The economy in the eurozone grew less in June, with the composite purchasing managers’ index falling from 52.2 to 50.8. The services sector index dropped from 53.2 to 52.6, while the manufacturing index fell from 47.3 to 45.6, the lowest level in six months. The services sector offers no reason to the ECB to cut interest rates again in July, especially since German service providers raised prices more in June than in May. Additionally, European manufacturing increased sales prices in June for the first time since February 2023.
The Dutch funding requirement for this year has been reduced by 9.4 billion euros to 78.6 billion euros due to lower expenditures and higher tax revenues. The Agency of the Ministry of Finance expects that issuance will remain unchanged at approximately 40 billion euros, despite halting the sale of TenneT Germany. Existing DSL bonds will be reopened in July and September, and treasury bills will be issued on the money market.
Global steel production increased by 1.5 percent in May to 165.1 million tons, following a 5.0 percent decline in April. In China, production rose by 2.7 percent, while in Germany, the US, and South Korea, production decreased by 1.9 percent, 1.5 percent, and 10.9 percent respectively. The European Union saw a 1.8 percent increase year-on-year.
The 6M Euribor decreased with 1 basis point to 3.69% compared to previous business day. The 10Y Swap is unchanged at 2.76% compared to previous business day.
In the attachment, today’s market data on money and capital market rates as well as other rates are presented.
While Israel has been at war with Hamas in the Gaza Strip for over eight months, the country exported $13 billion worth of defense equipment, mainly air defense systems, in 2023. This marks a record for the third consecutive year. Air defense systems accounted for 36% of the exports, largely due to the sale of the Arrow 3 missile system to Germany. Asia was the largest market with 48%, followed by Europe with 35%.
Crude oil inventories in the United States fell by 2.5 million barrels to 457.1 million barrels last week, according to EIA data released on Thursday. Gasoline and heating oil/diesel inventories also declined, by 2.3 million barrels to 231.2 million barrels and 1.7 million barrels to 121.6 million barrels, respectively. Refinery utilization dropped from 95.0% to 93.5%.
The Bank of England maintained the official interest rate at 5.25% and is considering a possible rate cut in August. The decision was made with a 7-2 vote, with two policymakers advocating for a reduction to 5.00%. Following the decision, the British pound traded at 1.2705 USD and later fell to 1.2690. This was revealed on Thursday in the central bank’s rate decision.
The 6M Euribor is unchanged at 3.70% compared to previous business day. The 10Y Swap increased with 2 basis points to 2.76% compared to previous business day.
In the attachment, today’s market data on money and capital market rates as well as other rates are presented.
Producer prices in the United Kingdom rose as expected in May, according to figures released on Wednesday by the UK Office for National Statistics (ONS). On an annual basis, prices increased by 1.7 percent following a rise of 1.1 percent the previous month. Economists had also expected a rise of 1.7 percent. On a monthly basis, the price level fell by 0.1 percent last month, whereas a flat trend had been anticipated. The month before, prices had increased by 0.3 percent month-on-month.
Consumer prices in the United Kingdom also rose as expected in May. On an annual basis, prices rose by 2.0 percent, which is in line with expectations. The previous month, the price level had risen by 2.3 percent. Prices increased by 0.3 percent month-on-month after also rising by 0.3 percent the month before. A rise of 0.4 percent had been expected.
Confidence among American home builders declined in June, according to preliminary data from the National Association of Home Builders released on Wednesday. The NAHB housing index fell from 45 to 43 this month.
The 6M Euribor decreased with 1 basis point to 3.70% compared to previous business day. The 10Y Swap increased with 2 basis points to 2.74% compared to previous business day.
In the attachment, today’s market data on money and capital market rates as well as other rates are presented.
U.S. business inventories rose by 0.3% in April, matching economists’ expectations and reversing a slight decline from March, according to data from the U.S. Department of Commerce. Year-on-year, inventories increased by 1.0%, while sales also grew, rising 0.3% monthly and 2.2% annually.
Inflation in the Eurozone rose in May, with consumer prices increasing by 2.6% year-on-year compared to 2.4% in April, as confirmed by final figures from Eurostat. Core inflation, an important measure for the ECB which excludes volatile prices such as energy, food, alcohol, and tobacco, also increased to 2.9% from 2.7% the previous month.
U.S. retail sales saw a modest increase of 0.1% in May, slightly below the 0.2% economists had predicted, according to government figures. Despite a revised 0.2% decline in April, year-on-year sales rose by 2.3%.
