Tag Archives: ECB Meeting

Ukraine Likely To Overshadow ECB Meeting

Here’s today’s ‘Just A Minute’ bringing you a 60 second summary of what’s happening in the financial markets:

Main Trading Event Of The Day: EU ECB Press Conference @ 12.30 GMT

WHAT WE’RE WATCHING TODAY

Ukraine Likely To Overshadow ECB Meeting

The crisis in Ukraine along with a hesitant recovery in Europe will most probably overshadow today’s European Central Bank meeting. Economists say the monetary authority for the member states who use the Euro will look to reassure markets that it is ready to add more stimulus measures if the economy takes a turn for the worse. It recently approved a major package of measures including a cut in the main interest rate to a record low 0.15 percent and an offer of more extra-cheap credit to banks and is waiting to see how those work. If further measures are deemed necessary in the future, analysts say the bank could decide to purchase large amounts of financial assets such as government bonds in the open market, a step which can drive rates down further and add newly created money to the economy but the bank is only expected to use it if its current efforts don’t work as expected. One risk factor is a sudden shock to business and investor confidence if the conflict between Russia and Ukraine escalates which could lead the EU and United States to impose new sanctions on Russia, disrupting trade. Uncertainty over what the impact could be on the global economy and markets could make businesses hold off on investing and consumers on spending. Low inflation is another worry for the ECB, at only 0.4 percent in the year to July. ECB President Mario Draghi has indicated that asset purchases are possible in the future and is one of the reasons why the euro has been in retreat over the past couple of months. ECB Press Conference is due today @ 12.30 GMT.

German Industry Output Grows Less Than Expected On Russia

German industrial output grew less than forecast in June as Europe’s largest economy came under pressure from political tensions with Russia. Production, adjusted for seasonal swings, rose 0.3 percent from May, when it declined a revised 1.7 percent. While that’s the first increase in four months, economists predicted a gain of 1.2 percent. Production fell 0.5 percent in June from the previous year when adjusted for working days. The European Union agreed last week on its widest-ranging sanctions yet over Russia’s backing of rebels in eastern Ukraine and the Bundesbank has cited geopolitical tensions as contributing to a probable stagnation of the economy in the second quarter. Factory orders fell the most in more than 2 1/2 years in June and sentiment surveys have plunged in Germany, Russia’s biggest trading partner in Europe. There is pessimism in the markets and it remains to be seen whether this pessimism will become persistent.

Australian Jobless Rate Tops U.S. First Time Since 2007

Australia’s jobless rate jumped to a 12 year high in July, overtaking the U.S. level for the first time since 2007 while sending the local currency falling. The unemployment rate rose to 6.4 percent from 6 percent according to the statistics bureau in Sydney, versus estimates for unemployment to hold steady. The number of people employed fell by 300. Australia appears to be losing its developed-world-beating status as the mining investment boom that powered it through the global financial crisis wanes. The number of full-time jobs increased by 14,500 in July, and part-time employment fell 14,800, today’s report showed. Australia’s participation rate, a measure of the labour force in proportion to the population, climbed to 64.8 percent in July from 64.7 percent a month earlier. The Australian dollar was trading at 92.87 U.S. cents at from 93.43 cents before the data were released.

That sums up today’s highlights! Don’t forget you can find us throughout the day on the social media platforms delivering u-to-the-minute news for traders. We hope you have a profitable day on the markets.

Euro Hovers Near Lows As Draghi Speech Awaited

Here’s today’s ‘Just A Minute’ bringing you a 60 second summary of what’s happening in the financial markets:

Main Trading Event Of The Day: EUR President Draghi Speaks @ 08.00 GMT

WHAT WE’RE WATCHING TODAY

Euro Hovers Near Lows As Draghi Speech Awaited

The euro touched a new three-month low against the dollar today as investors awaited comments from ECB head Mario Draghi and took on board the results of the weekend elections. Critics of the European Union more than doubled their presence following the elections, as voters registered discontent over immigration, austerity and unemployment. Although it is unlikely that Draghi will say anything new or surprising, his speech will be closely watched for any signals about the ECB’s next steps. The euro has fallen more than 2 percent on the greenback since May 5 against a backdrop of rising expectations that the ECB will ease policy next month, which in turn increased wagers on the common currency coming under pressure. The Euro last traded at $1.3619, down about 0.1 percent on the day. Early in the session, it briefly dipped to $1.3615, a low not seen since mid-February. Against its Japanese counterpart, the euro slipped about 0.2 percent to 138.80 yen. Traders said the policy outlook will continue to be a negative factor for the euro rather than results of the weekend elections.

Gold Steady Below $1,300 As Ukraine Elections Eyed

Gold continued to hover below $1,300 an ounce on today after ending flat for two straight weeks but the metal could gain from developments in the Ukraine where pro-West billionaire Petro Poroshenko claimed the Ukrainian presidency on Sunday. Analysts say the relationship between Russia and the newly elected president in the Ukraine will be key for gold prices. Since the new president is not pro-Russia, it could make Ukraine more divided. There is still a lot of uncertainty and political risk there, which could boost gold’s safe-haven appeal. Spot gold was steady at $1,293.01 an ounce after ending flat for a second straight week. The metal has closed between $1,291 and $1,296 in the last seven sessions. Liquidity is likely to be thin today with U.S. markets closed for Memorial Day and Britain shut for a bank holiday.

