Key US data reviewed - Nomura

Analysts at Nomura offered a review of the key data from the US session today. 

Key Quotes:

"Initial jobless claims: Initial and continuing claims remain low. With strong employment growth and aggregate demand, we expect initial jobless claims to remain subdued over the near term."

"PPI: The PPI report for July will likely reaffirm rising pipeline price pressure with input costs on the rise. Business surveys such as the ISM and Philly Fed surveys indicated continued input price pressure. Consistent with these surveys, the inflation of PPI for processed materials excluding food and energy has picked up on a 12-month change basis, while that of unprocessed nonfood materials less energy has remained elevated. This suggests that producers are increasingly raising the prices of their finished products to pass the rising costs to their customers. 

Among volatile components, prices of transportation and warehousing service have been rising sharply in recent month on a 12-month change basis. Some of these increases were possibly due to ongoing transportation difficulties. The ISM surveys in recent months reported persistent supplier delivery issues partly due to increased transportation constraints. We expect the transportation component in PPI to remain elevated reflecting this ongoing problem. Note that our CPI inflation forecasts for July may be subject to revisions depending on the PPI report."

"Wholesale inventories: The advance report on trade and inventories showed softerthan-expected wholesale inventory accumulation in June. The final report could add additional information on whether the weakness in inventory investment will persist into Q3."