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The market mood remained tense as traders awaited news regarding the debt ceiling and specifically a meeting between the House Speaker and President Joe Biden later during the US session.
Volatility slightly increased with the VIX expanding by around 1 percent, and FX remained volatile but also in a small trading range as the debt ceiling news looms on the market.
Industrial production in the United States increased 0.2% year-on-year in April of 2023, following a downwardly revised 0.1% rise in March. The mining sector surged 5.6% while a decline was seen for manufacturing (-0.9%) and utilities (-0.4%)
Industrial production also increased 0.2% year-on-year in April of 2023, following a downwardly revised 0.1% rise in March. The mining sector surged 5.6% while a decline was seen for manufacturing (-0.9%) and utilities (-0.4%).
Hawkish comments from Mester aren’t a surprise in general but she’s openly advocating for another hike, and it comes just after a strong retail sales report. That’s flowing through to the dollar and helping to give it a lift.
Mester said “I would like policy rate to get to a point where it could equally be a potential increase or decrease” and “I don’t put it in terms of a pause, I put it in terms of a hold.”
He also gave a number “I don’t think we’re at that hold rate yet” and “There is four weeks to go until the next meeting, need to see more data”.
Also we got Canadian inflation data, the annual inflation rate in Canada rose to 4.4% in April of 2023 from the 19-month low of 4.3% in the previous month, well above market expectations of 4.1% to reignite fears of a hawkish Bank of Canada.
Consumer prices soared as the central bank’s tightening path lifted mortgage rate costs (28.5% vs 26.4%) and rent prices (6.1% vs 5.3%). The CPI also accelerated for transportation (1.3% vs 0.3%), as OPEC’s crude oil output cut pinned energy costs at stubbornly high levels.
On the other hand, inflation fell for food (8.3% vs 8.9%) amid eased pressure from fresh vegetables, coffee, and tea. On a monthly basis, the Canadian CPI advanced by 0.7%, the most in six months.
