Weekly Summary

Most Outstanding Points of the Week

• Joe Biden drops out of the race: Endorsing Kamala Harris, who secures her nomination.

• Ethereum ETFs approved: SEC marks a milestone in cryptocurrencies.

• 2Q24 economic growth: The economy grew 2.8% annualized.

• S&P 500: 77% of the companies reported better profits.

• Mexico: Economic activity grows 0.7% in May reserves reach US$222 billion.

Important Events in the Coming Week

• In the U.S., there will be a FED monetary policy announcement 07/31
• In the U.S., employment figures will be released 08/02

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Most Outstanding Points of the Week

• U.S. Retail Sales: Retail sales were flat in June, defying expectations of a 0.4% decline. Excluding autos, sales rose 0.4%, beating forecasts.

• IMF: The IMF has adjusted upward the U.S. growth forecast to 2.6%, highlighting, however, the continued risks of inflation and trade protectionism that could impact the global economy.

• Mexico: IMF adjusts growth downward to 2.2% by 2024; Fitch maintains rating at “BBB-” with stable perspective, noting concerns about long-term growth and risks associated with Pemex.

• United Kingdom: Inflation in the United Kingdom stood at 2% annually in June, exceeding expectations. This data reduces the likelihood of a rate cut at the Bank of England’s next meeting in August.

• China: China’s economic growth in the second quarter was 4.7%, below expectations of 5.1%, reflecting a slowdown compared to the previous quarter.

Next week’s important events:

07-26: First estimate of U.S. 2Q24 GDP to be released

07-26: U.S. Personal Consumer Expenditure (PCE) inflation to be released

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Most Outstanding Points of the Week

• In the United States, June inflation fell 0.1% on a monthly basis, bringing the annual figure to 3% (vs. 3.3% in May), its lowest level in about 3 years.

• In the U.S., the yield on the 10-year Treasury note declined to ~4.19% from 4.28% last week and the odds of a September reference rate cut rose to 86% from 47% a month ago. 

• In China, inflation barely rose 0.2% annually in June, resulting below expectations.
  
• Most recent surveys indicate that analysts’ consensus estimates that the Bank of Mexico could cut its reference rate by 25 basis points to 10.75% from 11% at its next meeting. 

Important Events in the Coming Weeks

• In China, 2Q24 GDP to be announced 07/15

• In the United States, Beige Book and industrial production to be released 07/17

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Most Outstanding Points of the Week

• In the United States, it was a short week for the markets, with manufacturing activity (ISM) contracting for the third consecutive month in June.
  
• In the United States, June nonfarm payrolls rose by 206,000 jobs, slightly above the expectation of 200,000.

• In China, services expanded at their slowest pace in eight months due to a decline in new orders.
  
• In Mexico, the consensus of analysts consulted by the Bank of Mexico estimated that this year’s GDP could grow 2%, slightly below the 2.1% estimated in May.

Important Events in the Coming Weeks

• In the United States, Jerome Powell will make a speech 07/09

• In the U.S., inflation figure to be released 07/11

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Most Outstanding Points of the Week

• In the United States, the stress tests applied by the FED to different financial institutions showed that they could face the scenario of a severe recession.
  
• In the United States, the latest revision of the 1Q24 GDP showed that the economy grew 1.4% annualized, slightly better than the previous estimate.

• In China, industrial company profits barely managed to grow 0.7% on a monthly basis in May, mainly due to the benefit of higher raw material prices.
  
• In line with expectations, the Bank of Mexico left the reference rate unchanged at 11%.

Important Events in the Coming Weeks

• In the United States, there will be FED minutes and jobs data 07/03 – 05
• In the U.S., there will be a holiday for the celebration of Independence Day 07/04

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Most Outstanding Points of the Week

• In the United States, it was a short week for the markets, where the main economic standout was that retail sales for May grew marginally by 0.1%.
  
• In the U.S., several FED officials emphasized the need for more evidence of a decline in inflation before lowering interest rates.
  
• In China, the People’s Bank of China left its reference rates unchanged.

• In Mexico, the private sector announced the development of new investments for US$42bn during Claudia Sheinbaum’s six-year term. 

Important Events in the Coming Weeks

• In the United States, consumer confidence will be published 06/25
• In the U.S., final revision of the 1Q24 GDP to be released 06/27

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Most Outstanding Points of the Week

• In the US, the FED kept the reference rate range unchanged at 5.25 – 5.5%. On the other hand, it shared its macroeconomic expectations, where it highlighted that now only one 25bp cut could be seen for the remainder of the year, which contrasts with the three cuts expected in March.
  
• In the United States, May inflation slowed to 3.3% annually from 3.4% expected and from the previous month.

• In China, inflation advanced 0.3% annually in May, in line with April’s figure.
  
• In Mexico, the virtual president-elect, Claudia Sheinbaum, agreed with President López Obrador to immediately open a broad dialogue related to the reform of the Judiciary.

Important Events in the Coming Weeks

• In China, retail sales and industrial production will be published. 06/17
• In the U.S., we will know the retail sales and FED members will speak 06/18

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Most Outstanding Points of the Week

• In the U.S., non-farm payrolls increased by 272,000 jobs, while the unemployment rate rose to 4% from 3.9%.
  
• In the U.S., ahead of the FED’s next announcement, the consensus widely discounts that the federal funds rate range will remain unchanged.  

• In China, May manufacturing activity advanced at its fastest pace in about two years. 

• Claudia Sheinbaum Pardo, representing the ruling coalition, will be the first female president in 200 years of independent life in the Mexican Republic.

Important Events in the Coming Weeks

• In the United States, there will be a FED announcement 06/11 – 12
• In China, inflation figures to be released 06/11

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