SHANGHAI, Mar 21 (SMM) – This is a roundup of global macroeconomic news last night and what is expected today.
Last night
Driven by bullish sentiment on the US economy and an expected hike in interest rates, the US dollar rebounded to 90. Weak economic data for the eurozone also bolstered the greenback.
However, nonferrous metals fell across the board under pressure from the strong dollar. LME copper tumbled to a three-month low and lost over 1%. LME zinc dropped 1.4% as inventories grew.
The UK’s consumer price index (CPI) fell to 2.7% in February, down from 3% in January. February's CPI stood lower than the expected 2.8% for the month. The Bank of England (BOE) is unlikely to change its mind on monetary policy even as inflation fell under expectations.
Germany’s ZEW economic sentiment index, which measures investor confidence, slumped to 5.1 in March from 17.8 in February, below the expected 13. The current assessment component fell to 90.7 from 92.3 in February. The eurozone’s ZEW economic sentiment also dropped sharply to 13.4 from 29.3 in February, below the expected 29.3. The institute said that concerns of a US-led trade conflict made German investors more cautious, and that the strong euro is also "hampering the economic outlook for Germany" but that "the outlook is still largely positive".
The eurozone’s consumer sentiment index stood at 0.1 in the preliminary March reading, unchanged from February.
Inventories of US crude oil during the week ended March 16 dropped by 2.74 million barrels, according to data from the American Petroleum Institute (API). Gasoline inventories shrank by 1.06 million barrels and refined oil inventories fell by 1.93 million barrels.
Day ahead
Key factors to watch today include, from the US, current account data for the fourth quarter of 2017, February home sales, and oil stocks data by the Energy Information Administration.
The US dollar is likely to remain rangebound at current levels as the market expects higher interest rates.
With pressure from the US dollar, base metals are likely to remain weak in the short term.
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