Welcome to the easyMarkets weekly review where we look back over the results of some of the previous week’s economic indicators. It gives us the chance to reflect on how much expectations were met or missed and to examine a successful trade you could have made this week.
Don’t forget later today we’ll be getting employment data from the US with the Non-Farm Payrolls.
Event: EU Consumer Price Index
Date: Monday 31 July 2017 at 09:00 GMT
Markets affected: EUR/USD, EUR/GBP
Trending hashtags: #eur, #cpi
Monday’s inflation figures for the Eurozone came in as no surprise with consumer prices hitting the expected 1.3% increase for July – similar to the previous month. It shows good growth for the common region on an annualised basis, as does Core CPI which came in at 1.2% increase in July against the same month last year.
Event: RBA Interest Rate Decision
Date: Tuesday 01 August 2017 at 04:30 GMT
Markets affected: AUD/USD, AUD/NZD
Trending hashtags: #aud, #interest rate
The Reserve Bank of Australia kept the interest rate at 1.5% as markets were expecting. However, the Aussie dollar fell following comments by the central bank on worsening trade conditions that are being amplified by a strong AUD. On the positive side, commodity prices are increasing with iron ore, copper and gold all showing positive upward moves which is important for the nation’s exports. Further commentary from the bank highlighted the risks imposed by China’s high debt level, a key importer of Australian goods.
Event: EU Gross Domestic Product (Q2)
Date: Tuesday 01 August 2017 at 09:00 GMT
Markets affected: EUR/USD, EUR/GBP
Trending hashtags: #eur, #gdp
The second quarter GDP figures came in for the Eurozone at a solid 1.6% Q-on-Q growth. First quarter results were revised down 0.1% to 1.5%. On an annualised basis, economic expansion for Europe sits at a healthy 2.1%, an increase on the first quarter growth of 1.9%.
Event: US ISM Manufacturing Index
Date: Tuesday 01 August 2017 at 14:00 GMT
Markets affected: EUR/USD, GBP/USD, XAU/USD
Trending hashtags: #usd, #ism
The Institute for Supply Management manufacturing index came under expectations on Tuesday at 56.3 against the forecast 56.5. Not as big a drop as from the previous month’s figure of 57.8. Overall the sector is demonstrating positive growth with the ISM Prices Paid data leaping to 62.0 up from the previous month’s 55.0 and the expected 55.5. The ISM prices Paid signifies business sentiment on inflation for the future.
Event: UK Interest Rate Decision
Date: Thursday 03 August 2017 at 11:00 GMT
Markets affected: GBP/USD, EUR/GBP
Trending hashtags: #gbp, #interestrate
The pound moved sharply on Thursday in the lead up and fall out from the Bank of England’s decision to keep the interest rate unchanged at 0.25%. Before the announcement, the pound gained as the markets were expecting a 5-3 vote in favour of maintaining the rate like the previous month but BOE members voted just 6-2 in favour – showing less confidence in the economy and the likelihood of a rate increase any time soon. More dovish comments came as the central bank reduced the growth forecast for the UK from 1.9% to 1.7% for 2017. Consumer spending is being hit with a weaker pound and business investment has reduced by 20% in light of Brexit.
Trade of the Week
Time in: Thursday 03 August 2017 at 09:00 GMT
Market : GBP/USD
Investment: $500 with 200:1 leverage
Time out: Thursday 03 August 2017 at 13:00 GMT
If you had sold the GBP/USD with a $500 margin at the price of 1.32506 and closed the deal one day after the UK Interest Rate Decision on Thursday which saw the currency pair fall 1.02%, you might have made $1,020. Note this example does not take into account spread.