Hot Forex - Market Analysis and News.

[HFM.]

Date : 31st January 2017.

MACRO EVENTS & NEWS OF 31st January 2017.

FX News Today

European Outlook: The selloff in equities continued in Asia overnight. Hong Kong and China remained closed for New Year celebrations, but elsewhere market remained weary of Trump related policy risks. The BoJ left policy unchanged as expected and there was no sign of tapering, despite an upward revision to the growth forecast, but this failed to limit the selloff in Nikkei and Topix as it underpinned a stronger currency. U.S. stock futures are also down, but FTSE 100 futures are managing slight gains, despite a stronger Pound. The European data calendar is packed today, with the highlights including Eurozone inflation and GDP data, as well as German and Eurozone unemployment numbers and BoE lending data out of the U.K. There are also a number of ECB speakers, which are expected to play down the importance of the latest uptick in inflation.

Japan: Japanese household Spending came in unexpectedly at 0.3% lower than December’s 1.5%. Unemployment rate matches analysts’ predictions, since it came in at 3.1%, which consider being unchanged based on December’s rate. Furthermore, BOJ’s announced that monetary policy will be kept steady.

US data reports: The U.S. income report revealed a 0.3% December income rise after a small November boost that tracked assumptions, but a firm 0.5% consumption increase with a solid 0.3% “real” rise that modestly beat estimates. We saw a lean 0.2% December chain price rise that lifted the “real” consumption gain, while the savings rate fell to 5.4% from 5.6% (was 5.5%) in November. The firm close to Q4 consumption signaled slight upside risk to our 2.0% Q1 GDP estimate, which we left intact for now despite a small boost in our Q1 real consumption growth forecast to 2.2% from 2.1%, after a 2.5% Q4 clip. The savings rate has considerable room to fall as we eventually unwind the lofty 6.1% Q1 average and 6.2% figure last March, as the rate is well above the 4.6% cycle-low from November of 2013. The Confidence spike since the U.S. elections may indeed signal a further savings rate drop into early-2017 that boosts consumption relative to income. U.S. pending home sales bounced 1.6% to 109.0 in December after falling 2.5% to 107.3 in November from October’s 110.0. But, compared to last December, pending sales are down 2.0% y/y versus the 1.4% y/y gain for November.

Germany: German inflation data led the way for an uptick in the Eurozone rate, to 1.6% y/y from 1.1% y/y in December. Base effects from energy prices are the main driving factor and with even the German rate holding below the ECB’s 2% limit, the central bank is unlikely to change its course on the back of the numbers. Given that spreads are already widening, it will be crucial for Draghi and Co to send a very clear message to markets in coming months. German Dec retail sales came in, early today, much weaker than anticipated at -0.9% m/m. Expectations had been for a rise of 0.6% m/m as a rebound from the slump in the previous month and the data are more than disappointing, and at odds with very strong consumer confidence figures and the Bundesbank’s full year 2016 growth estimate, which suggested a strong last quarter also thanks to consumption. However, official retail sales cover only a part of overall consumption, so the gap between the official data and the consumption numbers in the GDP measures seem to be widening

Main Macro Events Today

Draghi’s speech – ECB President Mario Draghi speaks in ECB and European Commission conference.

Eurozone GDP – Quarterly GDP growth is expected to come in at 0.4% q/q, from 0.3% in the previous quarter and with a slight upside risk. Growth is broadening and confidence indicators suggest ongoing improvement in economic activity ahead, helped to a large extend by consumption and domestic demand. Risks remain tilted to the downside and come mainly from the political sphere inside and outside the Eurozone. For now, though the recovery remains on track.

US ECI & Consumer Confidence – Employment cost data expected to come in at 0.6%, matching the pace of growth that we have seen last time. The y/y pace of growth should tick up to 2.4% after holding at 2.3% for the past two quarters. January consumer confidence is expected to edge higher to 114.0 from 113.7 in December and 109.4 in November. Since the election various confidence measures have been topping highs set last winter during the oil price plunge.


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.

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.


Andria Pichidi
Market Analyst
Hot-Forex


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.

 

[HFM.]

Date : 1st February 2017.

MACRO EVENTS & NEWS OF 1st February 2017.

FX News Today

European Outlook: Asian markets were mixed overnight. Japan managed to close with gains as markets started to focus on corporate earnings, while stocks in Hong Kong were under pressure as markets reopened, with U.S. policy concerns weighing on confidence. A weaker yen underpinned Japanese markets. Japan’s final manufacturing PMI was revised slightly down, but business sentiment was still at a 31-month high and Chinese PMIs held steady and point to ongoing expansion. In Europe, the calendar holds final Eurozone PMI readings as well as the U.K. CIPS manufacturing PMI. Germany auctions 5-year Bobls, but political events will remain at the forefront as U.S. President Trumps seems to promote a breakup of the EU.

Japan: Final Manufacturing PMI came in slightly down at 52.7 from 52.8 in December. As HIS Markit / Nikkei reported, Japanese manufacturing sector started 2017 with operating conditions improving at the sharpest rate in 3 years’ time. Both Production and new order rose in January, with the latter rising at the quickest rate since December 2015.

China: Chinese PMIs held pretty steady with 51.3 from 51.4 last period (expectation at 51.2) and point to ongoing expansion. Also, indicates that steadiness in Chinese economy will continue.

US data reports: revealed modest shortfalls across the Q4 ECI data and the January figures for consumer confidence and Chicago PMI, though the shortfalls did nothing to change the outlook for GDP growth of 2.0% in Q1 after a 1.9% Q4 rise. A 0.5% Q4 U.S. ECI gain undershot the 0.6% increases of the last three quarters, and we saw a restrained 0.5% wage and salary rise that defied the steeper hourly earnings uptrend, and we expect a firm 0.3% January hourly-earnings rise fueled by minimum wage hikes, alongside a 190k payroll rise. We saw a Chicago PMI drop to 50.3 from 53.9, which may reflect the 4% drop we expect in the January vehicle assembly rate given this index’s sensitivity to the auto sector. For consumer confidence, we saw a drop to a still-firm 111.8 from a 113.3 (was 113.7) December cycle-high, though confidence is still at its highest levels since the 9-11 terrorist attack in 2001. Inflation expectations bounced sharply in January after an odd December pullback, as gauged by both the Consumer confidence and Michigan sentiment surveys.

Canada: BoC’s Poloz continued to highlight uncertainty in his prepared remarks and his Q&A with the press. In his Q&A, he said “The way we think of it now is uncertainty has risen in the wake of the election and that is likely to feed through to investment thinking.” In his speech, he championed the importance of judgment in setting policy, noting that uncertainties such as geopolitical risk limit the effectiveness of economic models. On the currency, he said that some rise in the loonie is premature given excess capacity. The energy crisis (plunge in oil) has left Canada with persistent excess capacity. As for Trump, the impact of the new president is not knowing what to expect. No change for an extended period remains the base case scenario.

Main Macro Events Today

UK Markit PMI – UK Markit Manufacturing PMI expected to fall to 55.9 from 56.1 in December.

FOMC & Fed’s Rate – Monetary policy announcement coming today, while there will not be any press conference or release of estimates. No policy changes are expected at this point. Fed’s Interest Rate will also be decided later today.

US ISM – January ISM is out today and should reveal a 54.5 (median 55.0) headline that remain unchanged from the post-revision level set in December. Other measures of producer sentiment have mostly improved for the month and hence the ISM-adjusted average of all measures expected to climb to 55 from 53.2 in both December and November and 51.9 in October.


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.


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.


Andria Pichidi
Market Analyst
Hot-Forex


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.

 

[HFM.]

Date : 2nd February 2017.

MACRO EVENTS & NEWS OF 2nd February 2017.

FX News Today

European Outlook: Asian stock markets mostly headed south ( Nikkei closed own -1.22% at 18, 914) ongoing concerns about am emerging global trade war, and as the dollar weakened after the Fed failed to signal a rate hike as early as March, which some expected after yesterday’s data round. Oil prices fell back and investor confidence ebbed. Meanwhile the tense transatlantic mood and the apparent desire by the new U.S. administration stir discord in the Eurozone and the EU with the aim of breaking up of the union, should keep Eurozone spreads on a widening path. This backdrop, if it sustains, this will make it less likely that the ECB will end its very accommodative monetary policy, and keep the euro on the back foot. The UK parliament voted in favour of the government to trigger Article 50 and today the Brexit White Paper will be released.

Australian Trade – A Record Surplus: Imports rose to 1% from 0% last time and Exports fell to 5% from 8% which grew the trade balance much more than expected to record AUD 3,511Million from AUD2, 040 million last time and an expected figure of AUD2, 200million. The record trade balance was due mainly to significant increases in commodity prices and prevented Australia slipping into a “technical” recession for Q4 2016.

The FOMC Statement: FOMC said inflation “will rise to 2%” over the medium term, and that economic activity continued to expand, while the labor market continued to strengthen. There was no change in rates, as projected. The FED also gave itself maximum flexibility to act in March, or not, if it deems it necessary as the policy statement neither put the markets on notice, nor did it signal the all-clear. Many factors will go into the policy decision next month. While stronger data and rising inflation pressures may push some of the more hawkish Committee members to argue for a 25 bp hike, the current voters, including Evans, one of the most dovish participants, along with the centrist Kashkari would likely prefer to delay, especially if political uncertainties remain high and if fiscal stimulus looks to be farther out the timeline. Additionally, the markets could be shaky ahead of Brexit, as the UK moves closer to triggering that event, and the March 15 general elections in the Netherlands. With this backdrop, Fedspeak should be closely monitored. USD sagged following the announcement and overnight Cable touched 1.2680, the Euro perked to 1.0795 and Japanese yen traded down to 112.46. The US Dollar index is currently trading significantly under 100 at 99.43.

US data: U.S. ADP reported private payrolls surged 246k in January after a 151k gain in December (revised from 153k). The service sector climbed 201k from 147k previously (revised from 169k), while employment in the goods producing sector rose 46k from December’s 4k gain. The U.S. ISM surge to a 2-year high of 56.0 from prior highs of 54.5 in December and 53.5 in November lifted January nonfarm payroll estimates to 200k from 190k, as the index continues to climb steeply from the 47.9 expansion-low in December of 2015. The jobs component surged to a 29-month high of 56.1 from an 18-month high of 52.8 in December.

Main Macro Events Today

BoE Super Thursday – Today the BOE announce it interest rate decision, (very likely to remain unchanged) along with its asset purchase facility (again likely to be unchanged) the minutes and votes from their last meeting and also the Quarterly Inflation report (the most interesting data) The minutes and inflation report are expected to convey a continued wait-and-see stance, repeating that policy could go in either direction this year. Finally governor Carney and members of the MPC hold a press conference regarding the Inflation report (likely to be by far the most interesting).

ECB President Draghi Speech – The speech in Slovenia may be more interesting and market moving than his speech on Monday but markets seem to be in a Trump On / Trump Off mood rather than Risk On / Risk Off.

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.

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.


Stuart Cowell
Senior Market Analyst
Hot-Forex


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.

 

[HFM.]

Date : 3rd February 2017.

MACRO EVENTS & NEWS OF 3rd February 2017.

FX News Today

European Outlook: Asian stock markets were mostly down overnight. The Nikkei managed to close with a marginal gain as the Yen declined, but elsewhere markets remained in a sombre mode, after mixed closes in the U.S. and Europe yesterday. Chinese stocks fell on the first trading day of the week. The Caixin manufacturing PMI came in weaker than expected, even though it remained in expansion territory, and the central bank raised interest rates in open market operations. Meanwhile international markets continue to look nervously to the U.S. and Trump’s new policies. U.S. and U.K. stock futures are also heading south. European yields came off yesterday and if the cautious mood prevails should remain underpinned going into the weekend. European spreads mostly narrowed yesterday, but France underperformed amid political concerns as the presidential elections draw nearer and Le Pen gains in the polls. The European calendar has final services PMI readings out of the Eurozone, as well as the U.K. CIPS services PMI.

