According to CCTV news reports, on the evening of July 9, Liu He, a member of the Political Bureau of the CPC Central Committee, Vice Premier of the State Council and Chinese leader of the China-US Comprehensive Economic Dialogue, spoke with U.S. Trade Representative Lethizer and Finance Minister Mnuchin to exchange views on the implementation of the consensus between the two heads of state in Osaka. Minister of Commerce Zhong Shan attended the call.
Asia-Pacific Data Intensive Publishing
South Koreas adjusted unemployment rate in June was 4.0%, which met expectations of 4.0%.
Japans PPI fell 0.5% in June, less than expected by 0.1%, 0.1% year-on-year, less than expected by 0.4%.
Chinas CPI rose 2.7% in June from a year earlier, while Chinas PPI remained flat in June, with an expected increase of 0.1%. According to the National Bureau of Statistics, CPI rose steadily in June, with pork prices rising by 21.1%, an increase of 2.9 percentage points over the previous month, affecting CPI by about 0.45 percentage points.
The Dollar Index Continuously Rises
The dollar index rose for three consecutive days, reaching a three-week high of 97.59 on Tuesday, as traders awaited testimony from Federal Reserve Chairman Powells Congress this evening and a summary of the Federal Reserves June policy meeting tomorrow morning to find clues for possible interest rate cuts.
The pound fell to 1.2453 against the dollar as uncertainties remained and the economy declined.
The fever of hedge assets has subsided. COMEX gold futures closed down 0.03% Tuesday at $1399.6 an ounce for three consecutive days. The worlds largest gold ETF-SPDR Gold Trust position fell by 1.72 tons, or 0.22%, compared with the previous day, and the current position is 794.08 tons.
Alex Turro, market strategist at RJOFutures, said the dollar rebounded to a three-week high, pushing gold down earlier in the session, and then we saw a small number of low suckers supporting the market.
Meanwhile, U.S. Treasury yields continued to rise. Two-year Treasury yields rose 1.7 basis points to 1.917%; five-year Treasury yields rose 2.2 basis points to 1.884%; 10-year Treasury yields rose 1.9 basis points to 2.071%; 30-year Treasury yields fell 1.1 basis points to 2.542%.
Although the price of gold fell below the key level of $1,400, analysts believe that tensions in the Middle East, trade status and central bank buying support the price.
COMEX gold futures fell further to $1394.80 per ounce in Asia-Pacific morning trading today.
Short-term or sustained volatility in oil prices
As API crude oil inventories fell more than expected, international oil prices both closed higher on the 9th. WTI crude oil futures closed up 1.18% at $58.34 a barrel for four days. Brent crude oil futures closed up 0.67% at $64.54 a barrel.
Previous data showed that API crude oil stocks fell 8.129 million barrels in the week from July 5, a sharp drop of 3.567 million barrels, and a drop of 5 million barrels over the previous value.
Yesterday, the short-term energy outlook report of the U.S. Energy Information Agency (EIA) lowered global crude oil demand growth by 150,000 barrels per day to 1.07 million barrels per day in 2019 and 20,000 barrels per day to 1.4 million barrels per day in 2020.
In terms of price, EIA expects WTI crude oil price to be $59.58 per barrel in 2019, which was previously expected to be $59.29 per barrel, and Brent crude oil price to be $66.51 per barrel in 2019, which was previously expected to be $66.69 per barrel. Its price expectations for WTI crude oil and Brent crude oil in 2020 are $63.00 per barrel and $67.00 per barrel, respectively, the same as previously expected.
In the near future, investors are waiting for the Feds interest rate guidance and progress in the Iranian deadlock. Michael Laitkep, an analyst who tracks Alerian, an energy infrastructure company, said oil prices could remain volatile in the short term, given persistent sanctions and tensions between the United States and Iran and the possibility of economic slowdown.
In todays Asia-Pacific morning trading, U.S. oil and oil distribution continued to rise by about 1%, at $58.59 per barrel and $64.72 per barrel, respectively.
The market is still expecting a rate cut in July. Before Fed Chairman Powells speech, U.S. National Economic Adviser Kudrow said the market showed that the Fed should withdraw last years rate increase. According to CMEs Fed Observation, the market now expects the Fed to cut interest rates by 25 basis points to 2.00%-2.25% in July, with a probability of 96.2% and a probability of cutting interest rates by 50 basis points to 3.8%. The market still expects a rate cut in July, but the bet on a sharp rate cut in July has fallen further from more than 5% at the beginning of the week, which reached about 25% last week. However, John Herrmann, an analyst at Mitsubishi UFJ Securities, suggested that Powell might adopt a cautious optimism attitude, which might disappoint the pigeons slightly. Source: First Financial Responsibility Editor: Wang Xiaowu_NF
The market still expects a rate cut in July.
Before the speech by Federal Reserve Chairman Powell, U.S. National Economic Adviser Kudrow said the market showed that the Federal Reserve should withdraw last years interest rate increase.
According to CMEs Fed Observation, the market now expects the Fed to cut interest rates by 25 basis points to 2.00%-2.25% in July, with a probability of 96.2% and a probability of cutting interest rates by 50 basis points to 3.8%. The market still expects a rate cut in July, but the bet on a sharp rate cut in July has fallen further from more than 5% at the beginning of the week, which reached about 25% last week.
However, John Herrmann, an analyst at Mitsubishi UFJ Securities, suggested that Powell might adopt a cautious optimism attitude, which might disappoint the pigeons slightly.