India Rains May Be Below Average, Worsening Dry Spell
(Bloomberg) -- India’s monsoon rainfall, the main source of irrigation for the country’s 235 million farmers, may be below average this year, denting prospects for bigger crops of rice, oilseeds and sugar cane.

Quick Overview

• (FT) The Organisation for Economic Co-operation and Development has revised its World Economic Outlook upwards for the first time in two years, as its latest review concludes that the global economic slide is nearing a bottom
  

• U.S. durable goods orders rose 1.8% in May. Excluding transportation orders rose 1.1%.
  

• U.S. new home sales fell 0.6%. YoY new home sales are down 38%.
  
  

• The U.S. Department of Energy said:
  Supplies of crude oil fell 3.8 million barrels last week to 353.9 million barrels
  Supplies of gasoline rose 3.9 million barrels
  Supplies of heating oil fell 100,000 barrels.
  Refinery use increased from 85.9% to 87.1%
  Gasoline demand rose 0.4% YoY
  Distillate demand fell 9. 3% YoY
  

• (FT) The Swiss franc fell sharply on Wednesday after the country's central bank intervened in the foreign exchange market to halt the currency's rise
  

• (Spiegel) A German court has ruled that pupils can rate their teachers online, rejecting a bid by one instructor to shut down a Web site that gave her a low grade.

• Northeast China's Port of Rizhao port handled 16.4 million tonnes of cargo in May, up 26.9 % YoY

Obama vs. Obama

Quick Overview

• U.S. existing home sales rose 2.4% to 4.77 million units in May -- less than expected.
  

• U.S. home prices fell 6.8% YoY and 0.1% MoM.
  

• (Reuters) - U.S. chief executives took a slightly less grim view of the economy in the second quarter, but still plan to cut jobs and capital spending, according to a Business Roundtable survey released on Tuesday.

• Japan's exports in May dropped 40.9% YoY

• Germany’s July Consumer Confidence rose to 2.9 from 2.6 in June
  

• Switzerland May Trade Balance out at 2.01B vs. 2.55B in April.
  

• Euro Zone June PMI Manufacturing out at 42.4 versus 40.7 in May.
  

• Euro Zone June PMI Services out at 44.5 versus. 44.8 in May
  

• The USDA said there were 79.1 million pounds of frozen bellies in storage, down 9.5% YoY.
  
• Frozen pork totaled 584.1 million pounds, up 0.8% YoY.
  

• The USDA said frozen supplies of orange juice in storage at the end of May were up 0.6% YoY.
  

• (FT) Japanese retail investors, once enamored of Icelandic bank accounts and kiwi bonds, are now turning their purchasing power to Japanese stocks
  

• FedEx CEO says the worst is behind us and is poised for growth in the second half
  

• China has cut the export tax on several steel products to 5% from the 10-15%.
  

• (Bloomberg) -- Sugar jumped to the highest price since July 2006 on signs that a production deficit may extend into a second year

• China's sugar imports in May rose 26% on year to 141,457 metric tons, the General Administration of Customs said.

• India’s sugar output is forecast to drop about 45% to 14.7 million tonnes in the crop year to September.

• (WSJ) Madoff asked a federal judge to sentence him to as little as 12 years in prison. Sentencing of the disgraced financier is scheduled for June 29.
  

Quick Overview

• The World Bank expects world GDP to fall 2.9% in 2009, worse than the 1.7% predicted in March. They expect U.S. GDP to fall 3% and 4.5% in Europe.
  

• Japan's Tankan survey rose from -66.0 to -13.2 in Q2
  

• (Reuters) - The worst of the global economic crisis is over, multi-billionaire financier George Soros told Polish news channel TVN24 on Sunday urging the creation of international regulations to oversee global markets.
  

• The USDA said there were 10.407 million head of cattle on feed as of June 1st, down 3.8% YoY
  

• China imported 337,230 tons of copper in May, a record high that dropped copper to the lowest level in more than two weeks. It was taken as a signal for a peak in demand from the world's biggest consumer of the red metal.
  

• (Reuters) - The Federal Reserve is considering creating a utility to replace the Wall Street banks that handle U.S. repo market transactions, the Financial Times reported on Monday,

Don't believe the hyperinflation hype - dare to make cuts
"If Ben Bernanke and his officials are listening to this sort of stuff and taking it seriously, they are making the same mistake as the Fed in the early 1930s," he said. The US "output gap" is near 7pc. That is a powerful lid on inflation.

Quick Overview

• California's unemployment rate climbed to 11.5% in May
  

• Moody's issued a downgrade warning to California.
  