China: China’s central bank sends tightening signal by lifting short term rtes. The first trading day after the long New Year holiday started with a bank in China as the bank lifted rates on open market operation repos by 10 basis points, effective today. Another signal that authorities are focusing on trying to control a real estate bubble, but some see it also as a way to try and halt the depreciation of the yuan, even if the rate rise focuses on reverse repos. According to Reuters two sources said authorities also raised the lending rates on its standing lending facility (SFL) short term loans.

UK: Sterling has followed Gilt yields lower in the wake of the BoE policy announcement and Inflation Report, which left the repo rate and QE settings unchanged, and detailed upgraded growth forecasts, as had been widely anticipated. The BoE retained its neutral policy bias, saying that the next move could be “in either direction”. The growth forecast has been lifted compared to the November inflation report, but the bank suggested that the equilibrium unemployment rate has dropped, which means the BoE can afford to accept a lower rate of unemployment without having to tighten policy. So, despite the better growth outlook, the bank remains firmly in neutral mode, leaving the door open to both further easing, or more tightening, depending how developments unfold. Cable had lifted from its lows, benefiting from the generally soft path of the dollar, though at 1.2575 bid presently remains a net 0.7% lower yesterday. The pound had remained heavier relative to the euro and yen, and although also off from earlier lows is still down by an average 1.1% versus the G3 currencies. A remark from BoE governor Carney during the BoE MPC’s post-meeting press conference, that “we think the economy can run with a lower rate of unemployment without us having to adjust policy” has been feeding a sterling-bearish narrative. Next domestic focus will be today’s December services PMI report, expected to dip to a 55.8 reading after 56.2 in December.

US: The dollar shrugged off the better jobless claims and productivity outcomes, leaving EUR-USD static just over 1.0800, and USD-JPY idling near 112.25. Yields were little changed, while equity futures remained moderately underwater. The 14k U.S. initial claims drop to 246k in the last week of January after climbing 23k to 260k the week before (revised from 259k). Claims are entering February on a tight trajectory following a 2-month period of holiday volatility that ended with last week’s report. Claims are averaging just 248k in January, versus higher prior averages of 258k in December. U.S. productivity posted a preliminary 1.3% growth rate in Q4, versus 3.5% in Q3. Furthermore, a 170K January nonfarm payroll rise expected in today’s report.

Main Macro Events Today

Us Non-Manufacturing ISM – January ISM-NMI is out today to close out the January producer sentiment releases and it is expected to tick down to 57 from 57.2 in December. Most measures of producer sentiment managed to post gains in January and the ISM-adjusted average of all measure looks poised to finish at 54 for the month, up from 53 in December and November.

US Employment – It is expected to post a 200k headline, up from 156k in December and about matching the 204k headline in November. The unemployment is expected to hold steady at 4.7% from November. The balance of risk is firmly to the upside as claims, consumer confidence and producer sentiment have all continued to strengthen in January.

EU Markit PMI – Expected to be unchanged since last time i.e. 53.6.

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.

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.


Andria Pichidi
Market Analyst
Hot-Forex


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.

 

[HFM.]

Date : 6th February 2017.

MACRO EVENTS & NEWS OF 6th February 2017.

FX News Today

February is starting off on an optimistic front after a solid beat from the January jobs report, and generally good news from the ISMs. Data calendars are pretty light around the world, though there will be a number of central bank meetings in Asia. Trade reports will highlight globally, especially from Germany, which has caught the ire of President Trump. The UK will also continue to wrestle with its Brexit dilemma, with the focus on the freshly published white paper on its negotiating stance before Article 50 is invoked next month.

United States: The economic calendar is a relatively lean one this week, with GDP and payrolls in the rear-view mirror now. Monday is empty, while the trade deficit is forecast to narrow to -$45 bln (Tuesday). JOLTS job openings and consumer credit are also due (Tuesday), with credit seen expanding by $20 bln in December from $24.5 bln in November. The MBA mortgage applications and EIA energy inventories are the only offerings (Wednesday). Initial jobless claims may rise 249K from 247K for the week ended February 2 (Thursday), while wholesale sales may rise 0.7% in December and inventories increase 1.0%. The Spartan week rounds out with import prices and export prices forecast unchanged in January (Friday), while preliminary Michigan sentiment is expected at 97.9 vs 98.5 last time. The January’s Treasury budget will also come out on Friday. The earnings season is coming to an end, but there are still a few key announcements due. So far 66.4% of the 274 S&P500 companies that have reported have revealed positive earnings news, while 20.8% have given negative surprises, with 12.8% in line.

Canada: The Canadian calendar is one of the few with a hearty spread of economic data this week after the paltry offerings last week. The employment report (Friday) is the main course, with total jobs projected to rise 5.0k in January after the 46.1k surge in December. The trade report (Tuesday) is expected to show a further expansion in the surplus to $1.2 bln in December following the surprise shift to a $0.5 bln surplus in November. Crude oil prices were sharply higher in December, which should provide a hefty boost to export values. The usual pairing of building permits (Tuesday) and housing starts (Wednesday) is expected to show moderation in Canada’s housing sector as Federal government measures impact. The Ivey PMI (Tuesday) is expected to fall to 58.3 in January on a seasonally adjusted basis from 60.8 in December. A 0.1% increase in the new housing price index (Thursday) is anticipated following the 0.2% gain in November.

Europe: The data calendar dries up this week and with the central bank meetings out of the way, the markets will have plenty of time to focus on the political risks that seem to be hitting the Eurozone from the inside and the outside. The French presidential election (first round April 23) remains a factor for markets, and it will be key to see how the Eurozone and the EU will react to the fact that the number of those who would love to see the unions fail is rising. Against that background and with the U.S. administration criticizing the weak EUR, which in turn is adding to Germany’s push for QE tapering, Eurozone spreads are likely to remain volatile and to continue to widen. Ironically that in turn puts Draghi in a difficult position and fears of a revival of the debt crisis will mean the ECB president will continue to send dovish signals at his comments at the European Parliament hearing next week.

The highlight of the data calendar is German manufacturing orders today (Monday), which came out at 5.2% from the -2.5% m/m decline in November. The sharp correction in orders in November, will likely keep a lid on December industrial production numbers (Tuesday) which are expected to rise to 0.2% m/m, following the 0.4% m/m in November. German December trade data (Thursday) may attract more attention than usual, not because of the monthly figure, but because it will likely show that Germany is the world’s leading exporters, which at the current juncture will only add to the arguments of German critics, especially Mr. Trump. Interestingly though, GDP numbers for this year already indicated that net exports detracted from overall growth and that the German recovery has been mainly underpinned by domestic demand and consumption. Additionally, the event calendar has ECBspeak from Draghi, Mersch, Weidmann and others and a German 10-year Bund sale on Wednesday.

UK: The calendar is fairly quiet this week, highlighted by industrial production and trade figures for December (Friday). The January BRC retail sales report is also up (Tuesday), along with the RICS house price balance for the same month (Thursday). The narrower manufacturing production gauge is expected to expand by 0.3% m/m from 1.3% last time. Data in-line with expectations should not affect sterling markets. Brexit focus will be on the government’s freshly published white paper on its negotiating stance before Article 50 is invoked. The paper will be subject to parliamentary approval, and is widely expected to pass without too much trouble. The government has pledged that Article 50 will be triggered by the end of March.

China: The January services PMI missed expectations since came out at 53.1 from forecast 53.6, while the January trade surplus is expected to balloon to $49.8 bln from 40.8 bln. January loan growth and new yuan loans are due Friday.

Japan: Japan’s docket kicks off with the December current account (Wednesday), where the surplus is expected to narrow to JPY 1,100 bln from 1,415,5 bln. January bank loan data are also due. December machine orders (Thursday) should rise 3.2% m/m from the prior 5.1% decline. January PPI (Friday) is penciled in at -0.1% y/y from -1.2% in December, while the December tertiary industry index is also due Friday.

Australia: The calendar has the Reserve Bank of Australia’s meeting (Tuesday) where we expect the rate setting to hold at 1.50%. RBA Governor Lowe speaks at the A50 Australian Economic Forum Dinner (Thursday). The RBA publishes the Statement on Monetary Policy on Friday. Economic data features. December housing investment (Friday) is expected to rise to 1.0% relative to November after the 0.9% m/m gain in November.

New Zealand: This week’s calendar has the Reserve Bank of New Zealand’s meeting (Wednesday), expected to result in no change to the 1.75% rate setting. At the last meeting, way back in early November, the RBNZ cut the OCR to 1.75% from 2.00%, as inflation continued to run below the target range. Governor Wheeler kept an easing bias in place at the time.

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.

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.


Andria Pichidi
Market Analyst
Hot-Forex


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.

 

[HFM.]

Date : 7th February 2017.

MACRO EVENTS & NEWS OF 7th February 2017.

FX News Today

European Outlook: Asian stock markets fluctuated after weaker sessions in the U.S. and Europe yesterday. Especially Eurozone markets were under pressure on Monday and spreads widened sharply, despite Draghi’s confirmation that the central bank will continue with its QE schedule and maintains an easing bias. This was followed up by Coeure telling La Parisien that the EUR is at an appropriate level. However, with the ECB continuing to keep the EUR down with a very expansionary policy the political risks facing the Eurozone externally and internally are rising and markets are reaction nervously to the rise of anti-EMU, far right parties in the polls. Especially France is in focus and the spread over the German benchmark has risen sharply in recent weeks. Political risks continue to overshadow the data calendar. Already released U.K. BRC retail sales for January unexpectedly dropped. German production numbers are due at the start of the session, followed by French trade data and U.K. house price numbers from Halifax later in the day.

ECB’s Coeure: EUR is appropriate level for the economy. The Executive Board member said in an interview with La Parisien that “since its last peak in 2011, euro has depreciated by almost 30% against the dollar”, adding that the single currency is “now at a level that is appropriate for the economic situation in Europe”. Coeure told said the “single currency has adjusted as a consequence” of necessary ECB policies designed to support the economy. Asked about Le Pen’s push for France to leave the EU Coeure said this is not what the French want as “when asked if they think the EUR is a good thing, the answer is an unambiguous yes”. He also played down arguments that the 3% debt limit in the Maastricht Treaty is a straightjacket, as “France has not respected the criterion once since 2007”. Meanwhile, ECB chief Draghi confirms easing bias and QE schedule at his hearing before the European Parliament, saying that the ECB policy is a key contributor to the Eurozone’s economic improvement and that financing conditions have to remain accommodative. He confirmed the QE scheduled of EUR 60 bln worth of asset purchases from April to December. The ECB president once again played down the importance of the recent uptick in headline inflation. Draghi repeated that the ECB will look through transient price increases and that the risks to the economic outlook remain tilted to the downside, and relate mainly to global factors.

Fedspeak: Philly Fed’s Harker did not discuss monetary policy in his prepared remarks on “Regulation is Key to Safeguarding Fintech, Consumers.” He did say it’s still an open question, who should supervise fintech lenders. We’ll see if he says anything policy related in Q&A. March should be considered on the table in terms of possible rate action, he told reporters in answering questions. Indeed, never take any meeting off the table, he warned, though he also advised he hasn’t made up his mind yet. It will depend on the evolution of the economy and fiscal policy. He still supports the FOMC’s three, quarter-point tightening trajectory and wants to make sure the Fed doesn’t fall behind the curve. Harker is on the hawkish side of the spectrum and is a voter this year.

Australia: Reserve Bank of Australia held rates at 1.50%, matching widespread expectations. They appear to be comfortable, for now, with inflation that “remains quite low.” Inflation is expected to “remain low for some time.” Governor Lowe said “Headline inflation is expected to pick up over the course of 2017 to be above 2 per cent, with the rise in underlying inflation expected to be a bit more gradual.” He said that the board “judged that holding the stance of policy unchanged at this meeting would be consistent with sustainable growth in the economy and achieving the inflation target over time.” They appear content to stay on the sidelines and let the easing from 2016 percolate through the economy.

