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Overview of the main economical events of the current day - 04/03/2014
The US Dollar and the Yen Strengthened Its Positions on Monday
On Monday March, 3 the US dollar was traded upwards Vs. most major currencies amid ISM Manufacturing PMI growth in the USA. Markit PMI, Personal Income, and Personal Spending data appeared to be better than expected. The yen strengthened its positions due to the demand for save heaven currencies amid heightening of tension in Ukraine.
Personal Income increased in January by 0.3% comparing with the previous month, having exceeded the expectations of growth by 0.2% - whereas personal Spending strengthened its position by 0.4% m/m, which appeared to be more than forecasted +0.1%. Report confirms the last data pointing that Americans start overcoming the results of severe winter. ISM Manufacturing PMI in February increased to 53.2 p. from 51.3 p. in January, having considerably exceeded the expectations of growth to 52 p.
Final Markit Manufacturing PMI also appeared to be better in February, and increased to 57.1 p. comparing with preliminary estimations at the level of 56.7 p. and January reading of 53.7 p. According to Markit, PMI signaled the most significant improvement of doing business terms for over 45 months.
The yen increased to its monthly high Vs. the US dollar due to the demand for save heaven currencies – amid escalation of tension in Ukraine on the weekend, when the President of Russia Putin got obtained admittance from the Parliament to use military forces in this country. Interference of Russia into Ukrainian events sparked concern about the big international conflict. On Monday gold prices increased to its high for over the last 4 months. Light Sweet Crude Oil (WTI) futures increased to the highest rate for more than 5 months.
The euro dropped on Monday from 2-month highs Vs. the dollar amid heightening tension in Ukraine – though ECB’s Draghi announced than economic influence of Ukraine to the Eurozone is limited, and commercial relations are not significant. Final Eurozone Manufacturing PMI decreased in February to 53.2 p., comparing with 54 p. in January, though it appeared to be better than preliminary estimations at the level of 53 p. German and Italian PMI decreased, whereas French and Spanish increased.
The pound sterling also decreased, having almost no reaction to the British data of manufacturing sectors, which appeared to be slightly better than expected. Manufacturing PMI increased in February to 56.9 p. comparing with 56.6 p. in January, whereas reduction was expected. According to Bank of England, Mortgage Approvals increased in January to its high for over more than 6 years – 76 900 against the expectations of growth to 73 500, but lending volume goes on reducing.
The Australian dollar gained back all the losses of the beginning of the day amid Non-Manufacturing PMI in China to 3-month high. Official Chinese Non-Manufacturing PMI increased in February to 55 p. comparing with 53.4 p. in January. Other data was also not so bad. ANZ Job Advertisements in February demonstrated the highest growth rate for over 2 years. AIG Manufacturing Index increased in February to 4-month high. The New Zealand dollar also negated part of losses amid Terms of Trade Index in New Zealand in the 4th quarter by 2.3% q/q to 40-years high.
By MasterForex Company
Overview of the main economical events of the current day - 06/03/2014
The US Non-Manufacturing Activity Dropped to 4-Year Low
On Wednesday March, 5 the US dollar decreased Vs. most major currencies after the release of weak US Non-Manufacturing Activity, but the reduction was moderate. ADP Employment Change also appeared to be worse than expected. The Canadian dollar strengthened its positions amid Bank of Canada Meeting. The Australian dollar increased amid strong Australian GDP data.
ISM Non-Manufacturing PMI suddenly dropped in February to its low since February 2010 at the level of 51.6 from 54 in January – whereas just slight decrease to 53.5 was expected. The largest decrease was demonstrated by Employment Index, which dropped in February to 47.5 from 56.4, having fallen lower than 50 for the first time for over 2 years - which is especially jittery before the release of Non-Farm Payrolls in the USA on Friday.
According to Automatic Data Processing (ADP), the US Non-Farm Employment Change increased in February by only 139 000, which appeared to be considerably worse than expected 160 000. Employment growth in January was also considerably revised downwards - to 127 000 from initial reading of 175 000. ADP data precede Non-Farm Payrolls key report of the US Department of Labor, which will be released on Friday, and it is frequently considered to be preliminary.
