Trading News to Watch Next Week (15 – 19 October 2018)

Next week, some of the top events that are poised to steal the market spotlights include:

  • Treasury Currency Report (USD);
  • Monetary Policy Meeting Minutes (AUD);
  • EU Economic Summit (EUR).

Ready to find out what else next week has in store for all financial aficionados?

Brew a cup of coffee, find a comfortable chair, and let’s dig right in.

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Monday, 15 October 2018

 

USD – Core Retail Sales m/m – 1:30 pm (High Impact)

Tracks the change in the total value of sales at the retail level, excluding automobiles.

Automobile sales account for about 20% of Retail Sales, but they tend to be very volatile and distort the underlying trend.

An actual value change of 0.3% falls just short of reaching a 0.5% forecast.

USD – Retail Sales m/m – 1:30 pm (High Impact)

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

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

CAD – BOC Business Outlook Survey – 3:30 pm (High Impact)

A survey of about 100 businesses which asks respondents to rate the relative level of general business conditions, such as sales growth, investment in machinery, employment, inflation expectations, and credit conditions.

The report 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.

USD – Treasury Currency Report – Tentative (High Impact)

It provides a detailed review of global exchange rate policies, economic conditions, and central bank and government actions around the world. Most importantly, the report outlines countries that the Treasury deems currency manipulators.

NZD – CPI* q/q – 10:45 pm (High Impact)

Tracks the change in the price of goods and services purchased by consumers. The average price of various goods and services is 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.

An actual price change of 0.4% slightly underperforms vs. a 0.5% forecast.

*CPI – Consumer Price Index

Tuesday, 16 October 2018

 

AUD – Monetary Policy Meeting Minutes – 1:30 am (High Impact)

This is a detailed record of the RBA* Reserve Bank Board’s most recent meeting, providing in-depth insights into the economic conditions that influenced their decision on where to set interest rates.

*RBA – Reserve Bank of Australia

CNY – CPI y/y – 2:30 am (Medium Impact)

Tracks the change in the price of goods and services purchased by consumers. The average price of various goods and services is sampled and then compared to the sampling done a year earlier.

Consumer prices account for a majority of overall inflation. Inflation is important to currency valuation because rising prices lead the central bank to respond by raising interest rates.

An actual price change of 2.3% slightly comes ahead of a 2.1% forecast.

GBP – Average Earnings Index 3m/y – 9:30 am (High Impact)

Shows the change in the price businesses and the government pay for labor, including bonuses. The data represents the 3-month moving average compared to the same period a year earlier.

The index is a leading indicator of consumer inflation—when businesses pay more for labor the higher costs are usually passed on to the consumer.

An actual price change of 2.6% slightly comes ahead of a 2.4% forecast.

GBP – Claimant Count Change – 9:30 am (Medium Impact)

Monitors the change in the number of people claiming unemployment-related benefits 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 change of 8.7K crushes a positive 6.9K forecast.

GBP – Unemployment Rate – 9:30 am (Medium Impact)

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

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 4.0% confirms a forecast of the same value.

CAD – Foreign Securities Purchases – 1:30 pm (Medium Impact)

Tracks the total value of domestic stocks, bonds, and money-market assets purchased by foreigners during the reported month.

Demand for domestic securities and currency demand are directly linked because foreigners must buy the domestic currency to purchase the nation’s securities.

An actual value of 12.65B crushes a 4.35B forecast.

Wednesday, 17 October 2018

 

GBP – CPI y/y – 9:30 am (High Impact)

Shows the change in the price of goods and services purchased by consumers. The average price of various goods and services is sampled and then compared to the sampling done a year earlier.

This is considered the UK’s most important inflation data because it’s used as the central bank’s inflation target. 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.

An actual price change of 2.7% crushes a 2.4% forecast.

GBP – PPI Input m/m – 9:30 am (Medium Impact)

The PPI* index tracks the change in the price of goods and raw materials purchased by manufacturers.

It’s a leading indicator of consumer inflation—when manufacturers pay more for goods the higher costs are usually passed on to the consumer.

An actual price change of 0.5% comes slightly ahead of a 0.4% forecast.

PPI* – Producer Price Index

GBP – RPI y/y – 9:30 am (Medium Impact)

The RPI* index tracks the change in the price of goods and services purchased by consumers for the purpose of consumption.

RPI differs from CPI in that it only measures goods and services bought for the purpose of consumption by the vast majority of households, and it includes housing costs which are excluded from CPI.

An actual price change of 3.5% beats a 3.2% forecast.

*RPI – Retail Price Index

CAD – Manufacturing Sales m/m – 1:30 pm (Medium Impact)

Monitors the change in the total value of sales made by manufacturers.

The report is a leading indicator of economic health–manufacturers are quickly affected by market conditions, and changes in their sales can be an early signal of future activity such as spending, hiring, and investment.

An actual value of 0.9% falls just short of meeting a 1.0% forecast.

