Trading News to Watch Next Week (10-14 December 2018)

The Christmas holidays being just around the corner, yet the recent arrest of the daughter of the CEO of Huawei and the significant setback of some major indices have left the markets in a rather sour mood. That said, there are still many events that every investor should definitely not miss out on, starting with:

  • NAB Business Confidence (AUD);
  • FED Chair Powell Testifies (USD);
  • SNB Press Conference (CHF).

Ready to view the full list of events? Let’s dive right in.

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Monday, 10 December 2018

 

GBP – GDP m/m – 10:30 am (High Impact)

Shows the change in the total value of all goods and services produced by the economy. The metric acts as the broadest measure of economic activity and the primary gauge of the economy’s health.

Last month, an actual value change of 0.0% slightly underperformed vs. a 0.1% forecast.

GBP – Manufacturing Production m/m – 10:30 am (High Impact)

Tracks the change in the total inflation-adjusted value of output produced by manufacturers. 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.

The metric acts as 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.

Last month, an actual value change of 0.2% slightly outperformed a 0.1% forecast.

Tuesday, 11 December 2018

 

AUD – HPI q/q – 1:30 am (Medium Impact)

Tracks the change in the selling price of homes in the nation’s 8 state capitals. It’s a leading indicator of the housing industry’s health because rising house prices attract investors and spur industry activity.

An actual home price change of -0.7% for the previous quarter confirmed a forecast of the same value.

AUD – NAB Business Confidence – 1:30 am (Medium Impact)

Measures the level of a diffusion index based on a survey of about 350 businesses which asks respondents to rate the relative level of current business conditions.

This is a leading indicator of economic health—businesses react quickly to market conditions, and changes in their sentiment can be an early signal of future economic activity such as spending, hiring, and investment.

Above 0 indicates improving conditions, while below that indicates worsening conditions. An actual diffusion index value of 4 for November underperformed vs. a value of 6 for October.

GBP – Average Earnings Index 3 m/y – 10:30 am (High Impact)

Tracks the change in the price businesses and the government pay for labor, including bonuses. The metric is a leading indicator of consumer inflation—when businesses pay more for labor the higher costs are usually passed on to the consumer.

Last month, an actual price change of 3.0% confirmed a forecast of the same value.

GBP – Unemployment Rate – 10:30 am (Medium Impact)

Tracks the percentage of total workforce that is unemployed and actively seeking employment during the past 3 months.

Last month, an actual unemployment rate of 4.1% slightly underperformed vs. a 4.0% forecast.

USD – PPI m/m – 2:30 pm (High Impact)

Shows the change in the price of finished goods and services sold by producers. The index is a leading indicator of consumer inflation—when producers charge more for goods and services the higher costs are usually passed on to the consumer.

Last month, an actual price change of 0.6% outperformed a 0.2% forecast.

GBP – Parliament Brexit Vote – Tentative (High Impact)

Standing at a Brexit crossroad

Source: DF Markets

The UK Parliament will vote to decide on whether to greenlight the deal with the European Union in regards to article 50.

The result will likely be projected before the official vote count is announced, based on early vote counts. A simple majority will be needed to pass the bill.

Wednesday, 12 December 2018

 

USD – Fed Chair Powell Testifies – Tentative (High Impact)

Due to testify on the economic outlook before the Joint Economic Committee of Congress, in Washington DC. As head of the central bank, which controls short term interest rates, Powell has more influence over the nation’s currency value than any other person.

Traders scrutinise his public engagements as they are often used to drop subtle clues regarding future monetary policy.

USD – CPI m/m – 2:30 pm (High Impact)

Shows the change in the price of goods and services purchased by consumers. The average price of various goods and services are sampled and then compared to the previous sampling.

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.

Last month, an actual price change of 0.3% confirmed a forecast of the same value.

USD – Core CPI m/m – 2:30 pm (High Impact)

Tracks the change in the price of goods and services purchased by consumers, excluding food and energy. 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.