Main Macro Events Today

US Trade, JOLTS & Consumer Credit – The trade report, expected to reveal to narrow to -$45 bln in December from the -$45.2 bln in November. JOLTS job openings and consumer credit are also coming out today, with credit seen expanding by $20 bln in December from $24.5 bln in November.

CAD Trade Balance – The trade report, expected to reveal an expansion in the surplus to C$1.2 bln in December from the C$0.5 bln in November.

CAD Exports, Imports & Ivey PMI – Crude oil prices were sharply higher in December, which should provide a hefty boost to export values. Exports are seen rising 2.0% m/m in December after the 4.3% surge in November. Imports are projected to increase 0.5% in December after the 0.7% gain. Building permits and the Ivey PMI are also due out today, but will take a back-seat to the trade report.

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.

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.


Andria Pichidi
Market Analyst
Hot-Forex


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.

 

[HFM.]

Date : 8th February 2017.

MACRO EVENTS & NEWS OF 8th February 2017.

FX News Today

European Outlook: Asian stock markets moved mostly higher, with property developers and automakers leading the way in China, but gains in Japan trimmed later in the session by a stronger Yen and the ongoing slump in oil prices. The front end Nymex future is currently trading at USD 51.76 per barrel, after data showing a rise i U.S. stockpiles, fuelling concerns that rising supply from the U.S. will offset cuts by OPEC. U.K. futures are moving higher, U.S. stock futures are narrowly mixed. In Europe only DAX and FTSE 100 managed to close with gains on Tuesday, while other markets were in the red. Yields declined as bond futures advanced and the French 10-year for once managed to outperform the German equivalent, but the Eurozone remains in the shadow of election jitters and mounting political risks inside and outside the union. The local data calendar today is pretty empty and with only business confidence data from the Bank of France on the agenda, political risks will remain a focal point.

US: U.S. December trade deficit narrowed 3.2% to -$44.3 bln after rising 7.1% to -$45.7 bln in November. Imports rose 1.5% versus the 1.2% gain previously, while exports were up 2.7% versus -0.2% in November. The “real” goods trade balance was -$62.3 bln compared to -$63.9 bln as imports rose 1.5% while exports increased 3.6%. U.S. JOLTS report showed job openings dipped 4k to 5,501k in December after rising 54k to 5,505k in November (revised from 5,522k). Also, the rate slipped to 3.6% from 3.7%. December hirings rose 40k to 5,252k following November’s 52k increase to 5,212k. The rate was flat at 3.6%. Quitters dropped 98k to 2,979k in December after rebounding 54k to 3,077k in November. The rate fell to 2.0% from 2.1%. The JOLTS report an important indicator for Fed Chair Yellen, particularly the quit rate, so the data will be slightly disappointing, but not really market moving.

Canada: GoC were ultimately little changed to firmer, with the long end of the yield curve outperforming. Equities managed to maintain a small gain late into the session, despite a drag from energy sector shares amid a tumble in crude oil prices. The loonie saw modest improvement against the U.S. dollar, despite the oil price decline and the not exactly surprising news that Canada ran a second consecutive trade surplus in December. Canada’s trade surplus narrowed to C$0.9 bln in December, which was better than expected and modestly below projection of C$1.2 bln. The November surplus was revised higher to C$1.0 bln from the original C$0.5 bln, leaving a narrowing in December despite what was a firm figure. Exports improved 0.8% m/m in December after a revised 5.1% surge in November (was +4.3%), driven by higher prices on energy products. Imports grew 1.0% on the heels of a revised 0.2% dip in November (was +0.7%), with December’s gain mostly due to an increase in aircraft and industrial machinery.

Fedspeak: Fed’s Kashkari said yesterday, it’s better the Fed errs on the accommodative side than on being more restrictive, in an essay he wrote to explain his vote on February 1. He noted that he “avoids making predictions about when our next rate change will be and how many changes I expect in a given year, in order to minimize confusion and because the Fed doesn’t know for sure how the economy will evolve, where he also acknowledged the Fed has often been wrong. He also added that there are too many uncertainties, including the fiscal policy outlook. Inflation is expected to remain well anchored, with the strong dollar likely to restrain price pressures. Wages aren’t showing much inflation either. In conclusion, he said from a risk management standpoint, “we have stronger tools to deal with high inflation than low inflation.” Hence, he voted to keep rates steady.

Main Macro Events Today

CA Housing Stats – Canada’s Housing starts are expected to slow to a 200.0k unit pace in January from the 207.0k rate in December. Permits grew at a 233k to 235k pace over the three months spanning October, November and December.

NBNZ Rate – Reserve Bank of New Zealand’s meeting, expected to result in no change to the 1.75% rate setting.

NZ MPS & Conference – RBNZ will publish today the Monetary Policy statement. Afterwards a press conference will also be held by Reserve Bank Governor regarding monetary policy.

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.

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.


Andria Pichidi
Market Analyst
Hot-Forex


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.

 

[HFM.]

Date : 9th February 2017.

MACRO EVENTS & NEWS OF 9th February 2017.

FX News Today

European Outlook: Japanese stock markets headed south despite a weaker Yen, as investors held back ahead of tomorrow’s meeting between Trump and Abe. ASX, Hang Seng and Chinese bourses meanwhile moved higher after U.S. equities managed to claw back losses and close with gains on Wednesday. In Europe markets also came up from lows in late trade and markets closed narrowly mixed, with FTSE 100 and Italian MIB outperforming. FTSE 100 futures are posting marginal gains at the moment and U.S. futures are narrowly mixed, as investors await further guidance on U.S. policies. Yields continued to head south in Asia but after Bund and Gilt futures rallied yesterday and Eurozone spreads narrowed markedly as peripherals outperformed it remains to be seen how far down yields can go. Already released the U.K. RICS house price balance improved slightly. Still to come Germany releases December trade data, Switzerland has unemployment numbers and Norway Q4 GDP.

New Zealand: RBNZ held rates at 1.75%, matching widespread expectations. The statement by Governor Wheeler was cautiously upbeat as he said “Growth in New Zealand has increased as expected…” and “The outlook remains positive…” As for inflation, it has returned to the target band as past oil prices declines fall-out of the annual calculation. They remain of the view that inflation will gradually return to the midpoint of the target band. On the currency, he said that “A decline in the exchange rate is needed.” But while the growth and inflation outlook may be looking somewhat better, Wheeler ended his statement with “Monetary policy will remain accommodative for a considerable period. Numerous uncertainties remain, particularly in respect of the international outlook, and policy may need to adjust accordingly.”

US: WTI crude has rallied to session highs following the EIA inventory report which revealed a large 13.8 mln bbl increase in crude stocks. The contract has topped at $52.65 after bottoming at $51.51 after the data. The market had sold off on the API report on Tuesday, and with today’s EIA report’s corroborating, it appeared short covering was the driver behind the fairly sharp rally. In addition, gasoline and distillate stocks came in lower than expected, a bullish development.

Canada: Yields have extended declines amid risk off trades, with the firm January housing starts report overlooked in favour of global developments, since they have been improved slightly to a 207.4k rate in January from a revised 206.3k clip in December (was 207.0k). Also, the government’s measures to temper the housing market are projected to gradually slow sales and construction. Hence, a firm starts report to begin the year is not likely to worry the BoC. The 10-year GoC has fallen to a session low 1.652%, leaving a 3.5 bp drop from Tuesday’s close. The 2-year is at 0.724%, also a session low, which is good for a 1 bp decline relative to yesterday’s close. Equities have turned (slightly) negative, according to the S&P/TSX 60 index futures after a nearly unchanged perch earlier.

Germany reported: a sa trade surplus of EUR 18.4 bln in December, down from EUR 21.8 bln in the previous month, as exports slumped 3.3% m/m, after a very strong November rise of 3.9% m/m, while imports were unchanged in December. after rising 3.5% m/m in November. Unadjusted data show a total trade surplus of EUR 252.9 bln in 2016, up from EUR 244.3 bln in 2014, as imports rose 1.2% and imports 0.6%. Imports as well as exports stood at record highs, but this is nominal data and impacted by exchange rate and oil price developments and official estimates for 2016 GDP reported a negative contribution from net exports to overall growth last year, which highlights the impact of price movements, but also that for once it wasn’t actually export strength that underpinned the recovery last year.

Main Macro Events Today

US Jobless Claims – Initial claims data for the week of February 4 is out today and should reveal a slight headline increase to 250k from 246k last week and 260k the week prior to that. Claims have been striking a tight path lately and we expect a February average of 250k, up slightly from 248k in January but down from 258k in December.

Canada NHPI – A 0.1% increase in the new housing price index is anticipated following the 0.2% gain in November. Bank of Canada Deputy Governor Schembri speaks today at Western University, London, Ontario.

BOE Gov. Carney – BOE Governor Carney speaks at the Bank of England Reception in London.

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.

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.


Andria Pichidi
Market Analyst
Hot-Forex


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.

 

[HFM.]

Date : 10th February 2017.

MACRO EVENTS & NEWS OF 10th February 2017.

FX News Today

European Outlook: The global stock market rally that was sparked by President Trump’s reference to “something” on the tax cut front in the next 2-3 weeks that would be “phenomenal”, continued in Asia overnight. The Nikkei closed with a more than 2% gain as a lower Yen gave an additional boost, especially to automakers. Markets have also welcomed a perceived softening of Trump’s rhetoric on tariffs on imports from China. The Abe-Trump meeting remains in focus today. U.S. and European stock futures are also moving higher after Trump’s remarks also underpinned closing gains yesterday. Today’s data calendar focuses on the December round of production numbers from the U.K., France and Italy, too backward looking to really change the outlook, leaving the focus on the political arena. Meanwhile the BoE announced that hawk Kristin Forbes, who recently said the BoE may have to hike soon, will leave the MPC after a single term on June 30.

US: Trump signed 3 more executive orders aimed at crime including measures to crack down on transnational crime and drug cartels, reduce crime domestically and prevent violence against law enforcement. This coincided with Sessions being sworn in as Attorney General. The dollar is still higher, however, after Trump’s reference to tax cut announcements in 2-3 weeks, which the markets have been braying for. Additionally, U.S. reports revealed robust wholesale trade and initial claims reports alongside a spike in the weekly Bloomberg consumer comfort index to a new cycle-high that lifted prospects for GDP and payrolls. For wholesale trade, a 2.6% December sales surge that was only partly price-related, and the inventory-to-sales (I/S) ratio plunged to 1.29 after a prior recession-sized climb from 1.20 in mid-2014 to a 1.37 expansion-high in January of 2016. For claims, a 12k drop to 234k in the first week of February left a super-tight path over the three weeks since the end of holiday volatility, with a reading that challenges the 43-year low of 233k in the Veteran’s Day week.

FX Update: USDJPY led the broader dollar rally sparked by Trump’s hint yesterday that “something” on the tax cut front in the next 2-3 weeks that would be “phenomenal,” which was followed-up by an unexpected phone all between Trump and his Chinese counterpart Xi, where Trump said that he would respect the “One China” policy, helping ease tensions. This sparked a risk-on trade and a dollar rally, and USDJPY extended in Tokyo to a nine-day peak of 113.80, which is over two big figures up on Tuesday’s 10-week low at 111.59. Japanese stocks, liking the weaker yen and risk-on vibe, surged; the Nikkei 225 closing with a 2.6% gain. Focus will now turn to the meeting between Trump and Abe, later today, which comes little more than a week after Trump accused Japan, along with China, of currency manipulation. In theory, the risk of fresh vitriol from Trump on exchange rates presents downside risk to USDJPY, though his diplomatic tone with China’s Xi may well be repeated with Abe. Elsewhere, EURUSD consolidated in Asia after tumbling back under 1.0700.

Canada: New housing price index improved 0.1% m/m in December after the 0.2% gain in November. By region, gains in Ontario and Alberta led the way higher for the total index. The new housing price index grew at a 3.0% y/y pace in December, matching the 3.0% rate in November and October. The index saw a cycle low 1.1% y/y growth rate in April of 2015, and has tracked higher since as sales and prices have gained momentum. Moreover, the 3.0% growth rates in the final three months of last year were the strongest annual gains since June of 2010’s 3.3% rise. The government housing measures implemented late last year will eventually temper sales and construction, but the impact should be gradual.