The euro had almost no changes according to the results of the day before the ECB Meeting on Thursday – the euro had almost no reaction to Retail Sales growth and Services PMI of the Eurozone. ECB’s inflation forecast for the nearest years will attract attention on Thursday, as well as the press-conference of ECB’s Draghi. The markets wait for the ECB to take some actions to monetary policy easing. Barclays wait for interest rate reduction, whereas others believe that we may observe some liquidity injection.
Final Services PMI of the Eurozone increased in February to 52.6 p. comparing with 51.6 p., having exceeded preliminary estimations. Flash Manufacturing PMI and Services PMI rose in February to 53.3 p. from 52.9 p. in January, against the expectations of decrease – the highest rates since June, 2011 are still left. The Eurozone Retail Sales increased in January by .6% after decrease by 1.3% in December, having twice exceeded the expectations of growth.
The pound sterling strengthened its positions before the Bank of England meeting on Thursday, at which no policy changes are predicted. Services PMI decreased in February slightly less than it was expected – to 58.2 p. from 58.3 p. in January, which appeared to be better than predicted decrease to 58 p. Though it is the lowest rate since June, 2013, Services PMI activity growth for more than a year, Employment Change growth also accelerated.
The Australian dollar increased to its weekly high Vs. the US dollar amid strong country’s GDP data. Quarterly Economic Growth Rate in Australian in the 4th quarter composed 0.8%, having exceeded the expectations of growth by 0.7% q/q. Annualized GDP of the 4th quarter increased by 2.8% against growth by 2.4% in the previous quarter – having exceeded the expectations of growth by 2.5%. GDP growth acceleration happened mainly due to Export growth, which in 2013 increased by 6.5%, which was mainly promoted by AUD weakening.
The Canadian dollar strengthened it positions to 2-weeks high Vs. the US dollar amid Bank of Canada Meeting, where the policy was left unchanged, and it was also announced that inflation goes on strengthening its positions, but downward risks are still considerable. Time limits and course of further interest rate change depend on the influence of the new risk balance information - the Central Bank noted.
By MasterForex Company
Overview of the main economical events of the current day - 07/03/2014
The US Dollar Dropped In Expectation of Non-Farm Payrolls
On Thursday March, 6 the US dollar dropped Vs. most major currencies in anticipation of weak Non-Farm Payrolls, which is going to be released on Friday. US Factory Orders also appeared to be worse than expected. The euro increased after ECB’s Meeting Minutes release, at which new measures of monetary policy easing were not announced.
The US dollar lost 0.5% to the dollar index, having dropped to the lowest rate since October, 2013 according to DX – before the release of Non-Farm Payrolls on Friday. The data appear to be weaker than expected at the level of 150 000 working places – this is implied by the growth of average weekly Unemployment Claims during February. The largest growth Vs. the US dollar was demonstrated by the Australian dollar, which strengthened its positions amid positive statistics in Australia.
The US Initial Claims last week decreased by 26 000 to 3-month low at the level of 323 000, from 349 000 of the previous week - it appeared to be better than expected 336 000. 4 weeks average Initial Claims was decreasing for the second week in a row to 336 500 - from 338 500 last week. However, in February average weekly Initial Claims increased by 3 500 comparing with January, when it was created only 113 000 working places.
The US Factory Orders also appeared to be worse than expected – orders dropped in January by 0.7% against the expectations of decrease by 0.4%. This is one more mark of recent Manufacturing Index in the USA. Previous month’s data was also revised downwards – decrease of Factory Orders in December composed 2% m/m, but not 1.5% as it was reported earlier.
The euro sharply rose and opened above $1.38 to the dollar for the first time since October, 2013 – after the ECB left interest rates unchanged despite the Eurozone bottom inflation. New measures of monetary policy easing were not announced. According to Draghi’s comments, aggressive measures are excepted in the nearest future. ECB increased the Eurozone economy growth predictions in 2014 to 1.2% from December 1.1% - but decreased Inflation estimation from 1.1% to 1%. In 2015 the Eurozone GDP will increase by 1.5%, and inflation rate will accelerate to 1.3%, as it was expected in December. In 2016 GDP growth will compose 1.8%, and inflation rate – 1.5%.
