPlexyTrade]

16th August 2024

Friday

​

On August 16th, the United Kingdom is set to release its monthly Retail Sales data, offering key insights into consumer spending trends. Following this, attention will shift to the United States, where Building Permits data will be released, providing an important indicator of future construction activity. Later in the day, the University of Michigan will publish its preliminary Consumer Sentiment index and Inflation Expectations, which are closely watched for signals on consumer confidence and future inflation trends.​

GBP - Retail Sales m/m (High Impact)​

The UK's Retail Sales data, released monthly by the Office for National Statistics, measures consumer spending by tracking sales volumes. Higher-than-expected figures are seen as positive for the Pound Sterling, indicating strong economic activity, while lower readings are viewed negatively. Traders closely watch this data as it is a key indicator of economic health.


In June 2024, UK sales volumes experienced a 1.2% decline following a 2.9% rise in May 2024, with annual volumes down 0.2% and 1.3% below pre-pandemic levels from February 2020. The overall sales volume for Q2 2024 fell by 0.1% compared to Q1 2024. Non-food store sales dropped by 2.1% in June, reversing a 3.3% gain in May, with significant decreases in department stores, clothing, footwear, and furniture due to election uncertainty, poor weather, and low footfall. Food store sales fell by 1.1% in June and 1.3% in Q2, primarily driven by supermarkets. Online spending decreased by 2.7% in June but was up 2.3% compared to June 2023, while the total spend decreased by 1.3%, reducing the online sales proportion from 27.5% in May to 27.1% in June.​

TL;DR

• June 2024 Sales Volumes: Decreased by 1.2%
• May 2024 Sales Volumes: Increased by 2.9%
• Annual Sales Volumes: Down by 0.2%
• Sales Volumes vs Pre-Pandemic Levels (Feb 2020): 1.3% lower
• Q2 2024 vs Q1 2024 Sales Volumes: Declined by 0.1%
• Non-Food Store Sales (June 2024): Dropped by 2.1% after a 3.3% rise in May
  • Key Sectors Affected: Department stores, clothing, footwear, furniture
• Food Store Sales (June 2024): Fell by 1.1%
• Food Store Sales (Q2 2024): Decreased by 1.3%, driven mainly by supermarkets
• Online Spending (June 2024): Declined by 2.7% but increased by 2.3% compared to June 2023
• Total Spend (June 2024): Decreased by 1.3%
• Online Sales Proportion: Dropped from 27.5% in May to 27.1% in June

The forecast for month-over-month Retail Sales shows a 0.6% increase, compared to the previous outcome of -1.2%.

The upcoming Retail Sales month-over-month report will be released on Friday at 6:00 AM GMT.

USD - Building Permits (Medium Impact)​

The Building Permits metric represents the annualized count of new residential building permits issued in the previous month. If the actual number exceeds the forecast, it is typically positive for the currency. This metric is important to traders because it serves as a strong indicator of future construction activity, with permits being one of the first steps in the building process.


In June 2024, U.S. building permits rose by 3.9% to an annualized rate of 1.454 million, the highest in three months and surpassing preliminary estimates. Permits for buildings with five or more units saw a significant increase of 20.7% to 466,000, while single-family authorizations declined by 1.8% to 939,000. Regional permit activity varied, with notable increases in the Midwest and the South. Meanwhile, housing starts edged up by 3.0% to 1.353 million, although this figure was still 4.4% lower than a year ago. Housing completions, however, surged by 10.1% from May to 1.710 million, marking a 15.5% year-over-year increase, driven by growth in both single-family homes and multi-unit buildings.​

TL;DR

Category	June 2024 Data
Building Permits	3.9% increase to 1.454 million (annualized rate)
Permits for 5+ Units	20.7% increase to 466,000
Single-Family Permits	1.8% decrease to 939,000
Regional Permit Activity	Notable increases in the Midwest and the South
Housing Starts	3.0% increase to 1.353 million
Year-over-Year Housing Starts	4.4% decrease
Housing Completions	10.1% increase to 1.710 million
Year-over-Year Housing Completions	15.5% increase

The forecast for Building Permits is 1.43 million, compared to the previous figure of 1.45 million.

The next Building Permits data is scheduled for release on Friday at 12:30 PM GMT.

USD - Prelim UoM Consumer Sentiment (Medium Impact)​

The Prelim UoM Consumer Sentiment measures the level of a composite index based on a survey of about 500 consumers who rate current and future economic conditions. A result that exceeds forecasts is generally favorable for the currency, as consumer confidence serves as a leading indicator of future spending. Traders care about this data because consumer spending drives a significant portion of economic activity, and shifts in sentiment can impact market expectations and currency values.


In July 2024, the University of Michigan's consumer sentiment index was revised upwards to 66.4 from the preliminary figure of 66.0, though it remains at its lowest level in eight months. This upward revision, while modest, indicates a slight improvement in consumer outlook compared to the initial reading. The index, which gauges overall consumer confidence, reflects a small but noteworthy adjustment in sentiment, suggesting that consumers' views on future economic conditions and personal finances were slightly more positive than initially reported. However, despite this revision, the sentiment index still highlights ongoing concerns about high prices and economic uncertainty, contributing to the fourth consecutive monthly decline in consumer confidence.​

TL;DR

• Time Period: July 2024
• Index Name: University of Michigan's Consumer Sentiment Index
• Revised Index Value: 66.4 (up from 66.0)
• Index Trend: Lowest level in eight months
• Upward Revision: Indicates a slight improvement in consumer outlook
• Current Sentiment: Slightly more positive than initially reported
• Economic Concerns: Ongoing issues with high prices and economic uncertainty
• Monthly Trend: Fourth consecutive monthly decline in consumer confidence

The forecast for Michigan Consumer Sentiment is projected at 66.7, up from the previous reading of 66.4.

