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Overview of the main economical events of the current day - 10/09/2013
Most Experts Are Sure QE3 Reduce to Be Started at the Nearest FOMC Meeting
The US dollar was traded downwards on Monday against most major currencies (except the yen) amid no any significant macrostatistics and continuing to recover Friday weak labour market data that lower the possibility of asset purchase reduce start at the nearest FOMC meeting.
Meanwhile, PIMCO's Bill Gross is sure of the Fed to start tapering off QE despite disappointing labour market report. Most experts polled by Bloomberg last week also expect a reduction of monthly asset purchase of $10 billion at the FOMC meeting on September 17-18.
The pound reached 12-week high against the dollar and the euro –the highest reading of September on the back of also almost empty calendar. George Osborne, Chancellor of the Exchequer announced that British economy had passed a crucial point, which allowed the government to continue implementing economy measures. Sentix Investor Confidence reached more than 2-year high of +6.5 and exceeded zero point that separated optimism from pessimism – for the first time since July, 2011.
The Bank of France raised on Monday its estimate of French economic growth in the third quarter to 0.2% q/q against 0.1% before. Bank of France Business Sentiment reached almost 2-week high in August at 97 against 95 in July.
Japanese yen weakened on Monday amid the news on Saturday of Tokyo hosting summer Olympic Games 2020, which may have a beneficial effect on Japanese economic growth. Hosting Olympic Games can favour construction and influx of tourists to the country and also facilitate implementing Shinzo Abe’s plans. Chinese and Japanese data also had a positive effect. Japanese stock index Nikkei 225 which is recently closely correlated with USDJPY grew by 2.5% and reached monthly high.
Japanese final GDP growth data for the second quarter were raised from 0.6% to 0.9% at a quarterly rate and from 2.6% to 3.8% at an annual rate. As a result the Japanese economy showed the highest half year growth for almost three years, which proves that Prime Minister Shinzo Abe’s policy, which is aimed to economic growth stimulation, is right.
The Australian dollar reached 6-week high Vs the dollar after Chinese trade balance data released on Sunday had showed trade balance surplus by 60% in August to $28.5 bln compared with $17.8 bln this July. The exports increased by 7.2% in August in comparison with the same period last year, which turned out better than Consensus 5.5%. The imports rose by 7% at an annual rate. The data indicate a stable high PMI in Chinese economy. Besides, Home Loans growth data in Australia in July turned out better than expected.
The Canadian dollar continued Friday’s growth and rose to 3-week high on Monday Vs the dollar amid positive housing market data which followed a strong employment report on Friday. Building Permits in July grew by 20.7% m/m up to record 7.99 bln Canadian dollars, which exceeded the expectations almost 5 times. Growth rates turned out the highest for more than two years.
By MasterForex Company
Overview of the main economical events of the current day - 11/09/2013
Chinese Industrial Output Exceeded Expectations
The US dollar was traded differently on Tuesday; it fell against commodity currencies and the pound and grew against the yen and Swiss franc and almost didn’t change according to dollar index. Some pressure was put by job openings data from the Bureau of Labour Statistics that dropped by 180 thousand in July to 3.69 million against 3.87 million prior month. The reading has been falling for two months in a row. NFIB Small Business Index also dropped to 94 in August against 94.1 in July although its growth was expected.
Defensive currencies such as the yen and Swiss franc and also gold fell on Tuesday after the USA president Obama had agreed to consider Russian plan on Syria’s transfer its chemical weapon under international control, which may significantly reduce the possibility of attack on Syria at the nearest time. Obama said that he asked the Congress to delay voting on military attack in Syria.
The yen fell to more than 7-week low against the dollar, which was favored by the published BoJ meeting minutes of August that showed central bank’s firm intention to continue monetary policy easing.
Chinese positive data released on Tuesday that exceeded the expectations and indicated Chinese economic outlook improvement, supported commodity currencies growth. PRC industrial output growth rates accelerated in August up to 10.4% at an annual rate from 9.7% in July having exceeded forecasted growth by 9.9%. Retail sales grew by 13.4% y/y against expected growth by 13.3%. Fixed Asset Investment ytd/y grew by 20.3% y/y in August (Consensus 20.2%).
