Date : 11th MARCH 2016.

MACRO EVENTS & NEWS OF 11th MARCH 2016.

Main Macro Events This Week

FX News Today

ECB’s policy “bazooka” backfired at least yesterday, where a buffet of easing steps were at first embraced then later spurned by the markets. For a while it seemed like Draghi had found his magic touch again. By burying a rather modest deposit rate cut in a broad package of other stimulus package, including a new corporate bond purchase program, he managed to keep markets happy, bring in spreads and give stock markets a boost, but only for an hour or so. Peripheral government bonds, stressed banks and corporate bonds were the main beneficiaries. In the long run though Draghi’s eagerness to shield highly indebted countries and banks struggling with non-performing loans may come back to haunt the ECB and the Eurozone. It would appear Draghi did too good a job of signaling the moves in advance, which were clearly priced in, then followed by rapid unwinding on-the-fact. He also managed to confuse markets while he initially managed to bury the modest deposit rate cut in a host of other measures and implicit easing bias. He undid most of the good work by remarking that he doesn’t expect it to be necessary to cut rates again. Given the ECB’s track record, the only thing that means is that there won’t be another cut at the next meeting, and we would expect markets to settle down again today as the details of the stimulus package sink in. Today’s CPI number release from Germany won’t change the picture either as numbers were in line with expectations and mostly unchanged.

Japanese business sentiment deteriorated abruptly in the first quarter, the BSI Manufacturing Index indicated today. Financial market turmoil and slow demand globally had impacted negatively Japan’s flimsy economic recovery. The data pressures the policymakers to deploy extra stimulus measures to reflate an economy that is bordering on yet another recession. BSI Index measuring sentiment at large manufacturers came in at -7.9 in January-March, swinging from 3.8 in Q4 2015. BSI index is a joint survey by the Ministry of Finance and the Economic and Social Research Institute, an arm of the Cabinet Office.

OPEC, Non-OPEC meeting unlikely to happen on March 20 as previously scheduled, as Iran has yet to agree to the oil production freeze, according to sources cited on Reuters earlier. That sure could explain the reversal in NYMEX crude into the red by -1.9% and back below $38 bbl to the $37.50 area.

Canada’s erosion in Q4 capacity use was not a surprise, as the drop to 81.1% in Capacity Utilization Rate fit with the already revealed slowing in real Q4 GDP growth to an 0.8% pace (q/q, saar) from the 2.4% growth rate in Q3. Revisions were substantial in today’s report, but the pattern in 2015 remained intact: The post-recession Q4 2014 near term peak use rate was revised to 82.8% (was 83.3%), falling to 81.9% in Q1 (was 82.5%) and 80.5% in Q2 (was 81.4%) before rising to 81.6% in Q3 (was 82.0%).

Main Macro Events Today

Canada Employment numbers: We expect employment to rise 10.0k in February (median same at +10.0k) after the 5.7k drop in January. The year started out in a mess, with crude oil prices plunging and global growth worries intensifying. Against that backdrop, total jobs dipped. A less dire backdrop of firmer oil prices and markets that were not melting down is expected to lead to some optimism, lifting employment in February. But the resource and manufacturing sectors remained a drag, which may leave another disappointing report.

Baker Hughes Oil Rig Count: Trends in rig counts are significant clues for market participants in the oil and gas sector as they reveal the supply dynamics in the sector. Rig counts are reported week on Fridays. On March 7th the company announced that the international rig count for February 2016 was 1,018, down 27 from the 1,045 counted in January 2016, and down 257 from the 1,275 counted in February 2015. The worldwide rig count for February 2016 was 1,761, down 130 from the 1,891 counted in January 2016, and down 1,225 from the 2,986 counted in February 2015.

Please note that times displayed based on local time zone and are from time of writing this report.

Click HERE to access the full HotForex Economic calendar.

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Janne Muta
Chief Market Analyst
HotForex

Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.

Date : 17th MARCH 2016.

MACRO EVENTS & NEWS OF 17th MARCH 2016.

Main Macro Events This Week

FX News Today

European Outlook: Asian stock markets outside Japan moved higher overnight, following on from gains in the U.S. after the FOMC trimmed its dot plot to imply just two tightening’s in 2016, which aligns the Fed’s view with the market. Japanese markets were weighed down by renewed strength in the Yen, following the dovish Fed statement. U.S. and U.K. stock futures are also up and oil prices are starting to eye USD 39 per barrel. So good leads for European stock markets, but also bond futures and with the Fed statement out of the way the focus shifts to BoE and SNB meetings today.

Fed Trims Dots and Remains Cautious: The FOMC statement reflects ongoing caution on global economic and financial developments, though optimism was maintained on the domestic front, and especially with regard to the labor market. The Fed also raised the profile of inflation, which “picked up” but remains shy of its target. The Fed’s mostly downward forecast revisions for the dot-plot and GDP, along with steadier inflation and job outlooks, left the markets taking a dovish cue from the proceedings, though Yellen left open the door for a move as early as April. She also the Fed is “not activity debating or considering negative rates,” or looking into other methods of accommodation. The Fed still has a range of tools it can use if it finds itself back in that situation of needing to add more stimulus. The adoption and impact of negative rates by other central banks is being studied.

UK Chancellor Osborne announced GBP 3.5 bln in spending cuts as he presents the government’s 2016-17 budget. He said that cuts would be implemented towards the end of the current parliament, in 2019-20. On the Brexit issue, he argued that the UK is “better off” inside a “reformed” EU and that the official UK growth forecasts from the independent Office for Budget Responsibility were based on the country remaining within the union. UK growth was revised down to 2.0% for 2016, down from 2.4% forecast in November, and 2.2% in 2017, down from 2.5% previously envisaged. He quoted the OBR’s view that leaving the EU would “usher in an extended period of uncertainty.”

CPI better than expected. The 0.168% February US. CPI drop was upstaged by a sturdy 0.283% core price rise, as the expected 6.0% energy price drop and 0.2% food price rise accompanied hefty gains of 1.6% for apparel prices that extended a 0.6% January rise, a second consecutive 0.5% rise for medical care service prices, and a 0.3% rise for owners’ equivalent rent after four consecutive 0.2% increases. We saw 0.2% gains for new vehicle and tobacco prices.

Main Macro Events Today

BoE Decision: There is a strong consensus for the BoE to stand pat on policy this week, and we expect the minutes to reveal a unanimous vote to maintain the repo rate at 0.5% (median same). This would make it exactly seven years the repo has been at its historic low. Weakness in the February PMI surveys and the benign inflation backdrop should ensure a dovish-tilted tone in the minutes, though still keeping the door open to an eventual rate hike, which markets are now discounting to be in Q1 next year. It will be interesting to see if there is any mention of “Brexit” risks, which kicked into gear following the PM Cameron’s renegotiated membership terms and consequence setting of a referendum data (June 23).September.