Main Macro Events Today

GBP Man. Production & NIESR GDP Estimate – December round of production numbers from the U.K are coming out, with manufacturing production for December to fall by 1% (i.e. forecast at 0.3%) after the 1.3% in November. Industrial production on the other hand expected to be 3.2% y/y, and 0.2% m/m.

Canada Employment Rates – Net Change in Employment, Participation rate and unemployment rate will be out today. Employment gains for January expected to be out today, after the 53.7k surge in December. Canada posted employment gains from August to October of last year, and saw a decline in November.

US Trade price data & Budget Statement – January’s import prices expected to be up 0.1%, with export prices unchanged. This compares to December figures which had import prices up 0.4% and import prices up 0.3% for the month. Oil prices continue to climb which should lend support to the headline however the pace of gains slowed in January. The Monthly Budget statement by FMS is also out today.

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.

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.


Andria Pichidi
Market Analyst
Hot-Forex


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.

 

[HFM.]

Date : 13th February 2017.

MACRO EVENTS & NEWS OF 13th February 2017.

FX News Today

“All politics is local,” quipped Tip O’Neill. But, as seen in recent election results, politics have become a very global affair and have underscored President Obama’s line, “elections have consequences.” Indeed, politics have dominated the landscape since the June 24 Brexit surprise and then the November 8 Trump shocker. So far, the ramifications have been a boon for investors as expectations for a more business friendly environment have manifest in hefty equity gains. While politics will remain a major risk ahead, especially with Brexit negotiations on the immediate horizon, and upcoming elections in the Netherlands (March 15), France (April 23) and Germany (September 24), monetary policy will be at the forefront this week as Fed Chair Yellen presents her Monetary Policy Report (Tuesday).

United States: Fed Chair Yellen should headline this week when she goes the Senate Banking Committee (Tuesday), after which she’ll go to the House Financial Services Committee (Wednesday). Key for the markets will be her outlook on the normalization path, including the balance sheet. The data calendar will be of importance too, led by January CPI and retail sales, which will have longer run implications for Fed policy. Production and housing figures also awaited (all due Wednesday). Price pressures have been on the rise as oil prices have stabilized higher, though the trajectory is still rather shallow, thanks in part to the firmer dollar. Remember too that the February 1 FOMC statement even dropped its mention of transitory effects capping inflation. CPI is forecast rising 0.4%, thanks to higher energy costs, with the core rate up 0.2%. Retail sales are expected to inch up 0.1% in January versus December’s 0.6% jump. February manufacturing reports also are due this week. The Empire State manufacturing index (Wednesday) is projected rising 2.5 points back to 9.0 after slipping 1.5 points to 6.5 in January. The Philly Fed index (Thursday) should tumble to 15.0 after increasing 3.9 points to 23.6 in January, which was the strongest since December 2014. January housing starts (Thursday) should hold steady at the 1.226 mln pace, after rebounding 11.3% to that rate in December. The February NAHB homebuilder sentiment survey is also on tap (Thursday).

Canada: The Canadian calendar has manufacturing and housing data feature on this week’s docket. The January Teranet/National Housing Price Index is due Tuesday. January existing home sales (Wednesday) are projected to expand 3.0% y/y after the 5.0% y/y drop in December. The international securities transactions report for December is due Friday. The Bank of Canada is silent this week. Prime Minister Trudeau meets President Trump in Washington D.C on Monday.

Europe: As pressure on the EU and Eurozone increases and political risks from the inside and outside mount it seems officials are trying to close ranks, at least on the monetary front. ECB’s Mersch signaled that the central bank may drop the reference to the possibility of another rate cut, while Germany is scaling back its ambitions to get the G20 to push for less accommodative policies. Both moves may reflect pragmatic decisions in the light of strong data and a changed global political landscape, but they also bring Draghi and Merkel closer together. At least current leaders seem eager to try and convince the world that while differences of opinion remain, they will fight hard to keep Europe’s unions together beyond what is promising to be a challenging year.

The raft of data releases this week will mainly be backward looking and confirm the picture of an ongoing recovery and rising inflation. The most interesting number may be German ZEW investor confidence for February, which will show how unsettled investors are by the mounting political risks and the growing tensions between the new U.S. administration. The data is releases on Tuesday, which will include German and Eurozone Q4 GDP numbers as well as final German inflation data for January. Italian GDP meanwhile continues to trail behind and expected to be unchanged. This combination should see overall Eurozone Q4 GDP confirmed 0.5% q/q, with domestic demand the main driving factor as the ECB continues to lend a helping hand. The full calendar also includes Eurozone production, trade and current account data for December, but with the focus on the Q4 GDP numbers these are unlikely to move markets or change the outlook. There is also ECBspeak from Nowotny and Coeure, which will be scrutinized for a change in tone.

UK: The UK calendar is highlighted by January inflation data (Tuesday), where a rise in the headline rate to 1.9% y/y is expected, after 1.7% y/y in December. In-line data would be consistent with BoE projections, based on y/y gains in energy prices and the significant y/y decline in sterling. The central bank reaffirmed in the February edition its quarterly Inflation Report that it expects CPI to top out at 2.8% y/y in the first half of 2018. Hawkish-leaning BoE MPC member Forbes subsequently warned that the inflation risks might be higher than the BoE’s projections suggest, although she also said that growth risks might quickly resurface when EU exit negotiations start next month. The monthly labor market report is also due (Wednesday), covering November and January. The headline claimant count is expected to rise by 1.1k in December after falling 10.1k in November. The official November ILO unemployment rate is expected to continue at the cycle low of 4.8%. Average household income in the three months to November is expected at 2.8% y/y growth, unchanged from the rate seen in the prior month. Official retail sales data for January is also up on Friday.

China: China’s docket starts with January loan growth and new yuan loan reports (tentatively Monday) with the former seen up 13.6% y/y from 13.5% y/y, and the latter expected up CNY 2,000 bln from 1,040 bln. January CPI (Tuesday) is expected to heat up to 2.4% y/y from 2.1% y/y, while PPI is seen accelerating to 6.0% y/y from 5.5% y/y in December

Japan: The preliminary Q4 GDP (Monday) is expected at 1.0% y/y, slowing slightly from the 1.3% Q3 outcome. Revised December industrial production (Tuesday) is on tap too. It slipped to a 3.0% y/y pace after bouncing 4.6% y/y in November.

Australia: The calendar has employment (Friday), expected to show a 15.0k gain in January after the 13.5k rise in December. The unemployment rate is seen at 5.8% in January, matching the December reading. The Reserve Bank of Australia’s Head of Economic Analysis Department Alexandra Heath speaks and participates in a panel at the Australian Business Economists (ABE) Forecasting Conference, Sydney (Tuesday). Assistant Governor (Economic) Luci Ellis participates in a panel at the 2017 Australasian Housing Researchers Conference, Melbourne (Wednesday).

New Zealand: This week’s calendar has retail sales (Friday), expected to improve 1.1% in Q4 (q/q, sa) after the 0.9% increase in Q3. The next meeting of the Reserve Bank of New Zealand is on March 23rd. The bank held the OCR steady at 1.75% last week, matching expectations.

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.

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.


Andria Pichidi
Market Analyst
Hot-Forex


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.

 

[HFM.]

Date : 14th February 2017.

MACRO EVENTS & NEWS OF 14th February 2017.

FX News Today

European Outlook: The global stock market rally run out of steam in Asia overnight and the Nikkei closed with a 1.13% loss, as markets turn cautious ahead of Yellen’s testimony to lawmakers. A strong Yen added to pressure on Japanese bourses, with other Asian indices only slightly in the red. U.S. and U.K. stock futures are also down, however, and while the overall sentiment still seems cautiously optimistic markets seem to be waiting for a clearer trigger to extend gains. Core European yields moved higher and yield curves steepened yesterday, while peripheral long yields declined and the spread over the German benchmark narrowed, at least in the 10-year area. The picture was very different for 2-year yields, which climbed in France, Italy and Spain, where yield curves flattened as the short end underperformed and spreads widened. Today’s very busy calendar starts with German GDP and inflation data at the start of the session, followed by GDP numbers from Italy, Portugal and the Eurozone, as well as inflation data from Switzerland and the U.K.

FX Update: The dollar is trading at moderately softer levels, despite seeing a flurry of buying just ahead of the London interbank open. USDJPY has retreated to the lower portion of the 113s amid a generally firmer yen today, which has recouped losses sub-113.50 levels as the risk-on vibe of yesterday was replaced by a risk-off one today. The sudden resignation of Trump’s national security advisor Flynn, and a nosedive in Toshiba shares after the conglomerate delayed its earning announcement, soured investor risk appetite. Markets are also being cautious ahead of Fed Yellen’s testimony before the Senate today. Most Asian stock indicies gave up intraday gains and declined into the red, while the Nikkei closed 1.1% for the worse. USDJPY breached both yesterday’s low and its 20-day moving average. Last Friday’s low at 112.88 provides a near-term target. EURUSD recovered above 1.0600 from 1.0591 low, while the dollar has posted an eight-day low versus the Canadian dollar, a two-day low against the Australian dollar, and has seen three-day lows versus sterling.

Germany: The January HICP inflation was confirmed at 1.9% y/y, in line with the preliminary number and up from 1.7% y/y in December. The breakdown confirmed that the rise was to a large extent driven by energy prices. Prices for heating oil rose 42.5% y/y, petrol prices were up 12.8% y/y and excluding mineral oil products, German inflation would have been just 1.3% y/y. So while the German headline HICP rate is pretty much in line with the ECB’s definition of price stability as close to, but below 2%, the numbers back Draghi’s argument that the uptick is due to temporary base effects. And with much of Draghi’s QE program an insurance policy against stability risks, the data won’t stop asset purchases, but the ECB’s critics in Germany will also feel justified as growth is robust.

US: U.S. equities continue to migrate higher into record territory as faith-based algos pile on their buy orders on the shoulders of last week’s “big league” tax cut promises. The WTI crude has turned turtle and eased back below $53 bbl as the ramp up in domestic shale production nips at the heels of 90% compliance with OPEC supply cuts.US markets closed at record highs with Apple being the main driver, i.e. closed at 133.29 which was a rise of 0.89%.

Canada: Trudeau’s opening remarks were constructive in his joint presser with Trump. The PM said much of Canada’s economy depends on U.S. integration, and that the U.S. and Canada will always be essential partners. The free flow of goods and services must be allowed, he said. In a joint statement, the two leaders said “As the process continues for the Keystone XL pipeline, we remain committed to moving forward on energy infrastructure projects that will create jobs while respecting the environment.” Border security is a “top priority.” Equities have moved slightly higher, adding to modest gains. GoC yields remain elevated, with 2 to 3 bp gains across the yield curve relative to Friday’s closing levels. More broadly, risk-on conditions remain supportive of equities and yields.

Main Macro Events Today

German ZEW – German investor confidence for February will be even more interesting than usual as it should give an indication about the impact of mounting political risks and the growing tensions between the new U.S. administration on sentiment. Expectations are to 15.1 from 16.6 last time.

UK PPI & CPI – Inflation data expected to rise in the headline rate to 1.9% y/y after 1.6% y/y in December. That would bring CPI to within 0.1% of the BoE’s target. The central bank reaffirmed in the February edition its quarterly Inflation Report that it expects CPI to top out at 2.8% y/y in the first half of 2018.

US Core PPI – January PPI is out today and should reveal a 0.3% headline with a 0.2% increase for the core. This compares to December figures which had the headline at 0.3% and the core at 0.2% as well. Oil prices have been rebounding this winter but the pace if improvement tapered off in January.

Fed’s Report and Fed’s Yellen – Fed Chair Yellen goes to Capitol Hill to give her twice-yearly Humphrey-Hawkins testimony to Congress, for the Semiannual Monetary Policy Report before the Senate Banking Committee.

