US DATA: Core PCE Estimates Could Be Trimmed Following Neutral PPI Readthrough
Jul-16 12:47
- Our crude proxy for key PPI contributions to core PCE sees another broadly neutral month in June, implying a boost of 0.02pp after a slightly upward revised 0.01pp in May (initially -0.01pp).
- For comparison, it follows -0.07pp in Apr, 0.07pp in Mar and 0.19pp in Feb.
- As such, it could leave core PCE estimates drift back a little closer to yesterday’s core CPI of 0.23% M/M vs pre-PPI core PCE estimates averaging 0.31% M/M. Of course that does also depend on what analysts expectations for particular line items.
- Reiterating how it’s not an exact science: whilst this rough proxy implies little boost from PPI details in May, there was still a slight gap between the 0.18% M/M currently seen for core PCE and 0.13% for core CPI.
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US TSY FUTURES: BLOCK: Sep'25 10Y Ultra-Bond Sale
Jun-16 12:41
- -3,500 UXYM5 112-12, sell through 112-13 post time bid at 0832:13ET, DV01 $309,000.
- The 10Y ultra bond contract trades 112-13 last (-3)
CANADA DATA: May Housing Starts -0.2%, Toronto YOY Starts -22%
Jun-16 12:36
- Seasonally adjusted monthly starts -0.2% in May to 279,510 units, Canada Mortgage and Housing Corp. says Monday.
- Six-month trend was also little changed +0.8% in May to 243,407 units.
- Toronto May YOY housing starts -22% and Vancouver -10%, both due to lower multi-unit starts. Montreal +11% YOY boosted by multi-units.
- “Growth in actual starts activity in May was once again driven by increases of single-detached homes and purpose-built rentals in Québec and the Prairie provinces. By contrast, weak condominium market conditions in Toronto and Vancouver have contributed to significant declines in overall housing starts in these regions,’’ said Tania Bourassa-Ochoa, CMHC’s Deputy Chief Economist.
- Government has pledged to double the pace of homebuilding to address supply squeeze; most economists note a lack of workers to achieve that goal.
PIPELINE: Corporate Bond Update: $3B KFW 2Y SOFR, Enbridge 4Pt on Tap
Jun-16 12:35
- Date $MM Issuer (Priced *, Launch #)
- 06/16 $3B KFW 2Y SOFR+29a
- 06/16 $1B Level 3 Financing 8NC3
- 06/16 $Benchmark EIB 7Y SOFR+53a
- 06/16 $Benchmark IBK 3Y SOFR+58a, 5Y +45a
- 06/16 $Benchmark Hungary +5Y, +10Y, +30Y
- 06/16 $Benchmark Enbridge 3Y +100a, 5Y +115a, 10Y +140a, tap 04/05/54 +155a
