Time | Country | Event | Period | Previous value | Forecast |
---|---|---|---|---|---|
01:30 | Australia | Home Loans | April | -2.5% | -0.2% |
05:00 | Japan | Leading Economic Index | April | 95.9 | 96.1 |
05:00 | Japan | Coincident Index | April | 99.4 | |
05:45 | Switzerland | Unemployment Rate (non s.a.) | May | 2.4% | 2.3% |
06:00 | Germany | Current Account | April | 30.2 | |
06:00 | Germany | Industrial Production s.a. (MoM) | April | 0.5% | -0.4% |
06:00 | Germany | Trade Balance (non s.a.), bln | April | 22.7 | |
06:45 | France | Trade Balance, bln | April | -5.3 | -4.9 |
06:45 | France | Industrial Production, m/m | April | -0.9% | 0.3% |
07:00 | Switzerland | Foreign Currency Reserves | May | 772 | |
07:30 | United Kingdom | Halifax house price index | May | 1.1% | -0.2% |
07:30 | United Kingdom | Halifax house price index 3m Y/Y | May | 5.0% | 4.9% |
12:30 | Canada | Capacity Utilization Rate | Quarter I | 81.7% | 81% |
12:30 | U.S. | Average workweek | May | 34.4 | 34.5 |
12:30 | U.S. | Manufacturing Payrolls | May | 4 | 5 |
12:30 | U.S. | Government Payrolls | May | 27 | |
12:30 | U.S. | Labor Force Participation Rate | May | 62.8% | 62.9% |
12:30 | U.S. | Private Nonfarm Payrolls | May | 236 | 175 |
12:30 | U.S. | Average hourly earnings | May | 0.2% | 0.3% |
12:30 | Canada | Unemployment rate | May | 5.7% | 5.7% |
12:30 | Canada | Employment | May | 106.5 | 8 |
12:30 | U.S. | Unemployment Rate | May | 3.6% | 3.6% |
12:30 | U.S. | Nonfarm Payrolls | May | 263 | 185 |
14:00 | U.S. | Wholesale Inventories | April | 0% | 0.7% |
17:00 | U.S. | Baker Hughes Oil Rig Count | June | 800 | |
19:00 | U.S. | Consumer Credit | April | 10.28 | 12 |
Time | Country | Event | Period | Previous value | Forecast |
---|---|---|---|---|---|
01:30 | Australia | Home Loans | April | -2.5% | -0.2% |
05:00 | Japan | Leading Economic Index | April | 95.9 | 96.1 |
05:00 | Japan | Coincident Index | April | 99.4 | |
05:45 | Switzerland | Unemployment Rate (non s.a.) | May | 2.4% | 2.3% |
06:00 | Germany | Current Account | April | 30.2 | |
06:00 | Germany | Industrial Production s.a. (MoM) | April | 0.5% | -0.4% |
06:00 | Germany | Trade Balance (non s.a.), bln | April | 22.7 | |
06:45 | France | Trade Balance, bln | April | -5.3 | -4.9 |
06:45 | France | Industrial Production, m/m | April | -0.9% | 0.3% |
07:00 | Switzerland | Foreign Currency Reserves | May | 772 | |
07:30 | United Kingdom | Halifax house price index | May | 1.1% | -0.2% |
07:30 | United Kingdom | Halifax house price index 3m Y/Y | May | 5.0% | 4.9% |
12:30 | Canada | Capacity Utilization Rate | Quarter I | 81.7% | 81% |
12:30 | U.S. | Average workweek | May | 34.4 | 34.5 |
12:30 | U.S. | Manufacturing Payrolls | May | 4 | 5 |
12:30 | U.S. | Government Payrolls | May | 27 | |
12:30 | U.S. | Labor Force Participation Rate | May | 62.8% | 62.9% |
12:30 | U.S. | Private Nonfarm Payrolls | May | 236 | 175 |
12:30 | U.S. | Average hourly earnings | May | 0.2% | 0.3% |
12:30 | Canada | Unemployment rate | May | 5.7% | 5.7% |
12:30 | Canada | Employment | May | 106.5 | 8 |
12:30 | U.S. | Unemployment Rate | May | 3.6% | 3.6% |
12:30 | U.S. | Nonfarm Payrolls | May | 263 | 185 |
14:00 | U.S. | Wholesale Inventories | April | 0% | 0.7% |
17:00 | U.S. | Baker Hughes Oil Rig Count | June | 800 | |
19:00 | U.S. | Consumer Credit | April | 10.28 | 12 |
Nathan Janzen, the senior economist at the Royal Bank of Canada, notes that Canada’s trade balance narrowed to $1.0 billion in April as nominal exports rose 1.3% and imports declined 1.4%.