Australian dollar rose on Tuesday to its high for more than two months amid Business Confidence growth to the highest level since May, 2011. Australian NAB Business Confidence rose to +6 in August against -3 in July having exceeded zero point, which separated business conditions improvement from its worsening, for the first time in 4 months. Canadian dollar reached 3-week high on Tuesday despite Housing Starts decrease in August by 6.6%.
The pound updated its height of September amid positive housing market statistics. RICS House Price Balance rose to the highest reading in August since November, 2006 and reached 40% compared with 36% in July. The euro was traded a little worse. The pressure was put by French industrial output decrease which has been falling for three months in a row – it dropped by 0.6% in July while its growth by 0.5% was expected. Italian Final GDP for the second quarter also turned out worse than expected. GDP decreased by 0.3% against preliminary decrease estimate by 0.2%.
By MasterForex Company
Overview of the main economical events of the current day - 12/09/2013
GBPUSD Reached 7-Month High
The pound reached 7-month high on Wednesday against the dollar after the release of strong labour market data that exceeded expectations. The pound has grown to the highest level since this January against European currency. In August both Claimant Count Rate and the number of those who get unemployment payment decreased. The data signal that British economic recovery is going on gathering pace.
According to the National Bureau of Statistics Claimant Count Change dropped by 32.6 thousand in August having exceeded the expectations of decrease by 21 thousand. The prior month reading was also revised for the better. Claimant Count Change has been falling for 10 months in a row. Claimant Count Rate decreased by 0.1% to 4.2% in August –the lowest level since February, 2009. ILO Unemployment Rate fell to 7.7% in July in comparison with 7.8% prior month.
Unemployment Rate became a key indicator for further monetary policy line in the UK last month when the Bank of England announced that it would start considering the possibility of interest rate increase in case of unemployment decrease to 7%. Meanwhile, MPC Member David Miles said on Wednesday that he doubted that British unemployment rate would fall quickly despite the signs of economic strengthening.
The dollar has continued falling on Wednesday for four days in a row after the release of a weak labour market report past Friday and in anticipation of FOMC meeting which will take place next week, September 17-18. Mortgage Bankers Association /MBA/ said that MBA Mortgage Applications had fallen by 14% for the recent week compared with the prior week amid rates increase. Wholesale Inventories rose by 0.1% in July compared with the prior month, which turned out lower than expected growth by 0.3%. Wholesale Trade Sales grew by 0.1% m/m against the forecasted growth by 0.4%.
Swiss franc maintained on Wednesday amid UBS outlook increase on Switzerland GDP growth in 2013 to 1.8% from 0.9% and in 2014 to 2% from 1.3% after positive economic readings in the second quarter. The euro has risen higher 1.33 against the dollar for the first time since late August amid weakening concerns about Syria – after US president Barack Obama announced that he was open for diplomatic solution on Syria, which brought relief to the markets of risky assets and increased the pressure on the dollar.
Australian dollar was traded upwards amid Australian consumer sentiment growth to the highest level for almost three years. Westpac Consumer Sentiment rose by 4.7% in September in Australia to 110.6 p. against 105.7 p. in August. Canadian dollar also reached the highest level on Wednesday from the middle of August.
New Zealand dollar rocketed after Reserve Bank of New Zealand meeting where the key interest rate was kept unchanged. However, RBNZ Rate Statement was rather tough – it said that rates increase would probably be necessary next year because of house price inflation. The terms of rates increase will depend on housing and construction sectors dynamics. Interest rate outlook is about 0.50% higher than in June’s outlook.
