ECONOMIC DATA OF THE DAY

Time	CY	Indicator	Forecast	Previous
10.00am	CNY	Retail Sales YoY	9.9%	10.0%
08.30pm	USD	CPI YoY	1.1%	1.0%

(Source: FabTrader)

OVERNIGHT NEWS

• UK: 
• The Bank of England unexpectedly maintained its policy stance, keeping the official Bank Rate at 0.50% (Voted 8 to 1) and the Asset Purchase Facility programme at £375bn.
• According to the statement, “Most members of the committee expect monetary policy to be loosened in August,”  and “The precise size and nature of any stimulatory measures” will be determined in the coming weeks.
• The BoE will publish its latest forecasts for U.K. growth and inflation in its quarterly inflation report alongside the next policy decision on August 4.
• US: 
• US producer prices rise strongly in June Producer prices rose faster than expected in June (0.5% MoM vs Exp. 0.3%), with strong increases across most goods and services components and largely driven by higher costs for energy. Excluding food and energy, goods prices were flat on the month
• Initial jobless claims printed at a seasonally adjusted 254k (Exp. 265k). The four-week moving average dipped 5,750 to a seasonally adjusted 259,000. Continuing unemployment claims, reflecting workers drawing jobless benefits for more than one week, jumped 32,000 to 2,149,000 (Exp. 2.13mln).
• FED SPEECH:
• Atlanta Federal Reserve President Dennis Lockhart said the central bank should remain "cautious and patient" with any future interest rate increases. However, he said it was still possible the Fed could raise rates as many as two times this year, depending on how the economy evolves
• FRANCE:
• A truck drove into a late-night crowd in Nice on the country’s Mediterranean coast, killing at least 70 people as the nation celebrated its Bastille Day holiday. The Paris prosecutor’s office called it a terrorist attack. Several hundred were injured and police ordered people off the streets. The truck driver was shot and killed by police. On the latest news, the police has found explosives and guns in the truck

FOREIGN EXCHANGE (INDICATIVE RATES)

Currency	Last	% Change	Overnight Range
DXY	96.14	-0.12%	95.831 – 96.368
EURUSD	1.1109	0.03%	1.1089 – 1.1165
USDJPY	105.24	0.88%	104.43 - 105.94
AUDUSD	0.7617	0.04%	0.7603 – 0.7653
GBPUSD	1.3367	1.25%	1.3157 - 1.3475

(Source: FabTrader)

Commodities (INDICATIVE RATES)

Currency	Price USD	% Change	Overnight Range
Gold	1334.95	0.79%	1320.35 - 1347.27
Silver	20.32	0.57%	20.011 - 20.553
Oil (BRENT)	47.37	0.81%	46.34 - 49.22
Oil (WTI)	45.33	0.80%	44.95 - 45.8

(Source: Bloomberg and Saxo)

COMMODITIES

Precious Metals: Gold dropped to a two-week low as the equities index, fueled by better than estimated earnings and may send gold to its first weekly loss since May. Gold is still up 26 percent this year.

Oil: Oil fell in New York amid forecasts crude may side towards $40 a barrel on oversupply concerns. Analysts from BNP Paribas warned prices may sink towards $40 a barrel amid a global glut of supply and weakening demand. The fuel surplus means American refiners may process less oil even as crude supplies remain more than 100 million barrels above the five-year average for this time of the year.

FOREX NEWS

• GBPUSD rose on initially short term stops on the unexpected move from BOE to keep the rates unchanged.  GBP went up 2.8% before retracing to finish up 1.25%. We should still see some selling interest ahead of the 1.3500 resistance
• RBNZ will give an assessment of the economy on the 21st of July which is 4 weeks before the next meeting and it’s an unusual move so the market is speculating that RBNZ is preparing for a rate cut pushing NZD 1.2% lower overnight
• USDJPY continues to squeeze higher on the news that the government may issue perpetual bonds that the BoJ would purchase, effectively helicopter money.
• It was an overall risk on move last night with Equities higher that benefited Emerging Markets currencies such as KRW, USDTWD on stops, USDPHP and on a lesser extent BRL

Federal Reserve policymakers signal no rush to raise U.S. rates

Three Federal Reserve policymakers on Thursday expressed the view that there was no hurry to raise U.S. interest rates in the wake of the UK decision to leave the European Union, despite signs that the U.S. economy is near full employment.

Ahead of the next Fed policy meeting on July 26-27, a core group are now happy to keep interest rates unchanged, potentially for months, whereas just last month, most Fed officials signaled they expected to raise rates at least twice this year.

St. Louis Fed President James Bullard, speaking with reporters in St. Louis on Thursday, repeated his position that only a single rate rise is needed for the next couple of years unless some unexpected shock moves the economy to a better or worse state.

"In the aftermath of Brexit people want to wait and see and I'm happy to go with that for now," said Bullard, a voting member of the U.S. central bank's rate-setting committee. "There’s really no rush."

Dallas Fed President Robert Kaplan, also in St. Louis, renewed his call for a "patient, gradual" approach to raising rates.

And earlier on Thursday Atlanta Fed President Dennis Lockhart, at the Global Interdependence Center's Rocky Mountain Economic Summit, said that he wants to be "cautious and patient."(Source: reuters.com)