Investment Bank Outlook 15-06-2021
Citi
USD remains well anchored, drawing some support as we head into the FOMC meeting. Overnight price action was typical, with lackluster price action. US equities continued to garner the previous week’s positive momentum, while US rates were sold across the curve as investors prepare for the possibility of a more-hawkish Fed tilt.
For today, we have some employment data for GBP and also US retail sales and manufacturing survey today. AUD is slightly underperforming after RBA minutes showed the bank was prepared to keep buying bonds even though the economy has recovered its pre-pandemic output. CNH has come off the lows from yesterday as local market participants return while TRY continues to underperform
RBC Capital Markets
Day ahead: US May retail sales are the pick of a busy calendar today. While our economists expect a bounce back in this report following sizable declines in the prior month (particular in retail control), we do not expect a material advance. Supply constraints might take a bit out of the bounce (furniture, building materials, and clothing seem particularly vulnerable). So control rises just 0.3% in May on our forecast, but consumer spending still seems poised for another strong quarter overall. Also in the US, we get PPI, industrial production and the June Empire survey. Outside the US, UK labour data are the key release .
AUD: Minutes of the June RBA meeting erred overall upbeat and continued to lay the groundwork for a shift in policy settings at the upcoming 6 July meeting. The RBA added that “Members also discussed the likely effect of the decision in relation to the yield target on overall financial conditions.” The minutes also hinted strongly at a QE3 program as the RBA outlined multiple options for what QE may look like when QE2 finishes in early September. House prices rose 5.4% q/q in Q1 – the largest increase for a decade.
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