US And Canadian Employment Reports Ahead Of The Weekend

While the EU supports a discussion about waiving patent considerations to expedite the manufacturing of the vaccines, the German government expressed its opposition. The argument is both ideological, that drug companies need the incentive of profits to make the R&D investment, and practical grounds, that the main obstacle to wider production is not intellectual property rights but the absence of manufacturing capacity and raw materials. The waiver will take some time to negotiate, as all 164 members of the WTO must agree. Note too that Moderna waived its patent right last October.  

Germany reported a larger than expected 2.5% jump in March industrial output. The median forecast was for a 2.2% gain in Bloomberg's survey.  More interesting was its trade report. The March surplus of 20.5 bln euros was a little less than expected, as exports rose 1.2% (around twice the expected increase), but imports surged by 6.5% (the median forecast was for a 0.8% increase). However, the current account surplus was stronger than expected at 30.2 bln euros, nearly a third larger than anticipated.  he German current account surplus was little changed last year from 2019. France also reported March trade figures. The trade and current account deficits were larger than expected, and its industrial output figures also undershot expectations. Last year, the French current account shortfall practically tripled from an average of 1.3 bln euro deficit in 2019 to a 3.6 bln average deficit in 2020. Separately, Italy reported a 0.1% decline in March retail sales, which was considerably better than the 0.6% decline economists projected. Spain's March industrial output just missed the 0.5% increase that was expected with a 0.4% gain. Lastly, note that late today, Moody's will announce the conclusion of the results of its review of Italy's credit rating, while Fitch does the same for France. 

The euro rose to new highs for the week today, near $1.2090. An 850 mln euro option at $1.21 expires today. A move above $1.21 targets last week's high near $1.2150. Initial support is seen near $1.2050. The euro settled last week around $1.202. Sterling is bid near $1.3920 in late morning turnover in Europe. It has hardly traded out of the range it too set on Monday (~$1.38-$1.3935). On the top side is $1.40, which sterling has not closed above since late February. On the downside is $1.38, which it has not traded below for the better part of three weeks. 

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Read more by Marc on his site Marc to Market.

Disclaimer: Opinions expressed are solely of the author’s, based on current ...

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