Press review - page 96

[Sergey Golubev]

GBPUSD Fundamentals (based on dailyfx article)

Fundamental Forecast for the British Pound: Bearish

• British Pound remains an attractive sell for these reasons
• Technical analysis warns that GBPUSD needs to hold $1.66 for uptrend to remain intact
  
  

[Sergey Golubev]

AUDUSD Fundamentals (based on dailyfx article)

Fundamental Forecast for Australian Dollar: Bearish

• Australian Dollar Snaps 3-Week Win Streak on Soft Chinese News-Flow
• Risk Aversion to Return on Fed QE Bets, Global Growth Slowdown Fears

[Sergey Golubev]

XAUUSD Fundamentals (based on dailyfx article)

Fundamental Forecast for Gold: Neutral

• Gold and Silver Dip As US Dollar Gains Following FOMC Minutes
• Gold Dip Underway; Former Range High at 1279 is Now Support

[Sergey Golubev]

Forex Weekly Fundamentals : Outlook Feb. 24-28

Weaker than expected data was reported almost everywhere. After suffering losses, can the US dollar emerge as a winner? Euro-zone inflation, Us consumer confidence, Housing data, Unemployment Claims and GDP data from the US, UK and Canada are among the major events on our calendar. Here is an outlook on the main market-movers this week.

The weakness was seen everywhere: a terrible Philly Fed Index in the US, a disappointing growth rate in Japan, a weak PMI in China, lower business sentiment in Germany and a rising unemployment rate in the UK, among others. Nevertheless, it seems that one central bank is not deterred: the Federal Reserve. Meeting minutes from the last decision showed again that the taper train is on the track.

1. German Ifo Business Climate: Monday, 9:00. German business confidence soared to 110.6 in January from 109.5 in December, rising to the highest level since July 2011. The reading surpassed forecasts of 110.2, indicating German economy is expanding full steam. The Bundesbank has projected a strong expansion in 2014, after the weak final quarter of 2013 where German economy shifted from domestic demand to global trade. Another climb to 110.7 is expected this time.
2. US CB Consumer Confidence: Tuesday, 15:00. Consumers sentiment unexpectedly edged up in January to 80.7 from 77.5 in December, reaching a five-month high amid renewed optimism about the economy and labor market. Economists expected a weaker reading of 78.3. US jobs market improved offering plentiful positions and higher wages propelling consumer purchases and confidence. A small decline to 80.2 is forecasted.
3. UK Second Estimate GDP: Wednesday, 9:30. The first release of UK GDP showed a growth rate of 0.7% in Q4 2013, which is quite solid growth. A confirmation of this figure is expected in the second release. According to NIESR monthly estimates, GDP has increased by 0.8% in the three months ending in January 2014. The Bank of England is expected to keep interest rates on hold until the second quarter of 2015 and annual GDP growth will reach 2.5% in 2014 and 2.1% in 2015.
4. US New Home Sales: Wednesday, 15:00. The annual number of new home sales disappointed for the second consecutive month with a seasonally adjusted annual rate of 414,000 units, much weaker than the 445,000-unit pace registered in November missing predictions for a rise to 457,000. Many blamed the harsh winter conditions for the ongoing fall in the housing sector with a 36.4% fall in the Northeast which was hit by cold temperatures. This fall is not consistent with the strong demand reflected in the declining inventory for new and existing homes, indicating this is only a temporary setback. Another drop to 406,000 is expected now.
5. US Durable Goods Orders: Thursday, 13:30. Orders for long-lasting U.S. manufactured goods excluding transportation items plunged unexpectedly in December by 1.6% after a 1.2% gain in the previous month posting the biggest decline since March 2013. Most orders were weak, with the exception for machinery, and electrical equipment, appliances and components rising. Durable goods orders fell 4.3% in December after a 3.4% climb in November, pulled down by weak demand for transportation equipment, primary metals, computers and electronic products and capital goods. Durable Goods Orders are expected to decline 0.7% while core Durable Goods Orders are expected to fall 0.1%.
6. US Unemployment Claims: Thursday, 13:30. The number Americans filing applications for unemployment benefits dropped by 3,000 last week, to a seasonally adjusted 336,000, indicating firing has not increased. The number of applicants became stable in recent weeks despite modest levels of hiring in January and February, signaling business confidence is improving. In recent months, frigid weather slowed down hiring, retail sales and home construction. Job growth for the past two months reached only a half the monthly average for the previous two years. However lower unemployment rate of 6.6% was an improvement from December. Another drop to 333,000 is anticipated now.
7. Euro-zone Flash CPI: Friday, 10:00. As the focus of the ECB shifted to inflation (or the lack of it), the importance of CPI has risen. The surprising drop in inflation in October triggered a rate cut in November. Year over year CPI is expected to remain unchanged at 0.7%. However, a strong euro and a fragile recovery could result in a new low for CPI and perhaps for core CPI, which also bottomed out at 0.7% so far. A drop to new cycle lows could trigger a negative deposit rate from the ECB in March.
8. Canadian GDP: Friday, 13:30. The Canadian economy expanded by 0.2% in November, in line with market forecast, rising for the fifth straight month amid a recovery in the oil industry outpaced a decline in manufacturing. This increase was preceded by a 0.3% increase in both September and October. Oil and gas extraction rose 2.6%, after a 0.7% decline in October, and mining and quarrying increased by 1.3%. Overall manufacturing output climbed 0.4% while the service sector increased by 0.2%. Canadian economy is expected to contract 0.2% this time.
9. US GDP: Friday, 13:30. According to the first release, the US economy grew by 3.2% in Q4 2013. Already at that release, there were worries about the quality of this growth, with an inventory buildup taking a large part in that growth. After a few weak figures, expectations are for a downgrade of growth to 2.6% at the second and not final release.
10. US Pending Home Sales: Friday, 15:00. The number of contracts to purchase previously owned homes in the U.S. plunged in December by 8.7% following a 0.3% decline in the preceding month. This was the worst reading since May 2010 amid higher borrowing costs and bad weather conditions halting sales. Analysts expected a modest drop of 0.3%, but unusually cold weather discouraged potential buyers. A rise of 2.9% is forecasted.
11. Mark Carney speaks: Friday, 15:30. BOE Governor Mark Carney will speak in Frankfurt on Central Bankers. Earlier this month Carney said there is a need to change the compensation structures so that banks could see whether employees had taken undue risks or behaved badly and that compensation of bankers should be withheld and deferred for a very long time. These comments were made after news that Barclays was paying bigger bonuses despite announcing plans to cut staff in response to a fall in profits. Carney may also refer to the developments in the housing market and the means to prevent a bubble from developing. Any comment on the interest rate will be closely scrutinized after Carney hinted a hike in Q2 2015.