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.

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.


Andria Pichidi
Market Analyst
Hot-Forex


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.

 

[HFM.]

Date : 15th February 2017.

MACRO EVENTS & NEWS OF 15th February 2017.

FX News Today

European Outlook: Yellen may have signaled that the Fed remains on track to raise rates, but stock markets seem to have taken it in their stride. Asian markets mostly posted robust gains and the Nikkei closed up 1.03% on the day, amid hopes that a weak currency will continue to underpin exporters and earnings. European markets closed narrowly mixed yesterday and U.S. stocks were also higher at the close and against that background Bund and Gilt futures, which were knocked lower by Yellen yesterday are likely to remain under pressure, with long yields on the rise again. Peripheral yields, spreads and curves remain volatile amid political risks and ongoing ECB asset purchases. The local calendar calm down after yesterday’s bumper day. The Swedish Riksbank is expected to keep monetary policy on hold. The U.K. releases its monthly labour market report, and the Eurozone has trade numbers for December and some national inflation data.

Fedspeak: Fed Chair Yellen said yesterday, the Fed will adjust the rate path as the economy evolves, and will evaluate progress at our “upcoming meetings.” Hence, she has kept March on the table (it’s always been “live” in the Fed’s rhetoric). She added that further policy adjustment will likely be needed if the economy remains on track. She also warned that it would be “unwise” to wait too long to tighten. The gradual approach to rate hikes was reiterated as the FOMC expects further moderate expansion in the economy, and a gradual rise in inflation to the 2% target. She also indicated that the economic outlook is uncertain, especially with potential changes in fiscal policy. Some of the headwinds that have restrained growth were mentioned, and she reiterated the “notable improvement” in business sentiment from the February 1 FOMC statement. She also addressed inflation and its pick up over the past year amid the diminishing effects of earlier declines in energy prices and import prices. For the balance sheet, Chair Yellen hopes the asset purchase program was unusual intervention, and the Fed hopes it will be much smaller, eventually. The Fed doesn’t want to use its portfolio as an active policy tool, but would rather use interest rates. Stopping the reinvestment will be a gradual process. Chair Yellen also reiterated that the Fed remains data dependent, so upcoming reports on CPI, retail sales, and employment will matter a lot.

Germany: The ZEW investor confidence weaker than expected, with the headline reading falling to 10.4 from 16.6 in the previous month. A slight decline to around 15 was expected, but in the event, it seems rising political risks are hitting investors and the ZEW dropped for the first time since July last year, when confidence fell back after the Brexit vote in the U.K. The fact that the reading remains in positive territory, which indicates that optimists continue to outnumber pessimists, but even the current conditions indicator fell back and the Eurozone expectations index dipped to 17.1 from 23.2. More reasons for Mr. Draghi and Co to keep the insurance policy of ongoing asset purchases in place for now.

UK: Sterling dove 0.5% before settling in the wake of the UK inflation data, which saw both the headline and core CPI measures miss expectations, although the former still hit a two-and-a-half-year peak of 1.8% y/y. Cable hit yesterday a low of 1.2445 before steadying, leaving Monday’s low at 1.2440 unchallenged and leaving the pound at about the midway point of the choppy range that’s persisted for nearly three weeks now. Additionally, there is a caveat in the inflation data as PPI output prices spiked to 3.5% y/y, the sharpest rate in five years and suggesting that higher CPI prices are in the pipeline. PPI input prices rose 20.5% y/y, up from 17.0% y/y in December, itself revised up from 15.8%. The start of the UK’s exit negotiations with the EU — the point that the rubber will hit the tarmac — is now nearly, with PM May reportedly gunning for a March-7 trigger-date of Article 50.

Main Macro Events Today

US CPI & Retail Sales – January CPI is out today and should reveal a 0.4% headline with the core up 0.2% for the month. This follows December figures of 0.3% for the headline and 0.2% for the core. January retail sales data should reveal a 0.1% headline increase with the ex-autos component up 0.6% for the month.
US Manufacturing data – U.S. NY Fed “Empire State” Index for February expected to climb to 9.0 after January’s dip to 6.5 from 7.6 in December. Producer sentiment firmed into year end and in January we saw the ISM-adjusted average of all measures climb to 54 from 53 in both December and November.
Fed’s Yellen – Fed Chair Yellen testifies to the House Financial Services Committee.

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.

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.


Andria Pichidi
Market Analyst
Hot-Forex


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.

 

[HFM.]

Date : 16th February 2017.

MACRO EVENTS & NEWS OF 16th February 2017.

FX News Today

European Outlook: Global stock markets continue to move higher and after European and U.S. bourses closed with gains, most Asian markets also managed to rise. Japanese bourses were the notable exception, with investors apparently spooked by a rise in indices of future volatility in U.S. markets, which raised doubts about the sustainability of the especially the U.S. run higher. A stronger yen, which weighed on automakers and exporters didn’t help either and the Nikkei closed with a -0.47% loss. U.S. stock futures are indeed in the red, while FTSE 100 futures are still managing gains, after yesterday’s broadly higher close in Europe. The FTSE 100 managed to close above 7300 and the DAX also remains at lofty highs even if gains above the 11800 mark could be held into the close. The Italian MIB underperformed after some rumors that Renzi is pushing for snap elections in September, which would only add to Europe’s political challenges this year. Today’s data calendar is quiet, with Italian trade numbers, as well as Eurozone current account data and inflation numbers from Sweden.

FX Update: The dollar has remained on a back foot, marginally extending the correction from post-U.S. data highs of yesterday. USDJPY has fallen back under 114.00, logging a low of 113.76 in Tokyo trade today. The move comes after the pair topped out at near three-week highs of 114.95 in the aftermath of yesterday’s hotter U.S. CPI outcome. Good selling was reported from the highs, with profit taking ramping up into the key 115.00 level, where a wave of Japanese exporter offers is reportedly sitting. The 50-day moving average is at 114.88. EURUSD has breached above yesterday’s peak in making 1.0624. AUDUSD rallied to a three-month peak at 0.7732, since settling just under 0.7700.

Fedspeak: During Fed Chair Yellen’s testimony, to House Financial Services Committee, she did state that she believes much of the rally on Wall Street is a function of hopeful fiscal policy expectations. The firmer dollar, meanwhile, reflects expectations of Fed rate hikes. She hopes that the economy will allow the Fed to raise rates faster. On the border tax, she sees great uncertainties with respect to impacts on trade and currency flows. Unfortunately, much of the day’s testimony saw grandstanding from many committee members who seemed more interested in throwing barbs at the new administration, rather than discussing key issues of monetary policy and the economy. Hence, there weren’t any fresh insights on how Yellen viewed today’s stronger than expected data and if the reports upped the chances for a March tightening. Meanwhile, Fed’s Harker repeated he supports 3 rate hikes this year, assuming the economy remains on track, in his speech on the economic outlook. The economy is more or less back at full strength he said, forecasting GDP growth a little above 2%. And he expects the inflation target to be met later this year or next. He does think the economy needs more workers and immigration could help.

US reports: revealed a wide array of upside surprises that have boosted prospects for the consumer and factory sectors in the face of rising confidence, small business optimism and producer sentiment, with a solid inventory reversal and a big bounce in the inflation gauges into 2017 that lift the risks of a Fed tightening at the March FOMC meeting. We saw January retail sales gains of 0.4% overall and 0.8% ex-autos after upward revisions, alongside a 0.4% December business inventory rise that lifted Q1 GDP estimate to 2.2% from 2.0% after an expected Q4 boost to 2.2% from 1.9%. We saw a 0.3% January industrial production drop that reflected temporary weather and auto hits, but with upward revisions that left a strong report, alongside a February Empire State surge to a 29-month high of 18.7 with an ISM-adjusted pop to 54.5. We saw a 0.6% January CPI gain with a 0.3% core price rise that left respective y/y gains of 2.6% for the headline and a cycle-high 2.3% for the core.

Main Macro Events Today

ECB Report – ECB Monetary Policy Meeting Accounts Report.
US Philly Fed Index – February U.S. Philadelphia Fed Index is expected to dip to 15.0 after a January surge to 23.6 from 19.7 in December. The Empire State index for the month was already released and posted a big headline bounce to 18.7 from 6.5 in January. Producer sentiment in February now looks poised to hit a two-year high with the ISM-adjusted average of all measures rising to 55 from 55 in January.

US Housing Starts & Unemployment Claims – January housing starts data should reveal a 1,226k headline for the month. This would be an unchanged pace following the 11.3% bounce to this level in December from 1.102k in November. Initial claims data for the week February 11 expected to rise to 247k after a big dip to 234k in the week prior. Claims in February are expected to average a stronger 244k in February from 247k in January and 258k in December.

NZ Retail Sales – New Zealand’s Retail Sales for last quarter of 2016, expected to rise by 0.2%, i.e. 1.1% from 0.9% last quarter.

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.

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.


Andria Pichidi
Market Analyst
Hot-Forex


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.

 

[HFM.]

Date : 17th February 2017.

MACRO EVENTS & NEWS OF 17th February 2017.

FX News Today

European Outlook: Asian stock markets headed south. U.S. stock futures are also in the red and only the FTSE 100 future is posting marginal gains. The correction in stock markets seems to be continuing Reflation trades have run out of steam for now and investors remain hesitant as indices remain at lofty highs. It may need another trigger though, to push the FTSE 100 lastingly above 7300 and the DAX above 11800. The correction on bourses should continue to underpin bond futures, with long yields heading south again yesterday especially in Eurozone peripherals after yesterday’s BoE minutes confirmed that the central bank is considering temporary deviations from QE purchases according to the bank’s capital key. Today’s calendar includes Eurozone current account and BoP data as well as U.K. retail sales and Swedish inflation data.

FX Update: The dollar has consolidated losses, with major pairings showing less than a net 0.2% chance since the New York close yesterday as London interbank traders take to their desks. USDJPY has settled in the mid 113s after logging a low of 113.07 in the New York PM session yesterday, which completed a near two-big figure drop from Wednesday’s peak. EURUSD has steadied in a narrow range shy of yesterday’s 1.0670 high. It’s a similar picture in other pairings. We retain a bullish view on the dollar the back of the contrasting Fed versus most other central bank policy outlooks, with the former expected to trigger three more 25 bp hikes this year.

US reports: revealed a round of big upside surprises for business and consumer sentiment, alongside solid labor market and housing sector readings, hence adding to the robust round of data released on Wednesday. We saw a February Philly Fed surge to 43.3 that left the strongest reading since January of 1984, when payrolls rose 446k and GDP growth reached 8.2%, and the ISM-adjusted measure rose to a 6-year high of 57.8, leaving a spike reminiscent of the small business optimism surge. We saw a rise in yesterday’s Bloomberg Consumer Comfort Index to a 10-year high of 48.1. We saw small 5k rise in initial claims to a lean 239k in the second week of February, leaving an average thus far for the month of just 237k. Finally, we saw a 2.6% January housing starts drop with a 4.6% permits increase that beat estimates thanks to upward revisions to prior starts figures that left a strong trajectory for both measures to likely Q1 new cycle-highs, after solid but weather-boosted Q4 figures.

New Zealand and Japan: New Zealand’s calendar has Producer Price Index during the weekend (Sunday). Additionally, Japan will release adjusted Merchandise Balances and Import, Exports data for January late on Sunday as well.

Main Macro Events Today

UK Retail Sales – The UK’s official retail sales report for January is up today, where a 0.9% m/m is expected, rebound after the unexpectedly sharp 1.9% m/m drop in December, though be warned as already-released January surveys of the sector by the CBI and BRC suggest downside risk.

US CB Leading Indicator – US Leading Indicator released by the Conference Board for January, expected to be unchanged following the 0.5% in December.

Canada Foreign securities – Canadian calendar today, features International Securities transactions for December, where $11.59B expected from $7.24B reported last time.

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.

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.


