It is a new week in the financial markets, and one that opens up with a couple of interesting fundamental reports.
Earlier today New Zealand published its inflation rate reports for the third quarter of 2021. Both were better than anticipated, with inflation rising to 4.9% and 2.2% in yearly and monthly terms, respectively.
In addition, New Zealand also released its services PMI for September, which was higher than the previous month, though it remains below 50, which indicates an economic contraction.
China also delivered several key reports today. First and foremost, it disappointed investors quite massively with a very low GDP growth rate for the third quarter, amounting to 4.9% YoY. The quarterly growth rate was 0.2%, also below the forecast.
The industrial production and fixed asset investment reports for September in China also failed to meet investors’ expectations.
The one saving grace for the Chinese economy today was an upbeat retail sales report for September and a lower unemployment rate compared to the previous month. But with so many of the other reports missing the target levels, the overall picture of the Chinese economy is not good at the moment.
Due to the weak economic reports from China, Chinese stock indices are underperforming today. In addition, European stock indices are also trading lower as a result.
Instead, today is shaping up to be a good day for safe haven assets. Among those, we expect the US dollar to fare the best and advance against other currencies.
Later today the United States is going to publish several reports, including industrial production, bond investments, and the monthly budget sentiment for September. Plus, there will be a speech by the Federal Reserve’s Quarles.
