Thursday 24/09/2015

Germany 09:00 BST

The German Business Climate Index combined with the German Current Assessment and German Business Expectations form a combined index, which rates the current German business climate as well as business expectations for the next six months. All three indexes are composite and based on a survey of manufacturers, builders, wholesalers and retailers.

What the forecasters say

The most important of the three is the German IFO Business Climate Index which is forecast to see a 0.40 fall, with markets likely to respond negatively to a published figure of 108.10 or less.

The German Current Assessment does not consider future expectations, and is expected to fall by 0.20 to a likely published figure of 114.10, which is in line with what we would expect given recent German GDP data.

Finally, we have the German Business Expectations Index that measures the future confidence of German businesses whilst excluding the forecasts regarding current business conditions. The index is currently expected to fall by 0.50 resulting in a forecast published figure of 102.50. The markets are likely to respond negatively to any published figures that are less than the forecast.

Our opinion

Germany still maintains the role of insurer when it comes to the euro zone even as we begin to see a possible resolution to the Greek issue. As a result we would expect to see some negativity within the euro if the current negative forecasts are reflected in the published figure. With both the Euro and the DAX likely to suffer from negativity throughout morning European trading.

View Points – Currencies and Indexes

The combination of releases is likely to place some downward pressure on the major European exchanges including the CAC, EuroNext and especially the DAX. As a result if the forecasts are equalled or not met the Euro is likely to see meaningful negative pressure, interesting currency pairs that may be worth a quick look may include the EUR/CAD, EUR/AUD, EUR/GBP, EUR/USD and EUR/JPY.

 

The United states 13:30 BST

US Quarter-on-Quarter Gross Domestic Product (GDP) measures the annualized change in the inflation-adjusted value of all goods and services produced by the economy. It is the broadest measure of economic activity and the primary indicator of the economy’s health and is recalculated on a quarter-by-quarter basis.

What the forecasters say

Nearly all independent forecasts as well as the city forecasts suggest that US Quarter-on-Quarter GDP is likely to rise from minus 0.70% shrinkage a forecast published figure of -0.20% shrinkage or better.

Our opinion

Although the forecast data suggests a strong upward revision within US GDP, the team at your personal economist have had a look at the underlying data and we have concerns regarding the US Economies overall state, however these are revised figures and the smaller level of negativity may explain wider trends within the USD and US indexes.

We are of the opinion that the revision to -0.20% shrinkage from -0.70% shrinkage may be significant enough to take in to account the recent mix of both positive and negative data we have seen out of the US.

View Points – Currencies and Indexes

Overall, it looks more likely that US GDP will be the dominant force creating upward pressure within the USD, the S&P 500, DJIA and Russell 2000 with interesting currencies likely to include the USD/CHF and USD/JPY, with the USD/EUR USD/GBP and USD/CAD also likely to be of merit.

 

 

Friday 18/09/2015

 

National Holidays: None

Fridays market activity is likely to be highly dependent on the outcome of the federal reserve’s Interest Rate Decision with ether a rise or a hold likely to create significant movement within both the USD and major US exchanges, as a result a lot of countries have moved their major releases.

This means the only major release of the day comes in the form of Canadian CPI and Core CPI figures at 13:30 BST and is currently forecast to see some mixed data does not provide a clear forecast, that may intern result in negative pressure within the CAD and the Toronto Stock exchange is forecasts are correct.

 

 

Thursday 17/09/2015

Estimated Reading Time: Five Minutes

 

National Holidays: WARNING!! US Interest Rate Decision and Press Conference 19:00-19:45 BST

We begin Thursday with an unusual release in the form of the Bank of Switzerland’s Interest Rate Decision and Press conference. The Bank of Switzerland is expected to keep its interest rates unchanged at 08:30 BST but analysis suggests that the accompanying press conference may see the governor reiterate that he is still prepared to take further action to weaken the Swiss Franc which may see the franc take a further negative decline.