Andria Pichidi
Market Analyst
Hot-Forex


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.

 

[HFM.]

Date : 20th February 2017.

MACRO EVENTS & NEWS OF 20th February 2017.

FX News Today

It’s been a busy couple of weeks so far in February with politics dominating, though monetary policy issues were back in the spotlight with Yellen’s testimony and the ECB minutes indicating the bank mulled stepping back from QE via the capital key. There will be no want of global issues, data, and events ahead to keep the markets choppy. Of course, Mr. Trump will remain a focal point, especially as tax initiatives may be trickling out, though the border adjustment tax may be on the ropes. But there is also rising angst over the upcoming French elections after the Left considered combined forces. A Eurozone Finance Ministers meeting is on tap, with Greece bailout problems back in the spotlight. Attention is also turning to March — Beware of the Ides. There are two important events on the 15th, the FOMC meeting and the elections in the Netherlands. Each could have significant market consequences ahead.

United States: The U.S. calendar is a relatively lean one this week when markets reopen on Tuesday after the long President’s Day weekend. The February Markit Flash PMI (Tuesday) is likely to show a dip to 54.0 on manufacturing from 55.0. MBA mortgage market data are due (Wednesday), along with existing home sales forecast to rise 1.1% to 5.55 mln from 5.49 mln. Initial jobless claims may bounce back 8k (Thursday) to 247k for the week ended February 18. The week winds down with new home sales (Friday) forecast to rebound 6.3% to a 570k unit pace in January from 536k in December. Michigan sentiment (final) is expected to be left unrevised at 95.7 in February.

Fedspeak: The Fed minutes (Wednesday) will be scoured for clues on the policy stance, but the report has lost much of its impact in the wake of chair Yellen’s testimony and the strength in recent data on inflation, sales, production, and confidence. Of course, the Fed left policy unchanged at its February 1 meeting. The key for the report will be the degree to which policymakers thought a rate hike might be affected sooner rather than later. Meanwhile, there are only likely to be a minority of FOMC members who were factoring in fiscal stimulus into their outlooks, and the majority won’t front-run fiscal initiatives. Rather than the minutes, the markets will look to upcoming data, especially payrolls, to fine-tune March rate hike probabilities. Geopolitical risks and market impacts will also play a part. While Fedspeak will be important, Chair Yellen didn’t show any urgency for a March tightening, nor have the two voting doves, Evans and Kashkari. Minneapolis Fed centrist Kashkari will take part in a conversation on the economy and the role of the Fed (Tuesday) from 8:50 ET and Philly Fed hawkish Harker discusses the economic outlook from Wharton in Philadelphia from 12 ET. Governor Powell will give his update on policy and the economy (Wednesday). Later in the week (Thursday) Atlanta Fed centrist Lockhart will be “Looking Back on 10-years at the Federal Reserve Bank of Atlanta” from 8:35 ET. Yellen’s next scheduled speaking engagement is set for Friday, March 3 at an Executives Club of Chicago even.

Canada: The holiday shorted week is long on important economic reports. While markets are closed Monday for Family Day, Statistics Canada will release wholesale trade, which is expected to reveal a 1.0% m/m gain in shipment values during December. Retail sales (Wednesday) are seen expanding 0.1% in value terms during December. But the ex-autos aggregate is expected to improve 1.0% after the 0.1% rise in November. The wholesale and retail reports will solidify the December GDP outlook. Average weekly earnings for December are due Thursday, and are expected to be consistent with a tame compensation backdrop. The CFIB’s Business Barometer survey of small and medium business for February will also be released Thursday. The January CPI (Friday) is expected to power higher by 0.4% m/m in January after the 0.2% drop in December. Annual growth is projected to accelerate to 1.7% y/y from the 1.5% y/y growth rate in December. Bank of Canada Senior Deputy Governor Wilkins participates in a panel discussion (Tuesday) at the Competition Bureau Ottawa, but the remarks will not be published on the Bank’s website.

Europe: The data calendar heats up with the second round of February confidence data in the form of Eurozone PMIs and the German Ifo, but with Eurozone Finance Ministers meeting at the start of the week, the Greek bailout problems will remain in focus and election jitters and Eurozone breakup concerns are also unlikely to go away. The latter has been fueling increased volatility in peripheral spreads over the German benchmark, but also yield curves in recent weeks, although speculation of possible “real” QE tapering also played a role, as growth remains robust and inflation spiked higher. Data releases include detailed Q4 GDP readings from Germany and the Eurozone. The German February Ifo Business Climate expected higher to 109.9 from 109.8, as strong orders are hoped to have lifted the expectations readings, but with inflation and import, as well as producer price inflation, rising sharply and political risks picking up, confidence indicators come with a slightly higher error margin than usual. Meanwhile PMI readings are expected to come in narrowly mixed across countries, but remain firmly above the 50 point no change mark. The Eurozone Manufacturing PMI is expected to rise to 55.2 from 55.2, while the services reading is seen at 53.8, slightly higher than the 53.7 in the previous month. At the same time inflation is moving higher and the Eurozone HICP reading is expected to be confirmed at 1.8% y/y, already broadly in line with the ECB’s upper limit for price stability. With core inflation stuck much lower at 0.9% y/y, the data does back Draghi’s view, however, that the uptick is driven mainly by base effects from energy prices, which means so far at least the ECB is content to ignore the rise and remain on course for a further expansion of the balance sheet. The calendar also includes final inflation numbers from France and Italy, as well as French national business confidence numbers. Germany sells EUR 1 bln of 30 year Bunds.

UK: Sterling came under pressure last week, losing ground to the G3 currencies, along with other European currencies and the dollar bloc units. One bearish driver has been data. The other bearish driver is the nearing start of the EU exit negotiation process, as there remains uncertainty about how the process will pan out. Markets will get a better hold on this once the negotiation gets under way. The UK data calendar schedule this week starts with the February CBI industrial trends survey (Monday), which expected to show a near steady +4 reading, in the headline total orders reading. Monthly government borrowing data is also up (Tuesday), ahead of the second-estimate of Q4 GDP (Wednesday), which is widely anticipated to come in unrevised at 0.6% q/q and 2.2% y/y. The February CBI distributive sales survey (Thursday) has us anticipating a moderation in the headline realized sales figure, to 24 from 26 in January. BBA mortgage approvals are also due (Friday).

Japan: The December all-industry index (Tuesday) is penciled in a -0.3% m/m, reversing November’s 0.3% gain, given the broad-based weakness in the tertiary index, with wholesale and retail trade lower. January services PPI (Thursday) should come in at 0.5% y/y from 0.4%. The accelerating price pressures are good news for the BoJ. Revised December leading and coincident indices are due Thursday.

Australia: The calendar has a double dose of Governor Lowe: The Reserve Bank of Australia governor speaks at the Australia-Canada Economic Leadership Forum in Sydney (Wednesday). And he appears before The House of Representative’s Standing Committee on Economics (Friday). The minutes to the February meeting will be released Tuesday. Recall the Bank held rates steady at 1.50%, matching expectations. Economic data features Q4 private capital expenditures (Thursday). The wage price index (Wednesday) is projected to grow 0.4% (q/q, sa) after the matching 0.4% gain in Q3.

New Zealand: The next meeting of the Reserve Bank of New Zealand is on March 23rd. The bank held the OCR steady at 1.75% last week, matching expectations.

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.

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.


Andria Pichidi
Market Analyst
Hot-Forex


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.

 

[HFM.]

Date : 21st February 2017.

MACRO EVENTS & NEWS OF 21st February 2017.

FX News Today

European Outlook: Asian stock markets traded mixed overnight. Hang Seng and ASX are in the red, but bourses in Japan and mainland China managed to climb higher. The Nikkei closed up +0.68%, underpinned by a weaker yen helped to underpin exporters and the BoJ’s purchases of exchange traded funds. Carmakers and banks gained, while telecommunication shares dragged. Comments from Fed’s Harker that he wouldn’t take a March hike off the table underpinned a stronger USD and U.S. stock futures are also higher, while FTSE 100 futures are down, as Sterling rose in tandem with the Dollar. The FTSE 100 already underperformed yesterday and once again didn’t manage to close above 7300, while the DAX finally seems to be taking the 11800 mark. Bund yields dropped yesterday despite the stronger currency, after progress in Greek bailout talks, Gilt yields rose, as did French yields as Le Pen continues to advance in the polls. Frexit remains very unlikely, but after the U.K. and U.S. poll surprises, markets are not taking any risks this time around. Today’s calendar has Eurozone PMI readings for February, as well as U.K. public finance data and final French inflation numbers.

Japan: Japan’s preliminary Manufacturing PMI for February exceeded expectations and climbed up to 53.5 from 52.7 last time. This value is a multi-year high. As Reuters states, Flash Manufacturing Output Index at 54.3 (53.2 in January) has been then sharpest rate of growth for three years, which can be reflected to a record-high for business confidence at Japanese manufacturers. Samuel Agass, economist at IHS Markit, stated that: “Japan’s manufacturing engine shifted into a higher gear during February, as faster increases in output, new business and employment were reported. Subsequently, business confidence was at a survey-high, with goods producers buoyed by the strongest upturn in the sector for 35 months. “

Canada: Canada’s wholesale improvement bodes well for December GDP: The 0.9% increase in shipment volumes suggests wholesalers will provide a solid positive contribution to GDP. The 2.3% gain in December manufacturing shipment volumes should be the driver of the expected 0.3% m/m gain in December GDP. An as-expected monthly gain would leave a 2.0% GDP growth pace in Q4 overshooting the BoC’s 1.5% estimate and presumably providing additional reassurance to the bank that the pick-up in the economy anticipated for 2017 is on track. Retail sales volumes are expected to contract. Housing starts improved 10.2% to a 206.3k unit pace in December. Hence, the contribution from construction production should be positive. The outlook for mining, oil and gas production is to the upside. Energy export values grew 15.9% m/m in December, but higher prices were the reason for the gain. Yet the manufacturing report’s petroleum and coal shipment values grew 11.6%, driven by firmer volumes as a number of refineries resumed production after maintenance and retooling work in September and October.

Germany: German PPI inflation jumped to 2.4% y/y from just 1.0% y/y in the previous month. The uptick was higher than expected and the breakdown confirmed that the turnaround from the firmly negative rates last year was mainly driven by a sharp pick up in energy and basic goods prices. The former jumped to 4.0% y/y from 0.2% y/y in December, while basic goods price inflation rose to 2.4% from 1.1%. Price increases for durable as well as non-durable goods remained pretty stable, and it will take some time for the uptick in energy prices t feed through, but with a tight labour market, the risk of second round effects are higher in Germany than in most other Eurozone countries.

Australia: RBA February Meeting minutes were published early today, and extended on an unchanged rate decision. Hence higher commodity prices and higher terms of trade have been observed, which lead Australian dollar to a slight growth. For Inflation, RBA mentioned that based on the enhanced labor conditions, wage inflation us likely to show a quicker increase.

Main Macro Events Today

EU PMI – Preliminary PMI readings for February, are expected to come in narrowly mixed across countries, but remain firmly above the 50 point no change mark. The Eurozone Manufacturing PMI is expected to rise to 55.2 from 55.2, while the services reading is seen at 53.8 slightly higher than the 53.7 in the previous month, which should leave the composite unchanged at 55.4. The Eurozone recovery remains intact, but with preliminary consumer confidence taking a hit this month, the political clouds gathering over the monetary union mean the balance of risks remains tilted to the downside.

UK BOE & Finance Data – January’s government borrowing data is also up today, and expected to come down to -14.4B from 6.4B last time. Also, Governor Carney is going to give a speech later today.

US Markit PMI – The February Markit Flash PMI expected to show a dip to 54.7 on manufacturing from 55.0. The Markit services PMI is seen slipping to 55.5 from 55.6.

RBA – RBA Governor Lowe speaks at the Australia-Canada Economic Leadership Forum in Sydney.

