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AFEX Market Watch Mon 12th December 2016
Monday Dec 12 No top tier data Tuesday Dec 13 02:00 CNY Industrial production YoY 09:30 GBP CPI YOY 10:00 EUR German ZEW economic sentiment
Wednesday Dec 14
09:30 GBP Average earnings
09:30 GBP Claimant count change
09:30 GBP Unemployment rate
10:00 CHF ZEW economic expectations
13:30 USD Core retail sales MoM
13:30 USD PPI MoM
15:30 USD Crude oil inventories
19:00 USD FOMC Projections, statement and interest rate decision
19:30 USD FOMC Press conference
Thursday Dec 15
02:30 AUD Employment change and unemployment rate
02:30 AUD RBA bulletin
08:30 CHF SNB rate decision and press conference
09:30 GBP Retail sales MoM
09:30 GBP MPC Interest rate decision
13:30 CAD Manufacturing sales MoM
13:30 USD CPI MoM
13:30 USD Philly Fed manufacturing index
16:15 BoC Gov Poloz speaks
Friday Dec 16
11:00 GBP CBI Industrial order expectations
12:00 GBP BoE Quarterly bulletin
13:30 USD Building permits
GBP - Sterling
· Last week saw GBPUSD get close to technical resistance levels before falling back as Brexit headlines continue to weigh on sterling.
· GBPEUR fared slightly better as the market priced in the ECB’s QE actions last week.
· This Wednesday we have UK unemployment data and Thursday morning retail sales are released before the BoE sets UK interest rates at lunchtime. Apparently there is another legal challenge to Brexit which is due to drag the Government through the courts and as such this will weigh upon the pound for some time to come.
EUR - Euro
· Last week Jean-Claude Juncker President of the European commission was speaking at an event to commemorate the EU’s landmark Maastricht treaty. In his remarks to fellow attendees he said that in 10 years Europe’s share in the world economy would fall to 15% from 25% now. In 20 years, no European countries would be part of the G7 group of the world’s top seven economies.
· This poor performance is reflected in the latest troubles that Italy is experiencing with the Italian banking industry urgently in need of assistance and youth unemployment hitting 36.4%.
· Italy has a new PM Gentiloni who was ex Foreign Minister and he has a lot to do. On his to do list could well be a rewriting of the election rules, with a reversion to proportional representation. If this happens then the anti-euro party 5 star movement could well be kept out of power. Whilst the Italian banking crisis rumbles on this will provide a negative backdrop for the Single currency.
USD - Dollar
· Last week’s economic data including the very positive ISM non-manufacturing PMI all points towards a rate hikeat this week’s FIOMC meeting on Wednesday.
· The market has priced this in so it will probably need hawkish comments from the Fed in the accompanying statement outlining more rate hikes next year for the Dollar to continue to rise in the short term.
· This week is really the last week of full market participation before the Christmas holidays and as such the market may well be even more thin and volatile after Friday.
Commonwealth et al
· It appears that Opec and other nations are managing to agree oil production cuts and as such the oil price has been pushing higher in recent days. This has helped the Loonie whilst the drop in the gold price has been a drag on the AUD. Australian employment data is due out on Thursday.
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