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Overview of the main economical events of the current day - 07/07/2014
The Main Events of the Coming Week
On Friday 4th July the US dollar strengthened its positions vs. most major currencies, having added 0.1% to the dollar index. The euro was traded downwards amid weak German Factory Orders.
On Friday the US dollar continued its growth after the US Non-Farm Payrolls, released on Friday. The calendar was almost empty, the 4th of July was celebrated in the USA and market activity was low. Market participants continued to estimate strong Non-Farm Payrolls released the previous day. In June the situation at the American Labor Market notably improved, which is confirmed by economy recovery continuation.
The US Non-Farm Employment Change jumped in June by 288,000 in comparison with upwardly revised 224,000 in May – which appeared to be considerably more than expected 212,000. Unemployment Rate reduced in June from 6.3% to 6.1% - the lowest rate since July 2008, whereas no changes were expected. According to CME, possibility of interest rates increase during FOMC Meeting in June 2015 after the release of Employment Change Report increased to 57%. The previous day the chances for interest rates increase in June 2015 composed 51%, and 43% a month ago.
The euro was traded downwards amid decrease of German Factory Orders, which dropped more than it was expected. Geopolitical risks brought pressure on confidence in the largest Europe’s economy. German Factory Orders dropped in May by 1.7% m/m against the expectations of decrease by 1.1%. In April growth of the reading by 3.4%, but not by 3.1% as it was stated earlier was noted. Increase was the highest since June 2013.
German Construction PMI dropped in June to 15-month low, which was mainly connected with the fall of new orders. ECB’s Noyer stated that ECB is ready to take all necessary measures for achieving inflation rate of 2%. Asset Purchase program oriented both to state-owned assets and private assets may be launched for these purposes. Euro course is overcharged vs. the US dollar, if taking into account the growth of the European economy. Strong euro pressurizes economical activity and inflation, and euro weakening vs. the US dollar would be reasonable.
According to the results of the week the US dollar strengthened its positions vs. most major currencies, having added 0.31% to the dollar index. Strong US Non-Farm Payrolls supported the US dollar, and increased the possibility of earlier interest rates rise. Most of all the US dollar increased vs. the yen and the Australian dollar. Only the pound sterling and the Canadian dollar managed to increase vs. the US dollar. The pound sterling received support from strong BBA Mortgage Approvals, Manufacturing PMI, and Construction PMI in the UK.
The most important event of the week will be the release of the last FOMC Meeting on Wednesday. These are very few data in the USA this week: on Tuesday JOLTS Job Openings and NFIB Small Business Index will be released; on Thursday – Wholesales Inventories and Wholesale Trade Sales; and on Friday – Monthly Federal Budget Balance. On Tuesday 8 July American companies quarterly report period of the 2nd quarter will start and will last till the middle of August.
On Monday Euro-Zone Sentix Investor Confidence will be released; and on Thursday – Monthly ECB Report. German Industrial Output will be released on Monday; and in France and Italy – on Thursday – low growth rates of Industrial Output are expected in May. French Inflation Rate will be released on Thursday; and in Germany and Spain on Friday. On Tuesday in Germany Trade Balance will be released.
On Tuesday in the UK Industrial Output will be released (acceleration of annual growth rate in May is expected), and on Thursday – Trade Balance. On Thursday BOE Monthly Meeting results will be announced, no policy changes are expected. On Tuesday in Japan Trade Balance and Current Account will be released; on Thursday – Core Machinery Orders. On Wednesday in China Inflation Rate will be released; and on Thursday – Trade Balance.
On Tuesday in Australia NAB Business Confidence will be released; on Thursday – Labor Market Report; and on Friday – Home Loans. In New Zealand NZIER Business Confidence will be released; on Wednesday – Electronic Cards Retail Sales; and on Thursday – Business NZ Manufacturing Index and REINZ House Price Index. On Monday in Canada BOC Business Outlook Survey, building Permits, and Ivey PMI will be released; on Wednesday – Housing Starts; on Thursday – New House Price Index; and on Friday – Labor Market report.
