Written Commentary
ADM Exceeds 5M Regenerative Agriculture Acreage Gal
September 9, 2025
Modest run of data to end the week, digesting UK Retail Sales, RBA and RBNZ policy comments and Singapore Exports, awaiting US Housing Starts and Michigan Sentiment, Fed’s Goolsbee the sole central bank speaker
UK Retail Sales: warmer weather and Euro24 give a boost, but detail continues to highlight considerable consumer caution, though still suggesting solid Personal Consumption to Q3 GDP
USA: Housing Starts seen drifting lower again, echoing down at heel NAHB; Michigan Sentiment seen little changed at depressed level, but at loggerheads with run of solid data
EVENTS PREVIEW
Today’s schedule of data is very much second division by comparison with yesterday’s deluge, with UK Retail Sales and Singapore Exports, along with testimony from RBA officials and a speech by RBNZ’s Orr to digest. Ahead lies little more than Brazil’s monthly GDP, US Housing Starts and preliminary Michigan Sentiment, and a ‘fireside chat’ with Chicago Fed’s Goolsbee. Next week’s run of data is quite sparse, but with Fed, ECB and RBA minutes and the week ending KC Fed Jackson Hole conference, central banks will be very much back in focus. Statistically the US has Existing and New Home Sales, there are G7 and India flash PMIs, the ECB’s Q2 Negotiated Wages report, Canadian, Mexican and South African CPI, and Japanese Trade. Central bank policy meetings in Indonesia, South Korea and Turkey are expected to see rates held at 6.25%, 3.50% and 50.0% respectively. Market sentiment remains as fickle and fluid as ever, driven all too often by poorly informed conjecture and advocacy, and a lack of critical or lateral thinking (above all in regards to the US economy, suffice it to say that ‘animal spirits’ were ever thus. Nevertheless the array of risks, be that national or geopolitical, economy or market imbalances remain very high, even if some of the excess leverage in yen carry trade has been purged.
** U.K. – July Retail Sales **
– Retail Sales were essentially in line with forecasts at 0.5% m/m, with warmer weather and Euro24 giving an expected boost, along with easing pressure on household incomes. But a look at the detail underlines that consumers remain cautious, above all evident in Textile, Clothing & Footwear and Household Goods, which both fell -0.6% m/m, and down -4.0% and -6.4% y/y respectively, even if this also reflects continued migration to internet sales from the High St, as is more than evident in a 2.5% m/m 10.3% y/y rise in Other Stores. It also suggests that Q3 GDP should continue to see a healthy pace of expansion, even if slower than the robust pace seen in H1 2024.
** U.S.A. – July Housing Starts, August Michigan Sentiment **
– Following on from a very down at heel NAHB Housing Market Index (39 vs. expected 43), which saw falls in buyer traffic, and rise in developer discounting, today’s Housing Starts are seen down 1.5% m/m to a somewhat lacklustre 1.333 Mln, even if the expected pace of Building Permits at 1.425 Mln remains closer to longer-term averages. Michigan Sentiment is forecast to edge up 0.5 pt, but remain depressed at 66.9, perhaps reflecting a negative media narrative on labour demand and the outlook for the economy. That said, this week’s run of data once again highlighted that actual hard data continues to tell a different and far more positive story about underlying trends, per se this survey probably needs to be treated with some caution in what it tells us about the economy.
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