Down from -16.9 in June.. Pretty much in line with Reuter’s median forecast of -20.0

ZEW says:

• Decline in indicator is flattening out gently, could be early sign of encouraging development in 2013

PARIS (MNI) – The monetary policy debate of the executive board of
Sweden’s Riksbank on July 3 was overshadowed by risks the Eurozone
crisis could pose for the domestic economy, according to minutes
released Tuesday by the central bank.

The draft Monetary Policy Report debated at that meeting noted that
concerns over the sovereign debt crisis had increased since April. Yet
it assumed that the crisis would “be managed so that the acute phase
successively wanes and long-run sustainable solutions are gradually put
in place.”

The “unease” in Europe was expected to subside in 2013, slightly
later than was assessed in April, the minutes showed. As a result,
expectations for the Riksbank’s repo rate were adjusted downwards
somewhat to show no change from 1.5% for around one year.

Deputy Governor Karolina Ekholm, who dissented from the board’s
decision to leave the repo rate unchanged at 1.5%, arguing instead for a
half-point cut, said that “increased concerns over developments in the
euro area appear to have led households and companies around the world
to postpone their investment and consumption decisions,” according to
the minutes.

Ekholm compared the situation to the autumn of 2008, when the
Swedish economy was hit “particularly hard” by a steep drop in demand
for the kind of investment goods it exports. While exports have so far
held up fairly well, there is a risk ahead “if the uncertainty over
developments in the euro area persists,” she warned, arguing that it was
“difficult to believe” that the measures agreed by European leaders
“entail an adequate solution.”

While the baseline scenario foresees the Eurozone’s woes will be
“resolved in one way or another,” Ekholm cited “fairly large downside
risks” and said “developments could be much worse than anticipated.”

First Deputy Governor Kerstin af Jochnick argued that the long-term
solution for the Eurozone would require “strong cooperation” on fiscal
policy and an efficient banking system, adding that she had not yet seen
“any concrete proposals” as to how the problem of bank recapitalization
could be resolved.

Deputy Governor Barbro Wickman-Parak said the EU summit decisions
on June 29 lacked “important details regarding the actual
implementation” and that monetary policy should be ready to take account
of the risks of “a really bad scenario”.

Deputy Governor Lars Svensson, who sided with Ekholm for a repo
rate cut to 1.0%, highlighted the dominant downside risks to standing
macroeconomic forecasts and the risk of “catastrophic outcomes” as an
argument for “an even more expansionary monetary policy” because the
domestic economy was “out of balance, with too low inflation and too
high unemployment,” according to the minutes.

Svensson also claimed that the Riksbank’s repo-rate path was “not
credible”, since forward rates were much lower than the repo-rate path
– in itself a good thing, since “the economy now needs more
stimulation.”

–Paris newsroom, +331 4271 5540; ssandelius@marketnews.com

[TOPICS: M$$EC$,M$X$$$,MGX$$$,M$$CR$]

-Adds comments from Treasury Minister Chloe Smith to version first sent
0933BST
-June CPI -0.4% m/m; +2.4% y/y vs May 2.8% y/y; Below Median Forecast

LONDON (MNI) – Consumer price inflation fell sharply in June,
coming in way below the latest Bank of England forecast, as clothing and
footwear prices fell at a record pace on the month, figures from
National Statistics showed Tuesday.

This is the third month in a row that the CPI has come in below
expectations, a reversal of the situation seen in the past few years.
Moreover, for the second quarter inflation fell to just 2.7%,
significantly below the May Inflation Report forecast of 3.19%.

While part of the decline may be due to timing effects of the
summer sales, the latest drop should help to assuage fears that
inflation could be sticky coming down.

Chloe Smith, the Economic Secretary to the Treasury, suggested
that weaker inflation could be a help to consumer spending, something
which the Bank of England has mentioned previously as well.

