Greece Debt crisis shaking again European economy – March 1-5 2010
The first week of the month is always busy in forex trading. Apart from Non-Farm Payrolls, we have 3 GDP releases and 4 rate decisions from all over the world, and many other major events. Let’s see what’s awaiting us on the crowded calendar.The first week of the month is always busy in forex trading. Apart from Non-Farm Payrolls, we have 3 GDP releases and 4 rate decisions from all over the world, and many other major events. Let’s see what’s awaiting us on the crowded calendar.
1. European Unemployment Rate: Published on Monday at 10:00 GMT. One of biggest burdens on Europe is unemployment rate, standing at 10%, double digits, for two months. In Spain, the number reaches 20%. A drop in this figure is essential for moving the interest rate, but it will probably take the other direction and rise to 10.1%.
2. Canadian GDP: Published on Monday at 13:30 GMT. Canada’s unique monthly GDP has posted three positive months, with the last print being better than expected 0.4%. The upcoming release is expected to show another 0.4% rise and completes the data for Q4 of 2009 and should provide another boost for the Canadian dollar.
3. American ISM Manufacturing PMI: Published on Monday at 15:00 GMT. This important purchasing managers’ index has been on the rise and jumped up to 58.4 points last month, significantly better than expected. It’s now predicted to ease to 57.9 points.
4. Australian rate decision: Published on Tuesday at 03:30 GMT. After last month’s disappointing decision not to raise the rates, there have been different hints about the upcoming decision, most of them leading to a fourth rate hike, to 4%. This should help the Australian dollar, that was hurt by risk aversion trading.
5. Swiss GDP: Published on Tuesday at 06:45 GMT. Switzerland was relived of 3 quarters of contraction in Q3 of 2009, when the economy grew by 0.3%. This stable recovery is expected to continue and push the Swissy upwards, despite the central bank’s effort to bring it down.
6. Canadian rate decision: Published on Tuesday at 14:00 GMT. The BOC is expected to leave the Overnight Rate unchanged at 0.25%, and again, the focus will be on the rate statement. The BOC was very clear about the timing – June 2010. Some expected a declaration about an earlier move, but this didn’t happen in previous decisions. Will it happen this time?.
7. American Beige Book: Published on Tuesday at 19:00 GMT. Two weeks before the FOMC meeting which decides on rates, this overview of the economy is released to the public. This could provide a hint about the next decision, or the next moves by the Fed, such as the recent surprising mini rate hike.
8. Australian GDP: Published on Wednesday at 00:30 GMT. The Australian economy enjoyed an improving job market throughout the fourth quarter of 2009, and this should be reflected in the GDP as well, showing the strength of the Australian economy. Q3 was disappointing, with a small growth rate of 0.2%. A strong growth rate of 0.9% is now expected.
9. American ADP Non-Farm Payrolls: Published on Wednesday at 13:15 GMT. This release always shakes the markets, as it’s sometimes considered to be a strong indicator for the Non-Farm Payrolls. Last month it showed a loss of only 22K jobs, better than expected – but the Non-Farm Payrolls were worse than expected. So this figure should be handled with care. It’s expected to show a small drop of 9K.
10. American ISM Non-Manufacturing PMI: Published on Wednesday at 15:00 GMT. In the non-manufacturing sectors, the situation isn’t as good as in manufacturing. ISM showed a score of only 50.5 points, hardly above the critical 50 point mark that indicates economic expansion. This figure fell short of expectations in the past four months. A small rise to 51 is expected.
11. British rate decision: Published on Thursday at 12:00 GMT. Mervyn King hurts the Pound every week. This time, his chance will come at the decision about the Official Bank Rate which will probably stay at 0.5%. Also the Quantitative Easing program (Asset Purchase Facility) isn’t predicted to move from the 200 billion pound already allocated to it, but there might be hints about its renewal.