The preliminary University of Michigan Consumer Sentiment report is scheduled for release on Friday at 2:00 PM GMT.

USD - Prelim UoM Inflation Expectations (Medium Impact)​

The Prelim UoM Inflation Expectations Measures track the anticipated percentage change in prices for goods and services over the next 12 months as projected by consumers. Generally, if the 'Actual' measure exceeds the 'Forecast,' it is considered positive for the currency. Traders closely monitor this indicator because expectations of future inflation can influence actual inflation; for example, if people expect prices to rise, they might seek higher wages, which can contribute to inflation. This data is collected from a survey of around 500 consumers, who provide their expectations for price changes in the coming year.


In a recent preliminary report by the University of Michigan, consumer inflation expectations for the next year dropped to 2.9%, marking a decline for the second consecutive month. This figure aligns with consumer expectations for the annual rise in costs over the next 5 to 10 years, which also adjusted downward from the previous month's projections. Despite this slight ease in anticipated inflation, the overall sentiment among consumers remains dim, fueled by persistent frustrations over high prices affecting their financial well-being and standard of living. This sentiment reflects a broader concern about inflation despite recent data indicating a cooling in price increases.​

TL;DR

• University of Michigan's preliminary report shows consumer inflation expectations for the next year at 2.9%.
• Expectations for inflation over the next 5 to 10 years have also adjusted downward from the previous month.
• This marks the second consecutive month of declining inflation expectations.
• Despite easing inflation expectations, overall consumer sentiment remains dim.
• Consumers are still concerned about high prices affecting their financial well-being and standard of living.

The forecast for Michigan Inflation Expectations is projected to be 2.9%, unchanged from the previous outcome of 2.9%.

The next Preliminary UoM Consumer Sentiment and Preliminary UoM Inflation Expectations reports are scheduled for release on Friday at 2:00 PM GMT.

 

[MiloPlexyTrade]

20th August 2024

Tuesday

​

On Tuesday, key economic indicators will be released from several major economies. China is set to announce its 1- to 5-year Loan Prime Rate early in the day, which could provide insights into the country's monetary policy direction. Later, attention will shift to the Eurozone, where the year-on-year Inflation Rate is expected to be published, offering a glimpse into the region's price stability. Finally, Canada will release its own Inflation Rate, rounding out a day of significant economic data that could influence global markets.

​

CNY - 1-y Loan Prime Rate (Medium Impact)​

On August 17th, 2019, the People's Bank of China (PBOC) switched its primary lending benchmark to the Loan Prime Rate (LPR), replacing the older one-year rate. The LPR, adjusted monthly based on contributions from 18 banks and their liquidity costs from PBOC operations, aims to better reflect market conditions and enhance monetary policy effectiveness. Although the PBOC's Monetary Policy Committee meets quarterly, the LPR's monthly adjustments directly influence the Renminbi's (CNY) value. Despite these changes, the CNY remains pegged to the U.S. dollar, maintaining controlled fluctuations influenced by the PBOC's strategic decisions.


In a bid to bolster its slowing economy, China’s central bank, the People’s Bank of China (PBOC), cut the seven-day reverse repo rate and other short-term borrowing costs on Monday, marking the first reduction in nearly a year. Alongside these moves, Chinese banks lowered their key benchmark lending rates, including the one-year Loan Prime Rate (LPR), which now stands at 3.35%. This adjustment, aimed at reducing borrowing costs for mortgages and other loans, follows a disappointing lack of short-term stimulus from a major Communist Party meeting. The LPR cut underscores the authorities' urgency to stimulate economic activity amidst the slowest growth pace in over a year. Despite the PBOC's efforts, the impact of these modest reductions is expected to be limited, with analysts suggesting that more substantial fiscal measures will be necessary to drive significant economic improvement.​

TL;DR

• China’s central bank, the People’s Bank of China (PBOC), cut the seven-day reverse repo rate and other short-term borrowing costs to stimulate the economy.
• This is the first reduction in these rates in nearly a year.
• Chinese banks also lowered key benchmark lending rates, including the one-year Loan Prime Rate (LPR), which is now at 3.35%.
• The rate cuts are intended to reduce borrowing costs for mortgages and other loans.
• These measures follow a major Communist Party meeting that did not deliver expected short-term economic stimuli.
• The reduction in the LPR is a response to the slowest economic growth pace China has seen in over a year.
• Despite these efforts, analysts believe the impact of these rate cuts will be limited and more substantial fiscal measures are needed to significantly boost the economy.
  

The 1-year Load Prime rate forecast remains unchanged at 3.35%, consistent with the previous figure.

CNY - 5-y Loan Prime Rate (Medium Impact)​

The Loan Prime Rate (LPR) is a key benchmark interest rate established by the People's Bank of China to guide short-term lending rates, influencing monetary policy. It reflects the rate at which commercial banks lend to prime customers and is derived from a weighted average of lending rates from 18 major banks. Traders closely monitor changes in the LPR as short-term interest rates play a crucial role in currency valuation, often outweighing the impact of other economic indicators, serving as a significant predictor of future rate movements.


