Chinese retail sales, Japan GDP, Asia trade deal
Retail sales in China rose at the fastest rate of the year in October, a strong sign that improving consumer demand is contributing to the economy’s solid economic recovery from the covid pandemic. Sales rose an impressive 4.3% MoM, well ahead of the 3.3% increase recorded in September. Retail sales returned to growth in August after 7 consecutive months of decline.
Adding to the upbeat mood data revealed that Japan’s economy rebounded sharply in Q3 with the economy growing by 5% QoQ, ahead of the 4.4% forecast, boosting the world’s third largest economy out of recession.
A trade deal agreed over the weekend also boosted optimism surrounding the covid economic recovery with 15 Asia-Pacific economies, including Japan and China agreeing to reduce futures tariffs.
Brexit will remain in focus this week, a crunch week for talks as both sides say that a breakthrough must be made in the coming days. The pound is pushing higher on optimism that a breakthrough could happen, particularly with the departure of Lee Cains and Dominic Cummings last week which could mean that Boris Johnson has more political space to compromise and secure a trade deal. Joe Biden wining the race to the White House could also motivate Boris Johnson & his team to secure a deal, although David Frost has warned that there may be on deal.
Oil advances ahead of OPEC +meeting
Oil is pushing higher as investors look ahead to the upcoming OPEC+ meeting on Tuesday, where producers are expected to support further extensions to supply cuts in order to offset the sharp decline in demand owing to covid infections.
The OPEC+ group had been reducing production by 7.7m barrels per day in order to underpin prices. The plan had been to increase production by 2 m barrels per day from January. However, this now looks unlikely. Crude oil trades +2.5% above $41.00