12. European rate decision: Published on Thursday at 12:45 GMT. Just 45 minutes after the British decision, Jean-Claude Trichet’s ECB will announce the European Minimum Bid Rate. Also here, no changes are expected, but the complementary ECB Press Conference will supply lots of action. The Greek crisis will still be in the limelight.
13. American Unemployment Claims: Published on Thursday at 13:30 GMT. Providing the last hint about the Non-Farm Payrolls, this weekly release is expected to show some improvement after last week’s disappointing figure – a rise to 496K, a number not seen in a long time. It’s expected to drop back to 474K.
14. American Pending Home Sales: Published on Thursday at 15:00 GMT. This figure returned to stability last month, rising by 1%, but this time it’s predicted to fall again as the housing sector continues to suffer, as we see in the new and existing home sales numbers. A rise of 1.6% is expected.
15. Non-Farm Payrolls: Published on Friday at 13:30 GMT. After two more months of negative numbers, the king of forex, the predictions now turned negative. Last month’s releases were confusing, as 20K jobs were lost, but the unemployment rate dropped significantly from 10% to 9.7%. Will it be confusing again? Or will we see finally see good numbers? This event will impact forex trading before and after the event, for quite some time. Current expectations are for another loss of jobs: 35,000. Also the unemployment rate is expected to be bad, edging up to 9.8%.
This Market Weekly Outlook was brought to you by our partner ForexCrunch.com
U.S. Dollar Slips ahead of Bernanke Testimony- February 22-26
After another wild week and a very surprising rate hike, the last week of February also has its share of big events. Bernanke will continue to dominate the scene with two testimonies and revised GDP in the UK and the US will supply an exciting end to the week. And there are more market moving events. Here’s the weekly outlook.
Ben Bernanke stole the show with a surprising hike of the discount bank rate. This came after the close of the American stock markets but forex trading continues all the time – the dollar leaped. Some currencies took a bigger hit than others. This event will continue to dominate trading on Monday when there aren’t any major releases.
1.German Ifo Business Climate: Published on Tuesday at 9:00 GMT. This wide survey of 7,000 businesses has a strong impact on the Euro. Contrary to the ZEW report that is recently weak, this indicator has been rising steadily in the past year, edging up each time. From last month’s 95.8 score, it’s predicted to tick up to 96.3.
2.American CB Consumer Confidence: Published on Tuesday at 15:00 GMT. Consumer confidence impacts sales and the whole economy. In the past three months, this indicator rose from the low level it fell to, and also revisions to previous releases have been to the upside. This time, it’s predicted to drop from 55.9 to 55 points. This has a wide impact.
3.New Zealand Inflation Expectations: Published on Wednesday at 02:00 GMT. New Zealand has a high interest rate, but expectations for a rate hike like its neighbor Australia haven’t been met. A rate hike depends a lot on prices. This quarterly release will show the direction of inflation and a possible rate hike. Last quarter, expectations rose from 2.3% to 2.6%. Now they are predicted to edge up some more.
4.Ben Bernanke testifies: Happens during Wednesday at 15:00 GMT and Thursday at 14:00 GMT. After Bernanke’s shocking mini-rate hike that was made off the main hours, he’ll make his semi-annual report in broad daylight in front of two committees in Washington DC. Although he might use confusing language, his words will shake the markets.
5.American New Home Sales: Published on Wednesday at 15:00 GMT and overshadowed by Bernanke. New Home Sales took a big dive two months ago and showed everybody that the housing sector depends on government aid. It hasn’t returned to previous levels. From 342K, sales are predicted to edge up to 350K this time.
6.American Durable Goods Orders: Published on Thursday at 13:30 GMT. Orders have been revised to the upside in the past month, from 0.3% to 1%. Also Core orders have been revised to 1.4%. The positive trend is expected to continue, with a rise a rise of 1.6% in orders and 1.2% in core orders. This figure doesn’t touch the consumers, but has a long term impact on the economy.
