12thJanuary 2024
Friday
On January12th, a series of high-impact economic announcements are scheduled from China,Great Britain, and the United States. China will unveil its year-over-yearConsumer Price Index (CPI), while Great Britain is set to announce itsmonth-over-month Gross Domestic Product (GDP). Following these, the UnitedStates will release its month-over-month Core Producer Price Index (PPI) andoverall PPI.
CNY – CPI y/y
A large part ofoverall inflation is represented by consumer prices. This aspect of inflationis significant for the valuation of currency, as higher prices typically prompta response from the central bank, often in the form of increased interestrates.
In November2023, China witnessed a significant year-over-year decrease in its consumerprice index (CPI) of 0.5%, more pronounced than the 0.2% drop observed in theprevious month and exceeding the forecasted 0.1% decline. This represented thesteepest fall in CPI since November 2020, mainly attributed to a notable 4.2%reduction in food prices, surpassing the 4.0% decrease seen in October, largelydue to decreased pork prices. Non-food inflation also decelerated to 0.4% from0.7%, affected by slower growth in education costs (1.8% versus 2.3%) and amore significant decrease in transport prices (-2.4% versus -0.9%). Inflationrates for housing and health remained stable, while there was a minor rise inclothing inflation. The core CPI, which excludes food and energy, maintained asteady year-over-year increase of 0.6%, consistent with the previous month.Monthly, the CPI also saw a 0.5% decrease, in line with predictions, marking asharper decline than October's 0.1% fall.
TL;DR
Indicator
November 2023
October 2023
1 CPI YoY
-0.5%
-0.2%
2 Food Price Change
-4.2%
-4.0%
3 Non-Food Inflation
0.4%
0.7%
4 Education Costs
1.8%
2.3%
5 Transport Prices
-2.4%
-0.9%
6 Housing Inflation
Stable
Stable
7 Health Inflation
Stable
Stable
8 Clothing Inflation
Slight Increase
-
9 Core CPI (YoY)
0.6%
0.6%
10 Monthly CPI Change
-0.5%
-0.1%
11 Indicator
November 2023
October 2023
The projectionfor the CPI y/y suggests a further decline to -0.7%, deepeningfrom the previous figure of -0.5%.
The upcoming CPI y/y data isscheduled for release on January 12th at 1:30 AM GMT.
The last time, the Chinese CPI y/ydata was announced on the 9th of December, 2023. You may find themarket reaction chart (USDCNH M5) below:
GBP – GDP m/m
This is the most comprehensive indicator ofeconomic performance and serves as the key measure of an economy's overall well-being.
In October 2023,Britain's economy experienced a 0.3% contraction, reversing the growth trend ofthe previous two months and falling short of the anticipated steadyperformance. This downturn was largely driven by a 0.2% reduction in the servicessector, particularly in information and communication. Notable declines wereseen in areas such as computer programming and media production.Consumer-facing services also saw a slight 0.1% decrease. The production sectorwitnessed a more substantial fall of 0.8%, with manufacturing output droppingby 1.1%, notably in sectors like computer, electronic, and optical products, aswell as machinery and equipment. Additionally, construction output declined by0.5%. On a broader scale, over the three months leading to October, the BritishGDP remained stagnant, showing no growth.
TL;DR
Indicator
October 2023
1 GDP Growth
-0.3%
2 Services Sector Growth
-0.2%
3 - Information & Communication
-0.2%
4 - Computer Programming
Decline
5 - Media Production
Decline
6 - Consumer-Facing Services
-0.1%
7 Production Sector Growth
-0.8%
8 - Manufacturing Output
-1.1%
9 - Key Sectors Affected
Computer, Electronic, Optical Products; Machinery and Equipment
10 Construction Output Growth
-0.5%
11 GDP Growth Over Three Months
Stagnant
The latestforecast for the GDP m/m indicates an expected increase of 0.1%,up from the previous figure of -0.3%.
