Talking Points
- Major events for this week include German High Court ESM ruling and Troika meeting in Greece
- Chinese export growth slows and imports decline
- Japan GDP estimate for 2Q halved
Following last week’s official announcement of ECB bond purchases, this week is also likely to provide major headlines that could affect the future of the Euro and a possible recovery from the debt crisis. In Germany, the High Court is set to present its decision on Wednesday about the legality of the permanent ESM rescue fund. German Lawmaker Gauweiler said today that he will try to delay the court’s decision because the ECB announcement fundamentally changes the situation. Gauweiler added that the central bank has become a hyper rescue fund. German Finance Minister Wolfgang Schaeuble said over the weekend that he expects the court to approve the ESM.
Additionally, Troika representatives are set to meet with Greek PM Samaras today. Samara’s coalition members recently refused 11.5 billion Euros of spending cuts, over worries that it would hurt Greece’s poor. The Troika are set to receive Greece’s austerity measures on Friday, which it must approve in order for Greece to receive the next 31 billion Euro bailout payment.
Both the Troika acceptance of the Greek austerity measures and the German court approval of the ESM would be seen as steps to improve the Euro and prevent the breakup of the single currency, and would therefore be Euro positive.
In the overnight Asian session, Chinese exports rose less than 3% and imports declined, as the global crisis slowed demand in China and abroad. Reports also showed a decline in industrial production and lower producer prices. The slowdown in the economic releases places pressure on Chinese Premiere Wen Jiabao to add to the stimulus program.
In Japan, the GDP growth in the second quarter was cut in half today by a revised estimate. According to the estimate, the economy grew by 0.7%. However, USDJPY did not significantly react to the lower than expected revision, the pair continues to trade slightly above 78.20.
Later this session, we will see the final estimate of the Italian GDP for 2Q and the results of the Euro-zone Sentix Investor Confidence Survey for September.
Asia Session: What Happened
|
GMT |
CCY |
EVENT |
ACT |
EXP |
PREV |
|
1:30 |
CNY |
Consumer Price Index (YoY) (AUG) |
2.0% |
2.0% |
1.8% |
|
1:30 |
CNY |
Produce Price Index (YoY) (AUG) |
-3.5% |
-3.2% |
-2.9% |
|
5:30 |
CNY |
Industrial Production (YoY) (AUG) |
8.9% |
9.0% |
9.2% |
|
5:30 |
CNY |
Industrial Production YTD (YoY) (AUG) |
10.1% |
10.2% |
10.3% |
|
5:30 |
CNY |
Retail Sales (YoY) (AUG) |
13.2% |
13.2% |
13.1% |
|
5:30 |
CNY |
Retail Sales YTD (YoY) (AUG) |
14.1% |
14.1% |
14.2% |
|
5:30 |
CNY |
Fixed Assets Inv Excl. Rural YTD (YoY) (AUG) |
20.2% |
20.4% |
20.4% |
|
22:45 |
Manufacturing Activity Volume s.a. (QoQ) (2Q) |
0.3% |
- |
1.2% (R+) |
|
|
22:45 |
NZD |
Manufacturing Activity (2Q) |
-1.1% |
- |
-1.5% (R+) |
|
23:01 |
Lloyds Employment Confidence (AUG) |
-43 |
- |
-51 |
|
|
23:50 |
Gross Domestic Product (QoQ) (2Q F) |
0.2% |
0.3% |
0.3% |
|
|
23:50 |
JPY |
Gross Domestic Product Annualized (2Q F) |
0.7% |
1.0% |
1.4% |
|
23:50 |
JPY |
Gross Domestic Product Deflator (YoY) (2Q F) |
-0.9% |
-1.1% |
-1.1% |
|
23:50 |
JPY |
Nominal Gross Domestic Product (QoQ) (2Q F) |
-0.3% |
-0.2% |
-0.1% |
|
23:50 |
JPY |
Current Account Total (¥) (JUL) |
625.4B |
485.6B |
433.3B |
|
23:50 |
JPY |
Adjusted Current Account Total (¥) (JUL) |
335.4B |
389.0B |
773.6B |
|
23:50 |
JPY |
Current Account Balance (YoY) (JUL) |
-40.6% |
-52.0% |
-19.6% |
|
23:50 |
JPY |
Trade Balance - BOP Basis (¥) (JUL) |
-373.6B |
-439.5B |
112.0B |
|
23:50 |
JPY |
Bank Lending incl Trusts (YoY) (AUG) |
0.9% |
0.7% |
|
|
23:50 |
JPY |
Bank Lending ex-Trust (AUG) |
1.1% |
1.1% |
0.9% (R-) |
|
1:30 |
Investment Lending (JUL) |
-2.7% |
4.4% (R-) |
||
|
1:30 |
AUD |
Home Loans (JUL) |
-1.0% |
0.0% |
1.0% (R-) |
|
1:30 |
AUD |
Value of Loans (MoM) (JUL) |
-1.4% |
- |
0.9% (R-) |
|
1:35 |
NZD |
REINZ Housing Price Index (MoM) (AUG) |
1.3% |
- |
-0.7% |
|
1:35 |
NZD |
REINZ House Sales (YoY) (AUG) |
16.2% |
-- |
19.9% |
|
1:35 |
NZD |
REINZ Housing Price Index (AUG) (AUG) |
3420.1 |
3377.1 |
|
|
3:02 |
CNY |
Trade Balance (USD) (AUG) |
$26.66B |
$19.50B |
$25.15B |
|
3:02 |
CNY |
Exports (YoY) (AUG) |
2.7% |
2.9% |
1.0% |
|
3:02 |
CNY |
Imports (YoY) (AUG) |
-2.6% |
3.5% |
4.7% |
|
4:30 |
JPY |
Bankruptcies (YoY) (AUG) |
-5.8% |
- |
-5.1% |
|
5:00 |
JPY |
Consumer Confidence (AUG) |
40.5 |
39.4 |
39.7 |
|
6:00 |
JPY |
Eco Watchers Survey: Current (AUG) |
43.6 |
43.4 |
44.2 |
|
6:00 |
JPY |
Eco Watchers Survey: Outlook (AUG) |
43.6 |
44.4 |
44.9 |
Euro Session: What to Expect
|
GMT |
CCY |
EVENT |
EXP |
PREV |
IMPACT |
|
6:30 |
EUR |
French Bank of France Bus. Sentiment (AUG) |
89 |
90 |
Low |
|
6:45 |
EUR |
French Industrial Production (MoM) (JUL) |
-0.5% |
0.0% |
Low |
|
6:45 |
EUR |
French Industrial Production (YoY) (JUL) |
-3.7% |
-2.3% |
Low |
|
6:45 |
EUR |
French Manufacturing Production (MoM) (JUL) |
-0.5% |
0.1% |
Low |
|
6:45 |
EUR |
French Manufacturing Production (YoY) (JUL) |
-4.2% |
-2.6% |
Low |
|
8:00 |
EUR |
Italian GDP sa and wda (QoQ) (2Q F) |
-0.7% |
-0.7% |
Medium |
|
8:00 |
EUR |
Italian GDP sa and wda (YoY) (2Q F) |
-2.5% |
-2.5% |
Medium |
|
8:30 |
EUR |
Euro-Zone Sentix Investor Confidence (SEP) |
-30.5 |
-30.3 |
Medium |
Critical Levels
|
CCY |
SUPPORT |
RESISTANCE |
|
1.2678 |
1.2800 |
|
|
1.5965 |
1.6000 |
--- Written by Benjamin Spier
