Recap 11-19-13




  • German ZEW rose to 54.6 vs 54 exp and 52.8 prev, close to a historical high.
  • RBA Minutes: Things getting better but the AUD remains high
  1. The revised staff forecasts suggested that growth in the near term would be constrained by the decline in mining investment, the high level of the exchange rate and weak public demand. A range of indicators showed that dwelling investment was picking up and this was likely to continue. In time, non-resources business investment was also expected to increase… Members noted that while the timing of investment upturns was very difficult to predict, it appeared likely that growth of the economy over the coming year would be below trend but that growth could reasonably be expected to pick up thereafter.
  2. There was mounting evidence that monetary policy was supporting activity in interest-sensitive sectors and asset values, and given the lags with which monetary policy operates, the stimulatory effects would likely continue coming through for some time. At the same time … the Australian dollar, while below its level earlier in the year, remained uncomfortably high. Members noted that a lower level of the exchange rate would likely be needed to achieve balanced growth in the economy.
  3. The Board’s judgement was that, given the substantial degree of policy stimulus that had been imparted, it was prudent to hold the cash rate steady while continuing to gauge the effects, but not to close off the possibility of reducing it further should that be appropriate to support sustainable growth in economic activity

Home Depot reported revenue of $19.5bn vs $19.17bn expected. EPS of 95c topped 89c expectations. Same-store sales +7.4% versus 5.6%. Gross margin 34.9% vs 34.8% expected. They guided the year to $3.72 up from $3.60 and above the street of $3.60.

Governor Zhou said the PBOC will basically exit from normal intervention in the FX market and will expand the daily trading band of the yuan as a part of reforms out of the Third Plenary.

Upcoming Data:

  • Wed: BoE Minutes, US Retail Sales, Dudley Speaks, US Existing Home Sales, FOMC minutes, China Flash Mfg PMI, BoJ
  • Thu: EU PMI, RBA Governor Stevens speaks, US Jobless Claims, US Markit Preliminary PMI, US Philly Fed, EU Consumer Confidence
  • Fri: German IFO, Canada CPI,
  • Mon: US Pending Home Sales,
  • Tue: US Housing Starts, Consumer Confidence, South Korea Mfg Survey