In a bid to stimulate economic growth amidst sluggish activity, China’s central bank has unexpectedly cut its seven-day reverse repo rate, marking its first reduction in nearly a year. The People’s Bank of China (PBOC) announced this cut on Monday, alongside a reduction in the five-year Loan Prime Rate (LPR) to 3.85%, reflecting a coordinated effort to make borrowing more affordable and counteract the economic slowdown. This adjustment aims to support mortgage borrowing and other long-term loans, particularly given the ongoing deflation and subdued economic momentum. While the cut is a step towards easing financial conditions, analysts caution that the impact may be limited, and substantial fiscal measures will be necessary to achieve the government's growth target of around 5% for 2024. The PBOC’s actions, which include adjustments to other key interest rates, are part of a broader strategy to navigate economic challenges and support the yuan amid global rate trends.

TL;DR​

• China’s central bank, the People’s Bank of China (PBOC), has unexpectedly reduced its seven-day reverse repo rate.
• This marks the first such reduction in nearly a year.
• Alongside this, the PBOC also lowered the five-year Loan Prime Rate (LPR) to 3.85%.
• These moves are aimed at making borrowing more affordable to help counteract a slowdown in economic growth.
• The rate cuts are intended to support mortgage borrowing and other long-term financing needs.
• These measures come as China faces ongoing deflation and sluggish economic momentum.
• Analysts believe that while these rate cuts will ease financial conditions, they may have a limited impact.
• Further substantial fiscal measures might be necessary to meet the government’s growth target of around 5% for 2024.
• The PBOC’s adjustments to interest rates are part of a broader strategy to support the economy and the yuan amid global interest rate trends.

The forecast for the 5-year Loan Prime Rate suggests it will remain unchanged at 3.85%, consistent with the previous outcome.

The 1-5 Loan Prime Rate release is set to be released on Tuesday at 1:15 AM GMT.

EUR - Inflation Rate y/y Final (Medium Impact)​

The final Consumer Price Index (CPI) year-over-year measures the change in the price of goods and services purchased by consumers. Typically, when the 'Actual' CPI is greater than the 'Forecast,' it is considered favorable for the currency. This is because consumer prices account for the majority of overall inflation, which is a critical factor in currency valuation. Rising prices often prompt the central bank to raise interest rates in order to fulfill their mandate of containing inflation.


Inflation in the Euro Area unexpectedly rose to 2.6% in July 2024, up from 2.5% in June, defying expectations of a slowdown to 2.4%. The increase was driven by a sharp rise in energy prices and a quicker uptick in non-energy industrial goods. Meanwhile, inflation eased for services and food, alcohol, and tobacco. Core inflation, excluding volatile items like food and energy, remained steady at 2.9%, slightly higher than predicted. Among the largest Eurozone economies, inflation picked up in Germany, France, and Italy, but decreased in Spain.​

TL;DR

• Overall Inflation: Rose to 2.6% in July 2024 from 2.5% in June, above the expected 2.4%.
• Primary Drivers:
  • Sharp increase in energy prices.
  • Faster rise in non-energy industrial goods prices.
• Areas of Easing:
  • Inflation for services.
  • Inflation for food, alcohol, and tobacco.
• Core Inflation:
  • Held steady at 2.9%, above predictions.
• Regional Variations:
  • Inflation increased in Germany, France, and Italy.
  • Inflation decreased in Spain.

The inflation rate year-over-year is forecasted to reach 2.6%, up from the previous outcome of 2.5%.

The year-over-year inflation rate is set to be released on Tuesday at 9:00 AM GMT.

CAD - Inflation Rate y/y (High Impact)​

The Consumer Price Index (CPI) in Canada, released monthly by Statistics Canada, measures price changes by comparing the cost of a fixed basket of goods and services. A higher CPI reading is generally positive for the Canadian Dollar, while a lower reading is negative. The most significant components of the CPI basket are Shelter (30%), Transportation (17%), and Food (16%). The CPI basket is updated every four years based on household spending patterns, with the current weights reflecting data from 2002.


Canada's annual inflation rate eased to 2.7% in June 2024, down from 2.9% in May, defying market expectations that it would remain at 2.9%, a level matching the three-year low seen in April. This decrease aligns with the Bank of Canada's (BoC) forecast that CPI inflation would hover around 3% in the first half of the year, continuing the disinflation trend in consumer prices. The most significant drop was seen in transportation costs, which fell to 2% from 3.5% in May, driven by a sharp slowdown in gasoline prices (0.4% vs. 5.6%), following OPEC’s gradual phase-out of production cuts. Shelter inflation also eased slightly (6.4% vs. 6.2%) as the BoC's rate cuts and lower bond yields helped to reduce mortgage rates and rental market pressures. However, food prices saw an acceleration, rising to 2.8% from 2.4%, driven by more expensive groceries. Despite the overall disinflation, the trimmed mean core inflation rate remained steady at 2.9%, largely due to the significant impact of gasoline prices.​

TL;DR

Category​	June 2024 Rate ​	May 2024 Rate​	Notable Changes​
Overall Inflation​	2.7%​	2.9%​	Decrease from May, below market expectations
Transportation Costs​	2.0%​	3.5%​	Sharp decrease, mainly due to lower gasoline prices (0.4% vs 5.6%)
Gasoline Prices​	0.4%​	5.6%​	Significant slowdown following OPEC’s production phase-out
Shelter Inflation​	6.2%​	6.4%​	Slight decrease due to BoC rate cuts and lower bond yields
Food Prices​	2.8%​	2.4%​	Increase driven by more expensive groceries
Trimmed Mean Core Inflation​	2.9%​	2.9%​	Remained steady, influenced significantly by gasoline prices

The forecast for the year-over-year Inflation Rate is projected at 2.5%, compared to the previous outcome of 2.7%.

