Trading News to Watch Next Week (01 – 05 October 2018)

On Wednesday, the US Federal Reserve hiked the interest rates by a quarter point to 2.25%, a fund target rate not reached since the 2008 economic crisis.

But while we cautiously keep an eye on credit card rates, house prices, and our retirement savings, it’s also worth checking out next week’s potential market shifters, of which there are many: Manufacturing PMI (GBP), Unemployment Rate (USD), RBA Rate Statement (AUD) and more.

 

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Monday, 01 October 2018

 

EUR – German Retail Sales m/m – 1st-5th (Medium Impact)

Tracks the change in the total value of inflation-adjusted sales at the retail level, excluding automobiles and gas stations.

This report is the primary gauge of consumer spending, which accounts for the majority of overall economic activity.

An actual value change of -0.4% underperforms vs. a forecast of -0.1%.

GBP – Manufacturing PMI – 9:30 am (High Impact)

The PMI* shows the level of a diffusion index based on a survey of 600 purchasing managers in the manufacturing industry. In it, respondents are asked to rate the relative level of business conditions including employment, production, new orders, prices, supplier deliveries, and inventories.

The report a leading indicator of economic health—businesses react quickly to market conditions, and their purchasing managers hold perhaps the most current and relevant insight into the company’s view of the economy.

Above 50.0 indicates industry expansion, while below that indicates contraction. An actual index value of 52.8 slightly underperforms vs. a forecast of 53.9.

*PMI Purchasing Managers’ Index

USD – ISM Manufacturing PMI – 3:00 pm (High Impact)

Shows the level of a diffusion index based on a survey of about 400 purchasing managers in the manufacturing industry. In it, respondents are asked to rate the relative level of business conditions including employment, production, new orders, prices, supplier deliveries, and inventories.

The report a leading indicator of economic health—businesses react quickly to market conditions, and their purchasing managers hold perhaps the most current and relevant insight into the company’s view of the economy.

Above 50.0 indicates industry expansion, while below that indicates contraction. An actual index value of 61.3 crushes a forecast of 57.6.

Tuesday, 02 October 2018

 

AUD – Cash Rate – 5:30 am (High Impact)

Tracks the interest rate charged on overnight loans between financial intermediaries. Short-term interest rates are the paramount factor in currency valuation—traders look at most other indicators merely to predict how rates will change in the future.

The actual rate remains unchanged at 1.50%, confirming a forecast of the same value.

AUD – RBA Rate Statement – 5:30 am (High Impact)

This RBA* statement is It’s among the primary tools the RBA Reserve Bank Board uses to communicate with investors about monetary policy.

It contains the outcome of their decision on interest rates and commentary about the economic conditions that influenced their decision.

Most importantly, it discusses the economic outlook and offers clues on the outcome of future decisions.

*RBA – Reserve Bank of Australia

GBP – Construction PMI – 9:30 am (High Impact)

Shows the level of a diffusion index based on a survey of about 170 purchasing managers in the construction industry.

In it, respondents are asked to rate the relative level of business conditions including employment, production, new orders, prices, supplier deliveries, and inventories.

Above 50.0 indicates industry expansion, while below that indicates contraction. An actual index value of 52.9 underperforms vs. a forecast of 54.9.

USD – FOMC* Member Quarles Speaks – 3:00 pm (Medium Impact)

Due to testify on the implementation of the economic growth, regulatory relief, and the Consumer Protection Act before the Senate Banking Committee, in Washington DC.

*FOMC – Federal Open Market Committee

Wednesday, 03 October 2018

 

GBP – Services PMI – 9:30 am (High Impact)

Shows the level of a diffusion index based on surveyed purchasing managers in the services industry.

In it, respondents are asked to rate the relative level of business conditions including employment, production, new orders, prices, supplier deliveries, and inventories.

The survey is a leading indicator of economic health—businesses react quickly to market conditions, and their purchasing managers hold perhaps the most current and relevant insight into the company’s view of the economy.

Above 50.0 indicates industry expansion, while below that indicates contraction. An actual index value of 54.3 slightly comes ahead of a forecast of 53.9.

USD – ADP Non-Farm Employment Change – 1:15 pm (High Impact)

Shows the estimated change in the number of employed people during the previous month, excluding the farming industry and government.

ADP* analyzes payroll data from more than 23 million workers to derive employment growth estimations. This data provides an early look at employment growth, usually 2 days ahead of the government-released employment data that it’s designed to mimic.

Job creation is an important leading indicator of consumer spending, which accounts for a majority of overall economic activity.

An actual number of 163K starkly underperforms vs. a forecast of 195K.

*ADP – Automatic Data Processing, Inc.

