China released good economic data today - 1.3.2023

On Tuesday, the US dollar index rose slightly. In the last few days, he is trying to update the January high, but can not gain a foothold above the psychological resistance level of 105 points. The main positive is investor expectations that the U.S. The Federal Reserve will continue to tighten its monetary policy. In September, its rate may rise to 5.4% from the current level of 4.75%. Yesterday the US dollar was supported by the S&P/Case-Shiller Home Price index. In December it grew only by 4.6% y/y. This is the smallest increase since July 2020. Investors are hoping that consumer price growth will also slow down. Australia released relatively weak Q4 2022 GDP data this morning (+2.7% y/y). In China, business activity indicators for February were published (Manufacturing PMI, Caixin Manufacturing PMI and others). They turned out to be better than expected. This contributed to the strengthening of the yuan and the Australian dollar. China is the largest buyer of Australian commodities.

Bitcoin quotes have slightly increased today. For 6 weeks they have been moving in the range of $21,000-25,000. In early January, cryptocurrency quotes rose after players believed that the bankruptcy of a number of crypto exchanges and crypto lending companies would not lead to the collapse of the entire industry. Now the players are waiting for new reasons for the market movement.

Yesterday the US stock indexes went down. A further increase in the Fed's rate may be negative for the stock market. On Tuesday, the decline in their quotes contributed to weak economic indicators. In particular, the Conference Board U.S. Consumer Confidence Index and MNI Chicago Business Barometer. Looking at February as a whole, the Dow fell 4.2%, the S&P 500 fell 2.6% and the Nasdaq fell 1.1%. Shares of Meta Platforms rose 3.2% yesterday after announcing the development of a new product for its social networking site Facebook. Zoom Video Communications and Target Corporation rose 1% on strong quarterly earnings. Salesforce, Lowe's and other companies are due out today in the US. In addition, ISM United States Manufacturing PMI, S&P Global Manufacturing PMI and some other economic indicators will be published.

Today, oil quotes are rising for the 2nd day in a row within the neutral price range. For WTI, it is approximately $70-80 per barrel. From March 1, 2023, Russia will reduce production by 500,000 bpd. This is due to a decrease in demand for its oil after the tightening of Western sanctions. So far, such a decision has been made only for March, but it can be extended. After today's publication of good economic statistics, investors do not rule out an increase in demand for oil in China. China Composite PMI in February updated a 5-year high and amounted to 56.4 points. Growth in other indicators of business activity exceeded forecasts. A relatively negative factor for the quotes could be a message from the American Petroleum Institute about an increase in oil reserves in the US for the week by 6.2 million barrels. Inventory growth is observed for the 3rd week in a row.

Natural gas in Europe on ICE Dutch TTF has reached a new low and is about $500 per 1000 cubic meters. US gas quotes on Henry Hub, on the contrary, have been rising for the 6th day in a row and reached $2.76 mmBtu. The US is slowly reopening the Freeport LNG export terminal in Texas, which was damaged by last year's fire.

Good economic performance in China supports the rise in copper prices.