CAD - Inflation Rate m/m (High Impact)​

The Consumer Price Index (CPI) measures the month-over-month change in the prices of goods and services purchased by consumers. A higher-than-expected CPI is typically favorable for a currency, as it suggests rising consumer prices, which constitute a significant portion of overall inflation. Inflation is crucial to currency valuation because it often prompts the central bank to raise interest rates to manage inflation. The CPI is derived by sampling the average prices of various goods and services and comparing them to the previous period's prices.


In June 2024, Canadian consumer prices saw a surprising dip of 0.1%, marking the first monthly decline of the year, contrary to market predictions of a 0.1% increase. This decrease was primarily influenced by a significant 11.1% reduction in travel tour costs and a 3.1% fall in gasoline prices. Although the overall Consumer Price Index (CPI) dropped slightly, it still managed a 0.1% rise on a seasonally adjusted basis. This shift in consumer prices reflects a volatile market, particularly in sectors directly impacted by fluctuating oil prices and tourism trends.​

TL;DR

Category	June 2024 Data
Consumer Price Index (CPI)	-0.1% (monthly decline)
Market Prediction	+0.1% (expected increase)
Travel Tour Costs	-11.1%
Gasoline Prices	-3.1%
Seasonally Adjusted CPI	+0.1% (increase)
Market Reflection	Volatile, impacted by oil prices and tourism trends

The inflation rate forecast for month-over-month is expected to be 0.4%, compared to the previous outcome of -0.1%.

CAD - Median CPI y/y (High Impact)​

The Median CPI year-over-year measure tracks the annual change in the median price of consumer goods and services. An 'Actual' result that surpasses the 'Forecast' is generally favorable for the currency, as consumer prices play a crucial role in overall inflation. Rising inflation often leads central banks to raise interest rates to control it. This measure is calculated by comparing sampled average prices of goods and services to those from the previous period.


In May, Canada’s median Consumer Price Index (CPI) rose by 2.6 percent compared to the same month last year, coming in slightly below the market expectations of 2.7 percent. This marks a modest decrease from the previous month's increase of 2.8 percent. Historically, the CPI Median has seen fluctuations, peaking at 5.00 percent and dipping to a low of 0.90 percent, reflecting the ongoing variability in inflationary pressures across the country.

TL;DR​

Category	Details
May CPI Median (YoY)	2.6%
Market Expectations	2.7%
Previous Month's CPI	2.8%
CPI Median Historical Peak	5.00%
CPI Median Historical Low	0.90%
Trend	Modest decrease from previous month, ongoing variability in inflationary pressures.

The year-over-year forecast for the Median CPI is projected at 2.5%, a slight decrease from the previous figure of 2.6%.

CAD - Trimmed CPI y/y (High Impact)​

The Trimmed CPI y/y measures the annual change in consumer prices, excluding the most volatile 40% of items. A higher-than-forecasted value is typically positive for the currency, as consumer prices are a major component of inflation, which influences central bank decisions on interest rates. This measure is derived by comparing the average prices of goods and services to those from the previous period.

In June, Canada's trimmed-mean core inflation rate held steady at 2.9%, surpassing market expectations which had anticipated a rate of 2.8%. This measure, which is the Bank of Canada's preferred indicator for assessing underlying inflation, plays a crucial role in guiding the monetary policy decisions aimed at managing economic stability in the nation.​

TL;DR

Category	Details
Month	June
Country	Canada
Trimmed-Mean Core Inflation Rate	2.9%
Market Expectations	2.8%
Bank of Canada's Preferred Indicator	Yes
Role in Monetary Policy	Guides decisions for managing economic stability

The projected year-over-year Trimmed CPI is forecasted at 2.8%, a slight decrease from the previous figure of 2.9%.


Canada's inflation figures are scheduled for release on Tuesday at 12:30 PM GMT.

 

[MiloPlexyTrade]

22nd August 2024

Thursday​

On Thursday, a series of key economic indicators will be released, starting early in Japan with the Flash Manufacturing and Services PMI data. This will be followed by similar reports from France, Germany, the Eurozone, the UK, and the US. In addition, the US will release its weekly unemployment claims and existing home sales data. The Eurozone will also unveil its latest Consumer Confidence figures. As the day progresses, New Zealand is set to release its quarterly Retail Sales data, and Japan will conclude the day with the publication of its year-on-year Core CPI and CPI figures.

JPY - Flash Manufacturing PMI​

The Manufacturing Purchasing Managers Index (PMI), issued monthly by Jibun Bank and S&P Global, assesses business conditions in Japan's manufacturing sector based on surveys of senior executives. The index ranges from 0 to 100, with readings above 50 indicating expansion (bullish for the Japanese Yen), and below 50 suggesting contraction (bearish for the Yen). This data helps predict trends in GDP, industrial production, employment, and inflation.


Japan's manufacturing sector experienced a setback in July 2024, with the au Jibun Bank Manufacturing PMI revised down to 49.1 from a preliminary 49.2, marking a decline from June's 50.0. This dip signals the first contraction in factory activity since April and the fifth overall this year, driven by a significant reduction in new orders and the sharpest decline in output in four months. Despite this, employment in the sector increased for the fifth consecutive month, even as backlogs of work continued to fall, reflecting spare capacity. Input cost inflation surged to its highest since April 2023 due to rising labor, logistics, oil, and raw material prices, although output cost inflation eased to a four-month low as companies sought to stay competitive. Business confidence, however, remained strong, fueled by optimism about a recovery in domestic and global demand.


The projected Flash Manufacturing PMI stands at 49.8, an increase from the previous reading of 49.1

JPY – Flash Services PMI​

The au Jibun Bank Japan Services PMI, compiled by S&P Global, surveys service sector companies across various industries, including consumer services (excluding retail), transport, communication, finance, real estate, and business services. The headline figure, the Services Business Activity Index, measures monthly changes in business activity, with a reading above 50 indicating growth and below 50 indicating contraction. This index is comparable to the Manufacturing Output Index.


