Good Morning: The Long & the Short of it and The Bigger Picture - 12 February 2019 - ADM ISI
08:52 (27 minutes ago)
- Politics likely still to the fore on meagre day for data; US NFIB survey
and JOLTS Job Openings ahead, unsurprisingly woeful Australia Housing
Finance to be digested ahead of India CPI and Ind. Production; Fed
speakers, new Dutch 10-yr and smattering of corporate earnings
- U.S. NFIB headline seen lower again, but focus on sub-indices; JOLTS
job openings expected to dip further, but still underlining strength
of labour demand
Today's statistical schedule appears very unlikely to have a significant impact on markets, even if overnight the Australian Housing Finance, along with the upcoming US NFIB survey and JOLTS Job Openings along with Indian CPI and Industrial Production are material in terms of their respective economic outlooks. But with May set to make (yet another) statement on Brexit; an EU EcoFin meeting that will discuss last week's EC forecast update, EMU and the next EU budget; ongoing US/China (with chatter about a Trump/Xi meeting ' very soon' doing the rounds) and US/EU trade negotiations and tensions, and of course the spectre of another US Govt shutdown (seemingly voided with the latest Senate 'deal on border funding, unless Trump vetoes it) - it is little wonder that politics will continue to rule the roost, with the latest OPEC oil market report another tangential political thematic, above all given that OPEC+ production cuts have been rather slow, even if supply outages have mitigated some this, but then again global demand concerns given the economic outlook remain all too obvious. Otherwise Fed speak comes via way of Powell and two arch hawks, George & Mester, who have turned neutral, while the corporate earnings schedule features Nissan, Metro, TUI and Molson Coors amongst others.
** U.S.A. - NFIB Small Business Optimism / JOLTS Job Openings **
- The NFIB survey is forecast to dip further to 103.0 from 104.4, but remain high on any historical comparison, and despite the headline drop in recent months, it has been noticeable that Order Flows, Employment and Investment intentions continued to see a lot of strength. A similar story applies to JOLTS Job Openings, which have fallen back from their August all-tine high of 7.293 Mln, but at an expected 6.846 Mln vs. November's 6.888 Mln continue to suggest a very tight labour market and skills shortages. The US economy has clearly lost momentum, but the 'recession countdown' which some commentators are indulging in looks to be the stuff of self-serving hyperbole. The greater risk with the Fed for the time being is that the current rate hike pause proves to be shorter-lived than most assume, even if it is clear that the Fed is a good deal more sensitive to the external macro-political environment than it has perhaps even been before.