Mon, Aug 05, 2024 @ 18:14 GMT
Facebook Mail RSS Twitter
Live Comments Page 113

Live Comments

Random

Italy to cut debt to 129.2% of GDP in 2019 to address EU concern

    By
    ActionForex.com
    -

    According to the new draft budget plan (DBP) submitted by Italy to the European commission, growth forecasts are held unchanged at 1.5% in 2019, 1.6% in 2020 and 1.4% in 2021. These are widely seen as overly optimistic as European Commission forecasts only 1.2% growth in 2019. The IMF projects only 1.0% growth in Italy in the same year. The budget deficit target was also held at 2.4% of GDP in 2019. Among that, Italy planned to raise its structural deficit by 0.8% of GDP. This is clearly a violation of EU’s demand to cut by -0.6%.

    However, the new draft showed fall debt as Italy planned to use funds equal to 1% of GDP from privatization. This is seen as an act to address EU’s major concern on ballooning debt. Public debt is now estimated to fall to 129.2% of GDP in 2019, then further to 127.3% in 2020, and then 126.0% in 2021. Italy’s debt stands at 130.9% this year.

    The new DBP now risk triggering the Commission’s penalty process. But Italian Deputy Prime Minister Matteo Salvini warned that “they’ve got it wrong if they are even just thinking of imposing fines on the Italian people.” Economy Minister Giovanni Tria also insisted that fiscal expansion is necessary for the country.

    RBNZ Orr will keep monetary support going for as long as necessary

      By
      ActionForex.com
      -

      RBNZ Governor Adrian Orr said in a article said the central bank recognized the “threat of COVID-19 to our collective well-being “. It will “keep monetary support going for as long as necessary through QE and other tools.”

      He also noted that there are “some very hard yards ahead” while “some businesses will fail, unemployment will rise”. But “many firms will make it through this period through working with their bankers and their own team, and understanding and utilising the Government’s significant and expanding support packages”

      He urged New Zealanders to “support each other, think beyond just the next six months or more, and visualise the role you can and will play in the vibrant, refreshed, sustainable, inclusive New Zealand economy.

      German GDP grew 0.1% in Q3, avoided technical recession

        By
        ActionForex.com
        -

        Germany GDP grew 0.1% qoq in Q3, beat expectation of -0.1% qoq. Returning to growth suggests that the Eurozone’s largest economy had avoided a technical recession. Over the year, GDP grew 0.5% yoy, price and calendar adjusted. Economy Minister Peter Altmaier  said “we do not have a technical recession, but the growth numbers are still too weak.”

        Full release here.

        Japan exports jumped 38% yoy in Apr, fastest in more than a decade

          By
          ActionForex.com
          -

          Japan’s exports rose 38.0% yoy to JPY 7181B in April. That’s the fastest growth in more than a decade since 2010, as led by US bound shipments of cars and parts. Also, Chinese demand for chip-making equipment was also a boost. Exports to China jumped 33.9% yoy while exports to the US rose 45.1% yoy. Imports rose 12.8% yoy to 6925B. Trade surplus came in at JPY 255B.

          In seasonally adjusted terms, exports rose 2.5% mom to JPY 6856B. Imports rose 7.5% mom to JPY 6791B. Trade surplus narrowed to JPY 65B.

          Also from Japan, machine orders rose 3.7% mom in March, below expectations of 6.4% mom.

          Australia consumer sentiment jumped 9.4% on RBA pause

            By
            ActionForex.com
            -

            Australia Westpac Melbourne Institute Consumer Sentiment Index witnessed a significant 9.4% increase in April, jumping from 78.4 in March to 85.8. This remarkable recovery can be largely attributed to RBA’s decision to pause rate hikes during its April meeting, breaking a sequence of ten consecutive meetings with cash rate increases.

            However, confidence remains weak, sitting -10.4% lower than April of the previous year, before the tightening cycle began. Respondents continue to exercise caution, with 34.11% still expecting the Standard Variable Rate to rise by more than 1% over the year, although this figure is down from 44.55%.

            Regarding the RBA’s meeting on May 2, Westpac noted that the central bank would benefit from a clean read on underlying inflation from the March quarter Inflation Report, set to be released on April 26, as well as staff’s refreshed economic forecasts. Westpac anticipates that a final 0.25% increase in the cash rate during the May Board meeting would be the best policy approach, rather than waiting for additional information and risking higher rates later in the cycle.

            Full Australia Westpac consumer sentiment release here.