[Sergey Golubev]

EURUSD Fundamentals (based on dailyfx article)

Fundamental Forecast for Euro: Neutral

• Retail crowd positioning warns of an extreme (and potential top) in the Euro.
  
• EURUSD only vulnerable to a bigger correction under $1.3670/85.
  
  

[Sergey Golubev]

Forex Fundamentals - Weekly outlook: February 24 - 28 (based on investing article)

The dollar was lower against the euro on Friday, following the release of poor U.S. housing data, but ended the week higher against the yen and most other major currencies.

Monday, February 24

• The euro zone is to release revised data on consumer price inflation, while the Ifo Institute is to publish a report on German business climate.

Tuesday, February 25

• New Zealand is to produce data on inflation expectations.
• The U.K. is to release private sector reports on mortgage approvals and retail sales.
• The European Commission is to publish its economic forecasts for European Union member states.
• The U.S. is to release data on consumer confidence and a private sector report on house price inflation.

Wednesday, February 26

• Australia is to publish data on completed construction work.
• In the euro zone, Germany is to release a report on Gfk consumer climate.
• The U.K. is to publish revised data on fourth quarter economic growth, as well as preliminary data on business investment.
• The U.S. is to release data on new home sales, a leading indicator of demand in the housing market.
• Later Wednesday, New Zealand is to release a report on the trade balance.

Thursday, February 27

• Australia is to release data on private capital expenditure.
• Switzerland is to publish data on fourth quarter gross domestic product, the broadest indicator of economic activity and the leading measure of the economy’s health. The country is also to release data on the change in the number of people employed in the previous quarter.
• In the euro zone, Germany is to publish preliminary data on consumer inflation, as well as data on the change in the number of people unemployed.
• Canada is to produce data on the current account.
• Also Thursday, the U.S. is to release data on durable goods orders, a leading indicator of production, and the weekly report on initial jobless claims.