The Ivey Business School Purchasing Managers Index (PMI), measuring Canada’s economic activity, came in at 55.9 in May, unchanged from April.
Economists had expected the gauge to hit 56.2.
A figure above 50 shows an increase while below 50 shows a decrease.
Within sub-indexes, the employment measure increased to 55.1 in May from 53.7 in the prior month, while the inventories indicator surged to 53.1 from 46.4, the supplier deliveries gauge climbed to 52.4 from 48.7 and the prices index rose to 59.5 last month from 58.9.
Sonia Meskin, the U.S. Economist at Standard Chartered, thinks the U.S. Fed’s goal is to sustain the current economic expansion, and its key dilemma is that it has a limited set of tools to do so.
The U.S.
Commerce Department reported on Thursday the U.S. the goods and services trade
deficit narrowed to $50.8 billion in April from a revised $51.9 billion in the
previous month (originally a gap of $50.0 billion).
Economists had
expected a deficit of $50.7 billion.
According to
the report, the April decrease in the goods and services deficit reflected a
decline in the goods deficit of $1.0 billion to $71.7 billion and a gain in the services surplus of $0.1 billion to $20.9 billion.
Exports of
goods and services from the U.S. fell 2.2 percent m-o-m to $206.8 billion in April,
while imports also decreased 2.2 percent m-o-m to $257.6 billion.
Year-to-date, the
goods and services deficit rose $4.1 billion, or 2.0 percent, from the same
period in 2018. Exports increased $8.3 billion or 1.0 percent. Imports went up
$12.4 billion or 1.2 percent.
Statistics
Canada announced on Thursday that Canada’s merchandise trade deficit stood at
CAD0.97 billion in April, narrowing from a revised CAD2.34 billion gap in March
(originally a CAD3.21-billion deficit). That was the smallest trade gap since October 2018.
Economists had
expected a deficit of CAD2.80 billion.
According to the report, the country’s exports increased 1.3 percent m-o-m in April, due mainly to higher exports of metal and non-metallic mineral products (+15.0 percent m-o-m), particularly gold.
Meanwhile,
imports fell 1.4 percent m-o-m in April, mostly on lower imports of aircraft
and other transportation equipment and parts (-23.6 percent m-o-m).
The data from
the Labor Department revealed on Thursday the number of applications for
unemployment benefits remained unchanged last week, indicating the jobs market
remains tight even as the economy slows.
According to
the report, the initial claims for unemployment benefits stood at 218,000 for
the week ended June 1.
Economists had
expected 215,000 new claims last week.
Claims for the
prior week were revised upwardly to 218,000 from the initial estimate of 215,000.
Meanwhile, the
four-week moving average of claims fell 2,500 to 215,000 last week.
U.S.-Mexico talks on immigration, tariffs will continue Thursday at U.S. State Department
Analysts at TD Securities expect the U.S. trade balance to widen modestly in April to $50.7 billion, following a minor increase in the trade gap in March.
“This would be in line with our view that net exports are likely to be less of a contributor to growth to Q2 activity after a notable shrinking of the trade deficit supported Q1 GDP growth.”
According to Carsten Brzeski, ING's chief economist in Germany, first industrial data for the second quarter keeps the hope of a gradual industrial recovery alive. Industrial orders were up by 0.3% MoM in April, increasing for the second month in a row from an upwardly revised 0.8% MoM in March. On the year, industrial orders were down by 5.3%, from -5.9% YoY in March. Excluding bulk orders, new orders were even up by 2.1% MoM. This is some welcome relief for German industry.
Analysts at TD Securities think that Canada’s international trade for April will give an early look at economic activity for Q2.
Bank of Japan Governor Haruhiko Kuroda warned of the potential dangers of heavy money printing, saying that financial bubbles, when accompanied by excessive lending by commercial banks, tend to trigger financial crises.
Kuroda said the G20 members must focus on implementing the financial reforms they launched in 2009 to prevent another financial crisis.
"Financial bubbles tend to associate with financial crises when accompanied by excessive credit creation," Kuroda said.
"Our experience of Japan's crisis in the late 1990s and of the last global financial crisis in the late 2000s reminds us that the most important role of financial regulation and supervision is to address market failures in order to prevent financial crises," he added.
Kristoffer Kjær Lomholt, senior analyst at Danske Bank, points out that more dovish hints from the Fed and a weak ADP employment report temporarily sent EUR/USD up to 1.13 yesterday before the cross more than erased gains on the non manufacturing ISM.
“The market will likely need a significant dovish shift from the ECB today to be inclined to sell EUR/USD, i.e. rate cuts and/or QE on the table. We think the ECB will have a hard time living up to market expectations as it becomes clear that the Fed is one step ahead of ECB in the dovish shift. Hence, we do not look for the ECB to derail recent positive EUR/USD momentum.”
