đź“Š Market Event Update

June 21, 2024

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From rate cuts and retail rebounds to a Juneteenth pause, let's dive into the latest global market moves with the BOE, SNB, RBA, and a sprinkle of U.S. retail vibes!

Market Event Recap:

  • 🏦 BOE, SNB, RBA decisions. A flurry of central bank decisions this week, starting with the Reserve Bank of Australia on Tuesday. The Swiss National Bank and the Bank of England follow on Thursday.

  • đź›’ US retail sales. Numbers from Walmart and Costco follow Tuesday’s May retail sales data, which will give an indication of how consumers are holding up amid higher rates.

  • 🌴 US market holiday. The NYSE, Nasdaq, and US bond markets are all closed Wednesday for Juneteenth.

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Market Event Update:

🏦 BOE, SNB, RBA decisions. 

  • The Swiss National Bank (SNB) has controlled inflation in Switzerland, with no signs of it rising again due to disciplined companies and employees. Chairman Thomas Jordan highlighted reasonable wage development and limited cost transmission to sales prices. The recent inflation increase to 1.4% in May was mainly due to higher residential rents, expected to stabilize. The SNB lowered its key interest rate from 1.50% to 1.25%. Despite the cut, the environment remains non-expansionary, with low and declining inflation guiding future interest rate decisions.

  • The Bank of England (BoE) - UK retail sales in May surged 2.9%, exceeding expectations, with consumer confidence rising. Inflation fell to the Bank of England's 2% target, boosting hopes for sustained growth. Textile and footwear sales led with a 5.4% increase. PM Rishi Sunak gains a political boost ahead of elections, despite concerns over rising government borrowing and budget constraints.

  • The Reserve Bank of Australia (RBA) kept the official cash rate at 4.35% in June, emphasizing that while inflation has decreased since 2022, uncertainties in services price inflation and productivity growth persist, and future rate hikes remain possible to ensure inflation returns to target.

đź›’ US retail sales. 

  • In May, U.S. retail sales rose by a modest 0.1% as high prices and interest rates constrained consumer spending, with declines in gas prices partially offsetting gains. Despite mixed performances across retail categories, consumers remained cautious, influenced by inflation and rising credit costs.

  • A strong job market and rising wages continued to support spending, with retailers like Target and Walmart implementing price cuts to attract shoppers. The Federal Reserve's potential interest rate adjustments and consumer sentiment data reflect ongoing economic uncertainty.

🌴 US market holiday. The NYSE, Nasdaq, and US bond markets were all closed Wednesday for Juneteenth.

Credit: Fox News