Euro The euro depreciated vis-à-vis the U.S. dollar last week as the single currency tested bids around the $1.2595 level and was capped around the$1.2980 level. The pair lost about 285 pips last week. Fed officials continued to manage inflation expectations with more hawkish talk. Atlanta Fed's Guynn noted the Fed would 'not let its guard down;" St. Louis's Poole said the current economic slowdown may not stymie inflation; Kohn testified that inflation is elevated; Bies said the Fed can't say it's done hiking; and Bernanke reiterated the Fed needs to remain "vigilant." Traders bought dollars on the premise the FOMC will move again by +25bps at the end of June. Data saw the May services ISM fall to 60.1 from 63.0 while weekly initial jobless claims pulled back to 302,000. The April trade deficit narrowed slightly and the May import price index came in a hotter-than-expected +1.6%.
In eurozone news, the ECB lifted its headline rate by a modest +25bps to 2.75% with Trichet not overly hawkish in his remarks. Many traders expected a +50bps move. EMU-12 April retail sales were up 1.4% m/m and 2.8% y/y and the EMU-12 May services PMI up at 58.7. Ecofin ministers tried to talk the euro down with Austria's Grasser, Luxembourg's Juncker, and France's Breton noting $1.30 is at the high end of the its comfort zone. G8 officials meeting in St. Petersburg could shake things up in the FX world, especially if they again talk about normalization of Asian exchange rates. Papademos, Tumpell-Gugerell, and Gonzalez-Paramo talked up the EMU-12 economy and downplayed the euro's role in policymaking. The ECB kept its 2006 GDP growth forecast intact at +2.1%.
Yen/ CNY
The yen weakened vis-à-vis the U.S. dollar last week as the greenback tested offers around the 114.30 level and was supported around the 111.40 level. The pair gained about 230 pips last week. The Nikkei 225 stock index closed the week at14,750.84. BoJ's Iwata echoed Fukui's recent comments, saying policymakers have no idea when interest rates will be lifted from near zero per cent. May bank lending was up 1.2% y/y, the fastest climb in more than ten years and speculation mounted the government may lift its January - March GDP estimate. The Nikkei reported the government will emphasize deflation is receding in its June monthly report. April machinery orders rose 10.8% m/m.
The Chinese yuan rallied vis-à-vis the U.S. dollar last week as the greenback closed at CNY 8.0112 in the over-the-counter market and at CNY 8.0115 in the exchange-traded market. A Chinese government research body called on the government to widen the yuan's trading band and PBOC's Zhou indicated the central bank has no plans to tighten policy further at this time. May PPI was up 19.5% y/y.
GBP The British pound depreciated vis-à-vis the U.S. dollar last week as cable tested bids around the US$ 1.8365 level and was capped around the $1.8880 level. The pair lost about 375 pips last week. BoE's MPC kept rates unchanged at 4.50% for the tenth consecutive month. Data was on the soft side with April manufacturing output off 0.2% m/m, May BRC retail sales off, and the May services PMI survey off at 59.2. Halifax and CML reported continued strength in house prices and May Nationwide May consumer confidence improved. The April trade in goods deficit printed at -GBP5.8 billion while NIESR sees U.K. GDP at 0.6% in the three months to May.
CHF
The Swiss franc depreicated vis-à-vis the U.S. dollar last week as the greenback tested offers around the CHF 1.2365 figure and was supported around the CHF 1.2015 level. The pair gained about 250 pips last week. Data released in Switzerland saw the May unemployment rate recede to 3.3% from 3.5% in April.
CAD
The Canadian dollar depreciated vis-à-vis the U.S. dollar last week as the greenback tested offers around the US$ 1.1230 level and was supported around the US$ 1.0975 level. The pair gained about 60 pips last week. The May unemployment rare fell 0.3% to 6.1%, its lowest level since December 1974.
AUD
The Australian dollar came off vis-à-vis the U.S. dollar last week as the Aussie tested bids around the US$ 0.7390 level and was capped around the US$ 0.7545 level. The pair lost about 25 pips last week. RBA kept its official cash rate unchanged at 5.75% and the May unemployment rate printed at 4.9%, down from 5.1%. Q1 GDP was up 0.9% q/q and 3.1% y/y and the May services PMI fell to 49.3. Also, the Q1 current account deficit printed at - A$ 13.999 billion, down from - A$ 14.330 billion in Q4, and Westpac industrial activity index receded to 48.4 in June from 51.1 in March, its lowest level since June 2001.