SNB Decision: The SNB will have eyed the ECB’s move carefully and especially the fact that the deposit rate cut was rather modest and so far the impact on the CHF proved temporary, could allow the Swiss central bank to hold off with another rate cut at its policy meeting on Thursday. Much will depend on developments in forex markets and even if rates are on hold this week, the SNB has shown before that it can always act at short notice and outside its quarterly policy meetings.

Please note that times displayed based on local time zone and are from time of writing this report.

Click HERE to access the full HotForex Economic calendar.

Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding on how markets work. Click HERE to register for FREE!

Janne Muta
Chief Market Analyst
HotForex

Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.

Date : 6th April 2016.

MACRO EVENTS & NEWS OF 6th APRIL 2016.

Main Macro Events This Week

FX News Today

German Feb industrial production drops less than feared: Production correcting just 0.5% m/m from the rise in January, against expectations for a drop of around -2.0% m/m. Still, the January number was revised sharply down to 2.3% m/m from 3.3% m/m reported initially and the annual rate fell back in February. Together with the weaker than expected orders readings and mixed confidence data the outlook is for slowing growth in overall production and a general weakening of the growth trajectory as the improvement on the labour market peters out and the refugee crisis weighs on consumer confidence.

European Outlook: Asian stock markets were mixed with Japan underperforming as a third consecutive dip in the leading indicator and a stronger Yen weighed on markets. Elsewhere stock markets started to stabilize and the front end Nymex futures climbed toward USD 37 per barrel. The EUR weakened, but remains clearly above 1.130 against the dollar. Released overnight the U.K. BRC shop price index dropped -1.7% in March, a slight uptick from the -2.0% y/y in February. Still to come, there is central bank speak from the ECB and the Riksbank and Germany, Denmark, Sweden and Norway sell bonds, while Greece issues bills amid fresh Grexit concerns.

US ISM-NMI March increased to 54.5: This was from a 53.4 two-year low that beat estimates and capped a four-month drop from a solid 58.3 as recently as October, versus a 59.6 ten-year high last July. The ISM-adjusted measure rose to 54.1 from 53.2 in February and a 53.1 two-year low in January, versus a 59.0 ten-year high last July. The ISM-NMI figures remain stronger than the factory sentiment readings likely because the service sector is benefiting from the boost to household purchasing power via lower gasoline prices, while the factory sector faces headwinds from an inventory overhang, weak foreign demand, restraint in the vehicle assembly rate, and a petro-sector recession. Given March strength in the factory sentiment figures, the ISM-adjusted average of the major surveys popped to a surprisingly solid 53 in March from 49 in both January and February and 50 over the last four months of 2015, leaving the strongest average since the 53 figure in June and July of last year.

US JOLTS report showed job openings fell 159k: 5,445k openings in February versus a revised 323k January gain to 5,604k (was 5,541k), though the January level was the 3rd highest of this cycle. The rate fell to 3.7% from 3.8%. Hiring rebounded 297k to 5,422k after diving 276k in January to 5,125k (revised from 5,029k). The rate rose to 3.8% versus 3.6% previously. Quitters increased 99k to 2,950k following the prior 237k decline to 2,851k (revised from 2,804k). The quit rate also rose to 2.1% from 2.0%.

Main Macro Events Today

FOMC Minutes
The minutes to the March 17, 18 Fed meeting will be interesting for clues on the various outlooks of the Committee. However, Yellen’s dovish stance has usurped a lot of the importance of the minutes. Also, other Fedspeakers since the mid-March meeting have also let their feelings known, with even the more dovish members supporting expectations for 2 rate hikes this year. Meanwhile, data has revealed a slower Q1 economy, with our 2016 growth forecast now just 0.7%, with the Atlanta Fed at 0.4%. We know that in March, policymakers were contending with many uncertain and conflicting signals, as well as geopolitical concerns. Those factors left the FOMC on the sidelines, as they punted into Q2, although the economic projections for the year, along with inflation forecasts, were trimmed. Look for the minutes to largely underscore the various uncertainties domestically and around the world as the central reason for the unchanged policy stance.

ECB Non-Monetary Policy MeetingThe Non-Monetary policy’s ECB meeting is this morning in Frankfurt. This is a monthly meeting and involves all 25 members of the governing council.

Please note that times displayed based on local time zone and are from time of writing this report.

Click HERE to access the full HotForex Economic calendar.

Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding on how markets work. Click HERE to register for FREE!

Stuart Cowell
Market Analyst
HotForex

Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.

Date : 11th April 2016.

MACRO EVENTS & NEWS OF 11th APRIL 2016.

Main Macro Events This Week

United States: There is a lot of potentially relevant US data due out this week, including CPI and retail sales. The week starts with March trade prices (Tuesday), where import prices should jump 1.6% (0.9% median) thanks to a rebound in oil (-0.1% ex-petro), while export prices are slated to sink 0.2% (median -0.3%). The Treasury budget is also due for March, with the deficit seen almost doubling to -$94.0 bln versus last March’s -$52.9 bln. Wednesday sees, retail sales, with a flat forecast for the headline (median 0.3%) amid some drag from chain store sales vs -0.1% in February. Excluding autos, sales should rebound 0.3% after the prior 0.1% dip. PPI is set to rise 0.2% headline (median 0.3%) or just 0.1% core, with business inventories seen sinking 0.2% in February. Inflation’s better half, the CPI report is due (Thursday) and expected to rise 0.1% in March (median 0.2%) vs -0.2% in February. Initial jobless claims may dip 7k to 260k (median 270k) for the April 9 week. Empire State is projected to sink to 0.0 in April (median 2.2) vs 0.6 (Friday), along with a 0.4% fall (median unchanged) in industrial production for March vs -0.5% and a drop in capacity use to 75.0% (median 75.4%) vs 75.4%. Preliminary Michigan sentiment may hold steady at 91.0 (median 92.0) and the TIC inflow report is also due.

Canada: The Bank of Canada’s policy announcement and MPR (Wednesday) loom large this week. We expect no change in the current 0.50% policy setting to come alongside a slightly more upbeat growth outlook, but one that maintains that ample downside risk to growth is still in place. The take-away from the announcement and MPR is expected to be for an extended period of steady policy, as the Bank remains on the sidelines while past monetary stimulus continues to work through the system and fresh fiscal stimulus comes on-line. Economic data this week is back-loaded, with February new home prices (Thursday) and February manufacturing shipments (Friday) due at the end of the week. Manufacturing shipments are expected to fall 1.5% in February after the 2.3% surge in January. The new home price index is seen expanding 0.2% m/m in February after the 0.1% rise in January. Existing home sales for March (Friday) and the Teranet/National HPI for March (Wednesday) are also due out.