7.American Unemployment Claims: Published on Thursday at 13:30 GMT and overshadowed by goods orders. The American job market is still fragile, and the number of claims refuses to leave the area it is in in the past months. Last week’s 473K is predicted to be followed by 466K this time. A number under 430K or above 480K will shake the markets.
8.British Revised GDP: Published on Friday at 9:30 GMT. Did Britain really return to growth? That’s a big question. The initial release for Q4 finally showed growth – but only 0.1%. Expectations are optimistic and a revision to 0.2% is expected. According to the unofficial NIESR GDP estimate, the economy did grow by only 0.1%. A drop to 0% growth or another quarter of contraction will be devastating for the Pound.
9.Swiss KOF Economic Barometer: Published on Friday at 10:30 GMT. This indicator, locally called Konjunkturbarometer, is an important composite index that usually reflects the situation of the Swiss economy quite well, and has a strong impact. From 1.77 points it’s predicted to rise to 1.77 points this time.
10.American Prelim GDP: Published on Friday at 13:30 GMT. The best is kept almost for last. There were many doubts about the rapid American growth that was reported in the first release. The second release is predicted to show only a small downward revision: from 5.7% to 5.6% in Q4 of 2010. The markets will surely shake with this release. A long term rise in the dollar’s value cannot happen without an improvement in jobs as well.
11.American Existing Home Sales: Published on Friday at 15:00 GMT. This release will be somewhat overshadowed by the GDP publication. Similar to new home sales, this figure, that accounts for more sales, is also volatile and is dependent on government aid. After a drop of 1 million sales last month, stability is expected this time – a tiny rise from 5.45 to 5.51 million.
This Market Weekly Outlook was brought to you by our partner ForexCrunch.com http://www.forexcrunch.com.
Best Regards,
TradeSmarter Team
Disclaimer: Binary options trading might carry potential rewards, but also potential risks. You must be aware of the risks and willing to accept them in order to trade in the financial markets. Don’t trade with money you can’t afford to lose.
Greek Economy Spells Trouble For Eurozone – Market Weekly Outlook – February 15-19
A volatile week full with hope and fear comes to an end with currencies returning to the same spots. The week ahead contains a nice mix of events from all over the world: a rate decision in Japan, employment data from Britain, and lots of American numbers, with important inflation data to close the week. Here’s an outlook for the major events in the week ahead.
The Greek crisis is far from over. While Greece is only a small country at the edge of the Euro-zone, the implications of debt and the ways to deal with it have an impact on many other troubled countries in the region that is on the brink of new recession. This also has a wider impact – debt problems trigger risk aversion trading – dollar buying. OK, let’s start the review:
1.Japanese GDP: Published on Sunday at 23:50 GMT. As of Q2 of 2009, Japan is out of recession. The growth rate has dropped to 0.3% in Q3, after being first reported at 1.2%. Apart from slow economic growth, Japan historically suffers from deflation, a problem that won’t be solved soon. Growth of 1% is expected now.
2.British CPI: Published on Tuesday at 9:30 GMT. This important indicator has risen sharply in recent months. The last print was 2.9%, and the upcoming number is predicted to be 3.6%, above the government’s target. Mervyn King dismissed the inflation threats and signaled that no rate hike is underway. Will he continue this stance once again? Rising inflation isn’t seen elsewhere, and it will be interesting to see the impact on the whole market.
3.ZEW Economic Sentiment: Published on Tuesday at 10:00 GMT. This is a major market mover – especially the release for Germany.
In the past months, it has deteriorated sharply, going hand by hand with the Eurozone’s troubles, and Germany’s stagnant economy. It’s expected to dive again – this time from 47.2 to 41.9 points.
4.American TIC Long-Term Purchases: Published on Tuesday at 14:00 GMT. Foreign investment in the US has made a leap last month, rising from 20 to 126 billion dollars. This confidence in the US economy and the dollar probably won’t repeat itself, at least not so strong – 50 billion is predicted this time. A stronger number will boost the dollar.