Eurostat said, the number of persons employed increased by 0.3% in both the euro area and the EU28 in the first quarter of 2019 compared with the previous quarter. In the fourth quarter of 2018, employment increased by 0.3% in the euro area and by 0.2% in the EU28.
Compared with the same quarter of the previous year, employment increased by 1.3% in the euro area and by 1.2% in the EU28 in the first quarter of 2019 (after +1.3% and +1.2% respectively in the fourth quarter of 2018). These data on employment provide a picture of labour input consistent with the output and income measure of national accounts.
Based on seasonally adjusted figures, Eurostat estimates that in the first quarter of 2019, 240.7 million people were employed in the EU28, of which 159.5 million were in the euro area. These are the highest levels of employment ever recorded in both areas. More specifically, the number of persons employed has increased by 10.8 million in the euro area and 16.6 million in the EU28 since the lowest level of employment after the financial crisis (2013 Q2 for euro area, 2013 Q1 for EU28).
According to an estimate published by Eurostat, seasonally adjusted GDP rose by 0.4% in the euro area (EA19) and by 0.5% in the EU28 during the first quarter of 2019, compared with the previous quarter. In the fourth quarter of 2018, GDP had grown by 0.2% in the euro area and by 0.3% in the EU28.
Compared with the same quarter of the previous year, seasonally adjusted GDP rose by 1.2% in the euro area and by 1.5% in the EU28 in the first quarter of 2019, after +1.2% and +1.5% respectively in the previous quarter.
During the first quarter of 2019, household final consumption expenditure rose by 0.5% in both the euro area and the EU28 (after +0.3% and +0.4% respectively in the previous quarter). Gross fixed capital formation increased by 1.1% in the euro area and by 1.3% in the EU28 (after +1.4% and +1.1%). Exports increased by 0.6% in the euro area and by 0.5% in the EU28 (after +1.2% and +1.5%). Imports increased by 0.4% in the euro area and 1.2% in the EU28 (after +1.2% and +1.3%).
IMF views that ECB monetary policy accommodation remains necessary
IMF views that there is a small undervaluation in the euro exchange rate
IMF views that euro area countries with high debt like Italy should create more fiscal space by implementing structural reforms
Deutsche Bank analysts point out that the July FOMC meeting is now priced in for 21bps of cuts, with 88bps of cuts priced in for the next 12 months.
“The market is still priced for a very dovish shift in policy. Friday’s jobs report is looking ever-more pivotal for the Fed and for markets. Despite the firming market expectations for rate cuts, the 2s10s curve actually bull steepened to 27.7bps (over 30bps intra-day and 28.8bps this morning) and to the steepest since November last year with 10y yields down a more modest -0.9bps (down a further -2.5bps this morning though). In three days the curve has actually steepened more than +8bps and it continues to defy inversion unlike most of the other common yield curve measures in the US.”
Japan will explain to G20 members its plan to proceed with a planned sales tax hike in order to fund social security for all generations, the top government spokesman said on Thursday.
Japan's economy is underpinned firmly by fundamentals that support domestic demand, Chief Cabinet Secretary Yoshihide Suga told a regular news conference, adding that Tokyo would roll out offsetting measures as planned to ease the impact of the higher levy.
According to analysts at Danske Bank, focus in markets remains on US trade talks - with short-term emphasis on Mexico, and speculation of central bank easing for most notably the Fed.
“Today's highlight is the ECB meeting. We expect the ECB to maintain its easing bias, with no new additional stimulus measures announced. The update of the staff projections is unlikely to change much for inflation, but we see a downside risk to the 2020-21 growth forecast from its already low level. We will also get more information on the TLTRO3 terms, which we expect to be favourable in light of the ongoing struggles of the economy. We will also get euro area GDP details for Q1. We will closely monitor the domestic demand drivers and see how they fared; private consumption and fixed investments were probably strong judging from the German figures already released.”
According to the report from IHS Markit, eurozone construction firms recorded a further rise in activity midway through the second quarter, but the pace of growth eased to the softest for four months. A key factor behind the slowdown the first decline in new orders since last August. Meanwhile, firms continued to increase both their staff numbers and input buying, albeit at slower rates compared to April. On the cost front, input prices continued to rise markedly. However, the rate of inflation decelerated to the softest for 22 months
Falling 52.1 in April to 50.6 in May, the Eurozone Construction PMI pointed to a marginal rise in total construction activity, with the rate of growth easing from April. Across the euro area's three largest economies, the quickest expansion was seen in Germany, followed by France. Meanwhile, Italian builders reported their first decline in activity since March 2018, although it was only fractional overall.