“Inflation has more than halved since September, meaning a little
less pressure on family budgets. This lower inflation should support
high-street spending and growth in the economy in the months to come,”
she said

Consumer prices fell 0.4% on the month in June and were up 2.4% on
the year, down from 2.8% in May. This was the largest monthly decline
between May and June on record and the lowest annual inflation rate
since November 2009.

It was also way below the median forecast which was for a 0.1%
monthly drop and rise of 2.8% on the year.

The largest downward impact came from clothing and footwear, where
prices fell 4.2% on the month, the largest decline between May and June
on record. This knocked 0.17 percentage point off of annual CPI
inflation.

National Statistics said there was evidence that retailers had
brought forward sales from July, in part due to the wet weather. This
may have flattered the June outturn somewhat with the usual downward
impact now unlikely to be seen in July.

There was also a downward impact from food and non-alcoholic
beverages which knocked 0.12 percentage point off the annual CPI rate.
Meat prices were down with reports of the poor weather hitting demand
with fewer barbeque items being sold.

-London bureau: 0044 20 7862 7491; email: puglow@marketnews.com

[TOPICS: MT$$$$,M$B$$$,MABDS$]

-May House Prices unch. m/m; +2.3% y/y

LONDON (MNI) – House prices were flat on the month in May following
a sharp rise in April, figures from National Statistics showed Tuesday.

On a seasonally adjusted basis, house prices were unchanged on the
month and up 2.3% on the year, following an increase of 1.1% on the
month in April.

The data showed first time buyer prices rising 1.1% after a sharp
decline last month, while former owner occupier prices fell 0.4% on the
month, following a 2.3% rise in April.

-London bureau: 0044 20 7862 7491; email: puglow@marketnews.com

[TOPICS: M$B$$$,MABDS$]

-June CPI -0.4% m/m; +2.4% y/y vs May 2.8% y/y; Below Median Forecast

LONDON (MNI) – Consumer price inflation fell sharply in June,
coming in way below the latest Bank of England forecast, as clothing and
footwear prices fell at a record pace on the month, figures from
National Statistics showed Tuesday.

This is the third month in a row that the CPI has come in below
expectations, a reversal of the situation seen in the past few years.
Moreover, for the second quarter inflation fell to just 2.7%,
significantly below the May Inflation Report forecast of 3.19%.

While part of the decline may be due to timing effects of the
summer sales, the latest drop should help to assuage fears that
inflation could be sticky coming down.

Consumer prices fell 0.4% on the month in June and were up 2.4% on
the year, down from 2.8% in May. This was the largest monthly decline
between May and June on record and the lowest annual inflation rate
since November 2009.

It was also way below the median forecast which was for a 0.1%
monthly drop and rise of 2.8% on the year.

The largest downward impact came from clothing and footwear, where
prices fell 4.2% on the month, the largest decline between May and June
on record. This knocked 0.17 percentage point off of annual CPI
inflation.

National Statistics said there was evidence that retailers had
brought forward sales from July, in part due to the wet weather. This
may have flattered the June outturn somewhat with the usual downward
impact now unlikely to be seen in July.

There was also a downward impact from food and non-alcoholic
beverages which knocked 0.12 percentage point off the annual CPI rate.
Meat prices were down with reports of the poor weather hitting demand
with fewer barbeque items being sold.

-London bureau: 0044 20 7862 7491; email: puglow@marketnews.com

[TOPICS: MT$$$$,M$B$$$,MABDS$]

UK DATA: May SA House Prices unch. m/m; +2.3% y/y
————————————————————————
Seasonally adjusted house prices were flat on the month in May and
up 2.3% on the year, figures from National Statistics showed Tuesday.
The annual increase was driven by a 7.2% rise in London, while areas
such as the North West and Midlands were down 1.6% and 1.2%
respectively.