The pound sterling slightly strengthened its positions amid Bank of England decision to leave the key interest rate and the stake purchase program without changes. Housing Market data supported the pound sterling – according to Halifax, House Prices in the UK increased in February by 2.4% having demonstrated the highest growth rate for over 5 years. But the prices are still 10% lower than the peak of August 2007. Housing Price acceleration takes place amid country's economy recovery which supports demand for real estate.
The yen dropped to 5-week low Vs. the US dollar after Japanese Advisory Group announced on Thursday that the largest Government Pension Investment Fund GPIF has no need to focus investments to local bonds taking into consideration country’s inflations rate acceleration. GPIF should look for investment possibilities which may bring large profit. Increase of investments to foreign holdings may lead to further weakening of the yen.
The Australian dollar increased on Thursday to the highest rate Vs. the US dollar for almost three months - after positive statistic release in Australia. Retail Sales in January increased by 1.2% m/m, having exceeded the expectations of growth by 0.5%, and having demonstrated the highest monthly growth rate for almost a year. Trade Balance proficit increased in January to 1.43B AUD from 0.59B in December against the expectations of decrease. The proficit increases for the third month in a row, and appeared to be the highest for over 2.5 years.
The Canadian dollar strengthened its positions amid Ivey PMI growth to 4-month high. Building permits growth rate in Canada also exceeded the expectations and appeared to be the highest for over half a year.
By MasterForex Company
Overview of the main economical events of the current day - 11/03/2014
The Australian Dollar Dropped Amid Weak Chinese Data
On Monday March, 10 the US dollar increased vs. the pound sterling, the Australian dollar, and the Canadian dollar, having almost no changes vs. other major currencies amid absence of any significant macro statistics in the USA. The pound sterling decreased before Inflation Report Hearings, which will take place on Tuesday. The Australian dollar dropped amid weak data in China. The Canadian dollar got under the pressure amid fall of commodity prices.
The Australian dollar dropped amid weak data in China released last weekend and on Monday. Chinese Trade Balance deficit in February composed $23B, whereas balance proficit was expected at the level of $14.5B. At that the export dropped by 18.1% comparing with the similar period of the previous year (the highest decrease since 2009), against the expectations of growth by 5% y/y – at that import has almost no changes. Export from China is considered to be the gauge of global commodities demand. At the same time the data might be wrenched due to more early celebration of the Lunar New Year this year.
Annual growth rate of Consumer Price Index in China decreased in February to 13-month low at the level of 2% from 2.5% in January, against the expectations of decrease to 2.1% - which increased concerns about slow down of economy growth rate of PRC. New Loans in China in February decreased more than it was predicted and dropped more than twice comparing with January. New Yuan Loans reduced to 645B from 1320B in January – whereas decrease only to 730B yuans was predicted.
The yen increased at the beginning of the day amid weak Japanese data and decrease of Japanese stock market, but then negate the whole increase. According to final data, Japanese GDP annualized growth rate in the 4th quarter was decreased to 0.7%, against preliminary estimation of 1% and growth by 1.1% in the 3rd quarter. Current account deficit in Japan in January reached record high 1.589 trillion yuans. Import increased in January by 30.3% comparing with similar period of the previous year, due to energy source import price growth, entailed by falling in price yen.
According to the results of the two-day Meeting of the Bank of Japan, monetary policy was left without changes, as well as general economy assessment. It is a sign of confidence of the Central Bank that the economy is able to survive the forthcoming increase in sales tax in April. Bank of Japan decreased the estimation of export, but increased the estimation of capital investment and industrial production.
The euro had almost no changes according to the results of the day. Industrial Production in France appeared to be worse than it was expected, whereas in Italy it appeared to be better. Eurozone Sentix Investor Confidence in March appeared to grow slightly worse than expected, to 13.9 from 13.3 in February, and it still stays at 3-years highs. Bank of France left the estimation of country’s GDP growth for the 1st quarter without changes at the level of 0.2%. ECB’s Christian Noyer announced on Tuesday that he is not satisfied with the euro’s strength. ECB is open for all types of instruments and is ready to act if risks are revealed. ECB’s Sabine Lautenschlager also announced that ECB is open to the idea of negative rates and stake in purchase if necessary.
