Gold hits 14-month highs with yen on top after weak Chinese industrial output data and renewed declines in yields. The first vote of Conservatives MPs revealed that Boris Johnson will at worst advance to a run-off for his party's leadership. Friday's upcoming US retail sales report has the potential to be a major market mover (more below). Below is the Premium susbcribers' video focusing on gold and indices, with a preview for next week's crucial set of developments.

Johnson received the support of 114 of the 314 Conservative MPs in the first round of leadership voting. Baring some kind of scandal that leads to MPs switching their vote, the worst he can finish is second. At that point, broader party leadership will have the opportunity to vote for one of the final-two candidates, or if polls show a decided favorite, the runner up might quit.

The real race over the next two weeks will be who he faces off against. Several names will fall off the ballot and a second vote will take place on June 18 with votes potentially continuing until June 22. Remainer Matt Hancock dropped out earlier this morning, leaving remainers Setwart and Hunt in the race.

Coming second to Johnson was Jeremy Hunt, who had the support of 43 MPs, followed by Michael Gove at 37, Raab at 27 and Javid at 23. The results left a minimal impact on the FX market even though the betting odds of Johnson rose. That's a reflection of key divisions that persist in the party. Theresa May voted for Hunt along with influential ministers Liam Fox and Amber Rudd.

As we near today's US data, bond markets are firmly pricing 2 Fed rate cuts by end of September. This could change in the event of surprises in the May US retail sales report. The April report was weak with the control group flat compared to a 0.3% rise expected but March numbers previously were strong. The Fed has remained upbeat on consumers but this will be another test. The consensus for the headline retail sales is +0.6% but the spot to watch is the control group, which is forecast to rise 0.4%. A miss would weigh on USD and harden expectations for a rate-cutting signal while a strong number would add to volatility as risk assets weigh better news against the chance of no rate cuts.

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