SCHEDULE
Sunday, 11 June 2006
all times GMT
(last release in parentheses)
1700 US European Central Bank member Constancio speaks
1845 NZ Q1 import prices (0.6%)
1845 NZ Q1 export prices (-1.8%)
2245 NZ Q1 terms of trade index (-2.3% q/q)
2350 Japan Q1 GDP (0.5% q/q)
2350 Japan Q1 GDP, annualized (1.9%)
2350 Japan Q1 GDP deflator (-1.3% y/y)
2350 Japan May domestic corporate goods price index (0.5% m/m)
2350 Japan May domestic corporate goods price index (2.5% y/y)
2350 Japan May export price index (0.7% m/m)
2350 Japan May export price index (4.0% y/y)
2350 Japan May import price index (0.8% m/m)
2350 Japan May import price index (14.9% y/y)
2350 Japan April current account (¥2.395 trillion)
2350 Japan April trade balance (¥1.108 trillion)
Monday, 12 June 2006
all times GMT
(last release in parentheses)
N/A Australia Financial markets closed
0500 Japan May consumer confidence (50.2)
0600 Germany May wholesale price index (1.0% m/m)
0600 Germany May wholesale price index (3.2% y/y)
0800 Italy April industrial production (-0.1% m/m)
0800 Italy April industrial production (4.2% y/y)
0830 Eurozone European Central Bank member Quaden speaks
0830 UK May producer price index, input (2.5% m/m)
0830 UK May producer price index, input (15.7% y/y)
0830 UK May producer price index, output (0.4% m/m)
0830 UK May core producer price index, output (0.4% m/m)
0830 UK May producer price index, output (2.4% y/y)
0830 UK May core producer price index, output (2.3% y/y)
0830 UK April ODPM house prices (3.3% y/y)
0830 UK May FT house prices (3.3% y/y)
1200 NZ Q3 employment outlook
1230 Canada Q1 capacity utilization ratio (86.3%)
1315 US Cleveland Fed President Pianalto speaks
1345 Slovenia European Central Bank member Bini-Smaghi speaks
1430 US Dallas Fed President Fisher speaks
1615 US Fed Governor Olson speaks
2000 US Fed Governor Bies speaks
2245 NZ April retail sales (-1.0% m/m)
2330 US Fed Chairman Bernanke speaks
Tuesday, 13 June 2006
all times GMT
(last release in parentheses)
N/A Japan June monthly economic report
0130 Australia May National Australia business survey
0430 Japan April industrial production (1.5% m/m)
0430 Japan April industrial production (3.8% y/y)
0430 Japan April capacity utilization (104.1)
0430 Japan May machine tool orders (14.8% y/y)
0600 Germany May consumer price index (0.2% m/m)
0600 Germany May consumer price index (1.9% y/y)
0600 Germany May harmonized consumer price index (2.1% m/m)
0600 Germany May harmonized consumer price index (0.2% y/y)
0800 Italy Q1 labour cost in industry and services
0830 UK May consumer price inflation (0.6% m/m)
0830 UK May consumer price inflation (2.0% y/y)
0830 UK May core consumer price inflation (1.3% y/y)
0830 UK May retail price index (0.8% m/m)
0830 UK May retail price index (2.6% y/y)
0830 UK May RPIX (2.4% y/y)
0900 Germany June ZEW survey of economic sentiment (50.0)
0900 Germany June ZEW survey of current situation (8.7)
0900 Eurozone June ZEW survey of economic sentiment (47.7)
0900 Eurozone Q1 current account (-€15.1 billion)
1230 US May producer price index (0.9% m/m)
1230 US May producer price index, ex-food and energy (0.1% m/m)
1230 US May producer price index (4.0% y/y)
1230 US May producer price index, ex-food and energy (1.5% y/y)
1230 US May advance retail sales (0.5%)
1230 US April business inventories (0.7%)
1230 US Fed Chairman Bernanke speaks
1600 Eurozone European Central Bank member Mersch speaks
2245 NZ May food prices (-0.8% m/m)
Wednesday, 14 June 2006
all times GMT
(last release in parentheses)
N/A Japan Bank of Japan Policy Board meeting
0030 Australia June Westpac consumer confidence
0400 Japan May bankruptcies (14.9% y/y)
0400 Japan May Tokyo condominium sales (-2.5% y/y)