UK DATA: June CPI -0.4% m/m; +2.4% y/y vs May 2.8% y/y; Below Median
————————————————————————
Consumer prices fell 0.4% m/m in June and were up 2.4% y/y, down
from 2.8% in May. This was the largest monthly decline between May and
Jun on record and the lowest annual inflation rate since Nov2009. It was
also way below the median forecast which was for a 0.1% monthly drop and
rise of 2.8% on the year. This is the third month in a row that the CPI
has come in below expectations, a reversal of the situation seen in the
past few years. Moreover, for the second quarter inflation fell to just
2.7%, significantly below the May Inflation Report forecast of 3.19%.
While part of the decline may be due to timing effects of the summer
sales (clothing and footwear was down 4.2% m/m with sales brought
forward), the latest drop should help to assuage fears that inflation
could be sticky coming down.

Weaker than expected.

I had median forecasts -0.1%, +2.8% respectively.

Y/Y lowest read since November 2009.

Biggest driver the fall in the prices of clothes and footwear followed by lower transport and food prices.

And EUR/AUD continues to suffer with little in the way of a bounce so far after Asian lows around 1.1927.

There’s a large AUD/USD option expiry today 1.0250, but the downside remains fairly well supported by the likes of the intraday momentum traders and the 200 day MA currently sitting at 1.0277. Offers sit up in the 1.0300/10 area  with buy stops through 1.0315, and  further offers from ACB’s and reported commercial RBA sell orders sit up ahead of a 1.0350 barrier

AUD’s sitting around 1.0295

‘With North Korea not far behind’

Congratulations to all those who chose 1.2300 before 1.2100 in the last EUR/USD poll.

We sit at 1.2300, so guess we might as well have another poll.

What’ll we see first 1.2200 or 1.2400?

Reasoning/s for choice always welcome, but not obligatory.

Guess it comes down to what you think Bernanke has up his sleeve.

• Spain bank lending program only item on agenda

EUR/USD: 1.2150 and 1.2200

AUD/USD: 1.0350

USD/JPY:  78.50, 78.25 and 78.00

EUR/GBP: 0.7825

EUR/USD has given up about 10 pips in the two hours I’ve been sat here, presently at 1.2280.

Market now awaits Bernanke’s Congressional testimony later today/tomorrow.  Very poor US retail sales data yesterday has helped raise expectations he’ll signal more monetary stimulus. Talk circulating that we could be about to see a deposit rate cut ala ECB.

Talk trailing sell stops now gathered through 1.2275 and more through 1.2240.  On the topside, buy stops seen through 1.2315.

EUR/USD: Offers 1.2300/10 (talk ACB supply), buy stops through 1.2315 ahead of more offers 1.2330/50 (real money, supranational). Sell stops through 1.2275 ahead of bids 1.2250/60. Sell stops through 1.2240 ahead of bids at 1.2200/10 (barrier 1.2200)

GBP/USD:  Offers 1.5680/00, Bids 1.5640/50 sell stops below, ahead of more bids 1.5590/1.5610

EUR/GBP:   Tech supp/bids 0.7835/40 and 0.7800/05 (0.7800 barrier). Tech res 0.7870/75 0..7910/15

USD/JPY:   Offers 79.40/50 and 79.90/00.   Bids at 78.50/60, talk of barriers 78.50, 78.25. and 78.00. Sell stops through 78.50. Offers 78.90/00, likely buy stops through 79.05 (200 day MA), and more offers 79.20/30.

EUR/JPY:   Offers 97.20/30 and tech res 97.70/80.  Bids 96.65/75 and 96.15/25, likely sell stops through 96.00

AUD/JPY:  Tech res now around 81.20/25 (200 day MA at 81.21), offers 81.30/40. Bids 80.70/75, tech support 80.45/50 ahead bids 80.00/80 large sell stops through 79.95

EUR/CHF: Bids 1.2000/10(SNB), Offers 1.2025/50 buy stops through 1.2055

AUD/USD: Offers 1.0300/10 buy stops through 1.0315 and tech res/offers 1.0330/50 (ACB, Commercial RBA offers). Tech supp 1.0275/80 (200 day MA 1.0277), bids 1.0240/50 and 1.0200/10

