Macroeconomic/ geopolitical developments
- US inflation is cooling, as last week saw the US Personal Consumption Expenditures (PCE) price index increased 0.1% in May, with the YoY increase down to 3.8%, its lowest level since April 2021, whilst the core PCE index, the Fed’s preferred inflation measure, fell to 4.6% YoY.
- And US data stays firm, bucking the risks of a recession, as in the last week Consumer Confidence, Durable Goods Orders and housing data have all surprised to the upside, plus there was a sizeable upward revision to the final reading of Q1 GDP.
- At the ECB’s annual Forum on Central Banking in Sintra, Portugal, the ECB President Christine Lagarde, Bank of England (BoE) Governor Andrew Bailey and Fed Chair Powell all continued with the mantra of higher for longer on interest rates.
- Global financial market developments
- The major US stock averages were higher last week, with the S&P 500 hitting a new multi-month high close, as the Nasdaq Composite finished its best first half of a year since 1983, up 32%. Apple closed the quarter and half year on Friday with a market capitalization above $3 trillion!
- European and Asian indices were also notably higher.
- US and European Bond yields pushed to the upper end of wider consolidation ranges.
- The US Dollar Index was in a consolidation mode.
- Gold sold off again but did stage a rebound from a new multi-week low.
- Oil stayed in a range but retains a more negative tone ahead of this week’s OPEC meeting.
Key this week
- Geopolitical: US Independence Day holiday on Tuesday, all cash and futures markets closed. OPEC meeting Wednesday-Thursday. Tensions in Russia will still need to be monitored and will likely keep risks elevated across global financial markets.
- Central Bank Watch: Central bank focus is on the Reserve Bank of Australia (RBA) on Tuesday and the Fed Minutes on Wednesday.
- Macroeconomic data: A busy week for data with the standouts being US ISM Manufacturing and Services PMI Monday and Thursday respectively, global PMI data Monday and Wednesday, and the US Employment report featuring the Non-Farm Payroll data on Friday.
| Date | Key Macroeconomic Events |
| 07/03/2023 | Eurozone & UK Final Manufacturing PMI; US ISM Manufacturing, US Factory Orders |
| 07/04/2023 | Reserve Bank of Australia monetary policy; US Independence Day holiday |
| 07/05/2023 | China Caixin Services PMI; OPEC meeting; FOMC meeting minutes |
| 07/06/2023 | ADP Employment Change, US Weekly Jobless Claims, ISM Services |
| 07/07/2023 | US Employment Situation; Canadian Unemployment |