5.British Employment Data: Published on Wednesday at 9:30 GMT. The number of unemployed people made a turnaround in Britain two months ago and the positive trend continued last month as well. The Claimant Count Change, an early an important indicator is expected to show another “positive loss” of unemployed people this month – 14.3K. The British Unemployment Rate is predicted to remain stable at 7.8%, but economists were wrong with this figure over and over again. Positive numbers will also push towards a rate hike.
6.American Building Permits: Published on Wednesday at 13:30 GMT. The housing sector was one of the main contributors to the downturn in the economy, and is recovering slowly. The annualized number of 0.65 million is predicted to be followed by a drop to 0.62 million. The economy cannot make a significant advance without a healthy housing sector. Also note the housing starts published at the same time.
7.FOMC Meeting Minutes: Published on Wednesday at 19:00 GMT. Although the wording of the statement hasn’t changed, there was one surprise in the recent American rate decision – one member voted to change the wording and start signaling a future rate hike. When the minutes will be revealed, we’ll get to see if other members also began thinking out loud about such an option.
8.Japanese Rate Decision: Published on Thursday, in the early hours. No rate hike is expected in Japan, which suffers from deflation. The Overnight Call Rate is predicted to remain unchanged at 0.1% but the views that that will be expressed about the economy by the BOJ usually move the Yen.
9,American PPI: Published on Thursday at 13:30 GMT. Producer prices aren’t always a market mover, but this time, a rise of 0.8% is predicted, much higher than last month’s 0.2% rise and much higher than previous months. Such a rise might cause Bernanke to rethink the “extended period” wording in the FOMC Statements.
10.American Unemployment Claims: Published on Thursday at 13:30 GMT. After a surprise last week – a drop to 440K, the drop in jobs seen in the NFP can be forgotten. A small rise to 445K is predicted this time. Only another drop, preferably below 430K can boost the dollar.
11.American Philly Fed Manufacturing Index: Published on Thursday at 15:00 GMT. This important gauge has seen 6 months of improving conditions, but last month was disappointing with a drop to 15.2 points. A steady rise to 17.2 is predicted this time.
12.American CPI: Published on Friday at 13:30 GMT. The major inflation figure closes the week. Contrary to the expectations from the PPI, consumers probably didn’t see a significant rise in prices. CPI is predicted to rise by 0.3% and Core CPI, an indicator that the Federal Reserve watches, is expected to rise by 0.2% – very stable. A jump will make the markets jump, seeing another crazy Friday. For USD/CAD traders, note that the Canadian CPI is published around the same time.
This Market Weekly Outlook was brought to you by our partner ForexCrunch.com.
Click here to Trade Binary Options with our partner StartOptions.com
Best Regards,
TradeSmarter.com
Disclaimer: Binary options trading might carry potential rewards, but also potential risks. You must be aware of the risks and willing to accept them in order to trade in the financial markets. Don’t trade with money you can’t afford to lose.
TradeSmarter.com Market Weekly Outlook – February 8-12
After one of the wildest weeks that we’ve seen in quite a while, the upcoming week seems more quiet, at least at the beginning. The echoes of the Non-Farm Payrolls will be heard during this time. Later on, some major market moving events are due. Here’s the outlook for the second week of February.
Finance ministers of the G7 nations are meeting in the remote Canadian town of Iqaluit and may release important comments that might impact the opening of the markets. The final remarks by US Treasury Secretary Timothy Geithner are of high importance. He’ll speak more than 24 hours before the markets open, so there will be enough time to digest his words. Let’s review the week’s events:
- Swiss Retail Sales: Published on Monday at 8:15 GMT. Switzerland enjoys good fundamentals but the central bank doesn’t like it at all. The SNB intervenes in the markets, but usually this doesn’t have a long lasting effect. This important figure is expected to rise by an annual rate of 1.6%, double of last month’s number. There will action in USD/CHF around this release.
