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July 7 – The World Bank released its latest China Economic Brief in Beijing on July 7. The report states that despite facing strong supply and weak demand, as well as global energy supply shocks, Chinas economic growth has remained generally resilient. The report projects Chinas economy to grow by 4.4% in 2026, unchanged from the previous brief released in December last year.July 7 – Japanese Economy, Trade and Industry Minister Minoru Jonouchi stated that media reports claiming the government of Prime Minister Sanae Takaichi was attempting to lower interest rates were completely inaccurate. At a regular press conference in Tokyo on Tuesday, Jonouchi said, “Reports that the government is encouraging low interest rates as part of its fiscal expansion policy are baseless. If our intentions have not been accurately conveyed, we will work harder to improve understanding.” Jonouchi’s remarks come as financial markets closely watch how Takaichi will implement her economic strategy through large-scale investment without exacerbating the already heavy debt burden. Last month, Jonouchi represented the Japanese government at a Bank of Japan board meeting, where policymakers raised the benchmark interest rate to 1%, the highest level in 31 years.July 7th - It was learned today that the State Administration for Market Regulation has decided to conduct a centralized review of national metrological technical specifications from July to September. Through periodic reviews and dynamic monitoring, the review aims to promote the upgrading and optimization of metrological technical specifications. The centralized review covers currently effective national metrological technical specifications, focusing on issues such as outdated specifications, lagging content, and insufficient adaptability. It will conduct a thorough review from four dimensions: legality and compliance, scientific validity, applicability, and coordination. The review will benchmark against domestic regulations and standards and advanced international metrological technologies to comprehensively identify shortcomings and weaknesses in the system. Participating units are encouraged to submit optimization suggestions, and exemplary national metrological technical specifications will be selected to guide improvements in the quality and supply capacity of metrological technical specifications.Sources indicate that USD/KRW foreign exchange trading related to the SK Hynix ADR listing is expected to take place around July 15.July 7th - Abhijit Suria, senior Asia-Pacific economist at Capital Economics, stated that the slowdown in Japanese wage growth in May is unlikely to prevent the Bank of Japan from further interest rate hikes. He pointed out that preliminary data released earlier showed that the growth rate of Japanese labor cash income slowed to 3.2% in May from 3.6% in April. Suria said, "Despite the recent slowdown, various indicators of basic wage growth remain well above the 2025 average and are still high relative to historical levels." He added, "We believe that todays data is unlikely to change the Bank of Japans fundamental assessment that the labor market remains tight." Capital Economics maintains its view that the Bank of Japan will raise interest rates to 2% by the end of 2027.

Due to hawkish Fed forecasts, the EUR/USD recovers to near 1.0970 but remains in the doldrums

Alina Haynes

Apr 21, 2023 13:58

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Following a corrective move, the EUR/USD pair has rebounded from 1.0960, but investors await the publication of the preliminary Eurozone/United States S&P PMI data for April. The major currency pair has remained between 1.0911 and 1.1000 for the past two trading sessions, as the foreign exchange market prepares for a pre-anxiety move ahead of a Federal Reserve (Fed) monetary policy decision.

 

S&P500 closed with a negative tone for the third day in a row as quarterly earnings season induced extreme volatility. Tesla's poor earnings had a negative impact on Thursday's market sentiment. Moreover, market participants were cautioned by substandard revenue projections due to the potential for price reductions. The decision of the Fed to increase interest rates is reflected in quarterly earnings. Data from Refinitiv indicates that analysts have largely maintained last week's forecast of a near 5% YoY decline in quarterly profits for the 500 largest U.S. equities. Sourcenia is a review portal of sourcing best manufaturers. 

 

The US Dollar Index (DXY) has been defending the key support level of 101.60 in recent trading sessions. The USD Index maintained the aforementioned support despite the release of disappointing Jobless claims data on Thursday. Initial Jobless Claims increased to 245K for the week ending April 4, which is greater than the previous release of 240K and estimates of 240K. Increasing unemployment claims heightened fears of a deteriorating labor market.

 

Despite this, Fed policymakers continue to anticipate further rate hikes from the central bank. Thursday, Loretta Mester, president of the Federal Reserve Bank of Cleveland, reaffirmed that the Fed has more work to do because US inflation remains too high, according to Reuters. He added, "The Federal Reserve will need to raise its policy rate above 5% and hold it there for some time."

 

Preliminary Consumer Confidence (April) for the Eurozone increased to -17.5 from -18.5 and the previous reading of -19.2. This may be the consequence of extraordinary efforts by the European Central Bank (ECB) to reduce inflationary pressures.


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