Last month, an actual price change of 0.2% confirmed a forecast of the same value.

USD – Crude Oil Inventories – 4:30 pm (Medium Impact)

Tracks the change in the number of barrels of crude oil held in inventory by commercial firms during the past week. The report acts as the primary gauge of supply and demand imbalances in the market, which can lead to changes in production levels and price volatility.

Last week, an actual barrel count of 3.6M starkly contrasted with a 0.6M forecast.

Thursday, 13 December 2018

 

CHF – Libor Rate – 9:30 am (High Impact)

The event will contain information regarding the London interest rate for 3-month Swiss franc deposits. The Swiss National Bank usually announces a target range for Libor, and the midpoint is considered the target rate unless specifically stated otherwise.

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.

An actual interest rate of -0.75% for the previous quarter confirmed a forecast of the same value.

CHF – SNB Monetary Policy Assessment – 9:30 am (High Impact)

Upcoming Monetary Policy Assessment by the Swiss National Bank

Source: DF Markets

It’s the primary tool the Swiss National Bank Governing 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 projects the economic outlook and offers clues on the outcome of future rate decisions.

CHF – SNB Press Conference – 10:00 am (High Impact)

The conference is among the primary tools the SNB Governing Board uses to communicate with investors about monetary policy and the economic outlook.

EUR – Main Refinancing Rate – 1:45 pm (High Impact)

Tracks the interest rate on the main refinancing operations that provide the bulk of liquidity to the banking system. During the event, the 6 members of the ECB Executive Board and 15 of the 19 governors of the Euro area central banks vote on where to set the rate, via rotation.

The split of votes is not publicly revealed. The rate decision is usually priced into the market, so it tends to be overshadowed by the ECB Press Conference, held 45 minutes later.

A previous interest rate of 0.00% confirmed a forecast of the same value.

EUR – ECB Press Conference – 2:30 pm (High Impact)

The press conference is about an hour long and has 2 parts—first a prepared statement is read, then the conference is open to press questions. The questions often lead to unscripted answers that create heavy market volatility.

The press conference is among the primary methods that the European Central Bank uses to communicate with investors regarding monetary policy. It covers in detail the factors that affected the most recent interest rate and other policy decisions, such as the overall economic outlook and inflation. It also provides clues regarding future monetary policy.

Friday, 14 December 2018

 

CNY – Industrial Production y/y – 3:00 am (Medium Impact)

Shows the change in the total inflation-adjusted value of output produced by manufacturers, mines, and utilities. Chinese data can have a broad impact on the currency markets due to China’s influence on the global economy and investor sentiment.

The industrial production metric is a leading indicator of economic health—production is the dominant driver of the economy and reacts quickly to ups and downs in the business cycle.

Last month, a previous value change of 5.9% slightly topped a 5.8% forecast.

EUR – Flash Services PMI – 10:00 am (Medium Impact)

Measures the level of a diffusion index based on a survey of about 600 purchasing managers which asks respondents to rate the relative level of business conditions including employment, production, new orders, prices, supplier deliveries, and inventories.

The index acts as 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.

Last month, an actual index value of 53.1 slightly underperformed vs. a 53.6 forecast.

USD – Core Retail Sales m/m – 2:30 pm (High Impact)

Tracks the change in the total value of sales at the retail level, excluding automobiles. While automobile sales account for about 20% of the total retail sales, they tend to be very volatile and distort the underlying trend. The core data is therefore thought to be a better gauge of spending trends.

Last month, an actual sales value change of 0.7% slightly outperformed a 0.5% forecast.

USD – Retail Sales m/m – 2:30 pm (High Impact)

Shows the change in the total value of sales at the retail level. The report acts as the primary gauge of consumer spending, which accounts for the majority of overall economic activity.

Last month, an actual sales value change of 0.8% slightly outperformed a 0.6% forecast.

 

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Missed our previous report? Visit us here to 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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