QE or not to QE
Tue, 22 May 12 10:46 am
Data just out indicated that UK consumer price inflation eased for April. Weak CPI, coupled with a downbeat quarterly inflation report released last week, has further strengthened speculation of additional easing and could weigh on Sterling against the majors in today’s trading session. Turning focus to Europe, ‘Grexit’ chatters took a backseat after German and French finance ministers indicated their willingness for Greece to stay in the Eurozone. Opinion polls in Greece suggest that the conservative New Democracy party is drawing level with the radical left party Syriza. Consumer confidence data in the Eurozone later today may likely prove to be a driving force for the Euro.
G8 Stands firm with Greece
Mon, 21 May 12 11:34 am
Leaders at the G8 summit over the weekend indicated their desire for Greece to remain in the Euro zone and urged Europe to focus on growth rather than austerity. However, with the meeting providing little of substance, traders are likely to shift their focus onto the EU Summit and PMI numbers across Europe due later this week. In the UK, a raft of data is scheduled including inflation, BoE minutes of the last meeting and revised GDP data. All are likely to keep traders busy. With little noteworthy in terms of macro releases globally today, it is expeted that the major currency pairs will trade in a tight range.
Sterling’s Reins Pulled
Fri, 18 May 12 11:09 am
A deluge of rating downgrades has hit the Eurozone, with Fitch lowering its rating on Greece by one notch and Moody’s reducing its credit rating on sixteen Spanish banks. Meanwhile, Sterling continues its losing streak against the US Dollar following the BoE’s uninspiring quarterly inflation report. Additionally, US economic data released yesterday was disappointing and has turned the tide in favour of a potential QE3. With macro data on a light side today, markets are likely to take direction from news flow out of the Eurozone and the G8 meeting starting today.
BoE and Fed Ignite QE Hopes
Thu, 17 May 12 12:04 pm
Sterling witnessed a pullback against the majors yesterday after the BoE lowered its 2012 GDP growth forecast in its quarterly inflation report. This spurred market speculation of additional easing in the future. The central bank also forecast higher inflation in the near term. Across the Atlantic, prospects of further stimulus was kept alive after minutes of the Fed’s last policy meeting indicated that “several” officials are open to additional efforts to boost the economy if momentum falters. With Spanish GDP data indicating a contraction this morning and a light European economic calendar ahead, markets will closely eye today’s U.S. jobless claims and regional manufacturing data.
Euro Slides on Greece Polls
Wed, 16 May 12 10:34 am
Greece has called for fresh elections after the nation’s political parties failed to form a coalition government. The prolonged deadlock has sparked uncertainty over Greece’s pledged austerity measures and increased chatter about the nation’s future in the Eurozone. Meanwhile, better-than-expected growth in Germany avoided the Eurozone slipping into a recession. In the UK, markets keenly await the BoE Quarterly Inflation Report and the subsequent press conference later today. BOE is expected to lower its growth forecast for the UK economy and to throw light on its decision to leave the asset purchase facility unchanged. Across the Atlantic, attention will be focused on the FOMC minutes due later in the day.
How Low Can You Go
Tue, 15 May 12 10:33 am
The Euro, which was under pressure throughout yesterday’s trading session, has recovered some of its losses today following better than expected first quarter German GDP data. This has turned focus towards Eurozone economic growth data due later today. Meanwhile, uncertainty in the zone mounts as Moody’s downgrade 26 Italian banks and speculation is heightened that Greece could exit from the Eurozone, unless the nation positively counters the present political impasse. Eurozone finance ministers have, however, rejected talks of a Greece exit. With a light economic calendar in the UK today, some major economic data across the Atlantic, including inflation and retail sales, is likely to keep traders on their toes.
Greek Tragedy Takes Centre Stage
Mon, 14 May 12 10:32 am
Against the backdrop of successive failures to form a government in Greece, markets keenly await the Spanish and Italian debt auctions later today. The outcome of these auctions is likely to be a key determinant of risk sentiment today. Risk appetite remains subdued despite the Chinese central bank cutting the amount of cash that banks must hold as reserves. At home, the Greek political conundrum has kept Sterling resilient against the Euro. Meanwhile, the BoE’s quarterly inflation report due Wednesday is likely to shed some light on factors that prompted the central bank not to opt for further stimulus.
QE Off The Table – For Now
Fri, 11 May 12 10:50 am
The BoE maintained a status quo monetary policy stance yesterday which proved highly supportive for Sterling against the majors. Concerns over the outlook for inflation poured cold water on market speculation for additional easing. Meanwhile, a sharp decline in Nationwide consumer confidence index, released earlier today, put pressure on the Pound. Risk appetite has taken a hit today following a huge unexpected trading loss from JPMorgan Chase, uninspiring Chinese economic data and ongoing Greek political deadlock. With little on offer in terms of European economic releases, markets await US consumer confidence and producer price inflation data due later today.
BoE Monetary Stance Awaited
Thu, 10 May 12 10:52 am
The spotlight in today’s trading session undoubtedly lies on the BoE’s interest rate decision. Most expect it to adopt a wait-and-watch approach. However, the dismal first quarter GDP data, coupled with subdued economic indicators, have fuelled market speculation for additional stimulus measures. Meanwhile, data just out revealed that annual industrial production continued to drop for March. In Europe, the Greek political dilemma continues, as the leader of Syriza party failed to form a government and it looks highly likely that there may be a re-election in mid-June. Across the Atlantic, jobless claims data due today is likely to generate some market interest.
No Respite in Sight
Wed, 09 May 12 11:55 am
The after-shocks of the recent elections in the Eurozone continue to put pressure on high yield currencies. The impasse among Greek leaders to form a coalition government has spurred market speculation that the nation may exit the Euro-area bloc. With little on offer in terms of economic releases in Europe and the US, markets may respond to the news flow emanating from Greece in today’s trading session. At home, like-for-like retail sales for April, as measured by the British Retail Consortium (BRC), surprised market participants on the downside earlier today and has turned focus onto the BoE’s monetary policy meeting scheduled tomorrow.
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Data just out indicated that UK consumer price inflation eased for April. Weak CPI, coupled with a...
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