The pound sterling dropped on Monday before Inflation Report Hearings which will be held on Tuesday, and during which the Head of the British Central Bank Marc Carney will testify. BOE Deputy Governor Charles Bean announced that further pound’s growth may harm country’s export and economy overbalance from internal expenditures to foreign trading. Another negative factor according to Citigroup is investor quit of long positions of pound sterling, which previously were opened relying on growth connected with deal between Vodafone and Verizon, which finished in the end of February.
By MasterForex Company
Overview of the main economical events of the current day - 13/03/2014
Reserve Bank of New Zealand Was the First among Major Central Banks to Increase the Key Interest Rate
On Wednesday March, 12 the US dollar decreased vs. most major currencies before the release of Retail Sales report on Thursday. The New Zealand dollar increased vs. the American currency most of all – after the Reserve Bank of New Zealand (RBNZ) increased the Official Cash Rate (OCR) by 0.25%.
The New Zealand dollar sharply increased and refreshed the highs of the year vs. the US dollar after the RBNZ increased Official Cash Rate (OCR) by 0.25% to 2.75% as it was expected. But the tone of the announcement was stricter, and the rate forecast was higher. RBNZ’s Wheeler noted the impulse of the economy growth in New Zealand and strengthening of inflation pressure on the part of high prices and Housing market boom.
Further increase of OCR will depend on data and inflation. Thought RBNZ announced that the course of New Zealand dollar is overcharged, he didn’t point that OCR growth rate will be changed due to this fact. Wheeler expects that interest rates will increase by 1.00-1.25% this year, and by 2.00% during next two years. RBNZ was the first bank among the Central Banks of developed countries, which settled down the course of interest rates increase. The rate was not increased almost four years, and was at the level of 2.50% for three years, when in March, 2011 RBNZ decreased the rate due to the earthquake in New Zealand.
The sales of the US dollar were resumed on Wednesday at the American session amid absence of significant macro statistics in the USA. According to the results of Wednesday the US dollar index lost a bit more than 0.2%. The euro increased again above the mark of $1.39 vs. the US dollar, which he was reaching in the end of the last week.
The euro had almost no reaction to the Eurozone Industrial production data, which suddenly dropped in January. Industrial production decreased in January by 0.2% m/m against the expectations of growth by 0.2%. Data of the previous month was revised upwards. At the same time annualized data appeared to be better – industrial production increased by 2.1% y/y, having exceeded the expectations of growth by 1.9%.
The euro was given support by the testimony of ECB’s Coeure, who announced that there is no deflation in the Eurozone, and stimulation measures of additional liquidity inflow to the banking system are not necessary. German Finance Minister Wolfgang Schaeuble also noted on Wednesday that interest rates in the Eurozone are too low in mid-term, and he doesn’t notice deflation in the Eurozone.
The Australian dollar on Wednesday interrupted its three-day growth and increased before the Australian Labor Market report – thought it decreased in the first half of Wednesday after the release of weak Australian Consumer Sentiment which dropped to 10-month low. Home Loans and Investment Lending also appeared to be worse than predicted. The Australian dollar sharply increased to 4-day high vs. the US dollar – after the release of Australian Labor Market report on Thursday. Employment in Australia in February increased by 47 300 and thrice exceeded the expectations of growth by 15 000.
By MasterForex Company
Overview of the main economical events of the current day - 17/03/2014
Main Events of the Coming Week
On Friday March, 14 the US dollar decreased vs. the yen. The euro, and the pound sterling, but slightly increased vs. major commodity currencies having lost 0.2% to the dollar index amid the US Consumer Confidence decrease to 4-months low. The US Producer Price Index data appeared to be worse than expected.
Preliminary U. of Michigan Consumer Sentiment in March sharply dropped to 79.9 p. comparing with Revised U. of Michigan Consumer Sentiment in February at the level of 81.6 p., whereas the increase was not expected. Consumers’ concerns were related with economy prospects. Current Assessment in March slightly rose, whereas Expectations dropped to the lowest level since November.