The 6M Euribor decreased with 3 basis points to 3.71% compared to previous business day. The 10Y Swap decreased with 3 basis points to 2.72% compared to previous business day.
In the attachment, today’s market data on money and capital market rates as well as other rates are presented.
Paris has lost its spot as Europe’s biggest equity market. President Emmanuel Macron’s shock announcement of a snap election wiped off 258 billion USD from the market capitalization of French firms last week. Shares of banks Societe Generale SA, BNP Paribas SA and Credit Agricole SA — all big holders of government debt — lost more than 10% each. According to Bloomberg data, the stocks in the country are now collectively worth 3.13 trillion USD, narrowly losing to the UK, worth 3.18 trillion USD. The CAC 40 Index has erased all its gains from 2024 — a sharp reversal from the record highs a month ago.
Following the European Commission’s June 12 announcement that it would impose anti-subsidy duties of up to 38.1% on imported Chinese cars from July, global food companies have been on high alert for retaliatory tariffs from China. On Monday, China’s commerce ministry announced an anti-dumping investigation into imported pork from the EU, with an annual value of USD 2.2 B. This step appears mainly aimed at Spain, the Netherlands and Denmark, in response to curbs on its electric vehicle exports. The Chinese ministry says it was prompted by a complaint by the China Animal Husbandry Association on behalf of the domestic pork industry.
Australia’s central bank kept interest rates at a 12-year high and highlighted that inflation is proving sticky, suggesting it will be some time before policymakers are ready to signal easing. The Reserve Bank held its cash rate at 4.35% for a fifth straight meeting on Tuesday and restated that it wasn’t “ruling anything in or out,” a signal that a hike isn’t out of the question. Money markets are pricing a less than 40% chance of a rate cut by December, down from 50% prior to the release.
The 6M Euribor is unchanged at 3.74% compared to previous business day. The 10Y Swap increased with 3 basis points to 2.75% compared to previous business day.
In the attachment, today’s market data on money and capital market rates as well as other rates are presented.
Oil prices rose by about four percent last week, recovering the approximately two percent loss from the week before. OPEC’s optimistic outlook for oil demand growth helped reverse earlier losses, but uncertainties remain due to economic prospects and warnings from the International Energy Agency and the Energy Information Administration about a potential surplus and an increase in U.S. oil inventories. Upcoming data on crude oil processing in China could further negatively impact sentiment.
Consumer confidence in the U.S. economy fell from 69.1 in May to 65.6 in June, according to preliminary figures from the University of Michigan. Confidence in the current state of the economy deteriorated from 69.6 to 62.5, while economic expectations became slightly less optimistic, declining from 68.8 to 67.6. The inflation expectation for the next 12 months remained steady at 3.3 percent, while the five-year expectation rose from 3.0 to 3.1 percent.
The euro fell below 1.07 dollar on Friday morning, influenced by the upcoming French presidential elections and Fed policy. Inflation in France for May was revised up from 2.2 percent to 2.3 percent due to rising energy prices. The Bank of Japan left interest rates unchanged but is considering buying fewer government bonds. The euro was down 0.5 percent to 1.0682 dollar, the British pound fell 0.4 percent to 1.2703 dollar, and the Australian dollar declined 0.4 percent to 0.6610 dollar.
The 6M Euribor is unchanged at 3.75% compared to previous business day. The 10Y Swap decreased with 2 basis points to 2.78% compared to previous business day.
In the attachment, today’s market data on money and capital market rates as well as other rates are presented.
Consumer prices in the United States rose less than expected in May, according to figures from the US Department of Labor. Consumer prices rose by 3.3 percent year-on-year compared to 3.4 percent a month earlier. Economists had expected 3.4 percent. Core inflation, which is adjusted for food and energy prices, was 3.4 percent on an annual basis compared to 3.6 percent a month earlier. Economists had expected 3.5 percent.
British industrial production decreased more than expected in April, according to figures from the British official statistics office. Production fell by 0.9 percent on a monthly basis. Economists had expected a decline of 0.1 percent. In March production increased with 0.2 percent.
Stocks of crude oil in the United States rose last week, as did stocks of gasoline, heating oil, and diesel. This was evident on Wednesday from figures from the US Energy Agency EIA. In the week ending June 7, crude oil inventories rose by 3.7 million barrels to 459.7 million barrels. Gasoline inventories rose by 2.6 million barrels to 233.5 million barrels. Inventories of heating oil and diesel increased by 0.9 million barrels to 123.4 million barrels. The refinery utilization rate fell from 95.4 to 95.0 percent.
The 6M Euribor is unchanged at 3.75% compared to previous business day. The 10Y Swap decreased with 10 basis points to 2.80% compared to previous business day.
