• Markets:
    • S&P 500 back at previous highs on strong earnings, but:
      • Investors shift to defensives.
      • Other global equity markets and commodities fail to return to previous highs.
      • Is monetary tightening in the Eurozone, China and EM (and anticipation of tightening in the US) having an effect?
    • USD carry trade continues. USD falls to new lows, AUD strong, gold and silver make new highs.
    • Fukushima and Libya remain in the background.
  • China: rash of data and tightening continues:
    • CPI 5.4%, b.e., rising trend. Probably higher in reality.
    • GDP 9.7% yoy, b.e., around average since 2004.
    • Investment 25% — on the low side since 2005.
    • Industrial production 14% — about average.
    • Retail sales 17.4%, only partially recovered from last month’s pullback.
    • Capital targets for the five biggest lenders increased, but FX reserves had their second-largest quarterly increase on record in Q1.
    • => Boom goes on. Effective tightening is in Europe, not China.
  • Eurozone:
    • EUR core CPI jumps to 1.3%.
    • Schauble says Greece may require restructuring; 2-year >20%. 
    • Irish and Greek yields rise; Spain, Italy remain flat; Bund yields fall.
  • US:
    • S&P says US risks losing AAA rating if plan to cut deficits and debt not agreed by 2013. Irrelevant.
    • Inflation:
      • PPI weaker than expected, falling trend.
      • Core CPI increased to 1.2%.
      • Capacity utilisation jumps, at late-2004 levels.
    • Drop in initial jobless claims seems to be over — flatlining.
    • Housing: 
      • Building permits, housing starts, new home sales all flatlining at post-crisis lows.
      • Existing home sales off 2010 lows but struggling to get to 2008 levels.
  • Oil:
    • Saudi Arabia says supplies “adequate” but prices still rising.
    • Libyan situation ongoing; Jonathan wins Nigerian election, provoking riots in the North.
  • Coffee: 
    • ICO says tight supplies continue to support prices.
    • Previous spikes caused by Brazilian frost — this one has a wider cause.
  • Wheat: US winter wheat damaged, spring plantings delayed by drought. Production may increase elsewhere (e.g. Ukraine).
  • Soybeans: Chinese government pressure on crushers to keep prices low leads to cancelled orders
This Week
  • UK GDP estimate.
  • US Advance GDP, Durable Goods Orders, Personal Income and Outlays.
  • FOMC Statement and new press conference.
Advertisements