            BoJ Adachi: We should not forget strong yen led to two lost decades

              By
              ActionForex.com
              -

              BoJ board member Seiji Adachi said, “with the impact of the pandemic continuing, shifting to tighter monetary policy now would inflict huge damage to business and household activity… It’s premature to move toward tighter policy.”

              “If the bank uses monetary policy to respond to short-term fluctuations (in exchange rates) before achieving its goal for underlying inflation, it would bring negative effects on the Japanese economy,” he said.

              “We should not forget that a strong yen was among factors that led to Japan’s prolonged deflation and two ‘lost’ decades” of economic stagnation, he added.

              US NFP rose only 155k, missed expectation, wage growth also missed

                By
                ActionForex.com
                -

                US non-farm payroll report came in generally weaker than expected. NFP showed only 155k growth in November, well below expectation of 200k. Prior month’s figure was also revised down from 250k to 237k. Unemployment rate, though, as unchanged at 3.7% and matched expectation. Meanwhile, average hourly earnings rose only 0.2% mom, missed expectation of 0.3% mom. The data adds to the argument that while US job growth is still strong, momentum has already peaked.

                Full release here.

                Eurozone PMI composite rose to 50.2, escaping recession but renewed contraction shouldn’t be ruled out

                  By
                  ActionForex.com
                  -

                  Eurozone PMI Manufacturing rose from 47.8 to 48.8 in January, above expectation of 48.1. PMI services rose from 49.8 to 50.7, above expectation of of 49.4, and back in expansion. PMI Composite rose from 49.3 to 50.2, a 7-month high.

                  Chris Williamson, Chief Business Economist at S&P Global Market Intelligence said:

                  “A steadying of the eurozone economy at the start of the years adds to evidence that the region might escape recession…. The region is by no means out of the woods yet, however, as demand continues to fall – merely dropping at a reduced rate… The case for higher interest rates is fuelled further by the upturn in employment growth recorded during the month and signs of higher wages driving the latest upturn in price pressures.

                  “A case for policy caution is supported by the survey merely indicating a stagnation of the eurozone economy, hinting that a renewed slide into contraction should not be ruled out as borrowing costs rise, but the survey undoubtedly brings welcome good news to suggest that any downturn is likely to be far less severe than previously feared and that a recession may well be avoided altogether.”

                  Full release here.

                  CAD/JPY pressing 55 day EMA support as BoC awaited

                    By
                    ActionForex.com
                    -

                    BoC meeting is a major focus today and it will undoubtedly keep monetary unchanged. The overnight rate target will be held at effective lower bound of 0.25%. Large-scale asset purchase will continue at CAD 5B per week pace. Governor Tiff Macklem should reiterate the pledge to ” hold the policy interest rate at the effective lower bound until economic slack is absorbed so that the 2 percent inflation target is sustainably achieved.”

                    GDP data for May (4.8% mom) and June (6.5) suggest that slightly stronger than expected recovery is underway. Yet, the path ahead remains largely uncertain, depending on the coronavirus, vaccines and treatments. Hence, while Macklem might acknowledge the pleasant surprises of the economic data, the overall tone would remain cautious. Topics like yield curve control and Fed’s style average inflation targeting might be discussed. But there is no pressing need for any change as of now.

                    Canadian Dollar is currently the second worst performing one next to Sterling, as dragged down by the steep fall in oil prices. CAD/JPY is now pressing key near term support at 79.88, as well as 55 day EMA. Sustained break there will confirm the completion of rise from 77.61 to 81.58. We should at least see a deeper decline back to 81.58 support for the near term in that case.

                    China Shanghai Composite down but not out, AUDUSD attempts down trend resumption

                      By
                      ActionForex.com
                      -

                      Following selloff in Asia, Major European indices are all trading in red in initial trading. At the time of writing, DAX is down -1.4%, CAC down -1.2%, FTSE down -1.3%. But they are kept well above last week’s low, suggesting that selling is not too serious.

                      The China SSE composite closed down -49.85 pts, or -1.76% at 2777.77. While SSE lose 2800 handle again, it’s kept well above last week’s low at 2691.02. We’ve mentioned a number of times that 2638.30 – 2700 zone represents important support level. Judging from the fact that SSE close just slightly lower than open at 2780.70, there was no panic selling. We’re holding on to the case that 2691.02 is at least a short term bottom and there should be another rise through 2848.37 to extend the corrective rebound.

                      In the currency markets, Australian Dollar remains the weakest one for today, with AUD/USD as the biggest loser.