Europe: The Eurozone is once again looking shaky. Ongoing problems in Greek bailout talks have rekindled Grexit fears and with them, the question arises of just how much risk sharing there really is in the Eurozone. Data releases this week focus mainly on final inflation readings for March. German HICP moved back into positive territory and should be confirmed at 0.1% y/y, but with French HICP at -0.1% y/y, Spanish inflation at -1.0% y/y and the Italian HCIP rate at -0.3% y/y, the overall Eurozone CPI (Friday), is expected to be confirmed at a still negative -0.1%. Other data releases include February production and trade data, which are too backward looking to change the overall outlook for the ECB. We expect production to correct -0.9% m/m (median same), from the strong jump in January. The trade surplus meanwhile should widen judging by the improvement in the dominant German number that month, which was backed by a rebound in exports.

UK: The UK calendar has the April BoE Monetary Policy Committee meeting (Thursday), along with the latest BRC survey of retail sales (Tuesday) and inflation figures (also Tuesday). The BoE is widely expected to maintain an unchanged policy stance, by a unanimous vote. The BRC retail sales release is expected to rebound in March data to +1/4% y/y in the like-for-like measure, up from +0.1% y/y growth in February. Record levels of employment and rising real incomes are underpinning the sector. Headline CPI is expected to tick higher, to +0.4% (median same) from 0.3% in the month previous. The core CPI reading is also see nudging up, to +1.4% y/y from 1.3%. Such outcomes would be consistent with BoE projections.

China:  March CPI and PPI have been published earlier Today. Consumer prices were expected to rise to a 2.4% y/y rate from 2.3%, but they remained stuck on 2.3%. PPI however, posted a -4.3% y/y pace from -4.9%, better than expected. March trade surplus (Wednesday) is forecast to have narrowed slightly to $32.0 bln from $32.6 bln. Friday brings the balance of data releases, including March retail sales which are expected to slow to a 10.0% y/y pace from 11.1% previously. March industrial production is seen improving to up 5.7% y/y from 5.4%, while March fixed investment likely ticked up to 10.3% y/y from 10.2%.

Japan: February machine orders have been published earlier Today and the decline was 9.2%, better than the expected 10.0% m/m versus the 15% January rise. March bank loan data is due Tuesday, followed by March PPI (Wednesday) which is see steady at -3.4% y/y. Revised February industrial production data comes on Friday, and is seen at -6.2%, unchanged from the preliminary reading.

Australia: The Reserve Bank of Australia’s Financial Stability Review (Friday) will be of considerable interest. As for economic data, the March employment report (Thursday) is expected to reveal a 10.0k gain following the 0.3k rise in February. The unemployment rate is seen at 5.8%, matching the 5.8% in February. Housing investment (Monday) is expected to rise 1.0% in February after falling 3.9% in January.

Please note that times displayed based on local time zone and are from time of writing this report.

Click HERE to access the full HotForex Economic calendar.

Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding on how markets work. Click HERE to register for FREE!

Stuart Cowell
Market Analyst
HotForex

Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.

Date : 18th MAY 2016.

MACRO EVENTS & NEWS OF 18th MAY 2016.

FX News Today

European Outlook: Asian stock markets headed south, as stronger than expected GDP data out of Japan cast doubt over hopes of further easing and a delay to the sales tax hike, which added to US rate hike bets. FTSE 100 futures are also down. Positive leads then for European bond markets, which already moved higher yesterday, although the 10-year Bund future lost some of its gains in after hour trade. Today’s data calendar brings the final reading of Eurozone April CPI, expected to be confirmed at -0.2% y/y, and UK  labour market data. The April claimant count rate is seen steady at 2.1% and the ILO unemployment rate for March unchanged at 5.1% y/y. Earnings growth could show a slight deceleration in the rate excluding bonuses.

Japan’s GDP grew 1.7% in Q1: This following the downward revised 1.7% drop in Q4 (was -1.1%). The magnitude of the increase in Q1 easily outpaced projections (we saw +0.5%), but did follow a hefty downward revision to Q4. While the return to growth dodged a technical recession, the detail suggest underlying momentum is lacking in the economy, despite years of Abenomics and aggressive easing from the BoJ. Notably, an extra day in February due to leap year boosted consumption relative to the previous quarter. Private consumption grew 0.5% (q/q, sa) in Q1 after contracting a revised 0.8% in Q4 (was -0.9%). Business spending took a disappointing turn, falling 1.4% (q/q, sa) in Q1 after a revised 1.2% gain in Q4 (was +1.5%). The yen is steady, with USDJPY at 109.20.

Fedspeak: Fed’s Williams and Lockhart both noted June is a live meeting, in their comments at a Politico event. Both are doves, but have been noting the potential for further normalization this year, consistent with the FOMC’s projections of 2 25 bp hikes. Lockhart said it’s too early to draw conclusions about Q2 growth, but he wouldn’t take June off the table. Like several of his colleagues, he warns that the markets are more pessimistic than he is. Neither are voters this year. Fed moderate Kaplan said that the Fed should hike rates “in the not too distant future,” while he sees the household sector in good shape and forecasts a 2% rise in 2016 GDP, though still some slack in the labor force.

Main Macro Events Today

EMU CPI: We expect the headline rate to be confirmed at -0.2% (median same). The decline back into negative territory last month was partly due to special factors with the earlier timing of Easter meaning that holiday related prices, which picked up over Easter, fell back again in April. This distorts the annual rate somewhat and goes some way to explain the swings over the March/April period. In any case, the ECB has already reacted pre-emptively with the March set of easing measures and is now firmly in wait and see mode and focused on implementing what has already been announced, so that any revision won’t change the immediate rate outlook.
FOMC Minutes: Published at 21:00 GMT and should make interesting reading as a number of officials want interest rate hikes as early as June or July, whereas the market is discounting this heavily with only 23% of investors expecting a hike in either month. As ever the words that are used and indeed not used will be scrutinized closely.

Always trade with strict risk management. Your capital is the single most important aspect of your trading business.

Please note that times displayed based on local time zone and are from time of writing this report.

Click HERE to access the full HotForex Economic calendar.

Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding on how markets work. Click HERE to register for FREE!

Click HERE to READ more Market news.

Stuart Cowell
Chief Market Analyst
HotForex

Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.

Date : 13th June 2016.

MACRO EVENTS & NEWS OF 13th JUNE 2016.

