In today’s briefing:
- The Week At A Glance: The slippery slope of data revisions
- Slump in US Housing Starts Signals Dismal Recovery Prospects
- Energy Cable: On the inventory build-up due to China-tariffs
- US Politics: Kamalanomics
- Presidential Election: Harris for the Poor and Trump for the Book of Secrets?
- [IO Weekly 2024/34] Iron Ore Recovers as Chinese Stockpiles Decline and Fed Signals Boost Sentiment
- Great Game – What we know about Harris’ economic plan after DNC
- US Rig Count Drops for Second Consecutive Week as Gas Rigs Dip
- Actinver Research – Macro Daily: Trade Balance
The Week At A Glance: The slippery slope of data revisions
- Happy Monday from Europe.
- Powell is cutting, Ueda is hiking and USDJPY is heading lower.
- It sounds like a tune we have heard before, and while we are NOT on imminent recession watch, we need to be aware of the potential slippery slope once the revised cat is let out of the bag.
Slump in US Housing Starts Signals Dismal Recovery Prospects
- US housing starts fell 6.8% MoM and 16% YoY in July, falling to their lowest level since 2020. Single-family starts reached a 16-month low.
- Overall housing inventory has surged to its highest level since 2020, reaching 1.3 million. New housing inventory surged to levels last seen in 2008.
- Despite lower mortgage rates, high home prices are deterring buyers, stagnating housing sales, and dampening homebuilder sentiment.
Energy Cable: On the inventory build-up due to China-tariffs
- The Chinese rebound story is losing momentum fast, which has important implications for Western economies and assets, while the impact from freight rates on inflation might not be as large as previously feared.
- Take aways Beta from freight rates to goods inflation is lower than usual due to inventory building in the USChinese retail and IP down some 10% from the pre-pandemic trend China’s export of disinflation will force policy makers in the West to introduce tariffs and subsidies Greetings from a sunny Copenhagen.
- This week we’ll discuss freight rates and what inventory data tells us to expect going forward and then we’ll dive into some more data points on the weak Chinese economic outlook.
US Politics: Kamalanomics
- Kamala Harris is working hard to maintain party unity, leading to limited information about her economic policies.
- Investors are expressing concerns over the economic policies she has so far revealed.
- The tight race to the election and issues related to Trump are expected to cause more market volatility in the future.
Presidential Election: Harris for the Poor and Trump for the Book of Secrets?
- In addition to the stress of Harris on policies that help the poor, on the Trump side, we believe the book of secrets is in focus.
- The book of secrets is an intelligence briefing by the CIA for every President since JFK to present. Incoming President will get to read the book for limited time.
- There every chance that Trump had read the book in his last presidency and he wants to revisit as another term.
[IO Weekly 2024/34] Iron Ore Recovers as Chinese Stockpiles Decline and Fed Signals Boost Sentiment
- Iron ore prices rebounded strongly last week and continued rising this week, reversing losses from the previous week’s 9% decline
- Chinese portside inventories of iron ore fell by 2.48 million tons in August, signaling strong demand despite slower drawdowns in the final weeks
- SGX Iron Ore options saw a 20.7% decline in volume last week, with a sharp increase in the put/call ratio from 1.56 to 2.35, indicating increased bearish sentiment
Great Game – What we know about Harris’ economic plan after DNC
- It’s been a busy week in Chicago.
- I am taking over from Mikkel Rosenvold in today’s edition of the Great Game, to give you a rundown of the policy ramifications of a star-studded DNC 2024.
- A week ago, Vice President Kamala Harris provided a brief glimpse of her economic program, when she spoke at a campaign event in Raleigh, North Carolina.
US Rig Count Drops for Second Consecutive Week as Gas Rigs Dip
- US oil and gas rig count fell by one to 585 for the week ending 23/Aug, marking a decline in rig count for the second straight week.
- US oil rig count was unchanged at 483, after falling by two the week prior. Gas rigs fell by one to 97, after rising by one the previous week.
- For the week ending 16/Aug, US crude oil production rose back to its record high of 13.4m bpd, after slipping down to 13.3m bpd the week prior.
Actinver Research – Macro Daily: Trade Balance
- Although exports continue to recover, their pace has slowed due to a decline in oil exports.
- On the other hand, imports grew by 3.7% year-on-year (YoY).
- As a result, the trade balance recorded a deficit of USD 5.6 billion from January to July.
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