In July 2024, the au Jibun Bank Japan Services PMI was revised to 53.7 from an initial estimate of 53.9, reflecting a return to expansion after June's contraction at 49.4. This improvement, the sixth expansion this year, was driven by increased customer numbers and demand, with new orders seeing the most significant rise in three months and employment growth exceeding the long-term average. However, the sector faced challenges as foreign orders declined for the first time this year, marking the steepest drop since June 2022. Inflation pressures persisted as input costs, including fuel, labor, and logistics, remained high, leading firms to pass these costs onto clients through increased pricing. Despite these pressures, business confidence improved, buoyed by expectations of new store openings and client acquisitions enhancing future order volumes and customer engagement.


The Flash Services PMI forecast is set at 54, reflecting an increase from the previous reading of 53.7


The Japanese Flash Manufacturing & Services PMI will be released on Thursday at 12:30 AM GMT.

EUR – French Flash Manufacturing PMI​

The Manufacturing Purchasing Managers Index (PMI), provided by S&P Global and Hamburg Commercial Bank (HCOB), is an essential indicator for France's manufacturing sector, which plays a significant role in the national GDP. This index reflects the business conditions within the sector, with a PMI score above 50 signaling optimistic economic prospects and bullish market conditions for the Euro, while a score below 50 indicates bearish conditions potentially harmful to the currency. Traders closely monitor the PMI because it acts as a leading economic health indicator, with purchasing managers offering timely and pertinent insights into market conditions and the company's economic expectations.


In July 2024, France's manufacturing sector experienced its most significant contraction since January, with the HCOB France Manufacturing PMI dropping to 44 from 45.4 the previous month, a slight downward revision from the initial estimate of 44.1. This downturn marks the 18th consecutive month of declines, exacerbated by a sharp reduction in new orders—the fastest in six months—due to faltering demand. Production continued its downward trajectory for the 26th consecutive month, with the capital goods sector facing the most severe cutbacks. Employment rates also declined rapidly, reaching the fastest drop since March as companies did not renew temporary contracts and cut back on work backlogs. Additionally, input costs surged to their highest in 18 months, pushing selling prices up slightly as manufacturers offered discounts to remain competitive. This economic backdrop has dampened business confidence, eroding further after a brief recovery earlier in May.


The forecast for the Flash Manufacturing PMI stands at 44.4, compared to the previous value of 44.0.

EUR - French Flash Services PMI​

The Services Purchasing Managers Index (PMI), released by S&P Global and Hamburg Commercial Bank (HCOB), assesses business conditions in France's services sector, which constitutes a significant portion of the country's GDP. This index is a critical gauge of France's overall economic health, with a PMI reading above 50 indicating bullish conditions for the Euro, while a reading below 50 suggests bearish prospects. Traders closely watch this index as it serves as a leading economic indicator, with purchasing managers offering timely and relevant insights into the company's economic outlook.


In July 2024, the HCOB France Services PMI reached 50.1, marking a slight improvement from June's 49.6 and indicating stability after two months of decline. This performance, which was slightly below the expected 50.7, was influenced by increased activity associated with the Olympic Games and the conclusion of the election period. These factors helped to balance out tough selling conditions, resulting in steady output levels. Employment in the service sector continued its upward trend, extending over three and a half years. Despite this, new business volumes decreased due to ongoing uncertainties in French politics, affecting new order volumes. Input costs escalated, recording the highest increase in three months, driven by rising operational expenses. Business confidence waned, continuing its downward trajectory for the fourth month and staying significantly below average historical levels.


The forecast for the Flash Services PMI stands at 50.2, compared to the previous value of 50.1.


The French Flash Manufacturing and Services PMI is scheduled for release on Thursday at 7:15 AM GMT.

EUR - German Flash Manufacturing PMI​

The Manufacturing Purchasing Managers Index (PMI), released monthly by S&P Global and Hamburg Commercial Bank (HCOB), serves as a leading indicator of business activity in Germany's manufacturing sector, based on surveys of senior executives. It reflects month-to-month changes and can anticipate trends in GDP, industrial production, employment, and inflation. As Germany is Europe's main manufacturing hub, its PMI is also a key indicator for the broader continent. A PMI above 50 signals expansion and is bullish for the Euro, while a reading below 50 indicates contraction, seen as bearish for the currency. Traders value this index as it offers timely insights into economic health and market conditions.


Germany's manufacturing sector continues to face significant challenges, with the HCOB Manufacturing PMI for July 2024 revised slightly higher to 43.2, still indicating a sharp contraction for the 25th consecutive month. Key areas such as output, new orders, and employment have declined further due to weak demand, despite signs of cost stabilization as input prices fell at the slowest rate in 18 months. However, rising freight rates have offset some of the relief from lower raw material costs. Confidence among manufacturers remains low, with experts like Dr. Cyrus de la Rubia from Hamburg Commercial Bank predicting that a recovery is unlikely before autumn.

The projected German Flash Manufacturing PMI is forecasted at 43.4, slightly above the previous reading of 43.2.

EUR – German Flash Services PMI​

The Services Purchasing Managers Index (PMI), released monthly by S&P Global and Hamburg Commercial Bank (HCOB), is a key indicator of business activity in Germany’s services sector. Based on surveys of senior executives in the sector, the PMI reflects changes in business conditions compared to the previous month. A reading above 50 indicates expansion, signaling a positive outlook for the Euro (EUR), while a reading below 50 suggests contraction, which is bearish for the EUR. As a leading indicator, it provides valuable insights into economic trends, including GDP, employment, and inflation. Traders closely monitor the PMI as it offers early signals of economic health.


