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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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