The Stats
It was a very busy week on the economic calendar, within the week ending 8th May.
A total of 57 stats were monitored, following the 60 stats from the week prior.
Of the 57 stats, 29 came in ahead forecasts, with 26 economic indicators arising in need of forecast. 2 stat was in line with forecasts within the week.
Looking at the numbers, just 18 of the stats reflected an upward trend from previous figures. Of the remaining 39, 38 stats reflected a deterioration from previous.
For the Greenback, the pendulum swung back in favor of the Greenback within the week. The U.S Dollar Spot Index rose by 0.66% to finish the week at 99.734. Partially reversing a 1.30% fall from the previous week, it had been a third week within the green out of 4.
Economic data, COVID-19 news, geopolitics were focused throughout the week.
Looking at the newest coronavirus numbers.
The total number of coronavirus cases stood at 4,000,975, which was up from last Friday’s 3,392,718. Week-on-week, the entire number of cases was up by 608,257, on a worldwide basis. This was above the previous week’s increase of 564,143 in new cases.
In the U.S, the entire rose by 189,444 to 1,318,504. within the week prior, the entire number of latest cases had risen by 204,064.
Across France, Germany, Italy, and Spain combined, the entire number of latest cases increased by 42,031 to bring total infections to 823,870. within the previous week, the entire number of latest cases had risen by 54,254.
It was worth noting that the U.S and therefore the EU member states monitored all saw a spike in new cases on Thursday.
Out of the U.S
It was a busy week on the economic calendar.
In the 1st half the week, there was nothing positive for the markets to think about .
Factory orders tumbled by 10.3% in March, the deficit widened in March, and repair sector activity tanked.
The market’s preferred ISM Non-Manufacturing PMI slid from 52.5 to 41.8.
Employment figures also tested market resilience throughout the week.
After some quite dire ADP numbers on Wednesday, initial jobless claims jumped by another 3.169m within the week ending 1st May.
The surge preceded April’s nonfarm payroll figures on Friday, which showed a 20.5m slump. As a results of the slide, the U.S percentage jumped from 4.4% to 14.7% in April.
The only consolation was that economists had forecast an percentage of 16%. it had been enough to support the demand for riskier assets on the day.
In the equity markets, the Dow rose by 2.56%, with the NASDAQ and S&P500 rallying by 3.50% and 6.00% respectively.
Out of the UK
It was a comparatively quiet week on the economic calendar. Key stats included finalized April private sector PMI numbers and house price figures.
The stats were skewed to the negative. Finalized services and composite PMI were revised upwards from prelim figures, providing the sole positive.
It was of little consolation, however, with the PMIs still at 13 levels in spite of the upward revisions
House prices fell by 0.7%, reversing a 0.2% rise in March.
Also negative was a slide within the construction PMI from 39.3 to only 8.2 in April.
While the stats were negative, the BoE gave the Pound much needed support by standing pat on monetary policy.
The support for the Pound came in spite of the BoE delivering a dark economic outlook.
On the geopolitical risk front, updates on Brexit pinned back the Pound mid-week, with each side making little progress.
There was some hope of progress towards a U.S – UK trade deal, but it’s getting to take a while for any meaningful progress.
In the week, the Pound fell by 0.77% to $1.2410. The FTSE100 ended the week up by 3.00%, following on from a 0.19% gain from the previous week.
Out of the Eurozone
It was another busy week economic data front, with the stats heavily skewed to the negative another time .
Manufacturing and repair PMIs for April for Italy and Spain were focused within the 1st half the week.
Finalized PMIs from France, Germany, and therefore the Eurozone along side German factory orders and Eurozone retail sales also drew interest.
For Italy and Spain, while Manufacturing PMIs were on the slide and it had been the Services PMIs that delivered a market shock.
The Service PMIs on Wednesday coincided with a record slide in German factory orders in March.
Eurozone retail sales weren’t far better , with an 11.20% fall coming before the April lockdown…
Later within the week, dire industrial production figures and trade data out of Germany had a muted impact. Perhaps the sole consolation within the week was that Germany avoided a deficit by some margin.
For the week, the EUR rose by 1.29% to $1.0839, reversing a 1.46% gain from the previous week.