By MasterForex Company
Overview of the main economical events of the current day - 13/09/2013
Euro-Zone Industrial Output Slumped
The US dollar grew on Thursday against the euro and the pound, fell against the yen and almost didn’t change according to the dollar index amid weak euro-zone and Australian data and unemployment claims decrease to the low of 2006. Unemployment claims fell to 292 thousand last week while a growth to 330 thousand was forecasted. However, too optimistic data could turn out distorted. According to the Department of Labor unemployment claims decrease could be caused by the fact that two states didn’t report about all the claims because of computer programs updating.
The euro was traded slightly downwards amid industrial output decrease in the euro-zone and Italy. Industrial output in the euro-zone slumped in July discrediting the steadiness of the region’s economic recovery. According to the Eurostat euro-zone industrial output dropped by 1.5% in July in comparison with June against the expected decrease only by 0.3% having shown the largest drop since last September. At an annual rate industrial output fell by 2.1% having considerably exceeded the forecasted drop by 0.2%.
Italian industrial output fell by 1.1% in July for a month against the forecasted growth by 0.3%. According to the National Institute of Statistics (Istat) the decrease was recorded in all major sectors except fuel. At an annual rate the reading fell by 4.3% - it is the 23 decrease in a row. ECB chairman Mario Draghi said at the press conference in Riga that he estimated euro-zone economic recovery dynamics with no enthusiasm. The recovery was still very, very green, he said. Meanwhile, the European Parliament approved a bill on Thursday according to which the ECB would become the main regulatory body over most European banks.
The pound also fell a little from 7-month high Vs the dollar amid the Bank of England governor Mark Carney’s speech before the Parliament's Treasury Committee. Communication policy started by the Bank of England favors UK economic recovery, said Carney, but the Bank of England was not satisfied with its growth rates. The central bank is still loyal to its promise not to raise the key interest rate until unemployment rate falls below 7% if inflation remains moderate. According to Carney, BoE guarantees about keeping interest rate increased monetary policy efficiency.
The Australian dollar touched almost 3–month high on Wednesday but then dropped after 4 days of growth. According to Australian Bureau of Statistics Employment Change decreased by 10.8 thousand in August against expected growth by 10 thousand. Unemployment Rate rose by 0.1% to 5.8% from 5.7% in July. Participation Rate in August fell more than expected to 65%. Besides, according to Melbourne Institute Consumer Inflation Expectation in Australia fell to 1.5% in September against 2.3% in August.
New Zealand dollar was traded upwards on Thursday after a tough statement of the Reserve Bank of New Zealand by the end of the central bank meeting which put rate increase on the agenda. The bank said that rate increase was possible in near future when the economy improves. New Zealand may become one of the first developed countries which will start rates increase since 2014.
By MasterForex Company
Overview of the main economical events of the current day - 16/09/2013
The Main Events of the Week
The US dollar fell on Friday against the pound and the yen and almost didn’t change Vs the euro amid the release of weak Consumer Confidence and Retail Sales data in the USA. Preliminary U. of Michigan Consumer Sentiment dropped to 5-month low of 76.8 p. in September from 82.1 p. prior month. The decrease was probably caused by interest rates growth, which restrains housing market growth and economic growth in the whole; and by concerns about Syria.
Retails sales in August grew by 0.2% against expected growth by 0.5% - it is the lowest growth rate for four months. Core Retail Sales rose only by 0.1% while a growth by 0.3% was expected. At the same time, July data were revised upwards. Sales growth restrains tax increase, limited growth of jobs and slow increase of personal income – all this lowers consumer confidence.
By the end of the week the dollar fell by 0.81% according to the dollar index having been put under pressure after a weak labour market report. It fell Vs all major currencies except the yen (+0.13%). The dollar showed the lowest decrease against New Zealand dollar (-1.73%) and British pound (-1.58%). It fell a little less against the euro (-0.96%), Swiss franc (-0.90%), Australian dollar (-0.72%) and Canadian dollar (-0.57%).
The main event of this week and probably of the whole month may become FOMC meeting on September, 17-18 where a decision about the start of tapering off asset purchase program is expected to be taken. On Wednesday the meeting results will be announced and a quarterly press conference of FED governor Ben Bernanke will take place; also FOMC Economic Projections for inflation and economic growth will be released.