• YoY Thailand's exports fell 26.6% to $11.7 billion
  

• Mexico cut interest rates to 4.75 %
  

• Canada’s retail sales fell 0.8% in April.

• (WSJ) The U.S. and Switzerland agreed to share information on potential tax evaders.

• (WSJ) Chinese regulators have ordered Google to suspend search services for foreign Web sites via its Chinese Web site, a Xinhua report said.
  

• (Reuters) - A "distressingly slow" U.S. housing recovery, with inflation-adjusted home values expected to decline over the next five years, makes it unlikely that housing wealth will drive consumer spending in the next decade, a Reuters/University of Michigan survey found.
  
  
  

China’s Suntech, Denmark’s Vestas Bet on Obama’s Green Energy
“Most of the renewable energy industry worldwide believes that the U.S. will within the next three years become the largest market in the world for solar,” Efird, president of Suntech America, said in an interview.

Quick Overview

• U.S. jobless claims rose 3,000 last week to 608,000.
  

• The Philadelphia Federal Reserve's regional index of manufacturing rose from -22.6 to -2.2.
  

• U.S. index of leading indicators rose 1.2% in May.
  

• The World Bank has raised its economic growth forecast for China from 6.5% to 7.2%
  

• Canada’s consumer prices rose 0.1%
  

• U.K. retail sales fell 0.6% in May and 1.6% YoY
  

Suitcase With $134 Billion Puts Dollar on Edge: William Pesek

The implications of the securities being legitimate would be bigger than investors may realize. At a minimum, it would suggest that the U.S. risks losing control over its monetary supply on a massive scale.

Quick Overview

• U.S. Labor Department said that consumer prices rose 0.1% in May, but fell 1.3% YoY
  

• U.K. unemployment rate out at 7.2%
  

• Construction output in the EU rose 0.7% in April.
  

• FedEx's CEO Frederick Smith predicted that the worst of the recession is behind us.
  

• Guangdong's April EU imports rose 33.4% MoM
  

• Singapore's Maritime and Port Authority reported a 20.2% drop in container movement in May.
  

• Hong Kong reported a 12.1% drop in container movement in May.
  

• The U.S. DoE said:
  Supplies of crude oil fell 3.9 million barrels to 357.7 million barrels
  Supplies of gasoline rose 3.4 million barrels
  Supplies of heating oil supplies rose 600,000 barrels.
  Distillate inventories rose by 0.3 million barrels.
  Gasoline demand rose 1.1%

Quick Overview

• U.S. producer prices rose 0.2% in May but fell 5.0YoY
  

• U.S. housing starts rose 17.2% MoM.
  

• U.S. industrial production fell1.1% in May
  

• YoY Consumer prices in the Euro area rose 0.7% in May
  
  

• YoY U.K. consumer prices rose 2.2% in May
  
  

• Canada’s productivity rose 0.3% in Q1
  

• The real cost of living for British families has fallen by 10% since this time last year according to figures compiled for The Telegraph.
  

• (Spiegel) A German-led consortium wants to fund an international solar-energy plan to the tune of €400 billion. The idea is to gather solar heat in North Africa and send the electricity to Europe. If it works, it would be the largest green-energy project in the world.

Quick Overview

• The New York Federal Reserve's regional index of manufacturing fell from -4.4 to -9.4 in June.
  

• (Reuters) - Goldman Sachs senior investment strategist Abby Joseph Cohen said on Monday that risk aversion has eased, while inventory rebuilding and new business spending bode well for an economic recovery that could provide a dramatic surge in corporate profits by year end.
  

• The American recession will be less deep and shorter than initially predicted according to the IMF.

• The Bank of Japan upgraded its assessment of the economy for the second straight month, and left the overnight lending rate at 0.1 %
  
  

• 142.2 million bushels of soybeans were crushed in May, 6% more than in April and more than expected. Soybean crush must average only 125 million bushels per month in June, August and September to reach the USDA target; which is 10 million below the seasonal pace.
  
  

• The USDA estimates 2009-2010 world coffee production at 127.4 million bags and usage at 132.2 million bags, putting ending stocks at 35.3 million bags or 27% of use. The USDA expects 2010 ending stocks at 13 million bags.
  

• Cautious comments from Chinese premier Wen Jibao over the durability of economic recovery in the world's third largest economy weighed on investor enthusiasm.

The crucifixion of Latvia
We know from leaked documents that the Fund advised Latvia to ditch the peg last year. IMF experts were overruled by Brussels. The reason, of course, was to prevent: 1) a chain of falling dominoes in Eastern Europe; 2) a default shock for West European banks with $1.6 trillion (£970bn) of exposure to the region; 3) leakage from Bulgaria across the EU line into Greece – euroland's Achilles heel.

