The EUR/USD tumbled after lackluster German ZEW data hit the wires. The euro fell by 40 points to trade at 1.118 as the greenback continued to rally and
The EUR/USD tumbled after lackluster German ZEW data hit the wires. The euro fell by 40 points to trade at 1.118 as the greenback continued to rally and gold fell. Worries about Greece disappeared today as the new funding was approved. The latest release of Germany’s ZEW survey of economic sentiment shows that economists are not taking a strong run as a reason to be cheerful about the future. In part, this appears to be down to the risk that the UK will vote to leave the European Union.
The think-tank’s widely-watched (though not universally admired) index covering current conditions rose to 53.1 in May, up from 47.7 and well above expectations. But the ‘expectations’ survey slid by 4.8 points to 6.4, against forecasts of 12. (Financial Times).
The strong growth of the German economy in the first quarter of 2016 appears to have surprised the financial market experts. However, they seem not to expect the economic situation to improve at the same pace going forward. Uncertainties regarding developments such as a possible Brexit currently inhibit a more optimistic outlook.
The US dollar continued its weeklong rally following the release of hawkish FOMC minutes. Extending the Fed’s hawkish signals last week that a June US rate rise could be in the cards, James Bullard, president of the St. Louis Fed and a voting member of the policy-setting Federal Open Market Committee, warned that markets could be behind the curve on the Fed’s intentions.
Since raising rates in December for the first time in nine years, the Fed in March forecasted essentially two rate rises for this year, but markets have had much lower expectations amid a batch of weaker US economic data.
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Upcoming Economic Events that you should be monitoring:
Wednesday, May 25, 2016
Cur. | Event | Actual | Forecast | Previous | |||
USD | API Weekly Crude Oil Stock | -1.140M | |||||
NZD | Trade Balance (YoY) (Apr) | -3,940M | -3,380M | ||||
NZD | Trade Balance (MoM) (Apr) | 60M | 117M | ||||
AUD | Construction Work Done (QoQ) (Q1) | -1.5% | -3.6% | ||||
EUR | EU Finance Ministers Meeting | ||||||
USD | Goods Trade Balance (Apr) | -60.10B | -56.90B | ||||
USD | FOMC Member Harker Speaks | ||||||
USD | Services PMI (May) | 53.1 | 52.8 | ||||
CAD | Interest Rate Decision | 0.50% | 0.50% | ||||
USD | Crude Oil Inventories | 1.310M | |||||
USD | FOMC Member Kashkari Speaks | ||||||
USD | FOMC Member Kaplan Speaks |
Government Bond Auctions
Date Time Country Auction
May 25 11:03 Sweden Sek 1bn 3.5% 2022 & Sek 3bn 1% 2026 bonds
May 25 11:05 Norway Holds bond auction
May 25 11:30 Germany Eur 1bn 2.5% Jul 2044 Bund
May 25 19:00 US Holds 5Yr Notes Auction, 2Yr FRN
May 26 11:10 Italy Announces details of bond auction
May 26 11:10 Italy Holds Zero-coupon/BTPei auction
May 26 17:20 Sweden Details of I/L auction on Jun 02
May 26 19:00 US Holds 7Yr Notes Auction
May 30 11:10 Italy Holds bond auction
Jun 01 10:30 Denmark Holds bond auction
Jun 01 11:30 Germany Eur 4bn Apr 2021 Bobl
Jun 01 11:30 UK 1.5% 2021 Gilt
Jun 01 17:20 Sweden Announces details of bond auction on Jun 08
Jun 02 10:30 Spain Holds bond auction
Jun 02 11:03 Sweden Holds I/L bond auction
Jun 02 11:50 France Holds bond auction