The strongest-performing sub-sector was again housing. Although the rate of growth eased and was only modest overall, home building recorded an increase in activity for the ninth month in a row. There was also a slight rise in commercial activity, with the pace of expansion decelerating from April. However, civil engineering work fell at the fastest rate since July 2016.
Italy needs a big deficit correction for this year and next to avert a European disciplinary procedure over its deteriorating public finances, European Commission Vice President Valdis Dombrovskis told on Thursday.
“What is needed is a substantial deficit correction in 2019 and 2020,” Dombrovskis said in an interview published a day after the Commission opened the way to a possible disciplinary procedure that would trigger a clash with Rome’s anti-austerity government.
Dombrovskis also said that a planned tax-cutting reform backed by the right-wing League - which governs in coalition with the anti-establishment 5-Star Movement - could be very expensive and help to further deteriorate Italy’s public finances.
Markets are getting too far ahead of themselves in expectations for the Federal Reserve to cut rates, according to Goldman Sachs President and Chief Operating Officer John Waldron.
The market is pricing in a fairly substantial set of moves by the Fed.
I worry a little bit that the market is too optimistic about how much and how soon the Fed will move.
The market is currently pricing in more than a hundred basis points in cuts now.
The Fed will be more reliant on the data than they will on the short-term sentiment.
Boosting liquidity to the financial system on Thursday, China's central bank signaled its readiness to supply smaller banks with a steady stream of cash after the takeover of a troubled lender, letting more banks access the funds.
The People's Bank of China (PBOC) lent 500 billion yuan (£57 billion) to financial institutions via its medium-term lending facility (MLF), offsetting 463 billion yuan worth of MLF loans maturing on the same day. It left the interest rate for the one-year MLF unchanged at 3.30 percent.
Money market traders said the central bank has steadily expanded the list of qualified recipients for the liquidity tool this year, allowing more smaller lenders to directly tap longer-term funds.
Based on provisional data, the Federal Statistical Office (Destatis) reports that price-adjusted new orders in manufacturing had increased in April 2019 a seasonally and calendar adjusted 0.3% on the previous month. Economists had expected a 0.1% increase.
For March 2019, revision of the preliminary outcome resulted in an increase of 0.8% compared with February 2019 (provisional: +0.6%). Price-adjusted new orders without major orders in manufacturing had increased in April 2019 a seasonally and calendar adjusted 2.1% on the previous month.
Domestic orders decreased by 0.8% and foreign orders rose by 1.1% in April 2019 on the previous month. New orders from the euro area were down 5.8%, new orders from other countries increased 5.7% compared to March 2019.
In April 2019 the manufacturers of intermediate goods saw new orders fall by 0.4% compared with March 2019. The manufacturers of capital goods showed increases of 0.9% on the previous month. For consumer goods, an increase in new orders of 0.1% was recorded.
EUR/USD
Resistance levels (open interest**, contracts)
$1.1314 (5062)
$1.1279 (2972)
$1.1257 (2042)
Price at time of writing this review: $1.1231
Support levels (open interest**, contracts):
$1.1208 (3643)
$1.1181 (5646)
$1.1143 (3307)
Comments:
- Overall open interest on the CALL options and PUT options with the expiration date June, 7 is 126202 contracts (according to data from June, 5) with the maximum number of contracts with strike price $1,1500 (9050);
GBP/USD
Resistance levels (open interest**, contracts)
$1.2806 (512)
$1.2764 (814)
$1.2732 (1001)
Price at time of writing this review: $1.2687
Support levels (open interest**, contracts):
$1.2636 (1602)
$1.2595 (2004)
$1.2548 (840)
Comments:
- Overall open interest on the CALL options with the expiration date June, 7 is 41883 contracts, with the maximum number of contracts with strike price $1,3450 (3277);
- Overall open interest on the PUT options with the expiration date June, 7 is 39065 contracts, with the maximum number of contracts with strike price $1,2800 (3618);
- The ratio of PUT/CALL was 0.93 versus 0.94 from the previous trading day according to data from June, 5
* - The Chicago Mercantile Exchange bulletin (CME) is used for the calculation.
** - Open interest takes into account the total number of option contracts that are open at the moment.
Pare | Closed | Change, % |
---|---|---|
AUDUSD | 0.69673 | -0.36 |
EURJPY | 121.551 | -0.12 |
EURUSD | 1.12258 | -0.24 |
GBPJPY | 137.371 | 0.03 |
GBPUSD | 1.26876 | -0.08 |
NZDUSD | 0.66187 | 0.18 |
USDCAD | 1.34208 | 0.22 |
USDCHF | 0.99416 | 0.2 |
USDJPY | 108.271 | 0.12 |
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