- British Inflation Report: Published on Wednesday at 10:30 GMT. This important quarterly event will address the rising inflation in Britain and the central bank’s measures against it. This report, accompanied by a press conference by Mervyn King goes beyond inflation and will deal with the whole economy, which is shaky.
- US and Canadian Trade Balance: Published together on Wednesday at 13:30 GMT. This double-feature event always shakes USD/CAD. The American deficit is predicted to squeeze from 36.4 billion to 35.5 billion, while the Canadian trade balance is almost balanced. It’s predicted to stand at 0.1 billion, and could also turn into a surplus.
- British NIESR GDP Estimate: Published on Wednesday at 15:00 GMT. After the disappointing official Q4 GDP, we’ll get an initial unofficial glimpse at the British economy in 2010. Last month’s release related to the whole of Q4, and showed a higher number than the official release, but lower than economists’ estimates. The Pound will need a more serious growth to rise.
- Ben Bernanke testifies: On Wednesday. Exact time currently unknown. The head of the Federal Reserve will lay out the plans for exiting the crisis, and the emergency measures. During this testimony, he’ll probably provide an updated overview of the American economy.
- Australian employment figures: Published on Thursday at 00:30 GMT. Australia enjoys a healthy job market, and it’s predicted to remain rather steady. Australian unemployment rate is predicted to edge up to 5.6% from 5.5% but the employment change is expected o be positive again, showing a rise of 15,000 jobs. This is less than last month’s nice 35,000 job gain.
- American Retail Sales: Published on Thursday at 13:30 GMT. Both retail sales and core retails sales disappointed last month with drop of 0.3% and 0.2%. These important consumer-related figures are expected to rise this time by 0.3% each. This release, together with jobless claims, will shake the markets.
- American Unemployment Claims: Published on Thursday at 13:30 GMT. This important weekly figure disappoints every week with a number that is higher than expectations. After reaching 480K, economists expect a drop to 455K. This will be the first job figure after the Non-Farm Payrolls.
- New Zealand Retail Sales: Published on Thursday at 21:45 GMT. Although more people are unemployed in New Zealand, the consumers continue buying. Both retail and core retail sales have risen by 0.8% last month, and this trend is expected to continue, helping the beaten kiwi dollar.
- German GDP: Published on Friday at 7:00 GMT. Europe’s largest economy is the first to release GDP data for Q4. This initial release is expected to show a modest growth rate of 0.3%, much less than 0.7% that was reported in Q3. Germany led the continent with nice growth already in Q2. Now it might lag behind.
- European Flash GDP: Published on Friday at 10:00 GMT. 3 hours after the German release, the figure for the whole continent is due. This is expected to be better than the German one, and show a growth rate of 0.4%. This European morning will be very volatile for EUR/USD. Note that French and Italian numbers are also released during this time, something that might add confusion.
- American Consumer Sentiment: Published on Friday at 14:55 GMT. The week ends with a strong note – the University of Michigan provides its preliminary consumer sentiment figure, which is doing quite well. After reaching 74.4, it’s predicted to edge up to 75.2 points. This will shake the markets before the weekly close.
This Market Weekly Outlook was brought to you by our partner ForexCrunch.com.
Click here to trade Binary Options on real-money with our partner StartOptions.com.
Best Regards,
TradeSmarter.com
Disclaimer: Binary options trading might carry potential rewards, but also potential risks. You must be aware of the risks and willing to accept them in order to trade in the financial markets. Don’t trade with money you can’t afford to lose.
TradeSmarter.com Market Weekly Outlook – January 25-29
A busy week is ahead of us: rate decision in the US, Japan and New Zealand and GDP releases from the US, UK and Canada are part of an eventful week. Will we see more dollar strength? Here’s an outlook for the last week of January.