The Main Macro Events This Week

United States: FOMC Forecast revisions to be released Wednesday after the FOMC meeting should reveal little change in the official GDP and jobless rate estimates from the March meeting, which remain consistent across the forecast horizon with available growth and jobs data. The US economic calendar will have a few last-minute releases that may inform the Fed decision this week, but none sufficient to provide a counter-weight to the tepid May employment report that temporarily curbed the Fed’s appetite for a hike. Among them are the May retail sales report (Tuesday), which may log a healthy 0.6% gain (median 0.3%) vs 1.3% in April. Import prices are set to rise 1.0% in May, compared to a 0.2% gain in export prices. Business inventories are on tap too, expected be unchanged in April (median 0.3%) vs 0.4%. MBA mortgage market applications (Wednesday) are due, followed by an update on PPI set to rise 0.4% (median 0.3%) or -0.1% core. Empire State is seen flat for June (median -0.4) vs -9.0 in May, still not very inspiring, while industrial production may sink 0.2% in May (median unchanged) and capacity use slip to 75.2% from 75.4%. CPI is forecast to rise 0.2% for both headline and core in May (Thursday) and a 1.1% y/y reading won’t rattle the Fed. Philly Fed may resurface to 2.0 in June (median 0.7%) from -1.8, while the current account narrows to -$124.6 bln in Q1 from -$125.3 bln in Q4. Jobless claims are forecast to snap back 16k to 280k, while the NAHB housing market index may tick up to 59 in June from 58. Housing starts may sink 0.2% to 1,170 (Friday).

Canada: In Canada, the April manufacturing report and May CPI release highlight this week’s calendar, which also has appearances from Governor Poloz and Senior Deputy Governor Wilkins. April manufacturing, due Wednesday, is expected to reveal a 1.0% rebound in shipment values following the 0.9% drop in March. Total CPI, due Friday, is seen expanding at a 1.7% annual pace in May following an identical 1.7% y/y gain in April. But total CPI is seen jumping 0.6% m/m in May after the 0.3% gain in April, as higher gasoline prices and depreciation of the Canadian dollar both conspire to drive the index higher relative to April. The Bank of Canada’s core CPI index is projected to expand at a 2.2% y/y pace in May, matching the 2.2% rate in April. But here too we see acceleration in the monthly growth rate, with core CPI seen expanding 0.5% m/m in May after the 0.2% gain in April. Existing home sales for May (Wednesday) and the May Teranet/National home price index (Tuesday) also feature this week. BoC Governor Poloz speaks (Wednesday) at the Yukon Chamber of Commerce, Whitehorse, YT. A press conference will follow the speech. BoC Senior Deputy Governor Wilkins speaks (Friday) to the Canadian Payments Association in Calgary. There is not a press conference.

Europe: Eurozone Finance Ministers will meet again this week and Greece will hope to finally fully complete the bailout review, which would also open the way for the ECB to consider re-instating the waiver on Greek government bonds. This would allow Greek banks to participate in the central bank’s regular refinancing operations and be another step back towards normality. The events calendar also has a German 10-year Bund auction on Wednesday as well as the ECB’s economic bulletin on Thursday and several ECB speakers including Draghi (Friday). The overall message is likely to be the same, namely that the ECB is on hold while keeping the door open for further action if necessary. Data releases won’t change the overall outlook. There is a bunch of final May HICP numbers, with the overall Eurozone reading expected to be confirmed at -0.1% y/y (median same), and core inflation at 0.8% y/y. The ECB already had preliminary numbers at the time of the last meeting and is confident that current measures are sufficient to bring inflation back on a gradual growth path. The Eurozone also has trade numbers, BoP data and industrial production numbers for April. Production is expected to have rebounded slightly and we are looking for a marginal widening of the trade surplus, but overall data are unlikely to change expectations for a slowdown in overall GDP growth in the second quarter of the year.

United Kingdom: In the shadow of the EU vote, the week’s BoE June policy meeting and data calendar won’t carry as much significance as would usually be the case. The BoE’s MPC (announcing Thursday) will more than likely leave the repo rate at 0.5% by unanimous vote, and we don’t expect much deviation in the tone of the minutes to those of last month, nor last month’s edition of the quarterly Inflation Report. UK inflation data (Tuesday) has us expecting a 0.4% y/y reading on headline CPI (median same), up on April’s 0.3% y/y. This would still be below the 0.5% y/y cycle peak that was seen in March. Labour data covering April and May are also up (Wednesday), where we expect an unchanged unemployment rate of 5.1% (median same). Retail sales for May (Thursday) should show a rebound from April weakness. We expect a 3.7% y/y gain versus the -0.9% figure seen in April.

China: In China, May industrial production (today) came in unchanged compared to the 6.0% y/y April result. May retail sales (today) dipped to 10.0% y/y from 10.1% y/y in April. Foreign direct investment (today) dropped to 3.8% y/y clip in May versus 4.8% previously. Money supply figures are expected during the week.

Japan: Japan kicked the week off with the June MoF business outlook survey (BSI Manufacturing Index), which dropped to -11.1, versus the -7.9 reading seen in May. Revised April industrial production (Tuesday) is seen steady at 3.8% y/y. The BoJ is expected to keep policy unchanged at its meeting which culminates on (Thursday). Improved incoming domestic data, including upgraded Q1 GDP, stronger production, and a delay in the increase in the national sales tax proposed for April 2017 should be enough to keep the Bank on hold for now, while Governor Kuroda will likely want to further assess the impact of negative interest rates before easing further. The Q2 Tankan report, due June 30, may give him the data he needs on that front.

Australia: In Australia, Reserve Bank of Australia Assistant Governor (Financial Markets) Debelle delivers remarks (Tuesday) at the ASIFMA-GFMA Market Liquidity Conference 2016 in Hong Kong. His appearance will be via video link. Deputy Governor Lowe delivers a speech (Thursday) at the Economic Society of Australia (QLD) Business Lunch in Brisbane. Economic data features May employment (Thursday), expected to reveal a 10.0k gain following the 10.6k rise in April. The unemployment rate is seen at 5.7% in May, matching April.   

Always trade with strict risk management. Your capital is the single most important aspect of your trading business.

Please note that times displayed based on local time zone and are from time of writing this report.

Click HERE to access the full HotForex Economic calendar.

Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding on how markets work. Click HERE to register for FREE!

Click HERE to READ more Market news.

Janne Muta
Chief Market Analyst
HotForex

Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.

Date : 15th June 2016.

MACRO EVENTS & NEWS OF 15th June 2016.

FX News Today

Stock markets started to stabilise overnight, as the Yen weakened and helped exporters to bounce back ahead of today’s Fed decision. The BoJ is due to follow and some speculation of further central bank action has also underpinned the first improvement in Topix and Nikkei in five days. Chinese reversed early losses and jumped higher, sparking speculation that state-backed funds may be supporting the market, after MSCI Inc. refused to add China’s domestic equities to the benchmarks indexes. U.S. stock futures are still in the red ahead of the Fed, but FTSE 100 futures are moving higher. Oil prices are down, with the front end Nymex future trading below USD 48 per barrel. Nervousness remains ahead of the round of central bank decisions this week and next week’s Brexit referendum. The events will likely overshadow the data calendar once again, which has U.K. labour market data and European trade numbers.

