Chart of the Day
It was a strong month for US retail sales in January, as they rose by 3.8% MoM, despite concerns that the Omicron outbreak would weigh on sales. Control group sales - which feed into the GDP data for consumption - rose by an even better 4.8%. Coming alongside the strong gain in employment in January, this will increase speculation that the Fed will hit the ground running when it begins to raise interest rates, potentially with a 50 bp hike next month.
Industrial production also did well in January, up by 1.4% MoM.
The inventories-to-sales ratio is finally rising, which should help to alleviate some inflationary pressure.
In Canada, inflation rose by more than expected to 5.1% in January - so still a couple of percent below the US.
US homebuilder confidence edged down in February but is still quite high.
The weekly EIA report showed that crude inventories unexpectedly increased last week, though they are still much lower than in previous years.
Despite the rise in inventories, oil prices increased as traders grew nervous about the situation in Ukraine again, with the US and Nato dismissing the announcement from Russia that it is withdrawing troops from near the Ukraine border.
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