Markets Today: Powell sitting, waiting, wishing
- More calming words from Powell et al, but 2019 Fed easing risks now priced out
I reckon Jack Johnson’s “Sitting Waiting Wishing” must have been at the top of Fed Chair Jay Powell’s playlist this week. Certainly that’s the sentiment expressed in his latest utterances, where he told the Economic Club in Washington overnight that, “You should anticipate that we’re going to be patient, and watching, and waiting, and seeing”, reiterating his soothing comments made at the end of last week that have helped support risk sentiment. As for “wishing”, Powell noted that the current Fed median (‘dot’) projections are conditioned on a very strong 2019 outlook.
- AU Retail Sales and US CPI due
The Aussie dollar is the best performing G10 currency in the past 24 hours and only one to be up against an otherwise firmer US dollar (overnight high of 0.7198, 0.7185 now). Instrumental to the gains has been the appreciation of the Chinese Yuan yesterday afternoon and which has also dragged most of EM Asia FX up in its slipstream. USD/CNY fell from around 6.82 to 6.78 yesterday, a gain of over 0.5%.
- UK monthly GDP eyed as Brexit stalemate continues
The UK will also publish industrial output and trade stats next week, along with monthly GDP data. Despite the Brexit gloom and the gridlock in Parliament on the withdrawal deal, the UK economy does not appear to have slowed down any more than its European counterparts and probably managed growth of 0.1% month-on-month in November, GDP estimates on Friday are anticipated to show. Friday’s numbers will also include services, industrial and manufacturing output, along with the trade balance. Read more @ https://www.xm.com/week-ahead-factory-data-to-remain-in-focus-boc-to-start-off-2019-central-bank-meetings-92755
NEWS RELEASE TO WATCH OUT FOR TODAY
1. AUD Retail Sales m/m – It’s the primary gauge of consumer spending, which accounts for the majority of overall economic activity;
2. GBP GDP m/m – It’s the broadest measure of economic activity and the primary gauge of the economy’s health;
3. GBP Manufacturing Production m/m – It’s a leading indicator of economic health – production reacts quickly to ups and downs in the business cycle and is correlated with consumer conditions such as employment levels and earnings;
4. USD CPI m/m – Consumer prices account for a majority of overall inflation. Inflation is important to currency valuation because rising prices lead the central bank to raise interest rates out of respect for their inflation containment mandate;
5. USD Core CPI m/m – Consumer prices account for a majority of overall inflation. Inflation is important to currency valuation because rising prices lead the central bank to raise interest rates out of respect for their inflation containment mandate;
WHAT DOES OUR TECHNICAL CHARTS SAYING?
High Risk Investment Warning:
Please note that Forex and other leveraged trading involves significant risk of loss, It is not suitable for all traders and you should make sure you understand the risks involved, it is recommended that you seek an independent advice, if necessary.