Fedspeak – Minneapolis Fed centrist Kashkari will take part in a conversation on the economy and the role of the Fed from 8:50 ET and Philly Fed hawkish Harker discusses the economic outlook from Wharton in Philadelphia from 12 ET.

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.

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.


Andria Pichidi
Market Analyst
Hot-Forex


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.

 

[HFM.]

Date : 22nd February 2017.

MACRO EVENTS & NEWS OF 22nd February 2017.

FX News Today

European Outlook: Asian stock markets were mostly higher in the wake of yesterday’s U.S. stock rally. Japan underperformed and markets fell back but ra;llied in the final hour to close flat at 19, 379, as the Yen rebounded and spoiled the party for exporters. Overall though bourses remain in a buoyant mood and U.S. and FTSE 100 futures are also moving higher, after the S&P 500 closed at a new record high, and the DAX managed to move above the 11900 mark. The FTSE 100 dropped yesterday, amid a new bout of Sterling strength and while futures are up this morning, the FTSE 100 is likely to continue to underperform the DAX, as GDP moves above 1.18 against the EUR. Against that background core yields are likely to continue to move higher especially if the German Ifo goes the way of PMIs and comes in higher than expected and Eurozone HICP is confirmed at 1.8% See below) . The European calendar also has second-estimate of U.K. Q4 GDP, which is widely anticipated to come in unrevised at 0.6% q/q and 2.2% y/y (also see more below).

FX Update: The dollar has been trading so far today, advancing against the euro into the London open while showing a more net indifferent profile versus other currencies. The euro has come under fresh pressure. EURUSD has breached last Wednesday’s low at 1.0521 and logged a six-week low at 1.0519. EURJPY is also lower, trading at 12-day lows, and EURGBP has forayed into two-month lows. Concerns about Frexit are dominating over what has been a continued run of forecast-beating data out of the Eurozone through to yesterday’s flash February PMI surveys. More of this theme seems likely as currency reserve managers, corporations and investors hedge for the worst. USDJPY has lifted off its 113.33 low, recouping to around 113.50, amid a bullish session in Asian stock markets, which followed a record-high-producing rally on Wall Street on Tuesday. The pair traded as low as 112.62 last Friday, so the yen remains at lower on the week, although it has gained versus the beleaguered euro. USDJPY logged a five-session high at 113.77 yesterday. Cable has ebbed under 1.2500 after failing to sustain a number of rises above here over the last day. AUDUSD has eked out three-session highs just shy of 0.7700, with the Aussie benefiting from the risk-on backdrop.

Oil Breaks Higher? Oil prices broke higher yesterday and have continued to move north today after OPEC continued to suggest a strong compliance with production cuts agreed in November. As production curbs hold the draw on huge stockpiles accrued since 2104 should start to have an impact on prices. However, as OPEC curbs are implemented and non – OPEC follow, the USA shale producers continue to add more rigs into production. (Fridays Baker Hughes rig count was another record at 597). The U.S. West Texas Intermediate April crude contract, the new front-month future, was up 16 cents, or 0.3 percent, at $54.49 a barrel at 0552 GMT. On Tuesday, the March contract expired up 1.2 percent after reaching its highest since Jan. 3. Since the November agreement WTI has continually failed to break the $54.00 level, the next few sessions of the new April contract could determine where prices move from here. The DoE data tomorrow will be where we get our next direction; the data is set to be released on Thursday, a day later than normal, following a U.S. public holiday on Monday.

Fedspeak: Arch hawk Mester was across the airways yesterday with appearances on Bloomberg and CNBC “comfortable with rate hike” and economy “close to inflation target” she is not a voter this year but will be from 2108. Fellow hawk Philly Fed Harker was calling for 3 rate hikes this year, looking for consumer spending to bolster 2% economic growth. He also sees labor market tightening and more or less at full health. Earlier in the day he revealed that a March hike was on the table, though we knew that from Yellen’s semi-annual testimony where every meeting is now “live.” Still, that underscores the recent trends. Finally SF Fed’s Williams: risks to financial stability may be greater with persistently low global interest rates, which present daunting challenges for central banks. He suggests that once-extraordinary central bank policies are likely to become the norm. The typically dovish non-voter has been a bit more vocal of this year on interest rate normalization, but these remarks are offering mixed signals.

Main Macro Events Today

FOMC Minutes – The minutes, aren’t likely to shed a lot of light on the policy path and the risk for a March hike in the wake of Chair Yellen’s testimony last week. Additionally, the decision is partly dependent on upcoming data, and especially the jobs report (March 10). Fedwatchers will be looking for the degree to which policymakers thought a rate hike might be affected sooner rather than later. But we doubt there were many on the Committee who anticipated some of the big upside surprises the data, including the CPI. Meanwhile, there is only likely to be a minority of FOMC members who were factoring in fiscal stimulus into their outlooks. And, recent Fedspeak suggests the discussions on the balance sheet are still wide open.

UK GDP – This is the second estimate of UK GDP and expectations are for a stable unchanged estimate of 0.6% for the final quarter of 2016. Year on year estimates are to the upside at 2.2%. A strong end to 2016 is expected but with inflation rising and investment and consumer confidence and consumption showing signs of slowing the first half of 2017 may not be so positive.

German IFO – After the strong round of German PMI readings yesterday the consensus forecast for a rise in the German February Ifo to 109.9 from 109.8 in January has a bias on the upside. Strong orders data already suggested a pick up in confidence, with inflation and import, as well as producer price inflation, rising sharply and political risks picking up, confidence indicators come with a slightly higher error margin than usual. Still, like the PMIs the Ifo should be less impacted by political jitters than the ZEW investor confidence indicator, which came in weaker than hoped, although even the latter remains at high levels and shows that optimists continue to outnumber pessimists. For Draghi though that doesn’t mean that he can finally relax as Frexit concerns and election jitters keep especially bond markets at tenterhooks and French yields at elevated levels.

Canadian Retails Sales – The expectations are for retail sales, to improve just 0.1% in December after the 0.2% gain in November. The ex-autos sales aggregate is seen expanding 1.0% in December after the 0.1% rise in November. Gasoline prices rebounded 3.1% m/m in December after the 4.3% drop in November, according to the CPI . But vehicle sales fell in December, taking back the improvement in November. Hence total retail sales are seen as nearly flat due to the vehicle sales drag. But sales excluding the autos component are seen sharply higher, thanks to the boost from gasoline station sales.

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.

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Stuart Cowell
Senior Market Analyst
Hot-Forex


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.

 

[HFM.]

Date : 23rd February 2017.

MACRO EVENTS & NEWS OF 23rd February 2017.

FX News Today

European Outlook: The stock rally started to fizzle out yesterday. The DAX didn’t manage to hold gains above 12000 and closed slightly below and while the FTSE 100 managed gains above 7300 Eurozone peripherals headed south, and U.S. stocks closed narrowly mixed, which was followed by a disappointing session in Asia, where the Nikkei was -0.04% down at the close. Yesterday’s FOMC minutes showed no sign of urgency for a March hike, even if “many” officials saw the chance of a hike “fairly soon”. Bund futures moved up from lows in after hour trade, but while FTSE 100 futures are moving higher, U.S. stock futures are still narrowly mixed. Bund gains should continue to be capped by a reversal of safe haven flows, as French political jitters eased somewhat and French yields came down sharply on Wednesday. Still, Eurozone breakup fears will continue to haunt bond markets. Strong data out of the U.K. and Germany yesterday failed to dampen the uptick in Bund and Gilt futures. Today’s calendar includes detailed German GDP at the start of the session, followed by French business confidence and the U.K. CBI retailing survey.

Fedspeak: Fed governor Powell largely toed the line on gradual hikes, based on the economy roughly meeting its forecast path, with risks to the outlook now more in balance after a period of Fed patience. He expects stable economic growth and inflation back up to its 2% target over the next couple years, while a further modest drop in unemployment would equate with further labor market tightening. Powell believes the Fed is close to its employment objective and now requires non-monetary policies to encourage participation. On shrinking the balance sheet, he said there’s a time to reconsider the balance sheet, but first must get “well away” from zero rates. He expects that rates can be raised again “perhaps reasonably soon,” while it’s very difficult to incorporate fiscal changes into economic forecasts. March is on the table in terms of a possible rate hike and one option is to raise rates soon if the economy continues on its current path. He would prefer to keep the portfolio stable until rates are high enough to “react to a downturn,” while shrinking the balance sheet is a way to remove accommodation.

FOMC minutes: “many” officials saw chance of a hike “fairly soon” if the economy remained on track. That’s not a new sentiment, however, and doesn’t hint strongly at March. A “few” officials thought that a hike at an upcoming meeting would give the Committee flexibility. Several judged the risk of a “sizable undershooting of the longer run normal unemployment rate was high” and if that were the case a more aggressive stance might be needed. But, inflation was still running short of the Fed’s goal, a few saw downside risks. “A couple of participants expressed concern that the Committee’s communications about a gradual pace of policy firming might be misunderstood as a commitment to only one or two rate hikes per year.” And while there was no formal discussion of the balance sheet, participants “also generally agreed that the Committee should begin discussions at upcoming meetings about the economic conditions that could warrant changes in the existing policy of reinvesting proceeds from maturing Treasury securities.” While March is on the table, the Fed and the markets will be in wait and see mode, watching the data and financial conditions for clues.

UK: UK second-estimate Q4 GDP was revised upwards in the q/q figure, to 0.7% growth from the 0.6% preliminary estimate and the 0.6% growth of Q3. The y/y comparison was revised downwards, however, to 2.0% from 2.2%, also below the 2.2% y/y growth clip reported in the previous quarter. The ONS stats office highlighted that the better than expected q/q figure was driven by an improvement in the manufacturing sector, which rose 1.1%, while the big service sector put in a steady growth rate of 0.7%. The contribution form exports were stronger than expected, rising 4.1% q/q, which followed a 2.6% q/q contraction in exports in Q4. Imports fell 0.4% q/q. Business investment fell 1.0% q/q. For 2016 as a whole, the economy rose 1.8%, below the preliminary estimate of 2.0% growth. An inventory drawdown and weaker exports accounted for the downward revision in the annual figure.

Canada: Canada’s retail sales a set-back for December GDP: The 1.0% drop in retail sales volumes was a surprise but not a shock, as higher gasoline prices were seen lifting both the total and ex-autos sales value figures. Instead, broad-based volume declines resulted in the first decline since June. The drop-in retail sales volumes is a source of downside risk to our 0.3% estimate for December GDP. But we are maintaining that projection given upbeat manufacturing, wholesale and energy figures. Wholesales grew 0.9% and manufacturing surged 2.3%. Housing starts improved 10.2% to a 206.3k unit pace in December. Hence, the contribution from construction production should be positive. Energy export values grew 15.9% m/m in December although higher prices were behind the gain. Yet the manufacturing report’s petroleum and coal shipment values grew 11.6%, driven by firmer volumes as a number of refineries resumed production after maintenance and retooling work in September and October. An as-expected monthly gain would leave a 2.0% GDP growth pace in Q4 (q/q, saar), overshooting the BoC’s 1.5% estimate and providing additional reassurance to the bank that the pick-up in the economy anticipated for 2017 is on track.

Main Macro Events Today

US Crude Oil – Last week’s EIA Crude Oil Inventories expected to fall to 3.4M from 9.5 M last time.

US Initial Jobless Claims & House Price – Initial jobless claims may bounce back 8k to 247k for the week ended February 18. FHFA home price index is expected to rise 0.37% to 242.2 in December, along with EIA energy.

RBA – RBA Governor Lowe will testify before the House of Representatives Standing Committee on Economics, in Sydney.

Fedspeak – Atlanta Fed centrist Lockhart will be “Looking Back on 10-years at the Federal Reserve Bank of Atlanta” from 8:35 ET.

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.

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.


Andria Pichidi
Market Analyst
Hot-Forex


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.

 

[HFM.]

Date : 24th February 2017.

MACRO EVENTS & NEWS OF 24th February 2017.

