Weekly Macro Matters
Macro Matters – Weekly review, w/c June 12
Central banks take the spotlight this week with hawkish surprises, critical economic data, and major policy decisions from the Fed, ECB, and BoJ. Market volatility has subsided, but key events like US CPI and Fed guidance could ignite movement across bonds, equities, and commodities.
Macroeconomic/Geopolitical
• Hawkish surprises from central banks in Australia and Canada precede the Fed’s decision.
• US Treasury yields remain choppy, awaiting Fed guidance.
• Volatility indices drop across markets, but risks of complacency persist.
United States
• The Fed is expected to “skip” a rate hike, but hot inflation data on Tuesday could challenge this stance.
• Recent labor market signals, like rising jobless claims, suggest cracks forming despite strong payroll numbers.
• NASDAQ futures show signs of exhaustion, but bulls remain in control for now.
Europe
• The ECB is likely to hike rates by 25bps, with guidance expected for further tightening over the summer.
• UK wage growth data could signal easing pressure on GBP, while unemployment continues to tick higher.
Asia
• Chinese trade data disappoints, with falling exports and weak domestic demand, potentially prompting stimulus measures.
• BoJ is unlikely to make significant policy adjustments, leaving JPY under pressure.
Commodities
• WTI oil remains range-bound, supported by US Strategic Petroleum Reserve purchases below $70 but constrained by central bank hawkishness.
• Gold futures find support at $1931/$1940 as USD momentum stalls, with the Fed meeting likely to determine the next move.
On the calendar:
• 12/06/2023: N/A
• 13/06/2023: UK Unemployment and wage growth; German ZEW Economic Sentiment; US CPI
• 14/06/2023: UK monthly GDP; US PPI; Federal Reserve monetary policy
• 15/06/2023: Australian Unemployment; Chinese Industrial Production & Retail Sales; ECB monetary policy; US Retail Sales & Industrial Production
• 16/06/2023: Bank of Japan monetary policy; Michigan Sentiment (prelim)
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