Look Ahead 18/8/23: Japan consumer price; UK retail sales; Baker Hughes oil rig count
Inflation and retail sales figures from Japan and the UK; oil prices could be volatile ahead of the Baker Hughes oil rig count; and China’s central bank seeks to stem the rising pessimism over the economy.
(Video Transcript)
JPY/USD an interesting space
Hello, I'm Angeline Ong and welcome to your Look Ahead to 18 August 2023. We'll begin with Japan and the Japanese yen as we've got consumer price index numbers from there. Checking in on the yen first against the US dollar because this has been a really interesting space recently.
The yen has weakened to around 1465 per dollar and actually it's now trading at 14591. However, it was at its lowest level since November having come under renewed pressure. This is as a result of interest rate differentials between the US and Japan's ultra-low rate environment.
This is, of course, also tied in with the fact that we are looking at the Nikkei now because it has come off its high there seen in June, 34015, has come back down in this narrow range here and it looks like it is breaking through that resistance point.
If volumes hold, then it could go to that next blue line there which is 31.190 so we are keeping an eye on the Nikkei and the yen for you as well.
UK inflation in the spotlight
Now to the United Kingdom, we've got retail sales as well so inflation will be in focus too. Much of the UK retail sector has been mixed recently, f you look at much of the news of earnings coming out of the United Kingdom.
We've got Marks & Spencer, for example, saying that it's actually done quite well. Marks & Spencer, you know, has had a troubling time. It's been trying to get more people into its stores buying its clothing.
However, its food department, its food offering has remained strong and perhaps something about the high inflation that we have seen has meant that fewer people are eating out but they still want some luxury so they are going to buy food at M&S.
Clothing group, Nex, I just want to show you that as well because Nex is also an interesting one. A bright spark, it upgraded its profit forecast earlier this month and lifted it for the second time in three months.
However, Wilco, not as lucky. It could be one of the first major victims of Britain's tougher economy after consecutive interest rate rises that started in December 2021.
Oil a very volatile area
To the US now and we've got Baker Hughes will recount the latest data points from there. Oil, as I mentioned earlier, is a very volatile space for us. Let's see US crude first because look at all those moves around the 6376 range and the 8440 range.
We are seeing a bit of a consolidation point over there. However, if we slip past that resistance line, then perhaps 7614.4 is the next point of resistance.
Oil prices in terms of this session were 1.6% higher after China's central bank sought to stem the rising tide of pessimism over the country's property market and wider economy.
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