Trading News to Watch Next Week (26 – 30 November 2018)

Hello, and welcome to our latest economic report! From the looks of it, November is poised to exit the 2018 market scene just as energetically as it had made its entrance, promising to bring yet another batch of important (and therefore exciting) economic events for all of us to keep tabs on.

In a nutshell, the hottest events for the 26-30 November interval shape up to be:

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  • CB Consumer Confidence (USD);
  • RBNZ Financial Stability Report (NZD);
  • Bank Stress Test Results (GBP);
  • FOMC Meeting Minutes (USD).

With that said, let’s review these and many other events in more detail.

Monday, 26 November 2018

 

EUR – German Ifo Business Climate – 10:00 am (Medium Impact)

Tracks the level of a composite index based on a survey of about 7 000 manufacturers, builders, wholesalers, services, and retailers which asks respondents to rate the relative level of current business conditions and expectations for the next 6 months.

The survey 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 index value of 102.8 slightly underperforms vs. a 103.1 forecast.

NZD – Trade Balance – 10:45 pm (Medium 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. An actual value difference of -1560M greatly underperforms vs. a -1365M forecast.

Tuesday, 27 November 2018

 

All – OPEC-JMMC Meetings – Tentative (Medium Impact)

OPEC-JMMC meetings are attended by representatives from the 13 OPEC members and 11 other oil-rich nations. They discuss a range of issues regarding energy markets and, most importantly, agree on how much oil they will produce.

The meetings are closed to the press but officials usually talk with reporters throughout the day, and a formal statement covering policy shifts and meeting objectives is released after the meetings have concluded.

*OPEC: The Organization of Petroleum Exporting Countries

*JMMC: Joint Ministerial Monitoring Committee

USD – CB* Consumer Confidence – 4:00 pm (High Impact)

Tracks the level of a composite index based on a survey of about 5 000 households which asks respondents to rate the relative level of current and future economic conditions including labor availability, business conditions, and overall economic situation.

*CB: The Conference Board

NZD – RBNZ* Financial Stability Report – 9:00 pm (High Impact)

The report provides insights into the bank’s view of inflation, growth, and other economic conditions that will affect interest rates in the future.

A media conference is usually held 120 minutes after release time and is webcasted from the RBNZ website.

*RBNZ: Reserve Bank of New Zealand

Wednesday, 28 November 2018

UK banks stress test
Source: DF Markets
GBP – Bank Stress Test Results – Tentative (High Impact)

The stress test applies synthetic market conditions to the balance sheets of large banks in an effort to determine the banks’ stability and capital reserve adequacy.

GBP – BOE Financial Stability Report – Tentative (Medium Impact)

The report contains an assessment of certain conditions in the financial system and potential risks to financial stability—the evidence on strains and imbalances can provide insight into the future of monetary policy.

USD – Prelim GDP q/q – 2:30 pm (High Impact)

Shows the annualised change in the value of all goods and services produced by the economy. The index is the broadest measure of economic activity and the primary gauge of the economy’s health.

USD – Crude Oil Inventories – 4:30 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 metric acts as 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 number of 4.9M is vastly greater than the forecasted 2.5M.

Thursday, 29 November 2018

 

NZD – ANZ Business Confidence – 1:00 am (High Impact)

Tracks the level of a diffusion index based on a survey of about 1 500 manufacturers, builders, retailers, agricultural firms, and service providers.

The report 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 0.0 indicates optimism, below indicates pessimism. An actual index value of -37.1 for October beats a -38.3 index performance for September.

AUD – Private Capital Expenditure q/q – 1:30 am (High Impact)

Shows the change in the total inflation-adjusted value of new capital expenditures made by private businesses. The report is a leading indicator of economic health—businesses are quickly affected by market conditions, and changes in their investment levels can be an early signal of future economic activity such as hiring, spending, and earnings.

An actual index value of -2.5% completely fails to meet a 0.6% forecast.

All –  G20 Meetings – All Day (Medium Impact)

G20 meetings are attended by finance ministers and central bankers from 20 industrialised nations including the G7 nations—Canada, Italy, France, Germany, Japan, the UK, and the US.

The meetings are closed to the press but officials usually talk with reporters throughout the day, and a formal statement covering policy shifts and meeting objectives is released after the meetings have concluded.

GBP – Net Lending to Individuals m/m – 10:30 am (Medium Impact)

Shows the change in the total value of new credit issued to consumers. The report is correlated with consumer spending and confidence—rising debt levels are a sign that lenders feel comfortable issuing loans, and that consumers are confident in their financial position and thus eager to spend money.

An actual value of 4.7B is miles ahead of a 4.1B forecast.

CAD – Current Account – 2:30 pm (Medium Impact)

Shows the difference in value between imported and exported goods, services, investment income, and current transfers during the previous quarter.

The statistic is directly linked to currency demand—a rising surplus indicates that foreigners are buying more of the domestic currency to execute transactions in the country.

An actual value difference of -15.9B underperforms vs. a -15.3B forecast.

USD – Core PCE* Price Index m/m – 2:30 pm (Medium Impact)

Tracks the change in the price of goods and services purchased by consumers, excluding food and energy. The index differs from Core CPI in that it only measures goods and services targeted towards and consumed by individuals.

An actual price change of 0.2% edges slightly ahead of a 0.1% forecast.

*PCE: Personal Consumption Expenditures

FOMC meeting
Source: DF Markets
USD – FOMC* Meeting Minutes – 8:00 pm (High Impact)

Contains 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;

*FOMC: Federal Open Market Committee

Friday, 30 November 2018

 

CNY – Manufacturing PMI – 2:00 am (Medium Impact)

Shows the level of a diffusion index based on a survey of 3000 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 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.

An actual diffusion index value of 50.2 slightly underperforms vs. a 50.6 forecast.

*PMI: Purchasing Managers’ Index

CHF – KOF Economic Barometer– 9:00 am (Medium Impact)

Gauges the level of a composite index based on 219 economic indicators. This index is designed to predict the direction of the economy over the next 6 months.

The barometer contains a combined reading of 219 economic indicators related to banking confidence, production, new orders, consumer confidence, exchange rate, money supply, interest rate spreads, stock market prices, and housing.

EUR – Core CPI Flash Estimate y/y – 11:00 am (Medium Impact)

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

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 1.1% confirms a forecast of the same value.

CAD – GDP m/m – 2:30 pm (High Impact)

Shows the change in the inflation-adjusted 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.

An actual value change of 0.1% slightly edges ahead of a 0.0% forecast.

USD – Chicago PMI – 3:45 pm (Medium Impact)

Tracks the level of a diffusion index based on a survey of around 200 purchasing managers in the Chicago area, asking respondents to rate the relative level of business conditions including employment, production, new orders, prices, supplier deliveries, and inventories.

An actual index value of 58.4 underperforms vs. a 60.1 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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