passion-trading.com Live

Although this week will be slightly quieter than last, RBA, BOE and FOMC Meeting Minutes promise to take the economic centre stage.

The RBA Meeting Minutes will be the first high volatility event of the week, 02:30 BST on Tuesday 20^th. Australian Interest Rates currently stand at 7.25% with no speculation of any immanent cuts.

Both the BOE Monetary Policy Committee and the Federal Open Market Committee Meeting Minutes will be released this Wednesday, May 21^st. The BOE will come first, at 09:30 London time with the Fed following at 19:00 BST. As you might expect, these events will draw heavy interest from traders and economists with high market volatility expected. The markets are firmly focused on whether either central bank sees the need for further near term interest rate cuts.

Specifically, traders will watch the MPC Member vote split from the last meeting. The decision was taken to keep the rate on hold at 5.00% and the weight of the majority decision will be watched very closely for clues to the pace and direction of future rate moves.

While the FOMC does not reveal any vote casting it does publish a detailed summary of the interest rate meeting. Traders will closely scrutinize this commentary for clues to future rate moves. At present the popular market opinion is that the US will leave rates on hold in the near term.

Prior to the data landing on Wednesday we will see US PPI and Core PPI. They will hit the wire on Tuesday at 13:30 London time, 08:30 EST. The raw Producer Price Index carries more weight than the Core release. Economists are expecting 0.4% MoM for the PPI and 0.2% for the Core reading.

Later in the week we will see more high-volatility events from the US and UK. On Friday we will see the UK GDP Second Estimate which is expected to come in unchanged at 0.4%. This will be followed at 15:00 BST by US Existing Home Sales. Following a modest but unexpected increase to 5.03 million units in the March announcement, economists are expecting a second straight monthly decline to 4.86 million.

Further high volatility events this week are as follows:

BOJ Press Conference following the BOJ Interest Announcement - Tuesday am
Swiss PPI MoM - Tuesday 08:15
German ZEW Economic Sentimant - Tuesday 10:00
German Ifo Business Climate Index - Wednesday 09:00
Canadian Core CPI - Wednesday 12:00
UK Retail Sales - Thursday 09:30
Canadian Core Retail Sales - Thursday 13:30

The trading week is slightly shorter than normal in Canada (Victoria Day, Monday 19^th) and Germany (Corpus Christi, Thursday 22^nd) with lighter volume and volatility expected during these trading sessions. For more info please see our 2008 market holiday calendar.

The Passion-Trading visual analysis and historical data tool will support the following releases this week:

US PPI MoM
BOE MPC Meeting Minutes
Canadian Core CPI MoM
US Existing Home Sales

For details on the scheduled economic speeches you can check out this week’s economic comment calendar.

The GBPUSD currency pair promises to be in focus this week as the UK and US both have busy economic release schedules

On Monday we will see PPI Input and Trade Balance data from the UK at 09:30. Both of these releases are regarded with maximum importance. Economists are expecting PPI Input to come in at 1.8% MoM. The index is important because it assumes that the manufacturing sector will look to pass on increasing costs to the consumer. Elevated Producer Inflation has been caused by an increase in fuel and commodity prices and the impact of a softening Pound. PPI Output is also set to be released at the same time although this is slightly less important to the market.

The UK Trade Balance, released by The Office for National Statistics, is expected to narrow slightly to -7.5 billion pounds from an expected revision of -£7.6 bln in February.

This Tuesday (13^th) will be equally as busy. Just after midnight UK time, the RICS House Price Balance will be released. Economists are expecting 80% of mortgage surveyors polled to report house prices falling in their area from the 78.5% last month.

At 09:30 the highly anticipated UK Consumer Price Index will be released. Traders will be most interested in the CPI YoY because it is the benchmark reading that the BOE uses in its monetary policy considerations. The CPI is expected to increase to 2.6% from a previous reading of 2.5%. Core CPI is also expected to increase from 1.2% to 1.3%

After a quiet Monday, the first high volatility news from the US will be released on Tuesday. The action starts at 13:20 with Fed Chairman Bernanke’s speech at the Atlanta Fed’s Financial Markets Conference. Then, at 13:30 (08:30 EDT) Retail Sales and Core Retail Sales are due. Retail sales are expected to decrease MoM by -0.2%, however the core number is set to rise by 0.2%.

Later in the week we will see the further action from the UK and US with BOE Quarterly Inflation Report (Wednesday @10:30), US Core CPI MoM (Wednesday @ 13:30), Empire State Business (Manufacturing) Conditions Index (Thursday, 13:30), TIC Net Long-Term Transactions (Thursday, 14:00), Fed Chairman Bernanke speaking at the Chicago Fed’s annual convention (Thursday, 14:30), Philadelphia Fed’s Manufacturing Index (Thursday, 15:00) and finally Michigan Consumer Sentiment at 14:55 on Friday.

Outside of the US and UK this week the following high volatility events are scheduled:

NZD – Retail Sales MoM, Wednesday @ 23:45
NZD – PPI Input MoM, Thursday @ 23:45
JPY – Preliminary GDP QoQ, Friday @ 00:50

Economic Speeches and Comments

As usual there are a number of key comment and events to be aware of, especially from the US. The Atlanta Fed’s Financial Markets Conference dominates the first part of the week with no less than 3 Federal Reserve officials speaking on Tuesday. The market will focus on Bernanke’s comments at 13:20 with Warsh and Plosser participating in discussions later in the day.

Bernanke is also due to speak at the Chicago Fed’s Annual Conference on Bank Structure and Competition on Thursday, 14:30. This is also a high profile event as Bernanke’s comments focus on “Risk Management at Banking Organizations”.