Lagarde: Central Banks Should Cooperate On Policy Moves

IMF Managing Director, Christine Lagarde is urging central banks to cooperate on policy moves as the Federal Reserve debates the timing of its first interest rate hike since 2006. Lagarde stressed that in times of distress, the potential gains from cooperation can be huge by reducing the risk of tail events with large international feedback effects. The Fed and the Bank of England are expected to start raising interest rates in 2015. The Fed’s decision to unwind quantitative easing last year threw emerging markets into turmoil, prompting sharp currency and equity market declines in India, Indonesia, Brazil, South Africa and Turkey, and underscoring the impact of Fed policy on global markets. The case for policy cooperation may seem less compelling as urgency fades with the global economy turning a corner and as the gains from cooperative policy responses are unclear but it is precisely this uncertainty that would make us remiss in discounting the gains from cooperation in a post-crisis. Reducing vulnerabilities and reinforcing macroeconomic and financial frameworks should be the order of the day for emerging markets-and indeed for all countries according to Lagarde.

That sums up today’s highlights! We hope you have a profitable day on the markets.

Just A Minute!

Here’s today’s ‘Just A Minute’ bringing you a 60 second summary of what’s happening in the markets:

Main Trading Events Of The Day: Several today including USD FOMC Member Dudley Speaks @ 13.15, USD Unemployment Claims @ 13.30 & EUR ECB Press Conference @ 13.30 GMT

WHAT WE’RE WATCHING TODAY

Jobless Claims Not Likely To Show Improvement

Initial jobless claims are expected to drop to 335,000 in the last week of February from 348,000 two weeks earlier. Even if claims fall to this extent, however, they will revert to their recent average. Claims fell sharply in 2013 but have since leveled off around the 330,000 mark.

The failure of claims to continue to decline coincides with other indicators showing a slowdown in job creation, most notably the monthly U.S. employment report. The economy likely added just 140,000 jobs in February after a 113,000 gain in January. The February report comes out Friday. Most economists have cited the unusually harsh weather as being a key reason for the slowdown but persistent softness in many economic reports has raised questions about whether the problems actually run deeper. Wall Street will also listen closely to top Federal Reserve officials today for clues on the central bank’s next step. New York Fed President William Dudley will be interviewed by the Wall Street Journal and field questions and Philadelphia Fed President Charles Plosser is lined up to give a speech on how a central bank should exit “unconventional monetary policy.” Both are voting members on the bank’s policy-setting panel that meets in two weeks to discuss its next move. Also due today are reports on factory orders, productivity in the fourth quarter and household wealth. Factory orders likely fell in January and productivity is expected to be revised sharply lower to 1.7% from an original estimate of 3.2%. Slow productivity growth is not regarded as being good for an economy. The Federal Reserve’s quarterly report on household wealth, meanwhile, offers a good snapshot on whether consumers and businesses are reducing or adding to their debt. Consumers have cut debt sharply over the past few years.

Meanwhile, gold was trading in a tight range on Thursday, supported near $1,335 an ounce by the continuing weak U.S. data, with investors waiting for developments in the Ukraine geopolitical crisis and the impending jobs report for further cues.

Euro Trundles Along Ahead Of ECB Meeting

The main focus at today’s ECB Governing Council meeting will be on updated economic forecasts, and in particular whether inflation is likely to remain below target in 2016, thus potentially creating room for further monetary policy action in the coming months. With the Ukraine crisis still to be resolved, the markets have continued to keep an eye on the situation but it has not diverted investors’ attention away from what steps the ECB might take to support the economy and ward off deflation. On Wednesday, International Monetary Fund officials called on the ECB to start buying public and private assets or extend more cheap long-term loans to banks, as well as cutting interest rates to a new record low. Yet the ECB may hesitate to buy government bonds, unlike other major central banks such as the U.S. Federal Reserve and the Bank of Japan that have done so, in part for fear such a step could infringe its ban on financing governments directly. The ECB may explore other policy options, such as cutting rates or stopping “sterilisation” operations that soak up the money it spent buying the bonds of Greece and other countries at the height of the euro zone sovereign debt crisis. Europe’s benchmark stock index closed slightly lower after its biggest rally in eight months. The euro traded at $1.3726 early today but was off a two-month high of $1.38255 hit on Friday. The Stoxx Europe 600 index closed marginally lower at 337.06 in a choppy session, after jumping 2.1% on Tuesday. The move was the largest one-day percentage gain since early July, triggered by easing tensions between Russia and Ukraine.

Google: Mobile Will Create Bigger Advertising Pie

Mobile devices such as smartphones and tablets will hugely expand the number of companies who advertise online and will allow Internet companies to reap more revenue than they have from customers on PCs, according to Google. Small businesses will represent the largest influx of new marketers as they discover the benefits of reaching on-the-go consumers on their mobile devices. The desktop world took the world of advertisers from tens of thousands to a few million and as we go forward, a few million is likely to become tens of millions as mobility becomes more relevant. Google, the world’s No.1 Internet search engine, generates the vast majority of its revenue from advertising. But its ad rates, like those of other Internet companies including Yahoo have been under pressure as more consumers access its online services on small-screened mobile devices, where advertising rates are lower than on PCs. There’s no doubt that mobile is where the future of advertising lies!

That sums up today’s highlights! We hope you have a profitable day on the markets.

Sign Up to Open an Account at Banc De Binary