Quick Overview

• The University of Michigan's consumer confidence index rose from 68.7 to 69.0
  
  

• EU industrial production fell 21.6% YoY.
  

• China's retail sales rose 15.2% YoY.
  

• YoY India’s Industrial production rose 1.4% in April
  

• Retail sales in New Zealand rose 0.5% in April.
  

• OPEC expects world oil demand to average 83.8 million barrels per day in 2009, down from last month's estimate of 84.0 mbd.
  

• Crude oil stored on offshore tankers fell 16% in the past two weeks to about 67 million barrels.
  

• Crude oil exports from Iraq reached 2.4 million barrels per day, their highest level since after the U.S.-led invasion.

US cities may have to be bulldozed in order to survive Dozens of US cities may have entire neighbourhoods bulldozed as part of drastic "shrink to survive" ..

Quick Overview

• U.S. retail sales rose 0.5% in May, the first gain in three months -- much of the gain was due to higher gas prices.
  

• U.S. jobless claims fell 24,000 last week to 601,000.
  

• China’s copper imports rose 6% in May
  

• China’s urban fixed-asset investment (building railways, oil pipelines, low cost housing) rose 32.9%.
  

• Boeing projects a market for 29,000 new commercial airplanes valued at $3.2 trillion over next 20 years. They project strong global demand, more efficient commercial airplanes in response to high fuel prices, aging fleets and environmental concerns.
  

• (Spiegel) The Schönbrunn Zoo in Vienna has launched an art installation that puts its animal’s side-by-side with symbols of humanity's trashing of the environment -- including abandoned cars, rusty bathtubs and toxic waste.

• (Bloomberg) -- Swine flu, causing mostly mild disease outbreaks on four continents, prompted the World Health Organization to declare the first influenza pandemic since 1968

U.S. Foreclosure Filings Top 300,000 as Bank Seizures Loom
Additional U.S. home foreclosures will probably total 6.4 million by mid-2011, and inventories of foreclosed homes awaiting sale will probably peak in mid-2010 at about 2 million properties, JPMorgan Chase & Co. analysts led by John Sim wrote in a June 5 report. U.S. prices will likely drop 39 percent on average, they said.

IMF Says New Bonds Not Likely to Be Sold on Secondary Market
Treasury yields climbed this year and the dollar fell in part on concern that foreign central banks would reduce holdings of U.S. financial assets just as the Obama administration sells a record amount of debt to finance a growing budget deficit and pull the economy from the deepest recession since the 1930s.

Quick Overview

• The U.S. trade deficit widened to $29.16 billion in April. Exports fell $2.8 billion to $121.1 billion while imports fell $2.2 billion to $150.3 billion.
  


• (Bloomberg) -- Russia may switch some of its reserves from U.S. Treasuries to International Monetary Fund bonds, the central bank said today.
  


• China's May Producer Price Index fell 7.2% YoY
  

• China's May Purchasing Price Index fell 10.4% YoY.

• YoY China's exports fell 26.4 % in May
  

• Korea kept its interest rate unchanged at an all-time low of 2% for a fourth consecutive month.
  

• Australia's unemployment rose to 5.7% percent from a revised 5.5 % – better than expected.

• Japan's April Machine orders fell 32.8% YoY

• 
  China's May Consumer Price Index fell 1.4% YoY

• USDA’s 2009-2010 U.S. ending stocks estimates:
  Corn was lowered from 1.145 to 1.090 billion bushels.
  Soybeans were lowered from 230 to 210 million bushels.
  Wheat was raised from 637 to 647 million bushels.
  Sugar was raised from 289,000 to 459,000 tons.
  Cotton was unchanged at 5.60 million bales.

• The Department of Agriculture said by August 31 soybean stocks would fall to 110m bushels, the lowest since stocks dropped to 103m bushels in 1976-77.
  

• USDA’s 2009-2010 world ending stocks estimates:
  Corn was lowered from 128 to 125 million tons.
  Soybeans were lowered from 52 to 51 million tons.
  Wheat was raised from 182 to 183 million tons.
  Cotton was lowered from 58 to 57 million tons.
  


• The USDA raised its estimate of the 2008-2009 Florida orange crop from 158 to 160 million boxes. The juice yield was raised from 1.65 to 1.66 gallons per box.

• The U.S. DOE said:
  Supplies of crude oil fell 4.4 million barrels to 361.6 million barrels.
  Supplies of gasoline fell 1.6 million barrels
  Supplies of heating oil fell 800,000 barrels.
  Refinery use fell from 86.3% to 85.9%.
  YoY Gasoline demand rose 0.4%
  YoY distillate demand fell 8.4%.