Two thirds of Bloomberg respondents wait for Fed decision concerning asset purchase reduction at September meeting; according to forecasts the reduction will be moderate – by $10 billion (to $75 bln a month). According to the opinion poll of The Wall Street Journal, most economists expect the Fed to announce bond purchase reducing by $15 billion a month. As Credit Suisse experts believe the Fed would announce purchase reducing by $20 billion.
In the euro-zone the final inflation data will be released on Monday, on Tuesday – Trade Balance and Current Account, on Friday - Flash Consumer Confidence. German ZEW Economic Sentiment will be released on Tuesday and German Business Optimism Index is expected to rise. In the UK Consumer and Producer Price Index will be released on Tuesday, on Wednesday – Bank of England Meeting Minutes and on Thursday – Retail Sales and CBI Industrial Order Expectations.
The decision of the Swiss National Bank on the key interest rate will be announced on Thursday. Japanese trade balance will be published on Thursday. In Australia the Reserve Bank of Australia Meeting Minutes and New Motor Vehicle Sales will be released on Tuesday, on Wednesday - Conference Board and Westpac Leading Index. In New Zealand quarterly data will be released: on Wednesday – Current Account and on Thursday – GDP for the second quarter.
In Canada Manufacturing Sales will be published on Tuesday, on Thursday - Wholesale Sales and on Friday – Inflation. There will be quite a lot of data in the USA: on Monday - Empire State Manufacturing Index and industrial output, on Tuesday – Consumer Price Index, Capital Influx and NAHB Housing Market Index; on Wednesday - Building Permits and Housing Starts; on Thursday - Existing Home Sales, Philadelphia Fed Manufacturing Index and Current Account.
By MasterForex Company
Overview of the main economical events of the current day - 17/09/2013
Larry Summers Won’t Be a New Fed Chairman
The US dollar dropped on Monday after former US Finance Minister Larry Summers had withdrawn for Fed chair but then the dollar partially recovered its lost positions. Past Sunday Larry Summers, nominated by Obama a potential Ben Bernanke’s successor as the Fed chairman, withdrew his name justifying his decision with possible difficulties inside the Fed in case of his election, which may have a bad impact on the whole bank and the whole American economy.
Larry Summers was considered a “hawk”, a supporter of tougher monetary policy and in case of his election the probability of total tapering off of stimulus programs in the shortest period of time was growing. This decision increases the chances of Fed vice chairman Janet Yellen, who supports a milder monetary policy, to become a more possible candidate for the Fed chair – although Obama may put forward other candidates for the chair. Other top candidates are former Fed Vice Chairman Donald Kohn and former Treasury Secretary Tim Geithner.
Morgan Stanley experts believe that Summers’ withdrawal from the race for the Fed chair adds pressure on the dollar in anticipation of FOMC meeting. Commerzbank also believes that Yellen as Fed governor may favour dollar’s weakening in long-term perspective. Summers’ withdrawal may lower the concerns about the start of QE tapering off.
Other US data released on Monday had little influence on trading. Empire State Manufacturing Index dropped to 6.29 p. in September from 8.24 p. in August while a growth up to 9.1 p. was forecasted. The decrease was due to employment situation worsening. The US industrial output grew by 0.4% in August, which turned out a little less than expected growth by 0.5% and Capacity Utilization rate slightly increased to 77.8% as it was expected.
ECB president Mario Draghi making speech on Monday said about the progress in the efforts of euro-zone stabilization. Meanwhile, Eurostat data showed that euro-zone Labor Costs decreased to almost 3-year low in the second quarter and were behind inflation rates. It puts pressure on the finance of households and has a negative impact on the region’s stable economic recovery outlook. According to the Istat data, Italian trade balance rose by 64.6% in July to 5.95 billion euro against 3.62 billion in June.
