SHANGHAI, Mar 22 (SMM) – This is a roundup of global macroeconomic news last night and what is expected today.
Last night
The US dollar dropped below 90 at one point and then hovered around 89.7 as the Federal Reserve anticipated hiking interest rates three times in 2018, below market expectations of four hikes.
Nonferrous metals rose due to the weak US dollar and higher oil prices. SHFE lead jumped over 2%, zinc increased over 1%, while aluminium dipped. LME copper gained over 1% from a three-month low, while lead and zinc went up 2% and 1.6% respectively.
The US current account deficit widened to $128.2 billion in the fourth quarter of 2017, from $101.5 billion in the third quarter of the year, slightly more than the expected $125 billion. This difference was due to the larger deficit in goods trading and a smaller surplus in primary income.
US sales of existing homes surged to a seasonally adjusted annual rate of 5.54 million units in February, up 3% from January’s 5.38 million. The surge was supported by significant gains in the south and west of the US. A shortage of houses in the market is likely to be an obstacle in the spring selling season. Higher housing prices and mortgage rates also limited initial purchases.
Inventories of US crude oil during the week that ended March 16 dropped by 2.62 million barrels, according to data from the Energy Information Administration (EIA). Gasoline inventories shrank by 1.69 million barrels and refined oil inventories fell by 2.02 million barrels.
Day ahead
Key factors to watch today include the March manufacturing Purchasing Managers' Index (PMI) for the eurozone, Germany, and the US, the German Zentrum für Europäische Wirtschaftsforschung (ZEW) Economic Sentiment Index for March, weekly unemployment claims in the US, and the US' House Price Index (HPI) for January.
The US dollar edged down to stand around 89.6 as the Federal Reserve’s interest rate decision fell below expectations overnight. We expect the dollar to stay rangebound today.
Base metals inched up across the board overnight, and are expected to trade rangebound in the short term.
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