Trading News to Watch Next Week (7-11 January 2019)

Economic-news-for-7-11-january

Source: DF Markets

2019 has officially begun, and already there seems to be a barrage of important economic speeches and monetary policy reports to look forward to. Here are some examples:

  • Speech from Fed Chair Powell;
  • Speech from BOE Gov Carney;
  • BOC Monetary Policy report.

Please view the full list of upcoming events below.

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Monday, January 7

 

CAD – Ivey PMI – 4:00 pm (Medium Impact)

Tracks the level of a diffusion index based on a survey of about 175 purchasing managers, selected geographically and by sector of activity to match the economy as a whole, 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 insights into the company’s view of the economy.

Above 50.0 indicates industry expansion, while below that indicates contraction. Аn actual index value of 57.2 for the previous month underperformed vs. a 59.9 forecast.

USD – ISM Non-Manufacturing PMI – 4:00 pm (High Impact)

Shows the level of a diffusion index based on a survey of about 400 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 insights into the company’s view of the economy.

Above 50.0 indicates industry expansion, while below that indicates contraction. An actual index value of 60.7 for the previous month slightly topped a 59.1 forecast.

Tuesday, January 8

 

AUD – Trade Balance – 1:30 am (Medium Impact)

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 2.32B for the previous month failed to meet a 3.10B forecast.

CAD – Trade Balance – 2:30 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. An actual value difference of -1.2B for the previous month greatly underperformed vs. a -0.7B forecast.

Wednesday, January 9

 

JPY – Average Cash Earnings y/y – 1:00 am (Medium Impact)

Tracks the change in the total value of employment income collected by workers. Income is correlated with spending—the more disposable income consumers have, the more likely they are to increase spending.

An actual employment income difference  of 1.5% for the previous month outperformed a 1.0% forecast.

AUD – Building Approvals m/m – 1:30 am (Medium Impact)

Tracks the change in the number of new building approvals issued. The metric is an excellent gauge of future construction activity since obtaining government approval is among the first steps in constructing a new building.

An actual value difference of -1.5% for the previous month slightly underperformed vs. a -1.4% forecast.

CAD – BOC Monetary Policy Report – 4:00 pm (High Impact)

Bank of Canada monetary policy report

Source: DF Markets

The report contains valuable insight into the bank’s view of economic conditions and inflation—the key factors that will shape the future of monetary policy and influence their interest rate decisions.

CAD – BOC Rate Statement – 4:00 pm (High Impact)

It’s the primary tool the Bank of Canada 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.

CAD – Overnight Rate – 4:00 pm (High Impact)

Shows the interest rate at which major financial institutions borrow and lend overnight funds between themselves. 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.

On Dec 5 2018, the BOC Governing Council left the interest rate unchanged at 1.75%, which confirmed a forecast of the same value.

CAD – BOC Press Conference – 4:15 pm (High Impact)

The conference is among the primary method the BOC uses to communicate with investors regarding monetary policy. It covers in detail the factors that affected the most recent interest rate decision, such as the overall economic outlook and inflation.

The press conference 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.

GBP – BOE Gov Carney Speaks – 4:30 pm (High Impact)

Due to participate in an online question and answer session about the future of money at the Bank of England’s Future Forum. As head of the central bank, which controls short term interest rates, Mark Carney 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 – Meeting Minutes – 8:00 pm (High Impact)

This is a detailed record of the Federal Open Market Committee’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, January 10

 

GBP – BOE Credit Conditions Survey – 10:30 am (Medium Impact)

Bank of England

Source: DF Markets

This report includes detailed data on secured and unsecured lending to households, small businesses, non-financial corporations, and non-bank financial firms. The data is based on a survey of bank and non-bank lenders which asks respondents to rate the relative level of credit conditions in the past 3 months and next 3 months.

EUR – ECB Monetary Policy Meeting Accounts – 1:30 pm (Medium Impact)

It’s a detailed record of the European Central Bank Governing Board’s most recent meeting, providing in-depth insights into the economic conditions that influenced their decision on where to set interest rates.

USD – Fed Chair Powell Speaks – 6:00 pm (High Impact)

Due to speak at the Economic Club of Washington Luncheon, in Washington, DC.  As head of the central bank, which controls short term interest rates, Jerome Powell has more influence over the nation’s currency value than any other person.

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

Friday, January 11

 

AUD – Retail Sales m/m – 1:30 am (High Impact)

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

An actual value change of 0.3% for the previous month confirmed a forecast of the same value.

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

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

An actual value change of 0.1% for the previous month confirmed a forecast of the same value.

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

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

An actual value change of -0.9% for the previous month failed to confirm a forecast of 0.0%.

USD – CPI m/m – 2:30 pm (High Impact)

The index tracks the change in the price of goods and services purchased by consumers. Consumer prices account for the 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.

The data is derived from the average price of various goods and services, which are then sampled and compared to the previous sampling.

An actual value change of 0.0% for the previous month confirmed a forecast of the same value.

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

Shows 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.

An actual value change of 0.2% for the previous month confirmed a forecast of the same value.

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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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