                      From Action Bias point of view, the string of downside red bar in H Action Bias is hinting at down trend resumption. The break of 0.7414 minor support today is another signal on it. But we’d wait for 6H Action Bias to turn red too to give us more confidence on it. After all, we see 0.7328 as an important medium term support that takes some determination to break.

                      Eurozone Sentix fell to -17, Germany the biggest problem child

                        By
                        ActionForex.com
                        -

                        Eurozone Sentix Investor Confidence dropped from -13.1 to -17 in June, well below expectation of -9.2. Current Situation index dropped from -7.0 to -15.8. But Expectations index ticked up from -19.0 to -18.3.

                        Sentix noted: “The biggest problem child in the Eurozone remains Germany, which plummets dramatically in the sentix economic indices. The situation collapses to -22 points, expectations fall again slightly to -20.3 points. The overall index plunges to -21.1 points. All lows since Nov/Dec 2022.”

                        Sentix also said, “Eurozone economy continues to send weak signals at the beginning of June”, and “the clear slump in the assessment of the economic situation is particularly striking”.

                        Meanwhile, inflation expectations rose to -6, comparing to -44.25 a year ago. “Thus, positive inflation surprises are on the horizon,” Sentix said.

                         

                        Full Eurozone Sentix release here.

                        Eurozone PMIs showed renewed downturn in services

                          By
                          ActionForex.com
                          -

                          Eurozone PMI Manufacturing rose to 53.7 in September, up from 51.7, and beat expectation of 51.9. That’s also the highest level in 25 months. However, PMI services dropped to 47.6, down from 50.5, back in contraction and missed expectation of 50.5. PMI Composite dropped to 50.1, down from 51.9.

                          Chris Williamson, Chief Business Economist at IHS Markit said: “The eurozone’s economic recovery stalled in September, as rising COVID-19 infections led to a renewed downturn of service sector activity across the region. A two-speed economy is evident… The main concern at present is therefore whether the weakness of the September data will intensify into the fourth quarter, and result in a slide back into recession after a frustratingly brief rebound in the third quarter.”

                          Full release here.

                          Dollar extends decline as Trump blames Fed Chair Powell for rate hikes

                            By
                            ActionForex.com
                            -

                            Dollar stays generally weak in Asian session and extends Monday’s selloff, on Trump’s attack on Fed. In a Reuters interview, Trump reiterated his comments last month that “I’m not thrilled with his raising of interest rates, no. I’m not thrilled,” referring to Fed Chair Jerome Powell.

                            He complained the the US is not getting any support from the Fed during his negotiation with other countries. Trump noted, “we’re negotiating very powerfully and strongly with other nations. We’re going to win. But during this period of time I should be given some help by the Fed. The other countries are accommodated.”

                            Trump also fingered pointed Eurozone and China for currency manipulation to give them an advantage over the US on trade. He said . “I think China’s manipulating their currency, absolutely. And I think the euro is being manipulated also.”

                            DOW hits new record as focus turns to non-farm payrolls

                              By
                              ActionForex.com
                              -

                              US non-farm payroll report will be a main focus today. Markets are expecting strong 950k growth in April, with unemployment rate down from 6.0% to 5.7%. Average hourly earnings are expected to rise 0.1% mom. Looking at related data, ISM manufacturing dropped from 59.6 to 55.1, but stayed well in expansion. ISM services employment rose from 57.2 to 58.8. ADP employment showed 742k growth. Four-week moving average of initial claims dropped to 560k. Overall, it’s just a matter of how strong the job market rebound had been.

                              DOW outperformed other major US indices and surged 0.93% to new record high at 34548.53 overnight. The strong close suggests that up trend is maintaining solid momentum. We’d expect current rise to target 100% projection of 18213.65 to 29199.35 from 26143.77 at 37129.47 next. In any case, outlook will stay bullish as long as 33687.01 support holds.

                              Bank of Korea raises interest rate, embarking normalization process

                                By
                                ActionForex.com
                                -

                                Bank of Korea raised interest rate by 0.25% to 0.75% today, becoming the first major Asian economy to hike. “The Board will gradually adjust the degree of monetary policy accommodation as the Korean economy is expected to continue its sound growth and inflation to run above 2% for some time, despite ongoing uncertainties over the virus,” the BOK said in its monetary policy statement.

                                Governor Lee Ju-yeol said, “we’ve decided to put the focus on reducing financial imbalances, and as we raise the rate, we are embarking on a process of normalizing policy in line with economic recovery.”