FOMC began its meeting and announces its policy stance this afternoon at 14:00 ET. While a hike today is off the table, the policy statement and Fed forecasts will be scrutinized for clues on the rate path going forward. Outside of the weak May employment report, most pieces of data have been consistent with GDP growth of 2.6% this quarter. Price pressures have also been on the rise. And these factors support expectations that the FOMC will look to normalize further, and perhaps as soon as July, as is out view, as well as the Median estimate from last week’s Survey. The Fed’s dot plot is likely to again show 2 tightenings this year, though the median rate might be revised slightly lower. We also expect Fed Chair Yellen will be cautiously optimistic on the economy in her press conference, while still acknowledging the downside risks, as she did in her June 6 speech.

Canada Household Leverage Remains Near Record High: Canada’s household leverage remained elevated in Q1, as the ratio of household credit market debt to disposable income slipped ever so slightly to 165.3% from a record high 165.4% in Q4. The historically elevated debt to income ratio continues to highlight a prominent risk associated with the current policy setting. However, the Bank of Canada’s focus is growth and inflation, so rising leverage amid the current ultra accommodative rate environment will continue to be taken in stride by policymakers.

Atlanta Fed’s GDPNow was lifted to 2.8% in Q2 from 2.5% previously in the wake of the gain in May retail sales: “The GDPNow model forecast for real GDP growth (seasonally adjusted annual rate) in the second quarter of 2016 is 2.8 percent on June 14, up from 2.5 percent on June 9. After this morning’s retail sales release from the U.S. Census Bureau, the forecast for second-quarter real personal consumption expenditures growth increased from 3.5 percent to 3.9 percent. The next GDPNow update is Friday, June 17.”

Yesterday’s US reports revealed the expected May strength in retail sales and surprisingly large trade prices increases, though we also saw restrained business inventory gains that lowered our Q1 GDP growth estimate to 1.1% from 1.2%, versus the 0.8% prior reported pace. For retail sales, we saw only small prior revisions that had no net impact on our GDP forecasts, with expected May gains for gasoline station and auto dealer sales. For trade prices, we saw big increases in oil import and food export prices, but also big core price gains, and with boosts in prior import price gains that trimmed the skewing of recent trade price strength toward exports.

Main Macro Events Today

Canada Manufacturing: We expect manufacturing shipments, due Wednesday, to grow 1.0% in April (median same at +1.0%) after the 0.9% m/m drop in March and 4.0% plunge in February. A 1.5% gain in export values after the 4.1% drop in March and 6.8% plunge in February provides a compelling reason to forecast a gain in manufacturing shipment values during April.

US NY Fed “Empire State” Index: June producer sentiment kicks off with the release of the Empire State Index on Wednesday. We expect the headline to climb to -1.0 (median -4.0) after a tumble to -9.0 in May from 9.6 in April. Producer sentiment as settled back near recent lows with the ISM-adjusted average of all measures hitting 49 again in May after a spike to 53 in March and subsequent dip to 51 in April.

US Industrial Production: May industrial production is out Wednesday and should reveal a 0.2% (median unchanged) headline decline following a 0.7% increase in April and a 0.9% decrease in March. Capacity utilization should fall to 75.2% (median 75.3%) from 75.4% in April. Factory and mining employment both declined in the May employment report which could indicate downside risk for the release.

US FOMC: We expect no rate hike today but the policy statement and Fed forecasts will be scrutinized for clues on the rate path going forward.

Bank of Canada: Governor Poloz speech.

Always trade with strict risk management. Your capital is the single most important aspect of your trading business.

Please note that times displayed based on local time zone and are from time of writing this report.

Click HERE to access the full HotForex Economic calendar.

Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding on how markets work. Click HERE to register for FREE!

Click HERE to READ more Market news.

Janne Muta
Chief Market Analyst
HotForex

Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.

Date : 27th June 2016.

MACRO EVENTS & NEWS OF 27th June 2016.

Main Macro Events This Week

United States: The narrative turns to the fallout from Brexit in terms of the markets, central banks, and global politics into the second half of the year. The importance of the June jobs has also significantly diminished, though nonfarm payrolls are expected to bounce 195k, making the weakness in the prior two months look like anomalies. The U.S. calendar this week is mercifully tame after all the pandemonium on Friday, starting with the advanced trade report (Monday), the deficit expected to widen to -$59.8 bln for May vs -$57.5 bln year-ago. The highlight will be Q1 GDP (Tuesday), the third edition seen revised up to 1.2% from 0.8% previously. S&P/Case-Shiller home prices are also on tap, along with consumer confidence, seen rising to 93.5 in June  vs 92.6, and the Richmond Fed index. The MBA mortgage market indices (Wednesday) could show some sensitivity relative to the plunge in rates Friday. Personal income is expected to rise 0.3% in May vs 0.4%, while spending may be up 0.3% vs 1.0%; core PCE prices rising just 0.1%. Initial jobless claims should rebound 19k to 278k for the June 25 week (Thursday), after a similar plunge the week prior, while Chicago PMI is set to improve to 51.0 in June from 49.3. ISM may ease to 51.0 in June vs 51.3 in May as manufacturing remains sluggish (Friday), while May construction spending may rebound 0.7% from a -1.8% April deficit. Vehicle sales punctuate the week.

Fedspeak, Chair Yellen speaks on Wednesday from Portugal. Three other Fedspeakers are scheduled over the week, including centrist Fed governor Powell who speaks on Tuesday from Chicago. St. Louis Fed hawk-dove Bullard and Cleveland Fed hawk Mester speaks Friday from London.

Canada:  All of the domestic action takes place on Thursday, when April GDP and May IPPI will be released. Markets are closed Friday for the Canada Day holiday. We expect April GDP to rise 0.1% m/m following the 0.2% drop in March.  The widely anticipated plunge in May GDP looms over all the April reports. We see a 0.5% drop in May GDP, driven by the wildfire related shutdown in oil sands production. Real GDP is penciled in for a 1.0% drop in Q2, followed by a 4.0% gain in Q3. The IPPI is seen rising 0.3% m/m in May after the 0.5% drop in April. The RMPI is expected to jump 5.0% m/m in May as crude oil prices saw a strong gain, following the 0.7% increase in April. There is nothing from the Bank of Canada this week.