Producer Price Index decreased in February by 0.1%m/m against the expectations of growth by 0.2%. Core Producer Price Index Ex Food and Energy Supplies dropped by 0.2% comparing with the previous month, whereas growth by 0.2% was expected.
On Friday the euro gained back all the losses of Thursday, when the European currency dropped after ECB Draghi’s testimony. The pound sterling appeared to be slightly worse amid extension of the UK Trade Balance deficit in January to 4-month low. The yen continued its growth amid concerns about weak economy data in China and aggravation of tension in Ukraine. AUD and NZD corrected downwards after considerable growth of the previous days.
According to the results of the previous week the US dollar lost 0.36% to the dollar index having continued the decrease to DX for the third week in a row. The US dollar demonstrated multidirectional dynamics vs. major currencies – it decreased vs. the yen, the New Zealand dollar, the Swiss franc, and the euro – but increased vs. the pound sterling, the Australian dollar, and the Canadian dollar. The yen increased vs. the US dollar most of all, and the US dollar demonstrated the largest growth vs. the pound and the Australian dollar.
The main event of the coming week will be Fed’s 18-19 March Meeting, during which QE3 Tapering is expected to reduce by another $10B. Meeting Minutes will be announced on Wednesday, and FOMC Press Conference will take place; FOMC Economic Projections will be released as well.
On Monday in the USA Industrial Production, Capital Inflow, Empire Manufacturing PMI, and NAHB Housing Prices data will be released; on Tuesday – Building Permits, New House Starts and Consumer Price Index; on Wednesday – Current Account; on Thursday – Existing Home Sales, Philadelphia Fed Manufacturing Index, and Bank Stress Test Results.
On Monday in the Eurozone Final Inflation data will be released; on Tuesday – Trade Balance; on Friday – Current Account and Preliminary Consumer Confidence. On Tuesday German ZEW Economic Sentiment will be released; and on Thursday – Producer Price Index. The Swiss National Bank Interest Rate Decision will be announced on Thursday.
On Wednesday in the UK Bank of England last Meeting Minutes and Labor Market data will be released; on Thursday - CBI Industrial Order Expectations; and on Friday – Public Sector Net Borrowing. BOE Governor Mark Carney is due to speak at the Annual Mais Lecture at CASS Business School in London. On Wednesday Chancellor of the Exchequer George Osborne will perform Annual Budget Release.
On Wednesday in Japan Trade Balance will be released. Bank of Japan Governor Kuroda is due to speak at the International Financial Symposium and on Thursday he is due to speak at the Japan Chamber of Commerce and Industry in Tokyo. On Tuesday in Australia Reserve Bank of Australian last Meeting Minutes will be released.
On Monday in New Zealand Westpac Consumer Sentiment is going to be released; on Wednesday – Trade Balance; on Thursday – 4th Quarter GDP data. On Tuesday in Canada Manufacturing Sales will be released, and on Friday – Inflation and Retail Sales. BOC Governor Stephen Poloz is due to speak at the Chamber of Commerce in Halifax.
By MasterForex Company
Overview of the main economical events of the current day - 25/03/2014
The US Dollar Dropped after Fed’s John Williams Speech
On Monday March, 24 the US dollar dropped vs. most major currencies after Fed’s John Williams speech, where he announced that the rates will stay low for quite a long period of time. The largest growth vs. the US dollar was demonstrated by the Australian dollar, which increased amid hopes for stimulation in China, despite weak data of Manufacturing Index data in China.
The US dollar tried to increase amid weak data in the Eurozone, but it dropped after Fed’s John Williams speech, which decreased the hopes for earlier start of increase of base interest rates in the USA. Williams announced that Fed’s policy did not change deep down – he expects that rates will stay low for quite a long period of time. Rates will be increased not earlier than in the second half of 2015. Monetary policy may approach to normalization till the end of 2016, but even then the rate will stay much lower than 4%.
The US data released on Monday appeared to be mixed and had almost no influence to trading course. Chicago Fed National Activity Index increased in February after two-month decrease to 0.14 from -0.45 in January. At the same time, Markit Preliminary Manufacturing PMI decreased in March to 55.5 p. against the February reading of 57.1 p., which appeared to be the highest since May, 2010.