The forthcoming GDP m/m data isscheduled for release on January 12th at 07:00 AM GMT.
The last time, the British GDP m/mwas announced on the 13th of December, 2023. You may find the marketreaction chart (GBPUSD M5) below:
USD - Core PPI m/m
The CoreProducer Price Index (PPI) is an important economic indicator, as it tracks thechanges in prices that domestic producers receive for their goods, excludingthe more volatile elements such as food and energy. This makes it a morereliable gauge of underlying inflation trends, in contrast to the standard PPI,which can be affected by short-term variations in food and energy prices.
In November2023, the Core Producer Prices in the United States, excluding food and energycosts, showed no change, mirroring the previous month of October. This outcomecontrasted with market expectations, which had anticipated a 0.2% increase. On anannual basis, the US core PPI experienced a 2% rise in November, following adownwardly revised 2.3% increase in the prior month, falling short of marketforecasts, which had projected a 2.2% advance.
The latest forecast for the Core PPI m/msuggests an expected increase of 0.2%, up from the previous resultof 0%.
The upcoming Core PPI m/m data isscheduled for release on Friday, January 12th, at 1:30 PM GMT.
The last time, the US Core PPI m/mwas announced on the 13th of December, 2023. You may find the marketreaction chart (EURUSD M5) below:
USD - PPI m/m
As a precursorto consumer inflation, the indicator reflects that when producers raise pricesfor goods and services, these increased costs are often transferred to theconsumer.
In November2023, producer prices in the US had steadied, following a 0.4% fall in theprevious period, and contrary to the forecasts of a 0.1% rise. Prices for bothgoods and services had remained unchanged. The core PPI, excluding food andenergy, was also flat. Within the goods category, gasoline costs had seen themost significant drop at 4.1%, followed by decreases in industrial chemicals,jet fuel, and liquefied petroleum gas. Contrarily, food prices had increased,with chicken eggs experiencing a notable jump of 58.8%, alongside rises infresh fruits and melons. Utility natural gas and electric power prices had alsomoved higher. In the services sector, traveler accommodation had gone up by 4%,and there were increases in costs for deposit services, health, beauty, andoptical goods retailing, as well as in food and alcohol wholesaling, andapparel, footwear, and accessories retailing. However, margins for automobileretailing had declined by 5.1%, along with decreases in chemicals, portfoliomanagement, furniture, and truck transportation. Looking back a year ago, theheadline index had been up 0.9%, while the core gauge had risen by 2%, markingthe smallest increase since January 2021.
TL;DR
Indicator
November 2023
1 Producer Prices (All)
Steady
2 Goods Prices
Steady
3 - Gasoline
-4.1%
4 - Industrial Chemicals
Decrease
5 - Jet Fuel
Decrease
6 - Liquefied Petroleum Gas
Decrease
7 - Food
Increase
8 - Chicken Eggs
58.8% Increase
9 - Fresh Fruits and Melons
Increase
10 - Utility Natural Gas
Increase
11 - Electric Power
Increase
12 Services Prices
Steady
13 - Traveler Accommodation
4% Increase
14 - Deposit Services
Increase
15 - Health, Beauty, Optical Goods Retailing
Increase
16 - Food and Alcohol Wholesaling
Increase
17 - Apparel, Footwear, Accessories Retailing
Increase
18 - Automobile Retailing
-5.1% Decrease
19 - Portfolio Management
Decrease
20 - Furniture
Decrease
21 - Truck Transportation
Decrease
22 Core PPI (Excluding Food and Energy)
Steady
The latest forecast suggests a rise in the PPIm/m to 0.2%, up from the previous result of 0%.
The upcoming release of the PPI m/mis set for January 12th at 1:30 PM GMT.
The last time, the US PPI m/m data wasannounced on the 13th of December, 2023. You may find the marketreaction chart (EURUSD M5) below:
