Halister News

(Bloomberg) -- Reserve demand for USTs has been “one of the biggest surprises” this year, but the PBOC’s removal of a reserve requirement for trading foreign currency forwards could reverse that trend, and was a “critical trigger” for this week’s selloff, BofA strategists Shyam Rajan and Carol Zhang say in note.

• USD weakness and strong inflows into emerging markets have helped reserve managers rebuild dollar portfolios, driving growth in Fed custody holdings of USTs
• PBOC’s eased capital controls may curb interventions, slowing inflows into USTs
• Separately, BofA sees risk to 5y-7y USD swap spreads from increased UST issuance that may result from tax cuts, odds of which should become clear in next 4 weeks if Congress passes a budget

To contact the reporter on this story: Katherine Greifeld in New York at kgreifeld@bloomberg.net To contact the editors responsible for this story: Boris Korby at bkorby1@bloomberg.net Elizabeth Stanton

(Bloomberg) -- Following are forecasts for today’s economic releases as compiled by Bloomberg News.

• Business Inv. 0.2% m/m; range 0.1% to 0.3% (32 estimates)
• “The inventory-to-sales ratio edged up to 1.38 in June, the highest since November (1.39). Another gain could signal that the underlying pace of sales is not sufficient to draw down rising stockpiles”: Bloomberg Intelligence
• U. Mich Conf 95; range 87.5 to 102.8 (60 estimates)
• U. Mich Curr 108; range 101 to 109 (3 estimates)
• U. Mich Exp 83; range 79 to 86 (3 estimates)
• Preliminary September data will probably “show a steep decline due to Hurricane Harvey and in anticipation of Hurricane Irma”: Bloomberg Intelligence ** In August, the index rose to 96.8, the highest in three months

To contact the reporters on this story: Alex Tanzi in Washington at atanzi@bloomberg.net; Vincent Del Giudice in Denver at vdelgiudice@bloomberg.net To contact the editors responsible for this story: Alex Tanzi at atanzi@bloomberg.net Kristy Scheuble

(Bloomberg) -- Following are forecasts for today’s economic releases as compiled by Bloomberg News.

• Ind. Prod. 0.1% m/m; range -1.3% to 0.6% (72 estimates)
• Cap. Util. 76.7%; range 75.6% to 77.1% (53 estimates)
• Manu. Prod. 0.3% m/m; range -0.4% to 0.8% (19 estimates)
  • August report could show “softer utility and mining activity, resulting from Hurricane Harvey”: Bloomberg Intelligence
  • In July, industrial production rose just 0.2 percent amid weakness in auto production

To contact the reporters on this story: Alex Tanzi in Washington at atanzi@bloomberg.net; Vincent Del Giudice in Denver at vdelgiudice@bloomberg.net To contact the editors responsible for this story: Alex Tanzi at atanzi@bloomberg.net Kristy Scheuble