Global stock markets endured losses this week as gyrations on the Nikkei continued — fueled by worries about a surging yen and increased skepticism about the economic strategies of Prime Minister Shinzo Abe for extricating Japan from two decades of stagnation.
US investors digested a handful of mixed economic reports and remained on edge as concerns remained over whether Federal Reserve will pare back its bond purchases.
Markets have turned negative in recent weeks as investors start preparing for a time when central banks around the world aren't pumping as much money into the financial system. This week was no different.
Investors will closely watch on the Federal Reserve's policy-setting meeting next week for comments and clues into the central bank's plans for paring back some of its stimulus efforts.
Following is an economic review for the week June 10 - June 14, 2013.
Tuesday, June 11
Bank of Japan Monetary Policy Statement:
Bank of Japan left its current market operations on hold, resisting some market expectations that it would extend the duration of its fixed-rate funds supply to two years from the current one year. Yen jumped sharply, soaring against higher-yielding emerging market and commodity currencies following the news.
Great Britain Manufacturing Production:
UK manufacturing output fell by 0.2% in April after two months of expansion because of declines in the production of transport equipment, wood and paper products, and metals. A rise in pharmaceuticals industry output provided some lift. Overall industrial production rose slightly, by 0.1%, beating market expectations of no growth.
Wednesday, June 12
Great Britain Claimant Count Change:
The number of unemployed in UK fell more than expected (8.6K vs. 5K) in the three months to May, following an 11.8K-drop registered in the three months to April. The Claimant Count Rate remained unchanged at 4.5%.
US Crude Oil Inventories:
US crude inventories climbed 2.5 million barrels to 393.8 million barrels in the week ended June 7.
US Federal Budget Balance:
US budget deficit widened in May by $139 billion, but the annual deficit stayed on track to finish below $1 trillion for the first time since 2008.
Thursday, June 13
US Retail Sales Report:
US retail sales rose more than expected (0.6% vs. 0.4%) in May as households stepped up purchases of automobiles and bought other goods, suggesting the economy was squeezing out of a recent soft patch
US Unemployment Claims:
US unemployment benefits dropped by 12K last week to a seasonally adjusted 334K, nearing levels of a month ago that were the lowest in five years.
Friday, June 14
Canada Manufacturing Sales (April 2013:
Manufacturing sales fell 2.4% in April to $48.2 billion — the fourth decline in five months and the largest monthly percentage drop since August 2009. Lower sales in the petroleum and coal product, and primary metal industries were largely responsible for the decline.
US Producer Price Index (PPI:
US producer prices rose more than expected (0.5% vs. 0.1%) in May as gasoline and food prices rebounded, but underlying inflation pressures remained muted.
Preliminary University of Michigan Consumer Sentiment:
University of Michigan's preliminary reading on overall consumer sentiment for June fell by 1.8 points from May's final reading of 84.5.
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