Monday 31-07-2017 Outlook

Welcome to the easyMarkets weekly outlook starting this Monday 31 July. We’ll be looking at the week’s key economic events on the financial calendar covering Monday to Thursday. The week kicks off with inflation figures in from Europe and is followed by interest rates decisions from Australia on Tuesday and the UK on Thursday. In between those days we have GDP growth figures for the EU and key manufacturing data from the US. The week ends with the all-important employment data from the US with the Non-Farm Payrolls.

Event: EU Consumer Price Index

Date: Monday 31 July 2017 at 09:00 GMT

Markets affected: EUR/USD, EUR/GBP

Trending hashtags: #eur, #cpi

The Eurozone economy has been looking healthy recently with the IMF noting in a recent report that it is a main driver for the global economy. The CPI is a key measure for inflation which was sitting at 1.3% yearly change for the month of June and Core CPI, which strips away volatile goods like food and energy, was 1.2% annualised change.

Event: RBA Interest Rate Decision

Date: Tuesday 01 August 2017 at 04:30 GMT

Markets affected: AUD/USD, AUD/NZD

Trending hashtags: #aud, #interest rate

While Australia’s inflation rate levels have been within the Reserve Bank’s target of 2%, the Q1 slowdown may keep central bank officials from making any changes to the cash rate. Currently the rate sits at 1.5% and while positive data came in recently for employment, a decline in its main export partner, China’s GDP, may see the RBA keep the rate unchanged.

Event: EU Gross Domestic Product( Q2)

Date: Tuesday 01 August 2017 at 09:00 GMT

Markets affected: EUR/USD, EUR/GBP

Trending hashtags: #eur, #gdp

The first quarter for the Eurozone saw the economy expand by 1.9% on an annualised basis – and 0.6% better than the previous quarter. Growth forecasts for the Eurozone by the IMF has been positive, particularly for the four largest players including Spain, Italy, France and Germany.

Event: US ISM Manufacturing Index

Date: Tuesday 01 August 2017 at 14:00 GMT

Markets affected: EUR/USD, GBP/USD, XAU/USD

Trending hashtags: #usd, #ism

The previous ISM manufacturing index figure came in at a healthy 57.8 which is mostly seen as bullish for the dollar. Last week the USD fell against most of its major trading partners hitting multi-month lows so analysts are treating this indicator with caution as a number of other geopolitical events in the US are influencing the dollar strength. Mainly the investigations into Trump’s relationship with Russia and his ability to get through the promised tax cuts and infrastructure spend are the factors keeping the greenback under pressure.

Event: UK Interest Rate Decision

Date: Thursday 03 August 2017 at 11:00 GMT

Markets affected: GBP/USD, EUR/GBP

Trending hashtags: #gbp, #interestrate

The currently low 0.25% interest rate was sharply contested at the Bank of England’s last meeting. 5 members voted to maintain the rate but 3 voted to increase it – 2 more votes than what the markets were expecting. With inflation hitting above the desired 2% rate, the central bank may have its hand forced sooner than expected. However, uncertainty around Brexit negotiations have many analysts expecting the bank to stand pat on the decision for now.!/australia-national-australia-bank-business-conditions-prior-12-confidence-20170711

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Source:: Monday 31-07-2017 Outlook

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