New Zealand dollar reached 4-month high on Monday against the US dollar. Housing market data still support it. REINZ Housing Price Index rose by 2.1% in August compared with the prior month. REINZ House Sales rose by 8.5% in August Vs the same period last year. Risk appetite growth was supported by the agreement on chemical weapon in Syria between Russia and the USA past weekend.
By MasterForex Company
Overview of the main economical events of the current day - 18/09/2013
Euro-Zone Economic Sentiment Reached 4-Year High
The US dollar was traded slightly downwards on Tuesday against most major currencies in anticipation of the US Federal Open Market Committee (FOMC) decision by the end of 2-day meeting on Wednesday – amid weak US inflation statistics and strong economic sentiment growth statistics data in the euro-zone. The attention of market participants on Wednesday will be drawn by the results of the FOMC meeting where the Fed is expected to take a decision concerning QE reduction.
According to the Bloomberg poll most experts expect the Fed to reduce asset purchase by $10 billion – to $75 billion a month. In July the expectations were overestimated - $20 billion. The Fed is supposed to finish these programs totally in June, 2014. The officials of the Federal Reserve at the September meeting will have to consider three negative factors at once which may weaken the US economy in the nearest months: real interest rates growth in the country, complicated political situation abroad and a new episode of never-ending budget war in Washington.
Meanwhile, Congressional Budget Office (CBO) warned on Tuesday about a continuing growth of the US public debt and the risks connected with it. According to the CBO estimates, the US public debt today is 73% of GDP – it is the highest level in the country’s history except the Second World War period. Present level of the public debt is twice higher than at the end of 2007, according to the CBO report.
The USA consumer price growth in August slowed down to 3-month low. Consumer Price Index (CPI) rose by 0.1% m/m in August while a growth by 0.2% was forecasted. Annual rate inflation slowed down (growth by 1.5% Vs forecasted growth by 1.6%). Consumer Price Index Ex Food & Energy also grew by 0.1% m/m against the forecasted growth by 0.2%.
The pound was traded significantly worse that the euro also due to weak inflation report. Consumer Price Index rose by 0.4% in August against the expected growth by 0.5%. Inflation dropped to 2.7% in August at an annual rate in comparison with 2.8% in July. Core CPI remained unchanged in August – at +2% y/y having fallen short of expectations for a moderate growth to 2.1% y/y. Producer Price Index also turned out worse than forecasted.
The euro was traded upwards. German ZEW Economic Sentiment for the nearest six months rose in September to its high of 49.6 p. since April, 2010 – from 42 p. in August having exceeded the reading of 45 p. considerably.
Euro-Zone ZEW Economic Sentiment rocketed to 58.6 p. from 44 p., the highest reading in 4 years. German ZEW Current Situation rose to 30.6 p. from 18.3 p. in September – the highest reading for 15 months.
The Australian dollar rose on Tuesday after the publication of Australian Reserve Bank Meeting Minutes. The Bank didn’t exclude the possibility of further key interest rate decrease but it doesn’t plan doing it at the nearest time and waits for further clearing of economic situation. Lower lending rates and the AUD rate stimulate economic growth. But other indicators are less positive and the bank prefers waiting for additional evidence of economic growth before taking decisions concerning its further actions. The Canadian dollar was traded upwards amid Manufacturing Sales growth by 1.7% in July that exceeded expected growth by 0.5%.
By MasterForex Company
Overview of the main economical events of the current day - 19/09/2013
No Decision on QE Reduction Is Taken, the Dollar Slumped
The US dollar slumped just after the announcement of the FOMC 2-day meeting results, where it was decided not to reduce bond purchase program. A slight reduction of asset purchase by $5-$10 billion a month was widely expected and the Fed decision was sudden. The dollar fell to more than 7-month low according to the dollar index and showed the lowest drop since July, 10.
The Fed kept interest rate at 0.0%-0.25%. Nine of ten members of the meeting voted for keeping monetary policy unchanged. The head of the Federal Reserve Bank of Kansas Esther George opposed again – for the sixth time this year. She fears that keeping high level of stimulation increases the risks of economic and financial imbalance in future and also may have a negative effect on inflation in long-term perspective.
