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.
Event: Switzerland Unemployment Rate s.a. (MoM, Dec)
Date: Tuesday 10 January 2017 at 15:00 GMT
Markets affected: EUR/CHF
Trending hashtags: #swissy, #chf
Switzerland’s State Secretariat for Economic Affairs (SECO) released the Unemployment rate on Tuesday which came in at a higher than expected 3.5%. Expectations were for 3.3% like the previous month’s figure. This was the highest it’s been since April. However, once the rate was adjusted for seasonal factors it stood at 3.3% meaning that it hasn’t changed over the last quarter of 2016. The number of unemployed increased by 10,144 to 159,372 for the month of December and overall the year saw a small increase in unemployment of 4.6%
Event: US Crude Inventories
Date: Wednesday 11 January 2017 at 15:30 GMT
Markets affected: OIL/USD
Trending hashtags: #oil, #crude, #wti
Inventories of US crude stocks showed an increase by 4.1 million barrels according to the US Energy Information Administration (EIA). The report showed a huge increase to the expected 1.16 million barrels and oil prices dropped to weekly lows as a result. Oil prices continued to be volatile over the next 24 hours as they rebounded to daily highs of 52.65 thanks to a weaker US dollar.
The unexpected increase has been attributed to seasonal activities by companies bringing inventories onshore after being left in floating storage. The data released showed refineries working at 93.6% capacity, processing 17.1 million barrels of crude on a daily basis.
Event: UK NIESR GDP Quarterly Estimate (Dec)
Date: Wednesday 11 January 2016 at 15:00 GMT
Markets affected: EUR/GBP, GBP/USD
Trending hashtags: #sterling , #gdp
The NIESR estimate for UK GDP for the fourth quarter of 2016 came in at 0.5% and revised the previous reading of 0.4% to 0.5%. The result at 0.5% was slightly better than estimates of 0.46%.The GDP Estimate released by the National Institute of Economic and Social Research will be followed by the official announcement next month, but this has generally been considered very accurate. The estimate suggests the economy grew 2% for the year; a tad lower than the 2015 figure of 2.2%.
Event: ECB Monetary Policy Meeting Accounts
Date: Thursday 12 January 2017 at 12:30 GMT
Markets affected: EUR/USD
Trending hashtags: #ecb, #eur
The Governing Council of the European Central Bank reviewed financial, economic and monetary developments on Thursday. They characterised the financial environment as volatile across asset classes and noted an upward direction to global inflation expectations. They also commented that global trade was expanding at a modest pace and that consumer inflation for OECD countries had increases over the previous months. Real GDP for the EU was growing 0.3% q-on-q, pointing to economic expansion, as did further declines in unemployment. Overall, there was emphasis that even with price stability, due to surrounding risks, the asset purchasing programme (APP) would continue in order to fulfil the Council’s price stability objective. Currently APP is at 60 billion euros per month in the aim to bring inflation closer to the, just under, 2% target.
Event: US Initial Jobless Claims
Date: Thursday 12 January 2017 at 13:30 GMT
Markets affected: EUR/USD,
Trending hashtags: #unemployment, #usd
Initial Jobless Claims for the US came in under the expected 255,000 to 247,000 for the last week. It was 10,000 above the previous reading of 237,000 (revised from 235k) but still signalled a healthy employment sector for the nation as it was the 97th straight week in a row where claims came in under 300k – something not seen in over four decades. Analysts are however prudently noting the seasonality of the figure and commenting on the volatility involved in short-term outlooks.
Trade of the Week
Time in: Wednesday 11 January 2017 at 15:30 GMT
Market : OIL/USD
Investment: $500 with 200:1 leverage
Time out: Wednesday 11 January 2017 at 18:30 GMT
If you had bought OIL/USD with a $500 margin at the price of $50.85 a barrel and closed the deal once after the EIA Inventory release on Wednesday at 18:30 GMT which saw oil drop 3.44%, you might have made $3,440. Note this example does not take into account spread.