Explore Special Offers & White Papers from ADMIS

Macroeconomics: The Day Ahead for 18 November

  • Modest run of data to end the week: digesting UK Retail Sales, & GfK survey, Norway GDP and Japan CPI; awaiting US Existing Home Sales, Canada House Prices & PPI; smattering of central bank speakers
  • UK: dead cat bounce in Retail Sales and further slight recovery in Consumer Confidence offer little solace in the wake of grim Budget
  • US Existing Home Sales: further accelerated sharp fall seen, SAAR pace excluding pandemic seen at 2011 levels; inventories in view

EVENTS PREVIEW

The day’s data calendar is modest, though there are Japan’s National CPI, UK Retail Sales and GfK Consumer Confidence and Norwegian Q3 GDP to digest ahead of Chile’s Q3 GDP, Canada PPI and perhaps more significantly Teranet House Prices and US Existing Home Sales. There are quite a number of central bank speakers, though the latest very hawkish comments from Bullard yesterday suggesting that Fed Funds ‘sufficiently restrictive zone’ (i.e. to bring down inflation) is in the 5.0%-7.0% area will be the talking point, allied with continued concerns about the ongoing surge in Covid cases in China. Next week’s schedule will be disrupted by the US Thanksgiving day holiday, with G7 flash PMIs the likely highlight of a light statistical schedule, which also has Germany’s Ifo and other national surveys in the UK and Eurozone, US Durable Goods and New Home Sales, UK PSNB, Canadian Retail Sales and Japan’s Tokyo CPI. On the events front, the OECD updates its economic outlook forecasts, with the November FOMC minutes, and rate hikes expected in South Korea (+25 bps) and South Africa (+75 bps), and a jumbo 150 bps rate cut in Turkey.

** U.K. – Nov Gfk Consumer Confidence, Oct Retail Sales **
Following on from yesterday’s grim but very much largely as expected UK Budget, whose tax measures will primarily serve to continue a process of hollowing out the UK’s middle classes, which has been a sadly observable work in progress for more than a decade, today’s data falls into the category ‘better than expected, but still weak’. The 0.3% m/m rebound in Retail Sales ex-Autos was no more than a very dead cat bounce, given the 1.5% m/m fall in September and a 1.7% m/m drop in August. The pick-up in GfK Consumer Confidence to -44 vs. expected -46 was across the board in terms of views on Buying Climate, Personal Finances and Economic Situation, and probably owes to nothing more than a typical feature of diffusion indices, namely a small shift of those responding ‘no change’ vs. previously saying ‘worse’. The fact remains that the headline index remains close to its recent all-time low, and below the prior all-time low.

** U.S.A. – Oct Existing Home Sales **
Existing Home Sales are expected to fall for an eighth consecutive month, and at an accelerated pace of -6.6% m/m, the largest fall since February’s -8.6%. The anticipated 4.40 Mln SAAR pace would be the weakest since the pandemic trough in May 2020, and rather more notably the worst since 2011 excluding the pandemic. A close eye will also need to be kept on inventories, which at 3.3 months’ worth of supply remain low by historical standards, though a lot higher than January’s low of 1.6. Housing will continue to be a significant drag on GDP going forward, above all given that the mortgage rate has risen to 7.2%.

To view the full report and to sign up for daily market commentary please email admisi@admisi.com

The information within this publication has been compiled for general purposes only. Although every attempt has been made to ensure the accuracy of the information, ADM Investor Services International Limited (ADMISI) assumes no responsibility for any errors or omissions and will not update it. The views in this publication reflect solely those of the authors and not necessarily those of ADMISI or its affiliated institutions. This publication and information herein should not be considered investment advice nor an offer to sell or an invitation to invest in any products mentioned by ADMISI.

Risk Warning: Investments in Equities, Contracts for Difference (CFDs) in any instrument, Futures, Options, Derivatives and Foreign Exchange can fluctuate in value. Investors should therefore be aware that they may not realise the initial amount invested and may incur additional liabilities. These investments may be subject to above average financial risk of loss. Investors should consider their financial circumstances, investment experience and if it is appropriate to invest. If necessary, seek independent financial advice.

ADM Investor Services International Limited, registered in England No. 2547805, is authorised and regulated by the Financial Conduct Authority [FRN 148474] and is a member of the London Stock Exchange. Registered office: 3rd Floor, The Minster Building, 21 Mincing Lane, London EC3R 7AG.                  

A subsidiary of Archer Daniels Midland Company.

© 2022 ADM Investor Services International Limited.

Risk Warning: Investments in Equities, Contracts for Difference (CFDs) in any instrument, Futures, Options, Derivatives and Foreign Exchange can fluctuate in value. Investors should therefore be aware that they may not realise the initial amount invested and may incur additional liabilities. These investments may be subject to above average financial risk of loss. Investors should consider their financial circumstances, investment experience and if it is appropriate to invest. If necessary, seek independent financial advice.

ADM Investor Services International Limited, registered in England No. 2547805, is authorised and regulated by the Financial Conduct Authority [FRN 148474] and is a member of the London Stock Exchange. Registered office: 3rd Floor, The Minster Building, 21 Mincing Lane, London EC3R 7AG.                  

A subsidiary of Archer Daniels Midland Company.

© 2021 ADM Investor Services International Limited.

Futures and options trading involve significant risk of loss and may not be suitable for everyone.  Therefore, carefully consider whether such trading is suitable for you in light of your financial condition.  The information and comments contained herein is provided by ADMIS and in no way should be construed to be information provided by ADM.  The author of this report did not have a financial interest in any of the contracts discussed in this report at the time the report was prepared.  The information provided is designed to assist in your analysis and evaluation of the futures and options markets.  However, any decisions you may make to buy, sell or hold a futures or options position on such research are entirely your own and not in any way deemed to be endorsed by or attributed to ADMIS. Copyright ADM Investor Services, Inc.

Latest News & Market Commentary

Explore Special Offers & White Papers from ADMIS

Get Started