The economy is not strong enough to stop supporting it by quantitative easing, says the Fed. The decision on QE tapering off is put off for the next FOMC meetings this year. It is necessary to wait for new evidences of economic progress stability before correcting asset purchase rate. The Fed kept unemployment and inflation thresholds unchanged and again confirmed that it would increase or decrease bond purchases according to the economic outlook.
In economic outlooks published by the end of the meeting FOMC members revised downwards their forecasts on economic growth for this and 2014 years. Unemployment and inflation forecasts almost didn’t change. Most Fed officials expect the first interest rate increase in 2015 or later. Three of them believe that it is possible already in 2014.
Making speech at a press conference the Fed governor Ben Bernanke tried to explain taken decisions by poor labour market conditions, tightening financial conditions and fiscal problems. Bernanke said that unemployment rate was not an accurate indicator of labour market state as because of labour force reduction unemployment decrease was not totally due to new jobs creation. There is no any fixed calendar for asset purchase reduction and it can start later this year.
US housing market statistics data released on Wednesday again proved not quite stable economic state which was the reason of the FOMC meeting decisions. Building permits dropped by 3.8% in August at an annual rate to 918 thousand against 954 thousand in July. Housing starts in August also turned out worse than expected – they rose only by 0.9% (to 891 thousand) Vs the forecasted growth by 2.3% to 917 thousand. Mortgage rate increase has a negative impact on housing market recovery within recent six months.
The euro and the pound reached its high on Wednesday against the dollar for 7 and 8 months respectively; and Australian dollar – 3-month high. MPC Meeting Minutes supported the pound and gave an optimistic estimate to British economy. The third quarter GDP growth outlook was raised. Further stimulating may be required only in case of economic recovery slow down. According to the meeting minutes Monetary Policy Committee members didn’t think that market interest rate increase failed to meet fundamental economic indicators.
By MasterForex Company
Overview of the main economical events of the current day - 20/09/2013
UK Retail Sales Fell Unexpectedly
US dollar trade was mixed on Thursday and it made attempts of correction after prior day significant weakening and amid good US statistics. The dollar grew against the yen, the pound and Australian and Canadian dollars and slightly weakened against the yen, franc and New Zealand dollar. The Fed didn’t reduce asset purchase program, which led to a sharp decrease of the dollar across the whole market.
US Existing Home Sales rose by1.7% m/m in August to 5.48 million at an annual rate – the highest level since May, 2010 – while a drop to 5.25 million was expected. Potential buyers hurried to close deals before mortgage rates rose even higher. Philadelphia Fed Manufacturing Index rose from 9.3 p. in August to 22.3 p. in September, the highest level since March, 2011. A growth only up to 10 p. was expected. The index is above zero which has been showing conditions improvement for 4 months in a row.
Conference Board Leading Index rose by 0.7% m/m in August having exceeded the expectations of growth by 0.6% - which may signal of increasing economic activity rate in the nearest time. The US Current Account Deficit dropped by 5.7% in the second quarter to $98.9 billion having reached the lowest level for almost four years, which was favoured by exports increase and a larger income account surplus.
Initial Claims rose considerably less than expected last week to 309 thousand – while a growth to 330 thousand was forecasted. 4-Week Moving Average of Initial Claims continues falling having dropped by 7 thousand by the end of the last week to 314.75 thousand – the lowest level since October, 2007. Meanwhile, the data released a week ago still were not revised in a proper way due to programming problems.
The pound fell after a weak retail sales report which dropped unexpectedly by 0.9% m/m in August after three months of growth. The indicator was expected to grow by 0.4%. At an annual rate retail sales growth slowed down to 2.1% from 3% prior month against the expected growth by 3.3%. Meanwhile, CBI Industrial Order Expectations rose significantly in September having reached the level of 9 – such reading was only in August, 2007 before the crisis. The reading exceeded zero level for the first time in 2.5 years, which can indicate that the economy continues recovering.