Beginning on Wednesday, the World Economic Forum meets in Davos, Switzerland. In their 4-day annual meetings, many central bankers, senior politicians and business leaders from all over the world chit-chat with reporters and also make official and moving statements. Their sporadic comments can shake the markets during most of the week.
Monday, January 25th: Australian PPI provides a strong start to the week, as this is a quarterly figure that has a strong impact on the Aussie.
American Existing Home Sales are expected to post a big drop after two strong months, and fall to 6.04 million.
Tuesday, January 26th: The Bank of Japan makes a rate decision. While the Overnight Call Rate isn’t expected to move from 0.1%, but the Monetary Policy Statement could sure shake the Yen, especially if economic forecasts are changed.
German Ifo Business Climate is an important survey for the Euro. It’s expected to continue the steady rising trend and edge up to 95.3 points. Last week’s survey, from ZEW, was bad and sent the Euro down.
Britain probably finished the recession. Prelim GDP for Q1 is expected to show growth of 0.4%. The unofficial number from NIESR talked about 0.3% growth, and they are usually correct, so there’s a good reason to be optimistic. Right after the release, Mervyn King will be speaking.
Last week King weighed on the Pound. A volatile time for the Pound.
In the US, the year-over-year S&P/CS Composite-20 HPI is expected to show a smaller drop in the prices of homes, 4.9%. The more important figure is the CB Consumer Confidence, that recovered from a big fall, and is now expected to climb to 53.7 points.
Wednesday, January 27th: Australian CPI is a quarterly release and has a strong impact on policymakers. After a modest rise of 0.1%, Q4 is expected to show a rise of 0.4%. A stronger rise is necessary to push the Aussie higher.
American New Home Sales are expected to recover from last month’s big fall, and rise to 372K. This will be a warmup for the big event.
Bern Bernanke is expected to leave the interest rate unchanged. The Federal Funds Rate will probably stay at a maximum level of 0.25%, and traders will focus on the usually confusing FOMC Statement. Last month, it took the market 6 hours to digest the statement, which seemed balanced at first. As they focused on the upside of the statement, cautious signs of recovery, the dollar rose. But the message sure was confusing.
Also in New Zealand we have a rate decision. The hot air came out of the balloon with low CPI in New Zealand and China’s tightening measures. So, the Official Cash Rate will probably remain unchanged at 2.5%. Hints for future policy will be provided in the RBNZ Rate Statement.
Thursday, January 28th: American Durable Goods Orders are expected to jump by 2.1% after remaining almost unchanged last month. Core Durable Goods Orders, no less important, are expected to do the opposite and rise by 0.4% after a leap last month.
Unemployment Claims that disappointed last week, are predicted to go back down to 452K.
In New Zealand, both Building Consents and Trade Balance will impact the kiwi, with the latter expected to show a smaller deficit this time.
Near the end of the day, Japan will be releasing Household Spending which is expected to rise and Tokyo Core CPI which is still expected to show an annual drop in prices – 1.8%.
Friday, January 29th: European Unemployment Rate is expected to be bad once again. After reaching 10% last month, it’s predicted to rise to 10.1%.
In Switzerland, the KOF Economic Barometer will move the Swissy.
Canada releases its monthly GDP, which is expected to show a 0.3% growth, better than the previous month. Last week’s rate decision hurt the loonie. USD/CAD will shake during this time, especially with the next release.
American Advance GDP for Q4 holds high expectations: an annual growth rate of 4.6%. After exiting recession in Q3 with a 2.2% growth rate, things are expected to get better in Q4. This release will shake the markets.
Chicago PMI is predicted to post a small drop, and the Revised UoM Consumer Sentiment is expected to be revised to the upside. Both events will be overshadowed by the Advance GDP release.
Market Weekly Outlook was brought to you by our partner ForexCrunch.com
Disclaimer: Binary Options Trading might carry potential rewards, but also potential risks. You must be aware of the risks and willing to accept them in order to trade in the financial markets. Don’t trade with money you can’t afford to lose.