Friday, February 28

• Japan is to release a series of data, including reports on household spending, retail sales, inflation, and industrial production.
• New Zealand is to release data on business confidence, while Australia is to produce a report on private sector credit.
• The euro zone is to release preliminary data on consumer inflation and a separate report on the unemployment rate across the currency bloc. Germany is to publish data on retail sales.
• Switzerland is to publish its KOF economic barometer.
• Canada is to publish the monthly report on GDP growth.
• The U.S. is to round up the week with revised data on fourth quarter growth, a report on manufacturing activity in the Chicago region, revised data on consumer sentiment and private sector data on pending home sales.

[Sergey Golubev]

USD/JPY Fundamentals - weekly outlook: February 24 - 28 (based on investing article)

The dollar ended the week higher against the yen on Friday amid expectations that the Federal Reserve will continue to reduce stimulus, while the Bank of Japan sticks to its quantitative easing program.

Tuesday, February 25

• The U.S. is to release data on consumer confidence and a private sector report on house price inflation.

Wednesday, February 26

• The U.S. is to release data on new home sales, a leading indicator of demand in the housing market.

Thursday, February 27

• The U.S. is to release data on durable goods orders, a leading indicator of production, and the weekly report on initial jobless claims.

Friday, February 28

• Japan is to release a series of data, including reports on household spending, retail sales, inflation, and industrial production.
• The U.S. is to round up the week with revised data on fourth quarter growth, a report on manufacturing activity in the Chicago region, revised data on consumer sentiment and private sector data on pending home sales.

[Sergey Golubev]

USD/CHF Fundamentals - weekly outlook: February 24 - 28 (based on investing article)

The dollar ended the week lower against the Swiss franc on Friday as weaker-than-expected U.S. housing data added to concerns that the economic recovery is losing momentum.

Tuesday, February 25

• The U.S. is to release data on consumer confidence and a private sector report on house price inflation.

Wednesday, February 26

• The U.S. is to release data on new home sales, a leading indicator of demand in the housing market.

Thursday, February 27

• Switzerland is to publish data on fourth quarter gross domestic product, the broadest indicator of economic activity and the leading measure of the economy’s health. The country is also to release data on the change in the number of people employed in the previous quarter.
• The U.S. is to release data on durable goods orders, a leading indicator of production, and the weekly report on initial jobless claims.

Friday, February 28

• Switzerland is to publish its KOF economic barometer.
• The U.S. is to round up the week with revised data on fourth quarter growth, a report on manufacturing activity in the Chicago region, revised data on consumer sentiment and private sector data on pending home sales.

[Sergey Golubev]

USD/CAD Fundamentals - weekly outlook: February 24 - 28 (based on investing article)

The Canadian dollar ended the week lower against the U.S. dollar on Friday, following the release of weaker-than-expected domestic data on retail sales and tame inflation data.

Tuesday, February 25

• The U.S. is to release data on consumer confidence and a private sector report on house price inflation.

Wednesday, February 26

• The U.S. is to release data on new home sales, a leading indicator of demand in the housing market.

Thursday, February 27

• Canada is to produce data on the current account.
• The U.S. is to release data on durable goods orders, a leading indicator of production, and the weekly report on initial jobless claims.

Friday, February 28

• Canada is to publish the monthly report on GDP growth, the broadest indicator of economic activity and the leading measure of the economy’s health.
• The U.S. is to round up the week with revised data on fourth quarter growth, a report on manufacturing activity in the Chicago region, revised data on consumer sentiment and private sector data on pending home sales.

[Sergey Golubev]

AUD/USD Fundamentals - weekly outlook: February 24 - 28 (based on investing article)

The Australian dollar ended the week lower against its U.S. counterpart on Friday, amid expectations that the Federal Reserve will continue to gradually reduce the pace of its asset purchase program.

Tuesday, February 25

• The U.S. is to release data on consumer confidence and a private sector report on house price inflation.

Wednesday, February 26

• Australia is to publish data on completed construction work.
• The U.S. is to release data on new home sales, a leading indicator of demand in the housing market.

Thursday, February 27

• Australia is to release data on private capital expenditure.
• The U.S. is to release data on durable goods orders, a leading indicator of production, and the weekly report on initial jobless claims.

Friday, February 28

• The U.S. is to round up the week with revised data on fourth quarter growth, a report on manufacturing activity in the Chicago region, revised data on consumer sentiment and private sector data on pending home sales.