Europe: As markets start to come to terms with the immediate fallout of the U.K.’s decision to leave the EU, politicians and officials are trying to figure out a road-map for a divorce that will not only be costly for both sides, but also very difficult in practical terms. The longer the crisis drags on, the more likely further policy action from the ECB will be needed, especially as the Brexit vote also rekindled Eurozone break up fears and sparked a renewed sharp widening of spreads. What is clear is that forecasts for both growth and inflation will have to be rewritten now and that will mean data releases this week are already outdated. On the slate are preliminary June inflation reports from Germany, France and Spain, which are all expected to show a slight uptick in headline rates. The German HICP is

expected to rise to 0.2% y/y from 0.0% y/y in May. The French HICP rate is seen increasing to 0.3% y/y from 0.1% y/y and together these should lift the overall Eurozone rate to 0.0% y/y from -0.1% y/y and thus out of negative territory for the first time since January. Economic Confidence indicator will be outdated even before it is released; we are looking for an unchanged reading of 104.7.

UK: Four things to know: 1, the UK will remain a paid-up member of the EU for at least another couple of years; 2, there is a possibility that the UK will lose Scotland; 3, uncertainty will abound for the foreseeable; 4, the UK will more than likely lose its triple A credit rating.

Overall, this historical-watershed period will not good be for business and investment decision making.  We look for sterling to remain pressured, seeing potential for 1.2000 versus the dollar and at least another 10% decline in trade-weighted terms.  UK stocks are likely to be susceptible to periodic crashes in the weeks ahead, particularly those of the more domestically-focused businesses.

China: June PMIs headline at the end of the week. The Caixin/Markit index (Friday) is expected to dip to 49.0 after edging up to 49.2 in May from April’s 48.9. It’s been in contractionary over the past three months and will add to the worrisome tone if it falters deeper into negative territory. The official CFLP is seen slipping to 50.0 from 50.1 in April and May and has been on a decidedly slowing growth path since mid-2011. The non-manufacturing PMI report is also on tap.

Japan: May retail sales (Wednesday). The pace of contraction for large retailers is expected to slow to -0.5% y/y from -1.0%, while overall sales are seen worsening to -2.0% y/y from a revised -0.9% overall. May industrial production (Thursday) is seen rebounding 1.0% m/m from -3.3% previously, while May housing starts (Thursday) are penciled in with a 5.0% m/m increase after jumping 9.0% previously. May construction orders are also due (Thursday). The remainder of the calendar comes on Friday, beginning with CPI figures. June Tokyo overall CPI is seen steady at -0.5% y/y, and unchanged at -0.5% on a core basis. May national CPI is expected to tick down further to -0.4% y/y from -0.3% for both headline and core readings. May unemployment should be unchanged at 3.2%. The job offers/seekers ratio is penciled in at an unchanged 1.34. May personal income is expected to contract at a -0.5% y/y clip from the prior 1.0% gain, while May PCE is forecast to fall 2.0% y/y from -0.4% in April. The June Tankan report is predicted to slip to 5 from 6 for large manufacturers, and to 20 from 22 for large non-manufacturers. June consumer confidence is seen weakening to 40.5 from 40.9. June auto sales are also on deck. Data in line with our estimates would add to the general gloom and worries over growth, especially in the aftermath of Brexit.

Australia: The Reserve Bank of Australia schedule is empty of speakers or events. The next Bank event is the July 5th meeting, where we expect no change in the 1.75% setting for the cash rate. The RBA left its official cash rate unchanged at 1.75% in June, as had been widely anticipated. Recall that the central bank unexpectedly cut rates in May to 1.75% from 2.00% following an unanticipated drop in Q1 inflation. Economic data is in short supply this week, with just the May HIA new home price index (Wednesday) and May private sector credit (Thursday) on the docket.

Always trade with strict risk management. Your capital is the single most important aspect of your trading business.

Please note that times displayed based on local time zone and are from time of writing this report.

Click HERE to access the full HotForex Economic calendar.

Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding on how markets work. Click HERE to register for FREE!

Click HERE to READ more Market news.

Stuart Cowell
Market Analyst
HotForex

Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.

Date : 4th July 2016.

MACRO EVENTS & NEWS OF 4th JULY 2016.

THE ECONOMIC WEEK AHEAD

United States: US stock and bond markets are closed today for the independence celebrations. There are only two items of note on the abbreviated week’s calendar, the June jobs report (Friday) and the FOMC minutes (Wednesday). But with the much changed landscape following Brexit, and the Fed sidelined for the foreseeable future, there may be limited impact from these reports. The jobs report will be important, however, as we look to gauge whether the weakness in April and May data was more an anomaly or a new trend. The FOMC minutes to the June 14, 15 policy meeting will be of lesser value since the discussions will seem rather irrelevant after the surprise Brexit vote. Other data reports this week include the June ISM non-manufacturing index (Wednesday), May factory orders (Tuesday), May trade (Wednesday), and June ADP payrolls (Thursday). The services ISM is expected to bounce back to 53.5 after slipping 2.8 points to 52.9 in May. Such a rebound would help alleviate worries over general economic slowdown. Factory orders are forecast falling 0.7% given the 2.2% drop already reported in durable orders. The May trade deficit is seen widening to -$40.0 bln, after expanding to -$37.4 bln in April, with imports climbing another 1.3% after the 2.1% April jump, while exports should inch up 0.1% after a 1.5% gain previously. The ADP report, which will set the stage for the BLS jobs report, is expected to post a 165k private payroll increase.

Canada: Slate of economic data in Canada is heavy this week. The Bank of Canada’s Business Outlook Survey (today) is expected to reveal divergent moves in sentiment among industries. The impact of the Alberta wildfires and production shutdown should weigh heavily on oil industry sentiment. However, the outlook for the rest of the economy should see further modest improvement. The trade report (Wednesday) is seen revealing a slight unwinding of the trade deficit to -A$2.8 bln from -A$2.9 bln in April. Exports are seen falling 3.0% in May, while imports suffer a similar sized decline to leave the deficit little changed. But the risk is to the downside for both the May deficit and the size of the export pull-back. Building permits (Thursday) are expected to improve 1.0% in value terms during May after the 0.3% dip in April. The Ivey PMI (Tuesday) is seen improving to 51.0 in June from 49.4 in May. Finally, the employment report (Friday) is projected to reveal a 10.0k jobs gain alongside a rise in the unemployment rate to 7.0% from 6.9% in May.