The euro was traded downwards in the first half of the day after the release of the Eurozone Composite PMI, which dropped in March to 2-month low. The Eurozone data appeared to be worse than expected – PMI in France increased having exceeded the reading of 50 – whereas in Germany the PMI dropped. Manufacturing Index in Germany decreased to 4-month low, Services PMI – to 2-month low. The Eurozone Flash Composite PMI decreased in March to 53.2 p. from 53.3 p. in February, whereas no changes were expected. The February reading was the highest since June, 2011.
In March in the monthly report Bundesbank announced that the German economy growth in the first quarter of the year should be strong, but in the second quarter it will slow down. ECB’s Liikanen announced that ECB will keep to soft monetary policy for economy stimulation, and is ready to take further decisive actions if necessary.
The Australian dollar refreshed the year high despite the fact that Manufacturing Activity in China decreased to 8-month low. Preliminary HSBC Manufacturing PMI in March continued its reduction for the 5th month in a row. PMI dropped to 48.1 p. from 48.5 p. in February against the expectations of growth. China is the main trade partner of Australia.
However, weak Chinese data strengthened expectations of economy stimulation on the part of Chinese authorities. The main Chinese economist HSBC announced that the situation of Chinese economy goes down amid ongoing weakening of domestic demand, and Beijing is expected to take a series of actions for growth stabilization. In the nearest future mainstreaming of economy growth is expected due to planned reforms, economic liberalization, and increase of expenses for infrastructure projects.
By MasterForex Company
Overview of the main economical events of the current day - 31/03/2014
Main Events of the Coming Week
On Friday March, 28 the US dollar was traded mixed amid reduction of the US Consumer Confidence. The US dollar decreased vs. the pound sterling and the euro, but increased vs. the yen and major commodity currencies, having added about 0.1% to the dollar index. Commodity currencies were corrected downwards after considerable growth of the previous days. Consumer Confidence data appeared to be worse than it was expected.
UoM Consumer Sentiment dropped in March to 80 p. comparing with 81.6 p. of the previous month, but appeared to be slightly higher than preliminary estimations of 79.9 p. At the same time, final data was predicted at the level of 80.5 p. The index dropped in March to the lowest reading for over 4 months. Consumer Expectations reading decreased for the nearest 6 months. FOMC Member Charles Evans announced on Friday that interest rates will stay near zero level during considerable part of 2015.
On Friday the pound sterling continued strengthening its positions amid growth of the UK Consumer Confidence in March to the highest rate for more than 6 years. Country’s services sector in January demonstrated the highest annualized growth for almost 6 years since February, 2008. The yen weakened its positions before the finish of the financial year in Japan in the end of March and impositions of sales tax since April, 1 amid positive dynamics of stock markets. Citigroup expects that Bank of Japan will increase monetary stimulation program till July, due to this fact USDJPY may increase to 108-110 till summer.
The euro sharply dropped on Friday to 4-weeks low vs. the US dollar after release of weak Spanish inflation rate data, but then it gained back all the losses amid growth of Euro-zone Economic Sentiment. Euro-zone Economic Sentiment Indicator increased in March to 102.4 p. (the highest level since July, 2011) from 101.2 p. in February, having exceeded the expectations. The indicator grows for the 11th month in a row already. All confidence indices increased, which speak for the Euro-zone economy recovery continuation in the nearest future.
Preliminary March CPI in Spain, the fourth Euro-zone economy, fixed the first case of deflation of consumer price index since 2009 (-0.2% y/y). German Inflation Rate data also demonstrated slowdown of inflation rate growth. Preliminary Consumer Price Index (y/y) increased in March by 1% against 1.2% in February and expectations of growth at the level of 1.1%. March Inflation data of the whole Euro-zone will be released on Monday March, 31. Weak Inflation data strengthened the expectations of further stimulation measures on the part of ECB.
According to the results of the previous week the US dollar demonstrated multidirectional dynamics, having added 0.1% to the dollar index. The US dollar decreased vs. major commodity currencies (more than 1%) and the pound sterling, but increased vs. the yen, the Swiss franc and the euro. According to the results of almost finished month, the US dollar increased vs. the yen, the Swiss franc, the pound sterling, and the euro – but decreased vs. AUD and NZD (more than 3%) having added 0.7% to the dollar index.