                                BoK maintained its forecast of 4% GDP growth this year. Consumer inflation forecast was, however, upgraded from 1.8% to 2.1%.

                                Full statement here.

                                Fed Mester supports gradual rate hike, against a steep path

                                  By
                                  ActionForex.com
                                  -

                                  Cleveland Fed President Loretta Mester she supports gradual rate hike “this year and next year”. At the same time, she’s “against a steep path” in tightening because “we want to give inflation time to move back to goal”. She sounds optimistic saying that “this year is shaping up to be another good year for the economy.” And for monetary policymakers, the task is to “calibrate policy to this healthy economy so that the expansion is sustained.”

                                  The government’s tax cut poses “some upside risk” to the forecast, and Mester expects a better read on household spending “over the next several months”. Globally, she noted that “for the first time in many years, economic activity around the world is picking up and forecasts for global growth are being revised up.” And, “this should have a positive feedback effect on the U.S. economy via exports.”

                                  Meanwhile, she warned that trade developments are a “risk to the forecasts”. And the uncertainty “may not be resolved quickly”. But it didn’t change her outlook for the over economy yet.

                                  New Zealand CPI accelerated, but RBNZ core CPI slowed

                                    By
                                    ActionForex.com
                                    -

                                    New Zealand CPI rose accelerated to 0.8% qoq in Q1, up from Q4’s 0.5% qoq, well above expectation of 0.3% qoq. Annual inflation rate rose to 2.5% yoy, highest since 2011. Impact of coronavirus pandemic was not much reflected in the data yet as lockdown measures started on March 25. Separately released, RBNZ’s own core CPI measures slowed to 1.7% yoy in Q1, down from 1.8% yoy.

                                    Separately, New Zealand Prime Minister Jacinda Ardern announced today that the country will “move out of Alert Level 4 lockdown at 11.59 p.m. on Monday April 27, one week from today”. Afterwards, “we will then hold in Alert Level 3 for two weeks, before reviewing how we are tracking again, and making further decisions at Cabinet on the 11th of May.”

                                    ECB’s Lagarde emphasizes wage growth as key determinant for rate cut decision

                                      By
                                      ActionForex.com
                                      -

                                      ECB President Christine Lagarde emphasized that the central bank is not yet ready to initiate rate cuts, underscoring the need for comprehensive data analysis

                                      In a CNN interview overnight, she stated, “We are not there yet,” added that the decision to loosen monetary policy hinges on “all sorts of data”. She also singled out the significance of wage data as “critically important.”

                                      Despite acknowledging a clear disinflationary trend, Lagarde noted that ECB requires a deeper understanding and progression into this trend to make a well-informed decision. “We are on a disinflationary trend — no question about it,” she confirmed, “But we need to be further into that process.”

                                      Lagarde’s remarks also touched upon the consensus within the ECB regarding the direction of the next policy move. “I think we all agree that the next move” will be a cut, she said, aligning with the general anticipation of eventual rate reductions. However, the timing remains uncertain and subject to thorough examination of upcoming economic data.

                                      A key factor in the timeline for interest rate cuts is the availability of wage growth data, which is not expected until after ECB’s April meeting. This positions the June meeting as a more likely juncture for the consideration of rate cuts.

                                      US durable goods orders dropped -2%, second decline in three months

                                        By
                                        ActionForex.com
                                        -

                                        US durable goods orders dropped -2.0% mom to USD 242.6B, well below expectation of 0.2%. Headline orders was down in two of the last three months. Ex-transport orders was flat, missed expectation of 1.5% rise. Ex-defense orders, on the other hand, rose 0.8%.

                                        Full release here.

                                        ECB Lagarde: Uncertainty requires careful assessment of information including exchange rate

                                          By
                                          ActionForex.com
                                          -

                                          ECB President Christine Lagarde said in a speech the central bank’s pandemic response measures has stabilized the markets, protected the supply of credit and support the recovery. That should in turn support the return of inflation towards target.

                                          But at the same time, “the uncertainty of the current environment requires a very careful assessment of the incoming information, including developments in the exchange rate, with regard to its implications for the medium-term inflation outlook.. ECB stands ready to adjust all of its instruments as appropriate.

                                          Lagarde’s full speech here.

                                          1...112113114...683Page 113 of 683

                                          ActionForex.com was set up back in 2004 with the aim to provide insightful analysis to forex traders, serving the trading community for over a decade. Empowering the individual traders was, is, and will always be our motto going forward.

                                          Contact us: contact@actionforex.com

                                          © ActionForex.com © 2024 All rights reserved.