Wednesday, July 14 began with the latest Westpac consumer confidence index for July in Australia, which was better than the previous one at 108.8.
In neighboring New Zealand, there was a central bank policy meeting, but predictably the interest rate was left unchanged at 0.25%. The RBNZ also announced that from this month onwards it will taper its asset purchases because they no longer seem necessary for the economy.
The United Kingdom today published its inflation reports for June, which were overwhelmingly positive. Core inflation climbed to 2.3%, while the overall inflation rate was 2.5% last month.
Later today the Bank of Canada will also hold a monetary policy meeting though no adjustments to the interest rate are expected right now.
In the United States, the Federal Reserve will be publishing its beige book today, which will also be of interest to investors. Meanwhile, Fed Chairman Jerome Powell will be testifying before the US Congress today, as will US Treasury Secretary Janet Yellen.
Powell’s statements today will be especially important, because the head of the Federal Reserve has insisted for months now that any spikes seen in inflation are not to be taken too seriously due to the abundance of stimulus. But the markets worry that consistently high inflation month after month may actually reflect an improving economy, not mere stimulus, and that hawkish actions by the Fed may be necessary in this case.
As for the US stock market, today we expect all major indices to mostly trade flat as investors try to find the balance between high inflation and rising coronavirus cases in the United States, among other countries.
Companies to pay attention to right now include some major tech names. Apple, for instance, is preparing to increase its iPhone output, presumably to take advantage of market shares left up for grabs by Huawei, who is still suffering from US sanctions. Smartphone component makers such as Taiwan Semiconductor Manufacturing and its competitors will also be making gains as a result.