The main event of the week will be the release of key Non-Farm Payrolls on Friday in the USA, preliminary ADP data which will be released on Wednesday. In the USA on Monday Chicago PMI will be released, on Tuesday – ISM Manufacturing PMI and Construction Spending; on Wednesday – Factory Orders ж and on Thursday – ISM Non-Manufacturing PMI and Trade Balance. On Monday Fed’s Chair Janet Yellen is due to speak at the National Interagency Community Reinvestment Conference in Chicago.
The main event in the Euro-zone will be the Meeting of the European Central Bank on Thursday. Inflation decrease may provoke ECB to realize additional measures of stimulation. Recently many representatives of the ECB actively commented the possibility of interest rate decrease or even assets purchase. On Tuesday Final Manufacturing PMI and Final Services PMI will be released on Thursday; on Tuesday – Euro-zone Unemployment Change; on Wednesday – Producer Price Index; and on Thursday – Retail Sales. In Germany on Monday Retail Sales data will be released, on Tuesday – Labor Market data, and on Friday – Factory Orders.
On Monday in the UK Mortgage Approvals will be released, and since Tuesday till Thursday Manufacturing PMI, Services PMI, and Construction PMI will be released as well. On Monday Head of BOE Mark Carney is due to speak after Financial Stability Board Plenary Meeting press briefing. In Japan on Monday Industrial production data will be released, and on Tuesday – the Bank of Japan’s Tankan Quarterly Survey of Enterprises in Japan.
Meeting of the Australian Reserve Bank will be held on Tuesday, and no policy changes are expected. On Thursday retail Sales and Trade Balance data will be released, and speech of RBA’s Governor Glenn Stevens. On Monday in New Zealand ANZ Business Confidence will be released. Australia and New Zealand will revert to standard time on April, 6. On Monday in Canada GDP data will be released, on Thursday – Trade Balance data, and on Friday – Labor Market data. In China official Manufacturing PMI will be released on Tuesday, and on Thursday – Non-Manufacturing PMI.
By MasterForex Company
Overview of the main economical events of the current day - 01/04/2014
The US Labor Market Is Still Weak
On Monday March, 31 the US dollar moderately decreased vs. most major currencies, having lost 0.1% to the dollar index – amid Janet Yellen’s speech, during which she announced the necessity of monetary policy easing continuation, referring to the weakness of the labor market. Chicago PMI dropped in March to semiannual low.
Performing at the Chicago Conference Fed Chair Janet Yellen announced that the Central Bank should continue soft monetary policy for some period of time due to considerable weakness of the US labor market. In some ways the situation at the labor market is more complicated than during the recession period, she added, referring to the large amount of long-term unemployed, fractional persons, and low growth rate of salaries.
Chicago Business Barometer dropped in March to semiannual low. Chicago PMI dropped to 55.9 p. against 59.8 p. in February and expectations at the level of 58.5 p. Employment and New Orders considerably decreased in comparison with March.
The euro compensated all the losses at weak Eurozone Inflation rate, which appeared to be the lowest since October, 2009. According to preliminary data, annual inflation growth rate of the Euro-zone decreased in March to 0.5% against 0.7% in February and forecast at the level of 0.6%. Inflation in Italy also decreased to 0.4% y/y from 0.5% in the previous month.
The data intensifies pressure for the ECB in terms of new measures directed for overcoming of low inflation. Retail Sales (m/m) in Germany appeared to be positive, the reading increased in February by 1.3% against the expectations of decrease. ECB’s Nowotny announced that the Euro-zone recession is over, and there will be economy growth in the region this year.
The pound sterling continued its growth for the fifth day in a row amid general weakness of the US dollar. According to the Bank of England, Mortgage Approvals decreased in February from the highest reading of more than 6 years, but it is still at considerably high level. Mortgage Approvals decreased to 70 300 against 76 800 in January, and expectations at the level of 75 000; but consumer credit increased in whole, which speaks for further recovery of Housing Market.
