U.S. Market Preview
On the US calendar today are the releases of May personal income, personal spending, the PCE deflator, and PCE core at 8:30 ET, followed by the June Chicago PMI at 9:45 ET, and at 10:00 ET May construction spending, and the Final University of Michigan confidence for the month of June. There are no Fed speakers scheduled in the US today, and there is no new supply scheduled.
Regarding today's data, May personal spending is expected to rise to 0.6% from -0.1% in April, while personal spending is expected to rise to 0.7% from 0.5% in April. The PCE deflator is expected to rise to 2.3% in May from 2.2% in April, and PCE Core m/m is expected to remain unchanged at 0.1%. The Chicago PMI for the month of June is expected to decline to 58.0 from 61.7 in May. Construction spending for the month of May is expected to remain unchanged at 0.1%. The final reading of the June University of Michigan confidence is expected to rise slightly to 84.0 from the previous reading of 83.7.
In European economic news overnight German retail sales for the month of May declined by more than expected overnight to -1.8% m/m from 2.6% in April and to -3.7% y/y from -0.6% in April. The French consumer confidence indicator for the month of June, which was expected to decline, rose to -12 from -14 in May to its highest level since the series began in November of 2003. The final reading on first-quarter GDP in the UK was in line with the preliminary reading at 0.7% q/q, and was revised up to 3.0% y/y from the preliminary reading of 2.9%. Also in the UK overnight the GfK consumer confidence indicator for the month of June declined to -3 from -2 in May. As expected the Euro-Zone CPI estimate came in at 1.9% overnight.
In Asian economic news overnight the Japanese headline CPI reading came in at 0.0%, above estimates of -0.1%, while the core reading came in at -0.3%, in line with analyst estimates. The Japanese jobless rate, which was expected to rise, remained unchanged from April at 3.8%. Recall that the prior month's reading was the lowest since March of 1998. In New Zealand the first-quarter q/q GDP reading was in line with estimates at 1.0%, while the y/y reading was at 2.5%, above estimates of 2.4%. Both readings reached their highest level since the second-quarter of 2005. The Nikkei 225 closed up 1.15% overnight, while the Hang Seng closed down 0.75%, and, over in Australia, the ASX 200 closed up 0.15%.
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