Europe: the EMU June Services PMI (Tuesday) is expected to be confirmed at 52.8. The manufacturing reading was revised up, which leaves room for an upward revision to the composite, but while survey data confirmed that the economic recovery gathered pace again at the end of Q2, Markit said with the release of the manufacturing number that responses were gathered ahead of the Brexit result, so that they don’t capture the impact of the U.K.’s decision to leave the EU. German manufacturing orders (Wednesday) and industrial production (Thursday) data for May will be even more out of date in light of the recent events. Even if there are sizeable large- ticket items in the orders number that should underpin industrial production going ahead, the risk is that the Brexit referendum will lead to cancellations as investment projects are being put on hold until the future relationship between the rest of the EU and the U.K. is more clear. For what it’s worth, we are looking for a rebound in manufacturing orders of 0.8% m/m (med same), after the -2.0% m/m contraction in the previous month, while production is expected to ease -0.2% m/m (median 0.0%). The data calendar also has Eurozone May retail sales (Tuesday), German trade data for May (Friday), as well as French production numbers (Friday) and EMU PPI (today), none of which will change the outlook, which currently hinges on the Brexit fallout. Events include a German 2-year sale on Wednesday, which will likely see strong demand in the current climate.

United Kingdom: Incoming data will remain largely irrelevant while the numbers continue to pre-date the Brexit vote. The timely YouGov/CEBR consumer confidence survey, which gives weekly updates, gave a taste of what may come, with its headline reading of 104.3 in the days after June 23, down from 111.9 for the first three weeks of June. There is also growing anecdotal evidence of slowing activity in the property market and the market for high ticket items, such as cars. Against this backdrop, it’s difficult to be anything by bearish of sterling, especially against the dollar, which will be natural safe haven refuge from European strife. We expect the pound to see 1.2500 against the dollar before long.

China: June Caixin services PMI (Tuesday) is forecast dipping to 51.0 from 51.2. June fixed investment is due during the week and CPI numbers on Saturday.

Japan: In Japan, the June Nikkei PMI services PMI will be reported (Tuesday). It improved to 50.4 in May from 49.3 previously. May preliminary leading and coincident indices are due (Thursday), followed by June 1st 20-day trade data (Friday). The May current account surplus (Friday) is expected to narrow to JPY 1,800.0 bln from 1,878.5 bln. June bank loan data are also due (Friday).

Australia: In Australia, the Reserve Bank of Australia meets (Tuesday) and is expected to maintain the 1.75% setting for the cash rate. The RBA left its official cash rate unchanged at 1.75% in June, as had been widely anticipated. In May, they unexpectedly cut to 1.75% from 2.00% following an unanticipated drop in Q1 inflation. Economic data features the May trade report (Tuesday), expected to reveal a deeper -C$1.8 bln deficit in May from the -A$1.6 bln deficit in April. Retail sales (Tuesday) are seen improving 0.4% in May after the 0.2% gain in April. Building approvals (Monday) are expected to fall 3.0% in May after the 3.0% gain in April. The May ANZ job ads and the May Melbourne Institute inflation index are both due Monday. RBA Assistant Governor (Financial Markets) Debelle speaks, Wednesday, at the Thomson Reuters industry event: Examining the FX Code of Conduct (Phase One).

Always trade with strict risk management. Your capital is the single most important aspect of your trading business.

Please note that times displayed based on local time zone and are from time of writing this report.

Click HERE to access the full HotForex Economic calendar.

Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding on how markets work. Click HERE to register for FREE!

Click HERE to READ more Market news.

Janne Muta
Chief Market Analyst
HotForex

Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.

Date : 12th July 2016.

MACRO EVENTS & NEWS OF 12th JULY 2016.

FX News Today

European Outlook: Stock markets in Japan continued to rally, and the Yen weakened as Abe’s election victory cleared the way for more “Abenomics”. Gains in other Asian markets were more modest and while U.S. stock futures are moving higher, FTSE 100 futures are in the red, despite the fact that the BoE is expected to cut rates once again on Thursday. The U.K. may have a new Prime Minister by tomorrow evening and Theresa May, poised to take over from Cameron, could start exit talks earlier than previously thought. So far she hasn’t taken a soft approach and refused to rule out the deportation of EU citizens already working and living in the U.K., which will not go down well in the city. EU finance ministers will meet today and after the Eurogroup yesterday backed the Commission’s recommendations for fines on Spain and Portugal budget overshoots, this is likely to be approved by the Ecofin today. The issue of Italy’s plans to recapitalize Italian banks without bail-ins remains open. The data calendar has German final June inflation at the start of the session, more inflation data from Sweden and Portugal and Irish GDP numbers for Q1. Nothing that would change key central bank outlooks for now. The BoE releases the minutes of the Financial Policy Committee, which was held on June 28, that is after the referendum and may attract more attention than usual if there are more warnings on the possible fallout.

US Data Reports: The stock market got another free pass from prospects of fresh stimulus in Japan following the landslide election of Abe, as investors hoped to collect $200 in “helicopter” money, not go directly to jail or at least get some free parking near historic highs. News that Japan machinery orders plunged and former Fed chief Bernanke was paying a visit to BoJ buddies fueled that speculation and related asset rebalancing. This took some starch out of bonds, gold and the yen, while WTI crude also eased 1%, back under $45. S&P 500, hit fresh record highs at 2,143, The NASDAQ cleared 5,000, and the Dow marked a session high 18,283.

Brexit Aftermath: The uncertainty surrounding the new UK Prime Minister evaporated yesterday as Theresa May became the only candidate, following the withdrawal of Andrea Leadsom. David Cameron will tender his resignation to the Queen on Wednesday after chairing his last Cabinet meeting today. Brexit means Brexit, May has said. The GBP and the FTSE both rallied yesterday with some of the uncertainty over the government, post-Brexit, now out of the way. GBPUSD currently trades significantly north of 1.3000 at 1.3074.

Fedspeak: The Fed’s Esther George welcomed the good news from Friday’s jobs report and said it shows the resilience of the economy. She said consumers are continuing to spend, while household confidence is up. However, business investment has been relatively weak, though it’s been holding up ok outside of the energy and manufacturing sectors. She added that the strong dollar and weaker global growth may hurt exports. Keeping rates too low carries risks, reminded the long-time Fed hawk (and 2016 voter), and said the current level of Fed policy is too soft, in her opinion. There are limits to what monetary policy can achieve, but it’s getting closer to achieving its goals. Core inflation has been firming and the pace of job creation has been noteworthy. But demand for middle-skilled workers has dropped sharply and the recovery has not been evenly spread across the workforce. She thinks that gradual rate increase will help the FOMC achieve its goals. Though she’s one of the more hawkish on the FOMC, her comments don’t suggest she’ll push for a rate hike as soon as the July 26, 27 FOMC meeting due to Brexit fallout, but she is likely to argue for a hike at the September 20, 21 meeting if the markets are stable and Brexit fears have diminished.

Main Macro Events Today

BOE Governor Carney Speaks –  Testifies before the Treasury Select Committee about the Bank of England Financial Stability Report. Unlikely to reveal anything particularly new ahead of Thursdays MPC meeting announcement.
JOLTS Job Openings – This data point is a particular favourite FED Chair Mrs. Yellen so will have added interest today in particular following the strong NFP data on Friday. Last month there were 5.79m job openings posted with expectations that his month the number will be slightly lower at 5.74m.