Then yen weakened its positions vs. all major currencies amid Russia and the USA tendency to find diplomatic solution of the Ukrainian crisis, which decreased demand for save haven currencies. On the weekend during the meeting of heads of foreign affairs of Russia and the USA confirmed the aspiration to regulate the crisis in a political way. Industrial production in Japan in February dropped at the highest pace for 8 months. The Bank of Japan’s Tankan Quarterly Survey of Enterprises in Japan demonstrated that the companies wait for deterioration а business conditions in the next quarter, which may increase expectations of further monetary policy easing by the Bank of Japan.
The Canadian dollar inconsiderably strengthened its positions after release of the Canadian economy growth data, which appeared to be better than expected. GDP in January increased by 0.5% comparing with December reading, and against the forecast of growth by 0.4% - these are the highest growth rates for over the last 6 months.
By MasterForex Company
Overview of the main economical events of the current day - 02/04/2014
The Australian Dollar Dropped After RBA Decision
On Tuesday April, 1 the US dollar was traded mixed amid controversial statistic data in the USA. Manufacturing Activity growth in the USA reached 3-month high; still the data appeared to be worse than expected. The euro strengthened its positions amid positive German and Euro-zone labor market data. The pound sterling dropped after release of the weak UK Manufacturing PMI report, which demonstrated the lowest reading for over 8 months.
The US dollar increased vs. the yen, the pound sterling, the Australian dollar, and the New Zealand dollar, but decreased vs. the euro, and the Canadian dollar, having almost no changes to the dollar index. ISM Manufacturing PMI increased in March to 53.7 p. Against 53.2 p. In February, but appeared to be lower than expected 54 p. The PMI grows for the second month in a row. The growth in March provided considerable growth of manufacturing index. Final Final Markit Manufacturing PMI stayed in March without changes and composed 55.5 p.
The euro strengthened its positions amid positive German and Euro-zone Labor Market data. German Unemployment Change decreased in March by 10,000. Unemployment Change composed 6.7% having no changes in comparison with February, reading of which was downwardly revised from 6.8%. Euro-zone Unemployment Change remained in February without changes in comparison with the January reading of 11.9%, which was reduced from 12%. The same time, Italian Unemployment Change increased in February to 13% from 12.9% in January, whereas no changes were expected.
The euro was also supported by the Euro-zone Manufacturing Activity data, which exceeded the expectations in Spain, Italy, and France, but appeared to be weaker than forecasted in German. The Euro-zone data coincided with the expectations – Final Manufacturing PMI in March composed 53 p., having decreased from the February reading at the level of 53.2 p. ECB’s Board member Vitor Constancio announced on Tuesday that ECB doesn’t see further prospects of the Euro-zone deflation, and he expects that March reading will be revised.
The pound sterling dropped after weak UK Manufacturing Activity report, which demonstrated the lowest reading for over 8 months. Manufacturing PMI decreased in March to 55.3 p. From downwardly revised 56.2 p. In February, and appeared to be lower than forecasted 56.7 p. PMI decreased for the 4th month in a row.
The Australian dollar decreased after RBA Meeting, during which the rate was left without changes at record low 2.5%. But final RBA Rate Statement was more pessimistic in comparison with the previous ones. RBA noticed that AUD is high according to historical standards, and its recent strengthening creates potential risk for economy recovery, and also aggravates exporters’ situations. Final March HSBC Manufacturing PMI in China was downwardly revised to 48 p. against initial estimation of 48.1 p. and the February reading of 48.5 p.
The Canadian dollar strengthened its positions on Tuesday amid Raw Materials Price Index growth, which demonstrated the highest monthly growth rate for over almost three years, which was mainly due to energy prices growth. Raw Materials Price Index (m/m) increased in February by 5.7%, having twice exceeded the expectations. The index increases for the third month in a row.
The yen continued its weakening on Tuesday for the 4th day in a row amid start of the new financial year in Japan and positive dynamics at stock markets. The reduction of the yen was due to the Bank of Japan’s Tankan Survey of Enterprises, which demonstrated deterioration of Business Climate prospects in Japan due to sales tax initiation.
By MasterForex Company