China’s senior party official says China’s economic recovery is not strong enoughJapan PM Kishida says need to be cautious about effect of rising prices due to weak yenJapan finance minister Suzuki scolds government minister speaking about marketsChina says it will encourage the development and expansion of private economyJapan private sector economic council members say cant overlook weak yen negative effectsJapan government minister Kono says he is not directly requesting the BOJ raise rates nowWall Street Journal: “Top Democrats reportedly prepare for a campaign without Biden”Here’s a forecast for a Bank of Japan rate hike this monthPBOC sets USD/ CNY reference rate for today at 7.1315 (vs. estimate at 7.2706)New reports that Biden campaign is calling an all-staff meeting on FridayExplosion reported in Tel Aviv – cause is unclear – looks to be near US consulateBNP Paribas target 1.06 for EUR/USDJapan data – June CPI Headline 2.8% y/y (vs. 2.9% expected)Westpac eyeing Australia expected to follow the same broad disinflation trend as peersUK consumer confidence in July hits its highest in nearly 3 yearsFed’s Daly sees inflation data improving, but says not at target yetJP Morgan says they do not expect a Bank of Japan rate hike in July, or at all in 2024NYT: Biden has begun to accept that he may not win in Nov, may have to drop outMacquarie warns on populist US economic policies fuelling inflation, shallow Fed rate cutsUBS boost their end year S&P 500 target to 5900Forexlive Americas FX news wrap: ECB holds rates, the dollar perks upUnnamed source – Biden doing ‘soul searching’ amid calls to exit 2024 presidential raceUS equities struggle again but finish off the lowsTrade ideas thread – Friday, 19 July, insightful charts, technical analysis, ideas
In
between the deluge of US political news and views we had a few items
worth noting here in the Asian timezone.
Federal
Reserve Bank of San Francisco President Mary Daly spoke, sounding a
little less dovish than her FOMC colleagues have recently. Daly said
“we’re not there yet” on price stability and the inflation
target.
That
the Federal Open Market Committee (FOMC) needs to “balance the
costs of acting fast and being wrong”That
she is not yet convinced it’s a “green light” for a
September interest rate cut
Next
up was Japanese inflation data for June
the
‘core-core’ rate of inflation in May (core-core is that excluding
food and energy, it’s the closest to the US measure of core
inflation) inched up on the month.
The
other two measures came in just above the May figures and all well
above the BoJ 2% target. I posted early in the session a reminder
that the Bank of Japan is dissatisfied with the nature of the
inflation in Japan. Higher inflation, says the BoJ, is mainly due to
‘cost-push’ inflation pressure from rising input prices and the weak
yen. The BoJ want ‘demand-pull’ inflation from consumers increasing
spending after wage rises. Japanese
Prime Minister Kishida popped up in the news later in the session
alluding to this, saying the government must be vigilant about the
impact of rising prices, driven in part by the weak yen, on the economy moving to
achieve domestic-demand driven recovery. It’s a difficult time for
Japanese authorities. They’d like to keep progressing towards policy
normalisation but tightening monetary policy risks endangering the
precarious economic recovery.
From
China today we had a news conference on the Third Plenum outcome,
Chinese Communist Party officals made positive comments about
economic reform but details were extremely thin. We’ll get more on
these in the weeks and months ahead I suspect.
There
was news out of Tel Aviv, Israel, where an explosion occurred due to
a drone attack. A person was killed and others injured.
Major
FX traded in small ranges only, characterised by a USD inching
higher. Gold fell. Oil fell but has recovered.
Gold:
This article was written by Eamonn Sheridan at www.forexlive.com.