EUR/AUD:  Bids 1.1920/35, likely sell stops below ahead of tech projection 1.1890/95. Offers 1.2000/10,

NZD/USD: Bids/tech support 0.7955/65 (200 day MA 0.7959) and 0.7935/45. Tech res /offers 0.7980/00 (100 day MA – 0.7983) and 0.8030/40

USD/CAD: Bids 1.0130/40, and 1.0100/10, tech supp 1.0105/10 (200 day MA 1.0109). Offers 1.0150/60 and tech res 1.0170/75

FRANKFURT (MNI) – Eurozone new car registrations continued to trend
upward in June, bringing the annual shortfall to its lowest level since
November, the Association of European Automobile Builders (ACEA)
reported on Tuesday.

The number of new car registered reached 913,738 in June, up 8.1%
compared to May’s 845,156, but down 3.9% from last year’s 950,708 level.

With an unemployment rate of 11.1% and rising, many consumers are
worried about their jobs and pessimistic about future family finances.
Plans for major purchases, including autos, are well below average,
surveys by the European Commission show.

New car registrations in Germany rose 2.9% on the year in June to
296,722. Positive labour market developments are bolstering consumers’
willingness to spend, according to the GfK Group. “This reduced fear of
unemployment is improving the planning security of consumers, which is a
key factor for major purchases, in particular,” it said.

In France, 208,909 new cars were registered, down 0.6% compared to
one year ago. Car makers expect a decline of around 10% for the full
year. The looming closure of major PSA assembly line north of Paris has
prompted the government to devise new schemes to prop up sales. A
“strategic plan” to be unveiled July 25 is likely to include incentives
to purchase clean cars, notably by public authorities, and credits for
car buyers.

Italian car registrations fell 24.4% on the year to 128,388. An
ongoing recession and unemployment above 10% do not bode well for a
turnaround in spending in the near term. A recent Istat survey showed
consumer confidence falling to its lowest level since at least 2006 on
the back of a weaker economic climate.

In Spain, registrations fell 12.1% to 73,258. Discretionary
spending here is likely to remain limited as the country suffers through
recession, unemployment climbs closer to 25% and the government pushes
through more austerity measures.

Among smaller Eurozone states, the Netherlands saw the strongest
jump in registrations, with 52% more cars registered compared to last
year. Conversely, Greece led the way in declines, with 43.3% fewer cars
registered on the year. The shortfall in Ireland was also severe, with
42.1% fewer cars registered in June compared to the same month one year
ago. Data for Malta were not available.

– Frankfurt bureau: +49-69-720 142; email: frankfurt@marketnews.com –

[TOPICS: M$X$$$,M$XDS$,MT$$$$]

EMU DATA: June new car regs -3.9% y/y; May -11.9%: based on ACEA
– ACEA: EU-15 June new car registrations -2.9% y/y
– ACEA: EU-15+EFTA June new car registrations -1.7% y/y
– ACEA: June car regs Germany +2.9% y/y; France -0.6%; UK +3.5%
– ACEA: June car regs Italy -24.4% y/y; Spain -12.1% y/y
– ACEA: data for Malta not available
– See MNI MainWire for details

Financial bookies see FTSE up as much as +0.4%, DAX up as much as +0.5%  and CAC 40 up as much as +0.7%.

Market sensitive data will now be guarded with launch-code secrecy to avoid anyone taking advantage of an accidental or surreptious leak  to gain an insider’s edge in the financial markets… according to the NY Times

The US government has also order media groups to replace computers in their lock-up room  as part of the tightening down.

Looks like “Clarence Beeks” (‘Trading Places’) might be out of a job then … 

‘In the early 2000s, Germany was struggling to adhere to euro-zone criteria aimed at ensuring common currency stability. Instead of introducing austerity, however, Chancellor Gerhard Schroder simply launched an effort to change the rules. New documents show just how key his role was in weakening the Stability Pact.’