Analysis indicates that Thursday is set to be dominated by the major event of the summer – Septembers Federal reserve Interest Rate Decision at 19:00 BST.

 

The United Kingdom 09:30 BST

Our first major releases of the day comes from the UK, as we see the UK Office of national Statistics release its Year on Year (YoY) and Month on Month Retail Sales figures. Retail Sales measure the change in the total value of inflation-adjusted sales at the retail level. It is the foremost indicator of consumer spending, which accounts for the majority of overall economic activity. The Core number excludes Auto sales and Fuel, which tend to be very volatile.

What the Forecasters Say

Month –on-Month Retail Sales are forecast to show an increase in the rate of growth, taking the expected published figure to 0.20% growth from last month’s published figure of 0.10%.

Whilst Year-on-Year Retail Sales are expected to fall from last months figure of 4.20% growth to a forecast published figure of 3.80%.

Our Opinion

Given the wider economic data relating to the UK and specifically individual consumer spending and average earnings, we would expect these forecasts to under estimate UK Retail Sales growth, with Month-on-Month retail sales likely to exceed market sentiment figures of 0.20%.

View Points – Currencies and Indexes

We would also expect both the FTSE and the GBP to respond positively to this release during morning trading if month on month figures meet or exceed market sentiment forecasts. With interesting currency pairs likely to include GBP/JPY, GBP/CHF, GBP/CAD, GBP/EUR and possibly the GBP/USD.

 

The United States 19:00 BST

The United States Federal Reserve’s Federal Open Market Committee (FR:FOMC) concludes its meeting regarding the level of QE within the markets along with announcing its monthly central bank interest rate decision.

Our Opinion

The federal reserve had indicated that a rise may come in September but given the weaker than expected US data that we have seen over the last couple of months makes a postponement of that rise more than possible. As a result we may see some meaningful negativity within the USD ahead of the release and afterwards if the 19:30 Press conference goes as expected which in turn may lead to upward pressure within the major US stock markets.

But it must be noted that the US interest Rate decision is dependent on the board of the federal reserve and is therefore an unknown quantity especially considering this month’s interest rate decision may see the end of Zero Interest rate Policy in the USA and as a result is one of the highest risk events of the year.

 

 

 

 

 

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Wednesday 16/09/2015

Estimated Reading Time: 6 minutes

 

National Holidays: Watch out for UK Prime Ministers Questions at 12:00 BST as the New Leader of the UK opposition is scheduled to appear for the first time

Morning European trading gets underway at 09:30 BST with the release of official UK Average Earnings and Claimant Count Figures which are both currently forecast to see some viable improvement that may lead to upward pressure within the GBP and UK Indexes.

As morning European Trading progresses 10:00 BST sees the publication of Euro Zone CPI and Core CPI Inflation data . This data currently has no clear and viable forecast and as a result is likely to make the EUR highly unstable before the release, however analysis suggests we may see some positivity within the EUR after publication if we are correct.

Afternoon Americas trading is likely to centre around another set inflation figures this time in the form of US CPI and Core CPI inflation. Once again the data is unclear but analysis suggests we may see some downward pressure ahead of the 13:30 publication of the Core CPI data as the markets begin to reassess when a possible rate hike may arrive. This being the day before a Federal Reserve Interest Rate Decision.

We then round of the day with Asia-Pacific trading and the 23:45 BST release of Official Revised New Zealand GDP Growth figures for Q2 2015, with forecasts indicating we may see strong upward pressure within the NZD both before and after this release, if forecasts are correct.

 

The United Kingdom 09:30 BST

Today’s European trading is likely to experience some significant volatility as we see the UK taking Center stage throughout morning and early afternoon trading. Beginning with the UK’s official Claimant Count Numbers.

Claimant Count Change measures the change in the number of unemployed people in the U.K. during the reported month. A falling trend indicates strength within the labour market, which has a trickle-down effect on consumer spending and economic growth.

