REPORT
By Ovunc Kutlu & Gulbin Yildirim
U.S. Letter, Week beginning by April 18

- Last week, IMF & World Bank Spring meetings made most of the headlines.

The meetings brought finance ministers and central bank governors of 189 nations together in Washington DC to discuss the weak global economy.

Slowdown in both developed and emerging countries, low commodity prices, refugee crisis, geopolitical tensions and potential Brexit were among the top issues discussed at the meetings.

The communiques released after the meetings had common messages: continuing accommodative monetary policy, bolstering structural and financial reforms, and global cooperation for refugee crises and taxation issues.

- Economic data

According to official figures announced last week, retail sales were down a disappointing 0.3 percent in March, pulled down by low auto sales but unfortunately they show signs of wider weaknesses.

The overall Consumer Price Index (CPI) inched 0.1 percent higher in another disappointing reading. Year-on-year, the CPI is up only 0.9 percent, moving in the wrong direction, down one tenth from February.

The core CPI, which excludes food and energy, rose only 0.1 percent in March following two solid back-to-back gains of 0.3 percent. Year-on-year, the core is also moving in the wrong direction, down one tenth to a 2.2 percent reading that justifies Fed Chair Janet Yellen's doubts as to the possibility of inflation posting much improvement this year.

Crude oil production in the U.S. fell below 9 million barrels per day (mbpd), according to U.S.' Energy Information Administration (EIA) data released last Wednesday.

- New week

This week's economic calendar looks relatively sparse. Existing and new home sales data will provide significant information on the residential sector.

The markets will also be watching earnings of large companies such as Morgan Stanley, IBM, Yahoo, Coca Cola, Alphabet, Visa, McDonald's, and Microsoft as well as oil prices after the Doha meeting. 

19 Apr,2016

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