Morning Market Update – Canadian Data Comes with Mixed Results

Asian Markets

The Ministry of Trade and Industry said that Singapore’s gross domestic product was up by 2.5% in the first quarter of 2017. The seasonally adjusted annualized rate for GDP sank by 1.9%.

Australia’s consumer inflation expectations went up in April and the Melbourne Institute’s consumer inflation expectations came at 4.1%. The Reserve Bank of Australia (RBA) already stated that the inflationary pressures are expected to gain some grip throughout the year. The bank’s view on inflation contradicts the peak inflation argument with rising economies.

RBA said that there would be more risks to the inflation and productivity growth when compared to the financial institutions. The surge in debt will lead to a drop in income levels with high interest rates. China’s exports rose by 14.8% and the imports raised by 31.1% (y/y) in the first quarter. The People’s Bank of China (PBOC) set the Yuan rate at 6.8651 versus yesterday’s fix of 6.8940.

Other Markets

Moving on for the day, we have the Germany’s Harmonised Index of
Consumer Prices data release which seems to maintain the same levels as before and we do not expect any major changes.

Switzerland Producer and Import Prices have become stronger when compared with the previous data which was seen at -0.2%. After maintaining a low profile in the past, the positive results for the Swiss import prices have grabbed the attention of the markets.

The Canadian data released with mixed results as the Manufacturing
Shipment was hit majorly while the New Housing Price Index showed a good improvement when compared with the previous data results. It is better to watch out for both the results before making any decision.

We have the Bank of Canada’s (BoC) Governor Stepen Poloz stating that a low CAD would mean a positive outlook on the economy. Poloz added that “Would be wrong for us to try to offset market factors that drive the Canadian dollar.”

Later in the day, we shall look forward to the Initial Jobless Claims, Continuing Jobless Claims and Michigan Consumer Sentiment Index.  The Initial Jobless Claims seems to hold the correct output decision for the greenback to recover the lost momentum.
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