USD – ISM Non-Manufacturing PMI – 3:00 pm (High Impact)

Shows the level of a diffusion index based on a survey of about 400 purchasing managers, excluding those in the manufacturing industry.

In it, respondents are asked to rate the relative level of business conditions including employment, production, new orders, prices, supplier deliveries, and inventories.

Above 50.0 indicates industry expansion, while below that indicates contraction. An actual index value of 58.5 outperforms a forecast of 56.8.

USD – Crude Oil Inventories – 3:30 pm (High Impact)

Shows the change in the number of barrels of crude oil held in inventory by commercial firms during the past week.

This report is the primary gauge of supply and demand imbalances in the market, which can lead to changes in production levels and price volatility.

An actual barrel count of 1.9M is exceedingly higher than a forecast of -0.7M.

Thursday, 04 October 2018

 

AUD – Trade Balance – 2:30 am (Medium Impact)

Source: DF Markets

Тrading news for 01-05 October

Shows the difference in value between imported and exported goods and services during the reported month.

Export demand and currency demand are directly linked because foreigners must buy the domestic currency to pay for the nation’s exports. Export demand also impacts production and prices at domestic manufacturers;

A positive number indicates that more goods and services were exported than imported. An actual value difference of 1.55B crushes a forecast of 1.46B.

CAD – Ivey PMI – 3:00 pm (Medium Impact)

Shows the level of a diffusion index based on a survey of 175 purchasing managers selected geographically and by sector of activity.

In it, respondents are asked to rate the relative level of business conditions including employment, production, new orders, prices, supplier deliveries, and inventories.

The survey is a leading indicator of economic health—businesses react quickly to market conditions, and their purchasing managers hold perhaps the most current and relevant insight into the company’s view of the economy.

Above 50.0 indicates industry expansion, while below that indicates contraction. An actual index value of 61.9 slightly comes ahead of a forecast of 61.5.

Friday, 05 October 2018

 

AUD – Retail Sales m/m – 2:30 am (High Impact)

Shows the change in the total value of sales at the retail level. It’s the primary gauge of consumer spending, which accounts for the majority of overall economic activity.

An actual index value of 0.0% slightly underperforms vs. forecast of 0.3%.

CAD – Employment Change – 1:30 pm (High Impact)

Shows the change in the number of employed people during the previous month. This is vital economic data released shortly after the month ends. The combination of importance and earliness makes for hefty market impacts.

Job creation is an important leading indicator of consumer spending, which accounts for a majority of overall economic activity.

An actual index value of -51.6K brutally underperforms vs. a forecast of 5.1K.

CAD – Trade Balance – 1:30 pm (High Impact)

Shows the difference in value between imported and exported goods during the reported month.

Export demand and currency demand are directly linked because foreigners must buy the domestic currency to pay for the nation’s exports.

Export demand also impacts production and prices at domestic manufacturers.

A positive number indicates that more goods were exported than imported. About 75% of Canadian exports are purchased by the US. An actual value difference of -0.1B crushes a forecast of -1.1B.

CAD – Unemployment Rate – 1:30 pm (High Impact)

Shows the percentage of the total workforce that is unemployed and is actively seeking employment during the previous month.

Although it’s generally viewed as a lagging indicator, the number of unemployed people is an important signal of overall economic health because consumer spending is highly correlated with labor-market conditions.

An actual value of 6.0% fails to meet a forecast of 5.9%.

USD – Average Hourly Earnings m/m – 1:30 pm (High Impact)

Shows the change in the price businesses pay for labor, excluding the farming industry. It’s a leading indicator of consumer inflation—when businesses pay more for labor the higher costs are usually passed on to the consumer.

An actual value of 0.4% slightly outperforms a forecast of 0.2%.

USD – Non-Farm Employment Change – 1:30 pm (High Impact)

Tracks the change in the number of employed people during the previous month, excluding the farming industry.

This is vital economic data released shortly after the month ends. The combination of importance and earliness makes for hefty market impacts.

Job creation is an important leading indicator of consumer spending, which accounts for a majority of overall economic activity.

An actual value of 201K crushes a forecast of 191K.

USD – Unemployment Rate – 1:30 pm (High Impact)

Shows the percentage of the total workforce that is unemployed and is actively seeking employment during the previous month.

Although it’s generally viewed as a lagging indicator, the number of unemployed people is an important signal of overall economic health because consumer spending is highly correlated with labor-market conditions.

Unemployment is also a major consideration for those steering the country’s monetary policy

An actual value of 3.9% slightly underperforms to a forecast of 3.8%.

Missed our previous report? Catch up on last week’s top news. While you’re at it, don’t forget to also visit our Economic Calendar for extra details regarding each event.

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