Macroeconomic/ geopolitical developments
- Manufacturing Purchasing Managers Index (PMI) data for June mostly beat expectations on Thursday 1st July, both from Markit for many major economies and from the US Institute of Supply Managers (ISM), with the Manufacturing PMI coming in at 60.6%, beating consensus for a 13th straight month above 50.0%.
- The US Employment report was released on Friday 2nd July with the Non-Farm Payroll data posting at 850K jobs added, beating median expectations of 720K, though the unemployment rate did edge higher to 5.9%.
- Still no agreement on oil production among OPEC+ as the United Arab Emirates continued to object to a deal on the table, leaving Oil prices strong.
- The spread of the COVID-19 Delta variant in the UK and Europe remains of concern, although many countries have seen a breakdown of the correlation between cases and deaths, due to the success of vaccination programs.
Global financial market developments
- Global stock averages stayed firm with the US indices making new record highs.
- European averages have rebounded, but remain below cycle peaks
- The US Dollar Index gained again last week, but did setback after the US Employment report Friday
- EURUSD and GBPUSD pushed lower but bounced slightly after Friday’s US Employment report.
- Gold stays vulnerable with the US Dollar still strong.
- Oil extends higher.
- Copper is still trying to base and bounce.
Key this week
- Monitoring the spread of cases of the COVID-19 Delta variant in the UK and Europe, along with hospitalisations and deaths.
- Watching for lockdown easings in Europe and for announcements from the UK this week.
- Central Bank Watch: We get the Reserve Bank of Australia (RBA) interest rate decision and statement on Tuesday, then the Federal Open Market Committee (FOMC) Minutes are released Wednesday
- Macroeconomic data: Data standouts this week are the global Markit Services and Composite PMI on Monday, the US ISM Services PMI on Tuesday and UK GDP, Industrial and Manufacturing Production plus the Canadian Employment report on Friday.
|Date||Key Macroeconomic Events|
|05/07/21||Global Markit Services and Composite PMI; US Independence Day holiday observed, US markets closed|
|06/07/21||RBA interest rate decision and statement; EU Retails Sales; German ZEW survey; US ISM Services PMI|
|07/07/21||German Industrial Production; FOMC Minutes|
|08/07/21||Nothing of note|
|09/07/21||China CPI; UK GDP, Industrial and Manufacturing Production; Canadian Employment report|