By MasterForex Company
The Main Events of the Coming Week
On Friday 4th July the US dollar strengthened its positions vs. most major currencies, having added 0.1% to the dollar index. The euro was traded downwards amid weak German Factory Orders.
On Friday the US dollar continued its growth after the US Non-Farm Payrolls, released on Friday. The calendar was almost empty, the 4th of July was celebrated in the USA and market activity was low. Market participants continued to estimate strong Non-Farm Payrolls released the previous day. In June the situation at the American Labor Market notably improved, which is confirmed by economy recovery continuation.
The US Non-Farm Employment Change jumped in June by 288,000 in comparison with upwardly revised 224,000 in May – which appeared to be considerably more than expected 212,000. Unemployment Rate reduced in June from 6.3% to 6.1% - the lowest rate since July 2008, whereas no changes were expected. According to CME, possibility of interest rates increase during FOMC Meeting in June 2015 after the release of Employment Change Report increased to 57%. The previous day the chances for interest rates increase in June 2015 composed 51%, and 43% a month ago.
The euro was traded downwards amid decrease of German Factory Orders, which dropped more than it was expected. Geopolitical risks brought pressure on confidence in the largest Europe’s economy. German Factory Orders dropped in May by 1.7% m/m against the expectations of decrease by 1.1%. In April growth of the reading by 3.4%, but not by 3.1% as it was stated earlier was noted. Increase was the highest since June 2013.
German Construction PMI dropped in June to 15-month low, which was mainly connected with the fall of new orders. ECB’s Noyer stated that ECB is ready to take all necessary measures for achieving inflation rate of 2%. Asset Purchase program oriented both to state-owned assets and private assets may be launched for these purposes. Euro course is overcharged vs. the US dollar, if taking into account the growth of the European economy. Strong euro pressurizes economical activity and inflation, and euro weakening vs. the US dollar would be reasonable.
According to the results of the week the US dollar strengthened its positions vs. most major currencies, having added 0.31% to the dollar index. Strong US Non-Farm Payrolls supported the US dollar, and increased the possibility of earlier interest rates rise. Most of all the US dollar increased vs. the yen and the Australian dollar. Only the pound sterling and the Canadian dollar managed to increase vs. the US dollar. The pound sterling received support from strong BBA Mortgage Approvals, Manufacturing PMI, and Construction PMI in the UK.
The most important event of the week will be the release of the last FOMC Meeting on Wednesday. These are very few data in the USA this week: on Tuesday JOLTS Job Openings and NFIB Small Business Index will be released; on Thursday – Wholesales Inventories and Wholesale Trade Sales; and on Friday – Monthly Federal Budget Balance. On Tuesday 8 July American companies quarterly report period of the 2nd quarter will start and will last till the middle of August.
On Monday Euro-Zone Sentix Investor Confidence will be released; and on Thursday – Monthly ECB Report. German Industrial Output will be released on Monday; and in France and Italy – on Thursday – low growth rates of Industrial Output are expected in May. French Inflation Rate will be released on Thursday; and in Germany and Spain on Friday. On Tuesday in Germany Trade Balance will be released.
On Tuesday in the UK Industrial Output will be released (acceleration of annual growth rate in May is expected), and on Thursday – Trade Balance. On Thursday BOE Monthly Meeting results will be announced, no policy changes are expected. On Tuesday in Japan Trade Balance and Current Account will be released; on Thursday – Core Machinery Orders. On Wednesday in China Inflation Rate will be released; and on Thursday – Trade Balance.
On Tuesday in Australia NAB Business Confidence will be released; on Thursday – Labor Market Report; and on Friday – Home Loans. In New Zealand NZIER Business Confidence will be released; on Wednesday – Electronic Cards Retail Sales; and on Thursday – Business NZ Manufacturing Index and REINZ House Price Index. On Monday in Canada BOC Business Outlook Survey, building Permits, and Ivey PMI will be released; on Wednesday – Housing Starts; on Thursday – New House Price Index; and on Friday – Labor Market report.
By MasterForex Company