Always trade with strict risk management. Your capital is the single most important aspect of your trading business.

Please note that times displayed based on local time zone and are from time of writing this report.

Click HERE to access the full HotForex Economic calendar.

Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding on how markets work. Click HERE to register for FREE!

Click HERE to READ more Market news.

Stuart Cowell
Market Analyst
HotForex

Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.

Date : 14th July 2016.

MACRO EVENTS & NEWS OF 14th JULY 2016.

FX News Today

European Outlook: Asian stock markets are mixed, with Japanese bourses continuing to benefit from stimulus hopes, while mainland China saw profit taking amid concerns that the market is overbought. Hang Seng and ASX 200 posted modest gains and U.S. and European stock futures are also moving higher. Oil prices are higher on the day, but the front end WTI future is holding below USD 46 per barrel. The focus in Europe will be on the BoE today, which is expected to cut rates by 25 bp today along with dovish guidance, as the bank is eying the fallout from the Brexit vote. The U.K. RICS house price balance, dropped to 10 from 19 highlighting that house prices will be one are that will feel the sting. The European calendar is pretty empty otherwise.

US Data Reports: Fed Beige Book reiterated the economy grew at a “modest” pace over the last six weeks (ending July 1), in line with expectations. The report, prepared by the St Louis Fed, had a slightly more upbeat tone versus recent Beige Books and was generally positive across broad areas of the economy. Consumer spending was generally positive, as was reported in June. However, there are some signs of softening. Labor market conditions remained stable, with employment growth modestly while wage pressures remained modest to moderate. Manufacturing was mixed but generally improved. Real estate continued to strengthen. The natural resources and energy sectors continued weak, however, damping the overall outlook. Price pressures remained slight. Though a tad more optimistic than recent reports, it won’t bring the FOMC off the sidelines at the July 26, 27 policy meeting.

Fedspeak: Kaplan is optimistic on the economy, expecting growth of about 2% after the disappointing 1.1% pace from Q1. Consumer spending should be solid this year, he added. Much of the recent erosion in the labor market he attributes to demographics, with part of it cyclical too. The participation rate is likely to decline further to below 61%, which creates headwinds for GDP, and suggested the only way to bounce back is through immigration. He looks for demand and supply in the oil market to get back into balance in Q1 2017, with prices continuing to firm. He added that the FOMC is very sensitive to the strength of the dollar. Kaplan becomes an FOMC next year.

Main Macro Events Today

BOE Rate Announcement Our view matches the strong consensus view for the Old Lady to cut the repo rate by 25bp, which would take it to a record low of 0.25%. This would be the first change in the repo rate since March 2009 and would more than likely be accompanied by dovish guidance, leaving the door open to further cuts and to a restart of the QE programme. The BoE will continue to make cash available for liquidity injections into the banking system.

US Initial Jobless Claims Initial claims data for the week of July 9 is out today and should reveal a headline increase to 265k (median 265k) after a big dip to 254k in the week of July 2nd. Overall, we expect claims to average 262k in July from 265k in June with nonfarm payrolls adding 180k in July after a 287k bounce in June.

U.S. PPI June PPI is also out today and should reveal a 0.3% (median 0.3%) headline increase with the core up 0.1% (median 0.1%) for the month. This follows stronger figures in May which had the headline up 0.4% with the core up 0.3%. June trade price data has already been released and had import prices up 0.2% for the month with export prices up 0.8%.

Always trade with strict risk management. Your capital is the single most important aspect of your trading business.

Please note that times displayed based on local time zone and are from time of writing this report.

Click HERE to access the full HotForex Economic calendar.

Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding on how markets work. Click HERE to register for FREE!

Click HERE to READ more Market news.

Stuart Cowell
Market Analyst
HotForex

Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.

Date : 2nd August 2016.

MACRO EVENTS & NEWS OF 2nd August 2016.

FX News Today

European Outlook: Asian stock markets are mostly down, with the Shanghai Composite Index managing slight gains, but the Nikkei closed down -1.47% and Australia’s ASX also down, despite a rate cut from the RBA, which lowered the cash rate by 25 bp to 1.50%. Negative leads then for European stock markets which already closed in the red yesterday, which should give Bund futures some chance to recover some of yesterday’s losses. The European calendar is relatively quiet today, with only the U.K. construction PMI, the Swiss manufacturing PMI and Eurozone PPI numbers.

RBA Cuts rates by 25bp to a record low 1.50%: As expected and already largely priced in by the markets, AUDUSD fell but then immediately recovered, currently trading at 0.7548. “Moderate” repeated a lot in the statement, concerning Chinese growth, local domestic growth including housing and labour market. Key problem remains stubbornly low inflation and is expected to “remain so for some time”. The RBA report their quarterly forecast update on Friday.

Japan: Consumer confidence has slipped again, from 42.0 to 41.3 for July. Finance Minister Aso and BOJ Governor Kuroda will meet later today to “confirm cooperation over policy”. Also due today is PM Abe fiscal stimulus announcement. USDJPY 102.14 in anticipation.

US Market Reports: Yesterday they revealed only a small July ISM drop to a still-firm 52.6 from a 16-month high of 53.2 in June, and it’s now likely that the ISM-adjusted average of the major surveys will bounce to 52 in July from 50 in both May and June, as this aggregate reclaims the 52 eight-month high in March. Yet, we also saw a surprisingly weak round of Q2 construction spending figures that trimmed our Q3 GDP growth estimate to 2.6% from 2.8%, after a likely downward bump in Q2 growth to just 1.1% from 1.2%. We saw June construction drops in every major component except home improvement, after widespread downward bumps in both April and May.

Energy Action: WTI crude gapped to $40.20 lows after breaking Friday’s three-plus month base of $40.57. The contract now stands at levels last seen on April 20, when the printed base was $39.85. Fresh selling can be expected under there, with stop loss orders noted. Technically the key 50 and 200 DMA have been broken.

Main Macro Events Today

US Personal Income –  June personal income data is out today and should reveal a 0.3% (median 0.3%) headline with consumption up 0.3% (median 0.3%) as well. This follows respective May figures which had income up 0.2% on the month with consumption up 0.4%. Vehicle sales plunged in June but the employment report and aggregate income measure were both stronger, lending some upside risk to the release.

UK Construction PMI – More poor data expected a fall to 44.2 from 46.0 last time is anticipated. UK home ownership now at 35 year lows as demand out strips supply and generation rent continue to enter the market.

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Please note that times displayed based on local time zone and are from time of writing this report.

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Stuart Cowell
Market Analyst
HotForex

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