Full details can be found at this week’s speech and comment calendar.

Also this week, the visual analysis and historical data tool is available for Core US CPI.

Market Looks Forward to Advance GDP and Non-Farm Payrolls Report

This week’s economic calendar promises to be jam-packed with a wealth of information from the US and Japan.

Both the Fed and the BOJ will be releasing their latest Interest Rate changes on Thursday April 30th. First up is the BOJ Interest Rate Announcement with the BOJ expected to keep rates on hold once again at 0.50%. This is in spite of the encouraging Consumer Inflation data released last week which showed that Core CPI YoY grew in line with expectations to 1.2% from the previous reading of 1.0%.

The FOMC, on the other hand, is expected to continue its run of recent rate cuts by reducing the Fed Funds Rate to 2.00%. This represents a cut of 0.25%, less aggressive than in recent months. Some economists are expecting rates to stabilise at this level for at least the near-term.

As you would expect the US Labor Market will be closely scrutinized this week with both ADP Non-Farm Employment Change and Non-Farm Payrolls scheduled for release. Early indications are for another month of job cuts, -60K expected from the ADP report.

This week we will also see the following high volatility economic events from the US: Advance GDP QoQ (13:30, Weds Apr 30^th), Personal Spending (13:30, Thurs May 01), ISM Manufacturing Index (15:00, Thurs May 01), Unemployment Rate (13:30, Fri 02 May).

High profile events from the rest of the world (times BST):
New Zealand Trade Balance - Mon Apr 28 @ 23:45
UK Nationwide House Prices - Tues Apr 29 NTS
New Zealand Building Consents - Tues Apr 29 @ 23:45
Swiss Leading Index - Weds Apr 30 @ 10:30
Canadian GDP - Weds Apr 30 @ 13:30
Australian Building Approvals - Thur May 01 @ 02:30
UK Manufacturing PMI - Thur May 01 @ 09:30
Australian Retail Sales - Fri May 02 @ 02:30

The highlight of this week’s economic speeches calendar will undoubtedly be BOJ Governor Shirakawa’s press conference following the BOJ Interest Rate Announcement. Traders will be keen to see how the new governor sees the Japanese economy in light of recent increased consumer inflation. Furthermore BOC Governor Carney and Deputy Governor Jenkins testimony in front of the Standing Senate Committee on Banking, Trade and Commerce will draw heavy interest.

Consumer Price Inflation In Focus

With no fewer than 7 Consumer Price Index releases, consumer inflation readings are definitely in focus this week. We will see CPI data from New Zealand (Monday), France & the UK (Tuesday), Germany, the Eurozone and the US (Wednesday) and Canada on Friday.

The raw number from New Zealand and the UK are both expected to draw heavy market interest and volatility while the same can be expected for US and Canadian Core CPI figures.

It is not just Consumer Price Inflation drawing all of the interest with Producer Price Inflation (PPI) from the UK (Monday) and the US (Tuesday) also hitting the wire. Both of these data releases are expected to generate high market volatility, especially in the GBPUSD currency pair.

Other key economic events for this week include:

New Zealand Retail Sales MoM – Sunday April 13 at 23:45

US Core Retail Sales MoM – Monday April 14 at 13:30

Canadian Business Outlook Survey – Monday April 14 at 15:30

UK RICS House Price Balance – Tuesday April 15 at 00:01

The Reserve Bank of Australia Interest Rate Meeting Minutes – Tuesday April 15 at 02:30

US Empire State Manufacturing Index – Tuesday April 15 at 13:30

Treasury International Capital Net Long-Term Transactions – Tuesday April 15 at 14:00

UK Average Earnings Index + Bonus – Wednesday April 16 at 09:30

(all times are UK summer time GMT +1)

This week our visual analysis and historical data tools will be covering the US PPI MoM (Tuesday), the US Core CPI MoM (Wednesday) and the Canadian Core CPI MoM on Thursday. High market volatility is expected for all three of these events as our Visual Analysis tool enters its third month of service.

Our Economic Calendar has been updated for the upcoming working week. It is important to mention that our default time setting has changed to GMT+1 to reflect UK DST (daylight saving time)/ British summer time. If you would like to know how this relates to your domestic time you can use the Qlock World Time Clock.

This weeks’ main focus will undoubtedly be on employment data from the US. ADP Non-Farm Employment Change (Wednesday), Initial Jobless Claims (Thursday), Non-Farm Payrolls and Unemployment Rate (Friday) will all be closely watched. The fear is that the US economy is slipping into recession and the employment market is one of the most important driving factors of the economy.

Before the headline Payrolls figure hits the wire on Friday there will be considerable interest paid to US Manufacturing Data. The Institute of Supply Management is due to release its Manufacturing Index on Tuesday and the newer Non-Manufacturing Composite on Thursday. Traders’ focus will remain on weather either of these two indicators can pull their head above the 50 mark. A reading above 50 signifies expansion, while a reading sub 50 indicates industry contraction.

Elsewhere, New Zealand Building Consents (Sunday), Canadian GDP (Monday), Japanese Tankan Large Manufacturers’ Index, RBA Interest Rate Statement, UK Manufacturing PMI (Tuesday) and UK Services PMI (Thursday) round off a busy week all-round.

The Economic Speeches Calendar is equally as busy for the coming week. The focus will fall on Fed Chairman Bernanke’s Testimony to the Joint Economic Committee in Washington DC. It is expected that Bernanke will field some difficult question from the Committee on US Economic Outlook.

Traders will also keep a keen eye on RBA Governor Stevens’ Testimony to the House of Representatives Senate Standing Committee on Economics in Sydney.

If you wish to view this weeks' data at a later date you can visit its archive page.