We also have the publication of the UK’s national Unemployment Rate, which measures the percentage of the nation’s total work force that where unemployed but actively seeking employment during the previous three months. A higher than expected reading should be taken as creating negative pressure within the GBP, while a lower than expected reading should be taken as creating positivity within the GBP.

What the Forecasters Say

The UK Claimant count is currently forecast to show decrease of -5.00 thousand, with a fall in excess of the market sentiment figure likely to create positivity within the GBP, FTSE 100 and UK bond market.

The UK’s percentage unemployment level is forecast to remain unchanged at published figure of 5.60%,. Whilst average earnings excluding bonus’ are expected to see a growth rate of 2.90% growth.

Our Opinion

Given the current state of the UK economy combined with the wider issues within world export demand for British goods, we are of the opinion that a fall in the claimant count is still more than likely with the markets likely to respond positively to a published figure of -5.00K or grater. We would also hope to see a further decrease in the unemployment rate, although we are aware that the swing necessary to see a further fall is significant.

View Points – Currencies and Indexes

Given both the market sentiment data and the forecast data we would expect to see see a drop in the open market price of UK bond’s whilst and further upward pressure on the FTSE indexes. The GBP is likely to see some positivity with the GBP/CAD, GBP/EUR, GBP/USD, GBP/AUD and the GBP/JPY likely to be of interest.

 

The United States 13:30 BST

The US Department of Labor publishes Year-on-Year CPI and Core CPI as well as Month-on-Month CPI and Core CPI figures. The US Consumer Price Index measures the changes in the price of goods and services, excluding food and energy. The CPI measures price change from the perspective of the consumer. It is a key way to measure changes in purchasing trends and inflation.

What the forecasters Say

Month-on-month CPI is forecast to fall to a published figure of minus 0.10% Shrinkage. Whilst Year-on-Year CPI is expected to remain unchanged at a published figure of 0.20% Growth.
The significantly more market prominent US Month-on-Month Core CPI figures is forecast to remain unchanged at a published figure of 0.10% growth. Whilst, Year-on-Year Core CPI figures are forecast to rise by 0.10to a forecast published figure of 1.90% growth.

Our Opinion

Given the recent data out of the US coupled with the greater significance of the Month-on-Month CPI figures we would expect to see some negativity as a result of this release, meaning that these figures when combined and weighted for cumulative effects are likely to create some downward pressure within the USD and US indexes if forecasts are correct.

View Points – Currencies and Indexes

We would expect to see some negativity within the USD and corresponding major US stock Markets such as the Russell 2000 and S&P 500. Interesting currencies may include the USD/EUR, USD/CAD, USD/GBP USD/CHF and USD/JPY.

 

New Zealand 23:45 BST

New Zealand’s Quarter-on-Quarter Gross Domestic Product (GDP) figure is designed to measure the annualized change in the inflation-adjusted value of all goods and services produced by New Zealand’s economy. GDP and specifically Quarter-on-Quarter is the broadest measure of economic activity and the primary indicator of the economy’s health and as a result can have a significant impact on a nations currency upon release.

What the forecasters say

We round of the day with Quarter-on-Quarter New Zealand GDP figures which are forecast to show a significant increase from last months figure of 0.20% growth, to a forecast published figure of 0.50% growth or lower.

Our Opinion

Recent weeks have seen the Reserve Bank of New Zealand cut their interest rate by 0.25% which has had a significant impact on the NZD. Given the wider issues concerning the New Zealand Economy we would be of the opinion that a drop in GDP growth in-line with forecasts may create meaningful positivity within the NZD.

View Points – Currencies and Indexes

Interesting currency pairs are likely to include the NZD/JPY, NZD/CAD, NZD/AUD. With the more widely traded pairs such as the NZD/USD, NZD/GBP and NZD/EUR also likely to be of meaningful interest.

 

 

 

 

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