Swiss franc grew amid Swiss National Bank meeting where the monetary policy and also EURCHF floor limit were kept unchanged. The central bank raised the GDP growth outlook for the current and 2014 years. The government of Switzerland also raised GDP growth outlook and lowered unemployment outlook in 2013-2014 years. The yen weakened on Thursday amid Japanese stock index Nikkei growth to almost 2-month heights and also weak Japanese trade balance data.
New Zealand dollar was supported by GDP data which turned out better than expected. The country’s economy grew by 0.2% in the second quarter in comparison with the prior quarter despite agricultural production decrease, which met the expectations. At an annual rate the GDP rose by 2.5% Vs expected growth by 2.3%. Besides, first quarter data were revised upwards.
By MasterForex Company
Overview of the main economical events of the current day - 23/09/2013
The Main Events of the Week
The US dollar slightly grew Vs Canadian and Australian dollars on Friday and almost didn’t change Vs other major currencies amid no any significant US statistics. Canadian dollar was traded downwards amid the release of inflation report which showed inflation permanence in August – while it was expected to grow by 0.1% Vs the prior month.
Dollar slightly stabilized on Friday and made attempts of growth after FOMC member Bullard’s statement that a small reduction of bond purchases was possible already at the next FOMC meeting at the end of October. He said that the Fed was close to start tapering off QE in September but there was no reason for bond purchase reduction as macroeconomic data were not so good. The decisions on monetary policy always depend on the data and are not carried out according to a predetermined course.
By the end of the week the dollar considerably dropped to all major currencies (except the yen) having shown the second weekly decrease in a row after an unexpected decision of the Fed which declared on Wednesday that it wouldn’t start bond purchase reduction referring to slow economic growth. The dollar fell according to the dollar index by 1.10% having shown the lowest weekly decrease since early July. The result of the FOMC meeting will keep the dollar under pressure till the end of the year, according to the UBS.
According to the Barclays, Deutsche Bank and Goldman Sachs QE tapering off will be announced only in December when the Fed updates its economic outlooks and makes a press conference. The Bank of America considers that it won’t happen this year. BNP Paribas is also sure that the start of asset purchase tapering off will be only in January or March, 2014.
According to PIMCO, we won’t see QE reduction this year and it advises investors to buy euro at any downturn after the elections in Germany. According to Barclays, asset purchase program will be totally tapered off only by the end of June, 2014 and according to Goldman Sachs, it will happen only by September – both outlooks are moved three months back than the previous expectations of the banks.
In the euro-zone Flash Manufacturing PMI & Flash Services PMI of France, Germany and the whole euro-zone will be released on Monday; on Friday – Confidence Indexes from the European commission. ECB president Mario Draghi will make a speech on Monday in the European Parliament about economy and on Friday – in Italy. In Germany IFO Business Climate will be released on Tuesday, on Wednesday - GfK Consumer Climate and on Friday – preliminary inflation data. Confidence and Sentiment indexes are expected to grow, which will again indicate euro-zone economic recovery after coming out of the recession in the second quarter.
In Great Britain BBA Mortgage Approvals will be published on Tuesday; on Wednesday – CBI Realized Sales; on Thursday – Current Account for the second quarter and Final GDP for the second quarter; and on Friday - GfK Consumer Confidence and Index of Services. In Japan Consumer Price Index will be released on Friday.
In New Zealand Trade Balance will be published on Wednesday and on Friday - ANZ Business Confidence. Retail Sales in Canada will be released on Tuesday. In RBA Financial Stability Review will be published on Wednesday.
In the USA Chicago Fed National Activity Index and Flash Markit Manufacturing PMI will be released on Monday; on Tuesday - S&P/Case-Shiller Home Price Index and CB Consumer Confidence; on Wednesday - Durable Goods Orders and New Home Sales; on Thursday – Final GDP for the second quarter and Pending Home Sales; and on Friday - Personal Income and Spending and Revised U. of Michigan Consumer Sentiment.
By MasterForex Company