What you need to know before markets open
- The US Treasury market rout continues with the benchmark 10-year Treasury yield rising to 3.13% overnight, its highest level since 2011.
- China has offered President Donald Trump a $200 billion reduction in its annual trade surplus by increasing imports and other steps.
- Canada’s data set on both retail sales and inflation headline the day on the macro front while markets are likely to track closely the development of the US-China trade talks as well.
Friday’s market moving events
- German factory gate inflation is expected to rise 0.3% m/m in April while decelerating to 1.8% y/y.
- German wholesale prices are seen rising 0.2% m/m in April.
- Cleveland Federal Reserve Bank President Loretta Mester is scheduled to speak about macroprudential and monetary policy at the Third Annual European Central Bank Macroprudential Policy and Research Conference in Frankfurt at 7:00 GMT.
- The Eurozone current account surplus is expected to reach EUR 27.9 billion in March.
- Canada’s retail sales are set to rise 0.4% m/m in April with core retail sales rising 0.5% m/m.
- Canada’s core inflation is expected to rise 0.2% m/m while increasing 1.4% y/y in April. For detail read Yohay’s Preview here.
- Dallas Federal Reserve Bank President Robert Kaplan is due to participate in a moderated discussion at the 12th Annual University of Texas at Dallas Project Management Symposium in Richardson, Texas at 13:15 GMT
- Federal Reserve Board Governor Lael Brainard is scheduled to speak on Community Reinvestment Act Modernization at the "Association for Neighborhood and Housing Development's 8th Annual Community Development Conference" in New York at 13:15 GMT.
Major market movers
- The US benchmark Treasury yields jumped higher to 3.13% supporting the US Dollar to rise to the highest level in last 5 months.
- Watch CAD reacting to the inflation and retail sales data.
Thursday’s macro summary
- The Bank of Greece said ECB lowered the emergency liquidity assistance for Greek banks by 2.5 billion EUR to 12.2 billion EUR.
- The Eurozone construction output fell -0.3% m/m in March after -0.7% m/m in February. The Eurozone construction output rose 0.8% y/y.
- Fitch Ratings said the benefits of a weak US Dollar and rising commodity prices, which supported strong emerging-market growth in 2017, are now beginning to fade.
- ECB Vice President Vítor Constâncio spoke about the future of the central banking while delivering closing remarks at the Colloquium in his honor organized by the ECB.
- The US initial jobless claims reached 222K in the week ending May 11 adding 11K from the previous week.
- Philadelphia Fed survey rose strongly to 34.4 in May.
- Canada’s private ADP employment report saw 30.2K new jobs added in April.
- Minneapolis Federal Reserve Bank President Neel Kashkari said that slow wage growth in the US is a big conundrum; one theory is there is more slack in labor market.
- ECB's Nowotny said the Bank shouldn't wait too long to normalize monetary policy.
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