ECONOMIC DATA OF THE DAY

Time	CY	Indicator	Forecast	Previous
05.45am	NZD	CPI QoQ	0.5%	0.5%
04.15pm	GBP	BOE's Weale speaks in London	N/A	N/A

(Source: FabTrader)

OVERNIGHT NEWS

• TURKEY: 
• A coup attempt by military forces in Turkey failed. At least 290 people died in Ankara and Istanbul and 1400 were wounded. Turkish president Erdogan arrested 6000 people including generals and judges
• The Central Bank promised unlimited liquidity to lenders and measures to support the Lira to prevent a massive sell-off
• US: 
• U.S. retail sales rose faster than expected to 0.6% MoM (Exp. 0.1%) during June to a seasonally adjusted $456.98bln, from a downwardly revised gain of 0.2% in May (Prev: +0.5%). Most categories enjoyed sales grow last month, led by a 3.9% spike in sales at building-supply stores, the largest one-month increase since April 2010. Sales of motor vehicles and automotive parts inched up 0.1%. Sales at restaurants and bars dipped 0.3% and clothing-store sales dropped 1.0%. Sales ex-autos, gasoline, building materials and food services - those which, correspond most closely with the consumer spending component in of GDP - shot up 0.5% (Mkt est: +0.3%).
• CPI climbed 0.2% MoM (Exp. 0.35). Core CPI also rose 0.2% as expected and Core YoY rose 2.3% (Exp. 2.3%), matching the highest level since May 2012.
• Industrial Output rose 0.6% MoM (Exp. 0.3%) helped by a jump of 2.4% in utilities output.
• Manufacturing activity in NY retreated to 0.55 (Exp. 5.0) from 6.01 in June
• The University of Michigan sentiment dropped to 89.5 (Exp. 93.5)
• NEW ZEALAND:
• CPI printed lower than expected this morning at 0.4% QoQ (Exp. 0.5%) and 0.4% YoY (Exp. 0.5%) and remains below the range of what RBNZ targets. The market is now pricing 71% chance of rate cut in the 11th of August meeting
• UK:
• Trade Secretary Liam Fox said he has started lining up deals to be put in place once Britain leaves the bloc. He is preparing deals based on a timeline of Britain triggering Article 50 of the Lisbon Treaty by the end of the year, which would start formal exit negotiations with the EU in time to leave by Jan. 1, 2019.

FOREIGN EXCHANGE (INDICATIVE RATES)

Currency	Last	% Change	Overnight Range
DXY	96.58	0.51%	95.912 – 96.731
EURUSD	1.1052	-0.44%	1.1025 – 1.1149
USDJPY	105.41	0.33%	104.64 - 106.32
AUDUSD	0.7586	-0.24%	0.7561 – 0.7676
GBPUSD	1.3215	-0.89%	1.3132 - 1.3481

(Source: FabTrader)

Commodities (INDICATIVE RATES)

Currency	Price USD	% Change	Overnight Range
Gold	1333.45	0.35%	1322.61 - 1339.15
Silver	20.20	0.88%	20.0028 - 20.333
Oil (BRENT)	47.75	1.86%	46.65 - 48.25
Oil (WTI)	45.96	1.46%	45.05 - 46.33

(Source: Bloomberg and Saxo)

COMMODITIES

Precious Metals: Gold posted a weekly drop for the first time since May as investors turned to risk assets such as stocks, cutting demand for bullion as a haven. Silver imports by India are set to plunge from last year’s record as it was reported that jewellers grapple with slowing demand and excessive inventories.

Oil: Front month WTI crude prices rose overnight after better-than-expected Chinese data bolstered expectations for demand and despite an uptick in the number of rigs drilling for oil in the U.S. to 357 (+6), the highest number since April.

FOREX NEWS

• NZDUSD and AUDNZD Gamma remain very bid this morning following already strong buying interest last week after the lower than expected CPI print in New Zealand
• USDJPY vols opened higher with spot trading at the 50d MA resistance and the market being worried of an escalation of risk off following the Turkish coup
• Hedge Funds are buying quite aggressively downside EURUSD for the next ECB meeting this Thursday. Not much to read in that flow except that the buy side always likes to play that side

BOE’s Vlieghe Says Post-Brexit Economy Needs Range of Stimulus

Gertjan Vlieghe, who was alone in voting for an interest-rate cut at the latest Bank of England meeting, said the U.K. needs a range of stimulus to combat the impact of its decision to quit the European Union.

“The precise implications for the economy are uncertain, although the general direction of travel is likely to be lower growth and higher inflation for a period, as a result of weaker demand, weaker supply and a lower exchange rate,”  Vlieghe wrote in an opinion piece published on the Financial Times website late Sunday. “Early indications from business and consumer surveys, as well as the findings of the BOE’s own agents, support that assessment.”

While policy makers voted 8-1 at their meeting last week to keep the key rate at a record low, minutes showed most of them expect monetary policy to be loosened at their Aug. 4 gathering, when they will have new forecasts. The decision to hold the rate surprised investors, who had priced in more than an 80 percent chance it would be lowered. BOE Chief Economist Andy Haldane said on Friday that he will push for stimulus next month.

“I favored an immediate interest-rate cut, to be supplemented by a package of additional measures in August,” Vlieghe wrote in the FT. “What precisely that package should look like will have to be discussed over the course of the next three weeks.”
Read More at www.bloomberg.com