Daily Update - 7th June 2017
Yesterday’s Focus Eurozone retail PMI falls back in May, with the overall reading declining to 52.0 from 52.7, as confidence dropped in Italy and Germany, while the French reading jumped to 53.3 from 51.8. The Italian number fell further below the 50 point no change mark, indicating contraction, but for the Eurozone the numbers suggests a deceleration in the pace of expansion, rather than a contraction, which after the Easter holidays is probably not a total surprise. The Reserve Bank of Australia left cash rate unchanged at 1.50% as expected, highlighted weak wage growth, but saw the global economy picking up. Job growth continued to expand. Governor Lowe claims that “labour markets have tightened further in many countries and forecasts for global growth have been revised up since last year.” Global inflation is also moving higher. The RBA said that “headline inflation rates in most countries have moved higher over the past year, partly reflecting the higher commodity prices. Core inflation remains low, as do long-term bond yields.” Today’s Focus The day will start on the release of the reports from Australia whcih a measure of the total value of all goods and services produced by Australia that considered as a broad measure of the economic activity and health followed by Consumer Credit Change from US that indicates if consumers can afford large expenses, which can fuel economic growth. However, a high figure may also indicate that the economy is overheating, as consumers borrow in order to live beyond their means. Day will end in UK RICS Housing Balance that shows the strength of the UK housing market, which can be considered as the economy as a whole, as the housing market is sensitive to the business cycle.
