Talking Points
- All Eyes on Eurozone 2Q GDP Report to Shape Risk Appetite Trends
- Markets to Read Economic News Directly, Not in Terms of Stimulus
- US Retail Sales Expected to Yield Strongest Outcome in Four Months
A busy calendar of economic data promises to finally nudge financial markets out of complacency. Second-quarterEurozone GDP figures headline the docket. While softer readings compared with the first quarter will not be surprising – indeed, a recession in the region is readily accepted as consensus view across financial markets at this point – the degree of downturn will be important to monitor and may prove market-moving. As we discussed in our weekly fundamental briefing, outcomes that fall short of expectations are likely to be read as negative for risk appetite, weighing on the Euro as well as stocks-linked currencies.
Separately, the German ZEW gauge of investor confidence is expected to drop to the lowest since July 2010 at 17.5 in August. The forward-looking Economic Sentiment sub-index is expected to print at -19.3, within a hair of the six-month low of -19.6 recorded in July. Meanwhile, UK CPI is set to put the annual inflation rate at the lowest since November 2009 at 2.3 percent. On balance, both outcomes are unlikely to prove particularly market-moving, the former overshadowed by GDP data and the latter made largely moot by firmly anchored Bank of England monetary policy expectations.
Later in the session, the spotlight shifts to July’s US Retail Sales report. The reading will help establish the degree of follow-through on the stronger-than-expected jobs growth figures published earlier this month. Economists’ forecasts suggest receipts will add 0.3 percent, marking the strongest reading in four months. On the sentiment front, S&P 500 stock index futures are pointing cautiously higher to warn that safe-haven US Dollar and Japanese Yen may find themselves under pressure against their top counterparts. The critical mass of top-tier event risk on the docket may rapidly change the landscape in the hours ahead however.
Asia Session: What Happened
GMT |
CCY |
EVENT |
ACT |
EXP |
PREV |
22:45 |
Retail Sales Ex Inflation (QoQ) (2Q) |
1.3% |
0.7% |
-0.6% |
|
23:01 |
RICS House Price Balance (JUL) |
-24% |
-23% |
-22% |
|
23:50 |
JPY |
Bank of Japan July Meeting Minutes |
- |
- |
- |
23:50 |
JPY |
Tertiary Industry Index (MoM) (JUN) |
0.1% |
-0.3% |
0.7% |
1:30 |
New Motor Vehicle Sales (MoM) (JUL) |
-0.8% |
- |
-1.0% (R-) |
|
1:30 |
AUD |
New Motor Vehicle Sales (YoY) (JUL) |
5.0% |
- |
18.1% (R-) |
1:30 |
AUD |
NAB Business Conditions (JUL) |
-3 |
- |
-1 |
1:30 |
AUD |
NAB Business Confidence (JUL) |
4 |
- |
-3 |
3:00 |
NZD |
Non Resident Bond Holdings (JUL) |
62.8% |
- |
62.0% |
Euro Session: What to Expect
GMT |
CCY |
EVENT |
EXP |
PREV |
IMPACT |
5:30 |
EUR |
French CPI - EU Harmonised (MoM) (JUL) |
-0.5% |
0.1% |
Low |
5:30 |
EUR |
French CPI - EU Harmonised (YoY) (JUL) |
2.3% |
2.3% |
Low |
5:30 |
EUR |
French Consumer Price Index (MoM) (JUL) |
-0.4% |
0.0% |
Low |
5:30 |
EUR |
French Consumer Price Index (YoY) (JUL) |
2.0% |
1.9% |
Low |
5:30 |
EUR |
French CPI Ex Tobacco Index (JUL) |
124.2 |
124.78 |
Low |
5:30 |
EUR |
French GDP (QoQ) (2Q P) |
-0.1% |
0.0% |
Medium |
5:30 |
EUR |
French GDP (YoY) (2Q P) |
0.2% |
0.3% |
Medium |
6:00 |
EUR |
German GDP n.s.a. (YoY) (2Q P) |
0.9% |
1.7% |
High |
6:00 |
EUR |
German GDP s.a. (QoQ) (2Q P) |
0.2% |
0.5% |
High |
6:00 |
EUR |
German GDP w.d.a. (YoY) (2Q P) |
1.1% |
1.2% |
High |
6:45 |
EUR |
French Wages (QoQ) (2Q P) |
- |
0.9% |
Low |
6:45 |
EUR |
French Non-Farm Payrolls (QoQ) (2Q P) |
-0.1% |
0.1% |
Low |
7:15 |
Producer & Import Prices (MoM) (JUL) |
-0.2% |
-0.3% |
Low |
|
7:15 |
CHF |
Producer & Import Prices (YoY) (JUL) |
-1.7% |
-2.2% |
Low |
8:30 |
GBP |
DCLG UK House Prices (YoY) (JUN) |
1.5% |
2.3% |
Low |
8:30 |
GBP |
Consumer Price Index (MoM) (JUL) |
-0.1% |
-0.4% |
Medium |
8:30 |
GBP |
Consumer Price Index (YoY) (JUL) |
2.3% |
2.4% |
High |
8:30 |
GBP |
Core Consumer Price Index (YoY) (JUL) |
2.1% |
2.1% |
Medium |
8:30 |
GBP |
Retail Price Index (JUL) |
241.4 |
241.8 |
Low |
8:30 |
GBP |
Retail Price Index (MoM) (JUL) |
-0.2% |
-0.2% |
Low |
8:30 |
GBP |
Retail Price Index (YoY) (JUL) |
2.8% |
2.8% |
Low |
8:30 |
GBP |
RPI ex Mort Int. Payments (YoY) (JUL) |
2.9% |
2.8% |
Low |
9:00 |
EUR |
Euro-Zone GDP s.a. (QoQ) (2Q A) |
-0.2% |
0.0% |
High |
9:00 |
EUR |
Euro-Zone GDP s.a. (YoY) (2Q A) |
-0.4% |
-0.1% |
High |
9:00 |
EUR |
Euro-Zone Industrial Production w.d.a. (YoY) (JUN) |
-2.1% |
-2.6% |
Medium |
9:00 |
EUR |
Euro-Zone Industrial Production s.a. (MoM) (JUN) |
-0.7% |
0.9% |
Medium |
9:00 |
EUR |
German ZEW Survey (Curr. Situation) (AUG) |
17.5 |
21.1 |
High |
9:00 |
EUR |
German ZEW Survey (Econ. Sentiment) (AUG) |
-19.3 |
-19.6 |
High |
9:00 |
EUR |
Euro-Zone ZEW Survey (Econ. Sentiment) (AUG) |
- |
-22.3 |
Medium |
Critical Levels
CCY |
SUPPORT |
RESISTANCE |
1.2271 |
1.2434 |
|
1.5655 |
1.5715 |
--- Written by Ilya Spivak, Currency Strategist for Dailyfx.com
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