Germany's service sector saw a notable deceleration at the beginning of Q3 2024, as the HCOB Flash Services PMI dropped to 52.5 in July, down from 53.1 in June. This decline highlights a weakening in new business inflows, alongside a reduction in staffing levels after a sustained period of job creation over the past six months. Input cost inflation in the sector ticked up slightly, but the increase in prices charged by businesses was the softest observed in over three years, suggesting a more cautious pricing approach in response to subdued demand. Despite these challenges, there was a slight improvement in overall business sentiment, supported by a rebound in confidence within the services sector.


The projected Flash Services PMI stands at 52.3, slightly down from the previous value of 52.5.


The upcoming Flash Manufacturing and Services PMI is scheduled for release on Thursday at 7:30 AM GMT.

EUR - Flash Manufacturing PMI​

The Manufacturing PMI, released monthly by S&P Global and Hamburg Commercial Bank (HCOB), is a key indicator of the Eurozone's manufacturing sector's health. It ranges from 0 to 100, with readings above 50 signaling expansion and below 50 indicating contraction, influencing the Euro's strength. Traders watch this index closely as it offers early insights into economic trends like GDP, industrial production, and inflation.

In July 2024, the HCOB Eurozone Manufacturing PMI remained at 45.8, unchanged from June's year-to-date low and slightly revised upward from the preliminary estimate of 45.6. This marked a continuation of the weak momentum in the Eurozone's manufacturing sector, with the overall decline in activity driven by worsening conditions in major economies despite some slower contractions elsewhere. New orders contracted for the 14th consecutive month, forcing factories to rely on backlogs to sustain output. The lower demand led to significant job cuts, marking the sharpest decline in employment this year, alongside reduced purchasing and inventory levels. Although supplier delivery times improved for the sixth consecutive month, the pace of improvement slowed. Meanwhile, input cost inflation surged to an 18-month high, but factories hesitated to pass on these costs to clients, while confidence among manufacturers remained low, signaling a difficult outlook for the sector.


The expected Flash Manufacturing PMI is forecasted at 45.7, slightly down from the previous figure of 45.8.

EUR - Flash Services PMI​

The Services Purchasing Managers Index (PMI), released monthly by S&P Global and Hamburg Commercial Bank (HCOB), measures business activity in the Eurozone services sector. It's a key economic indicator, reflecting changes in the services economy through surveys of senior executives. The PMI scale ranges from 0 to 100, with a reading above 50 indicating expansion and below 50 indicating contraction, which respectively suggests bullish or bearish implications for the Euro (EUR). This index is crucial for traders as it provides up-to-date insights into economic conditions and can predict trends in GDP, employment, and inflation.


In July 2024, the HCOB Eurozone Services PMI decreased to 51.9, marking the slowest expansion in the services sector since March and falling below market expectations of 52.9. This decline from June's figure of 52.8 reflects a cooling in services activity over four months, attributed mainly to softer domestic demand despite stronger foreign client interest. The sector continued to grow for the sixth consecutive month, supported by new orders and a reduction in backlogs, but firms reduced the pace of hiring to the lowest rate this year due to moderated capacity demands. Additionally, input price inflation intensified due to higher costs for staffing and materials, though firms were cautious in adjusting their output charges due to weaker demand. Business confidence also declined slightly, reaching a six-month low, continuing a downward trend from May's peak.


The forecast for the Flash Services PMI is 51.7, compared to the previous outcome of 51.9.


The Eurozone Flash Manufacturing & Services PMI is set to be released on Thursday at 8:00 AM GMT.

GBP - Flash Manufacturing PMI​

The Manufacturing Purchasing Managers Index (PMI) from the Chartered Institute of Procurement & Supply and S&P Global is a crucial monthly indicator for the UK's manufacturing sector, derived from surveys of senior executives. It gauges changes in business activity, predicting shifts in GDP, industrial production, employment, and inflation. The index operates on a 0-100 scale; readings above 50 indicate sector expansion (positive for the Pound Sterling), while below 50 suggests contraction (negative for the currency). Traders value the PMI for its immediate insights into economic health provided by purchasing managers.


In July 2024, the S&P Global UK Manufacturing PMI surged to 52.1, surpassing the initial estimate of 51.8 and marking the highest expansion since July 2022. This growth was driven by a significant acceleration in production, reaching a peak not seen in over two years, coupled with a tentative stabilization in new export orders. The uplift in manufacturing spanned consumer, intermediate, and investment goods sectors, with firms increasing their workforce for the first time in nearly two years. However, the sector faced escalating input costs, leading to the highest inflation rate in 18 months, which in turn caused manufacturers to hike their selling prices to the steepest since May 2023. Amid these challenges, manufacturers' optimism remained robust, climbing to the second-highest level observed in the past two and a half years.


The estimated Flash Manufacturing PMI remains steady at 52.1, unchanged from the previous reading.

GBP - Flash Services PMI​

The Services Purchasing Managers Index (PMI), issued monthly by the Chartered Institute of Procurement & Supply and S&P Global, is a vital indicator of the UK's services sector health. Ranging from 0 to 100, a PMI above 50 indicates sector expansion, boosting the Pound Sterling (GBP), while below 50 suggests contraction, negatively impacting GBP. This index is closely watched by traders as it provides real-time insights into economic conditions from the perspective of purchasing managers.


