ASIA-PACIFIC Trading Newsletter

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EMU CONSUMER PRICE INDEX

Friday Notes - Fear of a credit crunch intensifies by HVB Group

July was likely the eleventh month of below 2% inflation. The final outcome is a close call between the 1.8% of the flash estimate and 1.9%. Again, energy will be the main contributor to the tame figure. Although we are forecasting a robust 0.9% m−o−m increase, the y−o−y headline energy number won't rise since energy was even up 1.4% m−o−m in July 2006. Food inflation is expected to stay tame, whereas among components seasonality should be responsible for a jump in air fares. As such, core inflation is bound to stay at 1.9%, hinting at pipeline pressures.

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US CAPACITY UTILIZATION

U.S. Industrial Production slows in July, Capacity Utilization edges up (FXstreet.com)

Industrial production has slowed its growing pace in July compared with June, according to the latest manufacturing report by the Federal Reserve.

• Read the INDUSTRIAL PRODUCTION AND CAPACITY UTILIZATION report at Bank of Governors of the Federal Reserve
• US July industrial production up 0.3 pct, capacity utilisation 81.9 pct (Thomson Financial News)
• Table Of Data On US Capacity Utilization (Dow Jones)
• DATA SNAP: US Industrial Output Growth Slows In July (Dow Jones)

US NET LONG−TERM TIC FLOWS

U.S. Net Long Term TIC Flows decrease in June (FXstreet.com)

Net buying of long−term securities has decreased to 120.9 billion in June from 126.0 billion on the previous month according to the monthly Treasury International Capital report, known as TIC.

• Read the Treasury International Capital (TIC) report at U.S. Department of the Treasury
• US June total net foreign capital inflow 58.8 bln usd (Thomson Financial News)
• US Jun Net Long−term TIC Flows down to $120.9B vs $126.1B in May (FXstreet.com)

US CONSUMER PRICE INDEX

U.S.CPI moderates in July due to lower energy prices (FXstreet.com)

Consumer prices have moderated their growing pace in the United States in July due to a decrease on energy prices, although prices for clothing and medical care have posted notorious gains, according to the latest report by the Labor Department.

• Read the Consumer Price Index at Bureau of Labor Statistics
• Inflation slows in July, output gains (Thomson Financial News)
• US Consumer Price Index−STATS−Historical (Dow Jones)
• US July CPI up 0.1 pct, core CPI up 0.2 pct (Thomson Financial News)

US NY EMPIRE STATE MANUFACTURING INDEX

August Empire State manufacturing index 25.1 vs 18.5 expected (Thomson Financial News)

The Empire State manufacturing index held steady in August, slipping only a bit to 25.1 from the 26.5 July reading. Economists had predicted a slowing in both new orders and shipments would take the index down to 18.5 from that 13−month high in July.

• Read the Empire State Manufacturing Survey at Federal Reserve Bank of New York
• US NY Empire State Manufacturing Index decreases to 25.6 in Aug from 26.46 in Jul (FXstreet.com)

UK BANK OF ENGLAND MINUTES

BOE's decision to hold rates was approved unanimously (FXstreet.com)

The Bank of England's Monetary Policy Committee decided by 9 votes to 0 to keep interest rates unchanged at 5.75% after their meeting celebrated on 1 and 2 of August, according to the Bank's minutes.

• Read the MINUTES OF MONETARY POLICY COMMITTEE MEETING at BOE
• BoE MPC voted 9−0 to keep base rate unchanged at 5.75 pct at Aug 2 meeting (Thomson Financial News)
• BOE Aug Minutes: MPC Voted 9−0 To Hold Bank Rate At 5.75% (Dow Jones)