USD – Building Permits – 1:30 pm (Medium Impact)

Represents the annualised number of new residential building permits issued during the previous month.

The report is an excellent gauge of future construction activity because obtaining a permit is among the first steps in constructing a new building.

An actual count of 1.23M fails to meet a 1.31M forecast.

USD – Housing Starts – 1:30 pm (Medium Impact)

Represents the annualised number of new residential buildings that began construction during the previous month.

The report is a leading indicator of economic health because building construction produces a wide-reaching ripple effect.

For example, jobs are created for the construction workers, subcontractors and inspectors are hired, and various construction services are purchased by the builder.

An actual count of 1.28M exceeds a 1.24M forecast.

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

Shows 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.

Analysts are currently predicting a barrel number change of 2.3M.

USD – FOMC Meeting Minutes – 7:00 pm (High Impact)

This is a detailed record of the FOMC’s most recent meeting, providing in-depth insights into the economic and financial conditions that influenced their vote on where to set interest rates.

Thursday, 18 October 2018

Top events for 15-19 October

Source: DF Markets
AUD – Employment Change – 1:30 am (High Impact)

Tracks 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 count of 44.0K crushes a 16.5K forecast.

AUD – Unemployment Rate – 1:30 am (High Impact)

Shows the percentage of the total workforce that is unemployed and 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 5.3% confirms a forecast of the same value.

GBP – Retail Sales m/m – 9:30 am (High Impact)

Shows the change in the total value of inflation-adjusted sales at the retail level.

The report acts as the primary gauge of consumer spending, which accounts for the majority of overall economic activity.

An actual value change of 0.3% comes ahead of a -0.2% forecast.

EUR – EU Economic Summit – All Day (High Impact)

Due to meet about a range of global economic issues, including Brexit, and the economy, in Brussels.

USD – Philly Fed Manufacturing Index – 1:30 pm (Medium Impact)

Shows the level of a diffusion index based on a survey of 250 manufacturers in Philadelphia. In the survey, respondents are asked to rate the relative level of general business conditions.

The index 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.

An actual diffusion index value of of 22.9 crushes a 17.5 forecast.

Friday, 19 October 2018

 

CNY – GDP q/y – 3:00 am (High Impact)

Monitors the change in the inflation-adjusted value of all goods and services produced by the economy.

The index acts as the broadest measure of economic activity and the primary gauge of the economy’s health.

An actual value of 6.7% confirms a forecast of the same value.

CNY – Fixed Asset Investment ytd/y – 3:00 am (Medium Impact)

Tracks the change in the total spending on non-rural capital investments such as factories, roads, power grids, and property.

The report is a leading indicator of economic health—changes in private and public investment levels can be an early signal of future economic activity such as hiring, spending, and earnings.

An actual value of 5.3% falls just short of reaching a 5.5% forecast.

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

Monitors 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 report 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.

An actual value change of 6.1% comes slightly ahead of a a 6.0% forecast.

CNY – NBS Press Conference – 3:00 am (Medium Impact)

The press conference has 2 parts—first,  a prepared statement is read which announces the key economic numbers, then the conference is briefly open to press questions.

The questions sometimes lead to unscripted answers that can have a significant market impact.

GBP – Public Sector Net Borrowing – 9:30 am (Medium Impact)

Tracks the difference in value between spending and income for public corporations, the central government, and local governments during the previous month.

A positive number indicates a budget deficit, a negative number indicates a surplus. An actual value difference of 5.9B starkly underperforms vs. a 2.9B forecast.

CAD – CPI m/m – 1:30 pm (High Impact)

Shows the change in the price of goods and services purchased by consumers. The average price of various goods and services is 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.

An actual price change of -0.1% confirms a forecast of the same value.

CAD – Core Retail Sales m/m – 1:30 pm (High Impact)

Shows the change in the total value of sales at the retail level, excluding automobiles.

Automobile sales account for about 20% of Retail Sales, but they tend to be very volatile and distort the underlying trend.

An actual value change of 0.9% beats a 0.6% forecast.

CAD – Common CPI y/y – 1:30 pm (Medium Impact)

Shows the change in the price of goods and services, purchased by consumers, which have similar price variations over time. The average price of various goods and services is 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.

An actual price change of 2.0% is slightly greater than a 1.9% change for August.

CAD – Median CPI y/y – 1:30 pm (Medium Impact)

Tracks the change in the median price of goods and services purchased by consumers. The average price of various goods and services is 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.

An actual price change of 2.1% is slightly greater than a 2.0% change for August.

CAD – Retail Sales m/m – 1:30 pm (Medium Impact)

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

An actual value change of 0.3% confirms a forecast of the same value.

CAD – Trimmed CPI y/y – 1:30 pm (Medium Impact)

Shows the change in the price of goods and services purchased by consumers, excluding the most volatile 40% of items. The average price of various goods and services is 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.

An actual price change of 2.2% is slightly greater than a 2.1% change for August.

 

Missed our previous report? Follow this link 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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