In July 2024, the S&P Global UK Services PMI saw a slight increase to 52.5, up from 52.1 the previous month, a revision from an initial estimate of 52.4 and in line with early market predictions. This marked the ninth consecutive month of expansion in the UK services sector. This uptick stands in contrast to the slower growth rates observed in fellow Eurozone countries. The UK experienced its highest surge in new business since May 2023, attributed to strong ongoing demand and successful acquisition of new domestic and international clients. This surge in demand prompted service providers to expand their workforce at the quickest rate since the previous June. However, work backlogs continued to shrink, marking the fourteenth month of this trend. Regarding prices, both the cost of inputs and the prices charged by businesses neared their lowest levels since the onset of the Covid pandemic. Future business confidence reached a peak not seen in the past five months.


The projected Flash Services PMI is 52.8, an increase from the previous reading of 52.5.


The Flash Manufacturing & Services PMI is scheduled for release on Thursday at 8:30 AM GMT.

USD - Unemployment Claims​

Initial Jobless Claims track the number of people filing for unemployment benefits for the first time in a week, serving as an early indicator of U.S. economic health. While the impact on the market can vary, a higher than expected number is usually seen as negative for the USD, and a lower than expected number as positive. Traders monitor these figures closely as they reflect labor market conditions, which are directly linked to consumer spending and are crucial for shaping monetary policy.


In the week ending August 10, U.S. initial jobless claims fell by 7,000 to 227,000, defying market expectations of a rise to 236,000 and marking the second consecutive weekly decline since late July's near one-year high of 250,000. The decrease to the lowest level in five weeks challenges recent data suggesting a slowdown in the labor market, potentially giving the Federal Reserve more flexibility in its monetary policy without jeopardizing inflation control efforts. Meanwhile, continuing claims also fell by 7,000 to 1,864,000, contrary to expectations of an increase, with the four-week moving average for initial claims declining by 4,500 to 236,500.


The forecast for Unemployment Claims is projected at 232,000, an increase from the previous figure of 227,000.


The next release of the Unemployment Claims data is scheduled for Thursday at 12:30 PM GMT.

USD - Flash Manufacturing PMI​

The S&P Global Manufacturing Purchasing Managers Index (PMI) is a crucial monthly indicator for the US manufacturing sector, derived from surveys of senior executives. It measures business activity, with a score above 50 indicating expansion and below 50 signifying contraction. This data helps predict trends in GDP, industrial production, employment, and inflation, and significantly influences the US Dollar's value. Traders value it as a leading economic health indicator, reflecting immediate market conditions from a managerial perspective.


The S&P Global U.S. Manufacturing PMI dropped to a 2024 low of 49.6 in July, slightly up from an initial estimate of 49.5, yet still signaling contraction within the sector. This period saw a decrease in new orders, marking a downturn in demand, although continued production was supported by handling backlogged orders and high stock replenishment. Employment also weakened, aligning with broader economic challenges. Despite rising costs for energy, freight, labor, and materials, output prices grew minimally, the slowest in a year, with overall inflation easing to a four-month low. Nevertheless, manufacturers remain cautiously optimistic, expecting a recovery in business conditions and new orders post-presidential election.


The forecast for the Flash Manufacturing PMI suggests a slight decline to 49.5 from the previous figure of 49.6.

USD - Flash Services PMI​

The S&P Global Services Purchasing Managers Index (PMI) is a crucial monthly indicator for the US services sector, which constitutes a significant portion of the economy. This index is derived from surveys of senior executives in private sector service companies, reflecting month-over-month changes in business activity. A PMI reading above 50 suggests expansion in the services sector, positively influencing the US Dollar, while a reading below 50 indicates contraction, which could negatively impact the currency. Traders value this data as it serves as a leading indicator of economic health, providing insights from purchasing managers who have timely and relevant perspectives on market conditions.


In July 2024, the S&P Global US Services PMI was adjusted downward to 55 from an initial estimate of 56, indicating a continued but slightly slower expansion compared to June's figure of 55.3. This growth was fueled by a steady increase in new business for the third month running and a modest uptick in international orders, marking the first rise in six months. Additionally, this increase in new business led companies to expand their workforce. However, despite a faster rise in input costs, service providers raised their prices at a more moderate rate due to competitive challenges. Although optimism in the sector waned to an eight-month low, service providers were still positive about future business prospects, buoyed by increased marketing efforts, recent cuts in interest rates, and improved demand post-Presidential Election.


The expected forecast for the Flash Services PMI is 54, down from the previous reading of 55.


The Flash Manufacturing & Services PMI is set to be released on Thursday at 1:45 PM GMT.

EUR - Consumer Confidence​

The Consumer Economic Sentiment Indicator (ESI) in the Euro Area measures consumer confidence on a scale from -100 (extreme pessimism) to 100 (extreme optimism), with 0 indicating neutrality. Based on phone surveys of 23,000 households across the Eurozone, the ESI assesses views on the current economic and financial situation, savings intentions, inflation expectations, and major purchases of durable goods. Traders pay close attention to this indicator as financial confidence is a key predictor of consumer spending, which drives a significant portion of overall economic activity.

In July 2024, consumer confidence in the Euro Area rose by 1 percentage point from the previous month to -13, the highest level since February 2022, in line with preliminary estimates. This steady improvement since February is likely influenced by the European Central Bank's rate cut in June, with further cuts anticipated later this year. Additionally, the easing of political tensions in France after the parliamentary elections contributed to the positive sentiment. Across the broader European Union, consumer confidence increased by 0.7 points to -12.2, reflecting gains in all key components, including household financial expectations, views on the general economic situation, and major purchase intentions.


