FOMC Minutes to be released in USA today - 18.8.2021

On Tuesday, the US dollar index rose for the 2nd day in a row. Investors reacted positively to the withdrawal of American troops from Afghanistan. This is expected to reduce budgetary spending. In addition, the US dollar index was supported by negative news on other currencies. Reserve Bank of New Zealand at its meeting today kept the rate at 0.25%, although it was expected to rise to 0.5%. In the capital of New Zealand - the city of Auckland, a 7-day quarantine was introduced due to new cases of coronavirus. Reserve Bank of Australia published Meeting Minutes of its July meeting, in which there was no information about the imminent tightening of monetary policy. The Australian dollar plummeted to a 9-month low, while the New Zealand dollar plummeted to a 3-week low. FOMC Minutes (materials of the July Fed meeting) will be released in the US today, which may affect the rate of the American currency. They are of increased importance ahead of the Fed's annual Jackson Hole symposium on August 28th. US construction data will also be released today. In Canada, the Eurozone and South Africa, there are inflation data for July. Inflation has already been released in Britain and it fell to 2% yoy in July compared to 2.5% in June. This contributed to the strengthening of the British pound.

On Tuesday, US stocks dropped for the first time after sluggish gains for 8 straight trading sessions. This was facilitated by weak economic statistics. US retail sales (-1.1% m/m (in monthly terms)) in July were worse than expected (-0.3%). Shares of retailers Home Depot (-4.3%), Target (-2.9%), Lowe's (-5.8%), Amazon (-1.7%) and other retail chains fell. This negative was partially offset by the growth of industrial production by + 0.9% against the forecast of + 0.5%. Some investors decided that the decline in retail sales was due to high inflation in July (+ 5.4%). This may become an additional factor in favor of tightening the Fed's monetary policy and contributed to the strengthening of the US dollar, while the stock indexes fell. Eric Rosengren - the head of the Boston Federal Reserve Bank, said that the Fed could reduce the monthly volume of buybacks ($ 120 billion) of bonds in September, if the data on the US labor market for August turns out to be positive. Recall that they will be released on September 3, and the Fed meeting will be held on September 22. Today in the US will be published materials of the July meeting of the Fed (FOMC Minutes). They can affect the dynamics of the markets if they contain hints of future actions and plans of the American regulator regarding the tightening of monetary policy.

World oil prices are rising today after a 4-day decline. The independent American Petroleum Institute announced a decline in US oil reserves for the week by 1.16 million barrels. Recall that OPEC + decided to increase production monthly by 400 thousand barrels per day (bpd) until September next year. The dwindling US stocks could be a sign that the recovery in global oil demand is faster. An additional negative for the quotes may be the U.S. forecast. Energy Information Administration (EIA) on the increase in shale oil production in the United States in September to 8.1 million bpd. This is the highest level since April 2020, before the coronavirus pandemic. The decline in US retail sales did not have a negative impact on cocoa quotes. The largest cocoa processing group, Gepex, reported a 7.3% increase in production in July. This is due to the high global demand for chocolate.