0600 Germany May wholesale price index (1.0% m/m)
0600 Germany May wholesale price index (3.2% y/y)
0800 Italy May consumer prices (0.3% m/m)
0800 Italy May consumer prices (2.2% y/y)
0800 France May consumer price index (0.4% m/m)
0800 France May consumer price index (2.0% y/y)
0800 France May harmonized consumer price index (0.3% m/m)
0800 France May harmonized consumer price index (2.3% y/y)
0830 UK May claimant count rate (3.0%)
0830 UK May jobless claims change (7,700)
0830 UK April average earnings (4.2%)
0830 UK April ILO unemployment rate (5.2%)
0830 UK April manufacturing unit wage cost (1.9%)
1230 US May consumer price index (0.6% m/m)
1230 US May consumer price index, ex-food and energy (0.3% m/m)
1230 US May consumer price index (3.5% y/y)
1230 US May consumer price index, ex-food and energy (2.3% y/y)
1230 Canada April manufacturing shipments (1.6% m/m)
1300 France European Central Bank President Trichet speaks
1530 US Fed Governor Bies speaks
1700 US Dallas Fed President Fisher speaks
1800 US Fed Beige Book
2300 US Boston Fed President Minehan speaks
2330 UK May RICS house price balance (15.0%)
2350 Japan April tertiary industry index (-0.6% m/m)
Thursday, 15 June 2006
all times GMT
(last release in parentheses)
N/A Japan Bank of Japan Policy Board monetary policy announcement
N/A CH Swiss National Bank interest rate announcement
N/A CH Swiss National Bank mid-year monetary policy assessment
0100 Australia June consumer inflation expectations
0130 Australia May Reserve Bank of Australia bulletin
0300 NZ May non-resident bond holdings
0500 Japan April leading economic index (50%)
0500 Japan April coincident index (77.8%)
0600 Japan Bank of Japan monthly report
0645 France Q1 non-farm payrolls (0.2% q/q)
0730 Italy European Central Bank member Tumpell-Gugerell speaks
0800 Eurozone June European Central Bank monthly report
0800 Eurozone European Central Bank member Liikanen speaks
0830 UK May retail sales (0.6% m/m)
0830 UK May retail sales (3.0% y/y)
0900 Eurozone May consumer price inflation (0.7% m/m)
0900 Eurozone May consumer price inflation (2.4% y/y)
0900 Eurozone May consumer price inflation, core (1.5% y/y)
1201 NZ May ANZ PMI (53.1)
1215 US Boston Fed President Minehan speaks
1230 US Weekly initial jobless claims (302,000)
1230 US Weekly continuing jobless claims (2.145 million)
1230 US June Empire Fed manufacturing index (12.4)
1300 US April net foreign security purchases (US$ 69.8 billion)
1315 US May industrial production (0.8%)
1315 US May capacity utilization (81.9%)
1430 UK April leading indicator index (0.6% m/m)
1430 UK April coincident index (0.2%)
1600 US June Philadelphia Fed index (14.4)
1700 US Fed Governor Kroszner speaks
1800 Us Fed Chairman Bernanke speaks
2245 NZ Q1 manufacturing activity (0.3%)
Friday, 16 June 2006
all times GMT
(last release in parentheses)
N/A CH Swiss National Bank President Roth speaks
0645 France April current account (-€1.793 billion)
0730 Korea St. Louis Fed President Poole speaks
0900 Eurozone Q1 labour costs (2.4% y/y)
0900 Eurozone April industrial production (0.4% m/m)
0900 Eurozone April industrial production (3.8% y/y)
1230 US Q1 current account balance (-US$ 224.9 billion)
1315 Italy April current account (-€1.991 billion)
1345 US June University of Michigan consumer sentiment (79.1)
1500 US Fed Governor Kohn speaks
1500 US Fed Governor Kroszner speaks
DISCLAIMER: GCI's Weekly Market Recap and Week Ahead is provided for informational purposes only. The information contained in these reports is gathered from reputable news sources and is not intended to be used as investment advice. GCI assumes no responsibility or liability from gains or losses incurred by the information