FX News Today

European Outlook: Asian stock markets headed south. Investors peddled back in China amid concerns that recent gains were overdone and the ASX ended the weak lower as metal prices dropped. Metal and machinery groups also dragged down Japanese markets, and the Topix closed with a 0.4% loss. U.S. and U.K. stock futures are equally in the red and global markets remain wobbly and investors in cautious mode. In Europe, the rebound in Sterling continues to weigh on the FTSE 100 and core yields continue to head south, with France now catching up again, as election jitters eased somewhat. Other Eurozone peripheral markets, however, continue to underperform, highlighting that Eurozone breakup fears have not gone away and will continue to haunt Draghi. Today’s economic calendar is pretty quiet, but includes French consumer confidence, Italian business confidence as well as BBA loans for house purchases from the U.K.

Fedspeak: Dallas Fed’s Kaplan reiterated the Fed should move sooner rather than later, suggesting he might support a tightening next month if the jobs data cooperates. He’s on the hawkish end of the voting spectrum so it may not take much for him to call for a hike. But, he also said that accommodation can be removed gradually and patiently. That indicates he might be able to go along with no change next month too, especially if the data aren’t terribly strong. He also wants to study shrinking the balance sheet as rate normalization progresses. He projects 2017 growth in the 2% region and sees the economy near full employment. Additionally, Fed’s Lockhart, said the data supported 2-3 hikes this year. He favors a natural run off of the balance sheet, in further comments. He sees the Fed’s portfolio shrinking to about $1.5 tln to $2 tln over a multi-year time frame, from the current $4.5 tln. Based on the Fed’s dots, the neutral rate has declined and hence the stopping point for rate hikes is likely lower than it was in the past. But much will depend on the inflation trends. On regulations, he expects Dodd-Frank to be softened, not scraped.

US reports: an increase of 6k in U.S. initial claims to 244k in the BLS survey week, which extended the prior 4k increase to 238k to leave claims still just above the 43-year low of 233k last November. There was as extremely tight claims path over the six weeks since the period of holiday volatility came to a close. Claims are well below the 263k average in 2016, and certainly well below the 6-month high of 275k as recently as mid-December. Claims are averaging 239k in February, versus higher prior averages of 247k in January, 258k in December, 252k in November, 258k in October, and 254k in September. The 244k February BLS survey week reading sits at the low end of recent BLS readings of 237k in January, 275k in December, and 233k in November. U.S. FHFA home price index rose 0.4% to 242.6 in December after rising 0.7% to 241.6 in November. Home prices are up 6.2% y/y. Seven of the nine regions surveyed posted gains on the month.

Crude Oil and Canadian dollar: Crude Oil fell to $54.44 from $54.89 following the EIA inventory data which showed a 564k bbl rise in crude stocks. The street had been expecting a 3.0 mln bbl increase, though API reported a 900k bbl decrease after the close on Wednesday. Meanwhile, gasoline supplies, seen down 1.0 mln bbls actually fell 2.6 mln bbls, while distillate stocks were down 4.9 mln bbls, versus expectations for a 0.5 mln bbl fall. Refinery usage fell to 84.3% from 85.4%. The pull-back in crude oil following the EIA data lifted USDCAD to 1.3113 from 1.3094.

Main Macro Events Today

CA CPI – Canadian CPI is expected to accelerate to a 1.7% y/y pace in January from 1.5% y/y in December. The CPI is expected to expand 0.4% in January versus December, as gasoline prices continued to track higher. Also, prices in general tend to turn higher beginning in January. The Bank of Canada has expressed guarded optimism that CPI will gradually move back towards the 2% target. However, Poloz said rate hikes are still on the table as long as downside risks to the inflation target still exist. The December CPI report did not lessen the downside risk, but did not exacerbate it either.

US New Home Sales – January new home sales data expected to be 6.3% headline increase that brings the pace up to 570k for the month after a 10.4% dip in December to a 536k pace. The NAHB composite dipped to 67 in January from 69 in December but the MBA purchase index managed to notch an increase for the month with a 2.5% increase.

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.

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.


Andria Pichidi
Market Analyst
Hot-Forex


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.

 

[HFM.]

Date : 27th February 2017.

MACRO EVENTS & NEWS OF 27th February 2017.

FX News Today

Political jitters have underpinned a safe haven bid in bonds through the month, while ongoing euphoria over “Trumponomics” has boosted equities to, or near, record highs. The strength of the bullish price action so far this year leaves the markets susceptible to a selloff, especially with a number of major risk events ahead. President Trump’s State of the Union (Tuesday) is the immediate wild card. National elections in the Netherlands (March 15) will be closely monitored. Other key events in March include FOMC and ECB meetings, and the reinstitution of the U.S. debt limit. There’s also an EU summit and the possible triggering of Brexit Article 50. Additionally, French presidential candidates are vying for attention ahead of elections on April 23. German politics also are coming into view, even well before the September vote.

United States: U.S. markets rallied last week on a combination of factors, but gains are at risk this week with President Trump’s State of the Union address (Tuesday) the biggest threat to the euphoria in equities. Politics will continue to dominate the headlines near term. President Trump delivers his first State of the Union address (Tuesday) and that could be a big wild card for the markets which are looking for specifics on the administration’s fiscal plans, especially with respect to deregulation, tax reform, including the border adjustment tax, infrastructure spending, and healthcare. The data slate is heavy with key reports on tap for the new year. The volatile January durable orders (Monday) are projected rebounding 1.0%. It will be interesting to see if orders bounce given the surge in investor enthusiasm on the “Trump effect.” The second look on Q4 GDP (Tuesday) should accelerate to a 2.2% pace from the 2.1% gain in the Advance report, supported by an expected consumption boost. Also slated is the Chicago PMI (Tuesday), seen jumping back to 54.0 in February after the unexpected drop to 50.3 in January. February consumer confidence (Tuesday) should edge up to 112.0 after dropping 1.5 points to 111.8 in January. March kicks off with the February ISM manufacturing index (Wednesday), expected to slide to 55.5 after rising 1.5 points. The reports on income and consumption for January (Wednesday) will help fine tune the Q4 and Q1 GDP outlooks. The ISM services index for February completes the week’s reports.

Fedspeak: will be closely monitored, but it’s likely to be too revealing regarding the March 14, 15 FOMC meeting result. Fed Chair Yellen highlights (Friday), but she’s speaking at an event before the Executives Club of Chicago. She won’t prejudge the upcoming decision, especially without benefit of the January jobs report (March 10). The hawkish Fed voter Kaplan starts off the week (Monday) with a speech. Another hawk, Philly Fed’s Harker speaks on the economic outlook (Tuesday). Also, the increasingly hawkish nonvoters’ SF Fed’s Williams and Bullard will also be on tap (Tuesday). Kaplan speaks again (Wednesday). The dovish governor Brainard will address the economic outlook (Wednesday). Fed hawk Mester speaks on leadership (Thursday). Friday is a busy day with the dovish voter Evans and hawkish nonvoter Lacker speaking on a panel. VC Fischer will discuss Fed policy decision-making at the Chicago Booth School’s annual policymaking forum. The Beige Book (Wednesday) for the upcoming FOMC will be released too. It should reiterate a moderate growth trajectory, continued tightening in the labor market, and some nascent signs of price pressures.

Canada: The BoC’s rate announcement is the main event (Wednesday). No change to the current 0.50% rate setting is projected. Recent economic data has added further reassurance that the projected recovery slated for this year is progressing roughly as anticipated, which should be enough to keep the cautiously optimistic tone from January intact. There are several important reports this week. Topping the list is Q4 GDP (Thursday), expected to grow at a 2.0% pace after the 3.5% rebound in Q3. December GDP (Thursday) is seen expanding at a 0.3% m/m clip following the 0.4% surge in November. The Q4 current account deficit (Wednesday) is projected to narrow to -C$9.0 bln from -C$18.3 bln in Q3, thanks to the dramatic return to a merchandise trade surplus in November and December. The industrial product price index (Tuesday) is expected to rise 0.7% m/m in January after the 0.4% gain in December, as gasoline prices surged higher during the month. The annual capital expenditures survey (Tuesday) will provide the always interesting business investment intentions, this time for 2017. The Markit manufacturing PMI for February is due Wednesday.

Europe: This week’s round of data releases will confirm the picture of stronger growth and rising inflation, with the Eurozone headline rate expected to come in bang in line with the ECB’s definition of price stability as below but close to 2%. But while this should be a time for jubilation for Draghi and finally a time the central bank to relax, mounting political risks mean the central bank’s helping hand is still needed. French election jitters may have eased somewhat and in Germany the euphoria over Socialist candidate Schulz is not only denting Merkel’s chances, but has also cut into support for Eurosceptics on the right end of the spectrum, the Dutch election (March 15) is drawing nearer and after markets were burned in last year’s U.S. and U.K. votes they are clearly taking no chances. This week’s data calendar focuses on the last set of confidence data for February as well as preliminary inflation numbers for February. Final PMI readings (Thursday and Friday) are unlikely to bring major surprises and are expected to confirm the Manufacturing PMI at 55.5 and the services reading at 55.6. These numbers were much stronger than initially expected and together with the robust German Ifo point to the risk of an upside surprise in the Eurozone ESI Economic Confidence indicator.

UK: The calendar this week is highlighted by the February PMI surveys. We expect the manufacturing PMI (Wednesday) to dip slightly, to a reading of 55.5 after 55.9 previously. The construction PMI has us anticipating a 52.0 reading, down fractionally from 52.2 in January. Other data includes the BoE’s report on lending for January. The BoE’s easing measures since the Brexit vote last year have driven many lending rates to historic lows, which should underpin the data.

Japan: Japan’s docket kicks off Tuesday with several important releases. Preliminary January industrial production is expected to rise 0.5%. A monthly decline hasn’t been posted since July, an encouraging sign for growth, although there’s downside risk from the slightly firmer yen this year on safe haven flows given political uncertainties in the U.S. and Europe. January retail sales are expected to remain in contraction. January housing starts should post a 3.0% y/y pace, down from 3.9% in December. January construction orders are due Tuesday as well. They’ve been choppy over the past year, but have slowed considerably since the 16.3% y/y pace in September, posting a -6.0% y/y pace in November, but rebounding 7.1% y/y in December. The MoF Q4 capex survey (Wednesday) is forecast jumping to a 1.0% y/y rate from -1.3% in Q3. The final February Markit manufacturing PMI (Wednesday) is estimated to have improved to 53.0 from January’s 52.7. The rest of the week’s releases come on Friday. January national CPI is expected to have accelerated slightly to 0.4% y/y from 0.3% y/y overall, but unchanged at a -0.2% y/y rate on a core basis. Tokyo February CPI likely slipped to -0.2% y/y overall. Inflation remains a real uncertainty for Japan, but signs of an emergence of global price pressures could be filtering through into Japan too. January unemployment is seen holding at 3.1%, with the job offers/seekers ratio steady at 1.43. January personal income and PCE are due, with the latter expected to fall to a -0.5% y/y clip from -0.3% y/y in December. Finally, February consumer confidence is penciled in at 43.5 from 43.2.

Australia: Australia’s calendar is data rich this week, in contrast to a poor RBAspeak slate. The highlight is Q4 GDP (Wednesday), expected to rebound 0.6% after the 0.5% tumble in Q3. The Q4 current account deficit (Tuesday) is seen narrowing to -A$7.0 bln from -A$11.4 bln in Q3. The trade report (Thursday) is projected to show a A$4.0 bln surplus in January after the A$3.5bln surplus in December. Building approvals (Thursday) are seen falling 0.5% m/m in January after the 1.2% drop in December. There is nothing from the Reserve Bank of Australia this week. The next event is the March 7 meeting, which we expect to reveal no change to the 1.50% rate setting.

New Zealand: New Zealand’s calendar has the January trade report (Tuesday). Trade prices are due on Wednesday. The next meeting of the Reserve Bank of New Zealand is on March 23rd. The RBNZ is expected to hold the OCR steady at 1.75%

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.

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.


Andria Pichidi
Market Analyst
Hot-Forex


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.