The Consumer Confidence forecast remains unchanged at -13, consistent with the previous measurement.


The Consumer Confidence report is scheduled for release on Thursday at 2:00 PM GMT.

USD - Existing Home Sales​

The Existing Home Sales report measures the monthly change in the annualized number of existing residential buildings sold, serving as a key indicator of the U.S. housing market's strength and overall economic health. A higher-than-expected reading is viewed as positive for the USD, while a lower-than-expected reading is seen as negative. Traders pay attention to this report because home sales trigger a wide-reaching economic ripple effect, including renovations, mortgage sales, and broker commissions, making it a crucial leading indicator of economic activity.


Existing-home sales in the U.S. declined by 5.4% in June to a seasonally adjusted annual rate of 3.89 million, marking a similar 5.4% drop from the previous year, according to the National Association of REALTORS. Despite this decline, the median existing-home sales price hit a record high for the second consecutive month, rising 4.1% year-over-year to $426,900. Inventory of unsold homes increased by 3.1% from May and 23.4% from last year, reaching a 4.1-month supply, the highest level in over four years. All four major U.S. regions experienced sales declines, with price gains noted across all regions.


The forecast for Existing Home Sales is projected to be 3.89 million, down from the previous figure of 3.93 million.


The Existing Home Sales report is set to be released on Thursday at 2:00 PM GMT.

NZD - Retail Sales q/q​

Retail Sales q/q measures the change in inflation-adjusted retail sales in New Zealand, a key indicator of consumer spending, which drives much of the country's economic activity. A higher-than-expected result is positive for the New Zealand dollar, as it suggests stronger consumer demand that could lead to higher inflation. This, in turn, may prompt the Reserve Bank of New Zealand (RBNZ) to raise interest rates to control inflation. The data is released approximately six weeks after the end of the quarter.


New Zealand's retail sector showed signs of resilience in the first quarter of 2024, with retail sales rising by 0.5% from the previous quarter, defying expectations of a 0.3% decline and marking a positive shift after two years of continuous drops. This quarter's performance ends a streak of eight consecutive quarters of decline, highlighting a modest recovery in the retail landscape. The uptick was driven by gains in several key industries; food and beverage services saw a notable increase of 2.2%, while sales in motor vehicle and parts retailing went up by 1.1%. Additionally, recreational goods and accommodation sectors also reported significant jumps, increasing by 4.7% and 4.1%, respectively. Despite these gains, the annual comparison shows that retail spending is still down by 2.4% from the previous year, though this is an improvement from the 4.1% decrease recorded in the first quarter of 2023. This suggests that while the sector is on a recovery path, it still faces challenges in regaining its pre-pandemic strength.


The forecast for Retail Sales q/q stands at -0.1%, down from the previous result of 0.5%.


The upcoming Retail sales q/q is set to be released on Thursday at 10:45 PM GMT.

JPY - National Core CPI y/y​

Japan’s National Consumer Price Index (CPI), published monthly by the Statistics Bureau of Japan, tracks the price changes of goods and services purchased by households nationwide, excluding fresh food due to its weather-related price volatility. The year-over-year (YoY) figure compares prices in the reference month to those from the same month the previous year. Typically, a higher CPI reading is viewed as bullish for the Japanese Yen (JPY), while a lower reading is considered bearish.


In June 2024, Japan's core consumer price index, which omits fresh food prices but includes fuel costs, saw a 2.6% increase from the previous year, marking an acceleration from May's 2.5% rise. This ongoing increase underscores a sustained inflationary trend, as the core inflation rate in Japan has consistently exceeded 2% for over two years. Although the June figures slightly missed the market expectations of a 2.7% rise, they have strengthened the anticipation that the Bank of Japan might increase interest rates in its upcoming late July meeting. This possibility follows the BOJ's significant policy shift in March, when it raised interest rates for the first time since 2007, moving away from eight years of negative interest rates in response to rising wages and persistent high inflation.


The expected year-over-year Core CPI is forecasted to be 2.7%, up from the previous reading of 2.6%.

JPY – CPI y/y​

The National Core Consumer Price Index (CPI), which measures the year-over-year change in the prices of goods and services purchased by consumers, excluding fresh food, has shown a positive economic trend. Released monthly, usually on the third Friday of the following month, the latest figures reveal that the 'Actual' CPI has exceeded 'Forecast' expectations. This is seen as beneficial for the national currency, indicating a stronger economy. Economists and market analysts closely monitor these figures to assess inflation trends and consumer purchasing power, highlighting the index's significance in economic analysis and policymaking.

In June 2024, Japan's annual inflation rate remained steady at 2.8% for the second consecutive month, marking the highest level since February. Despite a slight reduction in electricity price hikes (13.4% compared to 14.7% in May), the cost of gas increased by 2.4%, a notable shift from a 2.5% decrease in the previous year, coinciding with the end of energy subsidies. Inflation persisted across various sectors: food prices rose by 3.6%, transportation costs increased to 2.5%, and furniture and household items jumped to 3.7%. Notably, culture and recreation experienced a significant increase to 5.6%. Communication also saw a sharper rise at 1.3%. Meanwhile, education prices continued to decline, falling by 1.0% for the third month in a row. The core inflation rate accelerated to 2.6%, its highest in three months, fueling speculation about potential interest rate hikes by Japan's central bank. On a monthly basis, the Consumer Price Index (CPI) grew by 0.3%, a slowdown from May's 0.5%, which was the fastest in seven months.


The forecast for CPI y/y is 2.9%, up from the previous outcome of 2.8%.


The upcoming Core CPI y/y and CPI y/y data is scheduled for release on Thursday at 11:30 PM GMT.