For the ecu major indexes, it had been a bullish week. The EuroStoxx600 and DAX30 rose by 1.08% and by 0.39% respectively, while the CAC30 fell by 0.49%.
Elsewhere
It was another bullish week for the Aussie Dollar and therefore the Kiwi Dollar, with the pair managing to avoid a Friday reversal.
In the week ending 8th May, the Aussie Dollar rose by 1.78% to $0.6532, with the Kiwi Dollar up by 1.20% to $0.6136.
For the Aussie Dollar
It was a comparatively busy week for the Aussie Dollar on the economic data front.
Key stats included March retail sales and trade figures on Wednesday and Thursday.
Retail sales surged by 8.5%, with the jump attributed to hoarding. In spite of expectations of an April slump, the Aussie found support from the numbers.
Trade data also impressed, with the trade surplus widening from A$4.361bn to A$10.602bn.
Again, the markets and therefore the RBA are expected economic conditions to deteriorate within the 2nd quarter, which limited the upside from the stats.
On the monetary policy front, the RBA left interest rates unchanged on Tuesday, while assuring the markets of more support should the necessity arise.
The RBA’s base case scenario for the economic outlook did not sink the Aussie Dollar within the week.
From elsewhere, it had been trade data from China that ultimately gave the Aussie Dollar a lift . A 3.5% increase in exports caught the markets by surprise…
For the Kiwi Dollar
It was also a busier week on the economic calendar.
Key stats included 1st quarter employment figures and inflation expectations.
Employment increased by 0.7% within the 1st quarter, leading the percentage up to 4.2%. Economists had forecast a 0.3% decline and an percentage of 4.3%.
While the utilization figures were positive, inflation figures were quite the other .
Inflation expectations for 2-years out slumped within the 2nd quarter from 1.93% to 1.24%. Things weren’t far better for 1-year, with inflation forecasted to tumble from 1.88% to 0.74%. This was of little surprise, however, when considering the slump in petroleum prices.
Ultimately, better than expected employment figures and an end to the coronavirus in NZ were the positives.
The NZ economy should now be in recovery mode, which could give the RBNZ some breathing space .
For the Loonie
It was a comparatively busy week on the economic calendar, with the stats skewed to the negative.
While the stats showed further deterioration from the previous month, they were more upbeat than forecasts.
In March, the deficit widened from C$0.98bn to C$1.41bn, against a forecast of C$2.00bn.
In April, employment tumbled by 1.994m, following a 1.011m fall in March. Economists had forecast a 4m decline. The percentage jumped from 7.8% to 13%, which was well below a forecast of 18%.
From the private sector, the Ivey PMI did disappoint, however, with the PMI falling from 26.0 to 22.8 in April. Economists had forecast a PMI of 25.0.
Ultimately, an upward trend in petroleum prices and improved risk sentiment delivered the gains for the Loonie on the week.
The Loonie rose by 1.15% to finish the week at C$1.3927.
For the Japanese Yen
It was a comparatively quiet week on the info front.
Key stats included March household spending and finalized April services PMI figures.
There was nothing positive to require from the numbers, with household spending sliding by 4% in March.
Service sector activity also ground to a halt, with the finalized PMI revised down from 22.8 to 21.5. In March, the PMI had stood at 33.8.
While the stats were skewed to the red, the Yen found some support though nothing to write down home about…
The Japanese Yen rose by 0.24% to finish the week at ¥106.65. within the week prior, the Yen had risen by 0.56% against the U.S Dollar.
Out of China
It was a comparatively busy week on the economic data front.
Key stats included April service sector PMI and trade data.
The stats were skewed to the positive within the week. The pace of contraction in commission sector activity eased in April, with the PMI rising from 43.0 to 44.4.
Of greater significance, however, was a 3.5% increase in exports. Economists had forecast a 15.7% slide.
Imports did tumble by 14.2%, however, with the shortage of demand raising some uncertainty over what lies ahead.
The Yuan did not end the week within the green, with Trump’s threats and an uncertain economic outlook weighing.
In the week ending 8th May, the Yuan fell by 0.16% to CNY7.0742 against the Greenback.
The CSI300 rose by 1.30%, while the Hang Seng ending the week down by 1.68%.