In the attachment, today’s market data on money and capital market rates as well as other rates are presented.
Consumer inflation in China remained stable in May with the CPI rising by 0.3%, while the pace of decline in producer prices slowed, signalling ongoing deflationary pressures and the need for more robust fiscal and monetary stimulus to revive weak domestic demand and stabilize economic recovery. Despite various measures to spur growth, economists suggest that a comprehensive policy package is essential to boost confidence and consumption effectively.
The World Bank has slightly raised its global growth forecast for 2024 to 2.6%, buoyed by the U.S. economy’s strong performance, but noted that overall economic output will remain below pre-pandemic levels through 2026. While growth is stabilizing, the report highlights significant challenges such as persistently high interest rates, mounting debt pressures in emerging markets, and geopolitical risks that could disrupt global trade and economic recovery.
U.S. small-business confidence improved in May, reaching the highest levels of the year, driven by more optimistic hiring plans despite a rise in uncertainty due to the upcoming presidential election. The National Federation of Independent Business indicated that the Small Business Optimism Index increased slightly, though it remains below the historical average, with inflation continuing to be the top concern among business owners.
The 6M Euribor increased with 1 basis point to 3.75% compared to previous business day. The 10Y Swap decreased with 2 basis points to 2.90% compared to previous business day.
In the attachment, today’s market data on money and capital market rates as well as other rates are presented.
French President Emmanuel Macron’s snap election strategy to counter Marine Le Pen’s ascent has unsettled investors, leading to a sharp sell-off in national assets. On Monday, the yield on French 10-year bonds rose to 3.19%, pushing the spread over safer German bonds to 54 basis points. Consequently, the euro dropped to a monthly low of 1.0733 USD, and the CAC 40 index fell by 2.4%. Amidst this financial turmoil, France faces fiscal challenges, due to worsening growth and tax revenues, prompting S&P to downgrade its credit rating from AA to AA- on May 31.
New EU requirements regarding capital and transparency are leading to the banning of most stablecoins, including USDT, which dominates 70% of the 160 billion USD stablecoin market. This could severely disrupt European cryptocurrency trading, as the rest of the world continues using USDT, causing liquidity and ecosystem problems, according to analysis firm Steno Research. Tether, previously banned in New York, invested billions in risky corporate bonds and cryptocurrencies, contrary to investor expectations.
Egyptian inflation slowed to its lowest rate in 18 months, despite a significant currency devaluation and an unprecedented hike in the price of subsidized bread. Urban consumer prices in the North African nation rose by 28.1% annually in May, down from 32.5% in April, according to the state statistics agency CAPMAS on Monday. Inflation was below what economists had anticipated. The deceleration was attributed to a 3% monthly drop in food and beverage costs, which are the major contributors to the inflation basket. Year-over-year, prices climbed 31% in May, compared to a rise of 40.5% the previous month.
The 6M Euribor is unchanged at 3.74% compared to previous business day. The 10Y Swap increased with 8 basis points to 2.92% compared to previous business day.
In the attachment, today’s market data on money and capital market rates as well as other rates are presented.
The Dutch economy is expected to have a soft landing according to the Spring Forecast by De Nederlandsche Bank, with a growth of 0.5 percent in 2024 and 1.3 percent in 2025 and 2026. The economy is stimulated by higher government and consumer spending, rising house prices, and increasing employment, although business investments and exports are still lagging. Inflation is expected to decrease from 2.8 percent in 2024 to 1.8 percent in 2026, while the budget deficit is projected to rise to 3.7 percent in 2026, well above the European norm.
In May, employment in the United States increased more than expected with 272,000 new jobs, versus market expectations of 190,000 jobs. The unemployment rate came in at 4.0 percent, slightly higher than the expected 3.9 percent. The average hourly wage increased by 0.4 percent to 34.91 dollars, representing an annual wage growth of 4.1 percent, above the expected 3.9 percent.
Chinese exports in May rose more than expected, with an increase of 7.6 percent year-on-year in dollars, while economists had predicted a rise of 4.8 percent. Imports grew by 1.8 percent, significantly less than the expected 4.0 percent. China’s trade surplus amounted to 82.62 billion dollars, higher than the expected 73.7 billion dollars. In yuan, Chinese exports increased by 11.2 percent.
The 6M Euribor is unchanged at 3.74% compared to previous business day. The 10Y Swap increased with 5 basis points to 2.84% compared to previous business day.
In the attachment, today’s market data on money and capital market rates as well as other rates are presented.
