Archives of “October 18, 2021” day

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Metals set to gain in a green world

  
  Analysis

NG have an interesting piece here where they make a case for rising metal demand. They have a three fold scenario outlook which ranges from ‘wait and see’ through to ‘fast forward’. These projections essentially show their slowest projections up to their fastest. The key areas that are going to develop are things like energy storage, transmission cables, and distribution cables. The IEA see at least around 79 million KM of the stuff on the way.

The bottom line of ING’s research is as follows in terms of metal demand. However, remember their caveat that some technologies need for metals may change as the technology changes.

Wind is number one

Wind is to hold the biggest share of the power mix by 2040 under the two faster progression speeds. Copper and aluminium are the winners under this scenario.

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Oil (WTI) futures up $1, and in China copper & coal higher while iron ore is lower

  
  Analysis

Commodities kicking off with a solid beginning to the week with coal and copper futures in China trading higher.

  • iron ore is lower though
Meanwhile in US overnight trade CL (oil) is up $1 or so.

Across FX after earlier rises EUR, AUD, NZD GBP have all turned down against the dollar. USD/JPY also falling away. US equity index futures following a similar pattern.

Bitcoin is on approach to its earlier weekend high circa $62,700 and thereabouts. Its been underpinned by the imminent launch of BTC futures ETFs.
Bitcoin chart 18 October 2021

“Perfect storm” to keep US inflation at its highest in 30 years

  
  Analysis

Daiwa Capital Markets list supply-chain bottlenecks, tight labour markets, ultra-easy monetary and fiscal policies as likely to keep US inflation its highest since 1991.

The comments are contained in a Wall Street Journal report on economist survey expectations for US CPI in the months ahead, in brief:
  • Economists on average see inflation at 5.25% in December, just slightly less than the rate that has prevailed since June. Assuming a similar level in October and November, that would mark the longest inflation has been above 5% since early 1991.
  • will drop to 3.4% by June of next year, then 2.6% by the end of 2022

Here is what’s on the economic calendar in Asia today – China Q3 GDP & September Activity data

  
  Analysis

2130 GMT New Zealand services PMI for September

  • BusinessNZ Performance of Services Index (PSI), prior
  • unlikely to have too much immediate impact on NZD
2145 GMT NZ CPI – inflation in New Zealand for Q3 
  • CPI expected 1.4% q/q, prior 1.3%
  • CPI expected 4.1% y/y, prior 3.3%
  • The RBNZ is assessing the inflationary trend in NZ as broad-based, which contributed to their reading for their rate hike earlier in the month, and likely more to come.
  • Later in the NZ day will the Reserve Bank of New Zealand’s own measure of inflation. This is due at 0200 GMT. I’ll have more to come on this separately.
 2301 GMT UK data – Rightmove house prices for October
  • prior 0.3% m/m and 5.8% y/y
0200 GMT China Q3 GDP  
  • expected +0.5% q/q, prior was +1.3%
  • expected +5.2% y/y, prior was +7.9%
  • Renewed coronavirus outbreaks and associated shut-ins, port closures impacting during the quarter
 and September activity data:  
  • Industrial Production
  • Fixed Assets
  • Retail Sales
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