Please note that Monday 22 is Easter Monday, due to the holiday liquidity will be thin and volatile moves are possible.
USD
Industrial production for the month of March came in at -0.1% m/m vs 0.2% m/m as expected. The miss that will not have great impact on USD although it doesn’t paint a bright picture about the US industrial complex. Trade balance for the month of February came in at -$49.4bn vs -$53.4bn as expected. Both exports and imports rose, 1.1% and 0.2% respectively. Goods deficit was $72.1bn while services surplus was $22.63bn. Trade deficit with China came in at -$24.76bn vs -$34.47bn deficit the previous month. Tariffs seem to work which will make president Trump very happy. Retail sales for the month of March came in at 1.6% m/m vs 1% m/m as expected. The reading was the strongest in 18 months. Control group was 1% m/m vs 0.4% m/m as expected. Initial jobless claims came in at 192k vs 205k as expected for a fresh new 50 year low.
This week we will have housing and durable goods data with Q1 GDP on Friday. Atlanta FED has raised its GDP forecast to 2.8% while J.P. Morgan Chase sees it at 2.9% on the back of strong rise in control group of retail sales.
Important news for USD:
Monday:
Existing Home Sales
Tuesday:
New Home Sales
Thursday:
Durable Goods Orders
Friday:
GDP
EUR
ZEW survey of current situation in Germany dropped to 5.5 from 11.1 the previous month while outlook improved to 3.1 from -3.6 the previous month. Improvement in the outlook is based on expectations that the global economy will recover in H2. Several ECB policymakers are said to doubt projections for growth rebound in H2 2019. They think that weakening growth in China, Brexit and trade tensions continue to weigh down.
Preliminary PMI data for the month of April failed to ease concerns about economies in EU zone. German manufacturing PMI came in at 44.5 vs 45 as expected. Almost a negligible improvement from the last month’s reading of 44.1. Eurozone manufacturing PMI came in at 47.8 vs 48 as expected, dragged down by the reading from Germany. Services PMI also came below expectations thus dragging composite to 51.3 vs 51.8 as expected.
This week we will have data on consumer confidence from EU and business climate in Germany.
Important news for EUR:
Tuesday:
Consumer Confidence Index
Wednesday:
Ifo Business Climate (Germany)
GBP
The employment report came within expectations. Average hourly earnings came in at 3.5% 3m/y as expected and the unemployment rate stayed at 3.9%. GBP was not moved on this numbers. March CPI data came in at 0.2% m/m as expected and 1.9% y/y vs 2% y/y as expected. Core CPI also dipped on the year to 1.8% y/y vs 1.9% y/y as expected. ONS reports that decline in clothes and food prices as well as slower increase in computer games’ prices offset the rise in fuel prices. Markets didn’t react to the drop in inflation signalling that Brexit still takes centre stage regarding all matters with UK. Retail sales for the month of March came in at 1.1% m/m vs -0.3% m/m as expected. On the yearly level it came at 6.7% y/y vs 4.5% y/y as expected. These are great beats and ONS notes that mild weather boosted sales in March as food shops recovered following a weak February reading.
The Parliament returns to work on Tuesday so there will be more talks about Brexit which could impact GBP.
AUD
RBA meeting minutes revealed that a rate cut would be “appropriate” if inflation stays low and the unemployment rate goes up. The board added that effects of lower rates will likely be smaller than in the past but they will add benefits to the economy via lower AUD and lower interest payments on loans. Since inflation is subdued, there is no need to raise rates in the near term and likelihood remains low.
The employment report showed strong numbers adding to the RBA rhetoric of a strong labour market. Employment change came in at 25.7k vs 15k as expected for a healthy beat. Full time employment change was 48.3k, a very healthy number. Participation rate was higher at 65.7% which led to rise in the unemployment rate to 5% from the previous 4.9% but all in line with expectations.
We had a large amount of data from China and none of them disappointed. Q1 GDP came in at 6.4% y/y vs 6.3% y/y. Retail sales for the month of March came in at 8.7% y/y vs 8.4% y/y as expected. Industrial production came in at 8.5% y/y vs 5.9% y/y as expected. Huge beat on the industrial production number pushed AUD higher. Positive readings show that government stimulus is producing effects. This may ease the worries around the Globe about China slowdown and it can support stumbling national economies.
This week we will have inflation data.
Important news for AUD:
Wednesday:
CPI
NZD
Services PMI for the month of March came in at 52.9 vs 53.6 the previous month. New orders component dropped to the lowest since September 2012. After last week’s lower manufacturing PMI now, services are also weaker. RBNZ governor Orr confirmed that monetary policy easing bias remains due to softer economic conditions from Europe, US and China.
CPI for the Q1 of 2019 came in at 0.1% q/q vs 0.3% q/q as expected and 1.5% y/y vs 1.7% y/y as expected. Misses in inflation, much lower than expected, will add more fuel to the possibility of a rate cut in May.
This week we will have balance of trade data.
Important news for NZD:
Friday:
Trade Balance
Exports
Imports
CAD
Existing home sales came in at 0.9% vs 2% as expected with prior reading showing -9.1%. Decent rebound from the previous month, but weaker than expected. Housing market continues to pose problems for the Canadian economy. Western Canada sales are “more than 20% below the 10-year average for the month”. BOC Q1 business outlook survey came in at -0.6 vs 2.2 in the previous reading. Future sales dropped to -6% which is lowest in three years. Inflation is expected to decline but will stay within the inflation control range. Lowering of inflation expectations will push back BOC’s intent to raise rates, potentially making a U turn and considering cutting them.
CPI numbers for the month of March came in as expected at 0.7% m/m and 1.9% y/y. Core median and core trim CPI number beat the expectations coming in at 2% y/y and 2.1% y/y respectively while core common came in at 1.8% y/y as expected. Swings up in core inflation were acknowledged in the market as CAD shot higher. Merchandise trade came in at -CAD2.9bn vs -CAD3.25bn as expected. More numbers adding to the CAD strength. Lower than expected trade deficit was achieved with both falling export (-1.3%) and falling imports (-1.6%). Retail sales for the month of February came in at 0.8% m/m vs 0.4% m/m as expected. This is the first positive reading after 8 months of negative or flat readings. Main driver for gains was gasoline. New car sales also contributed to the gains.
This week BOC will take the centre stage with their rate decision and monetary policy report followed by the press conference. No changes are expected in regards to interest rate however possibly more upbeat tone can be expected from BOC on the backs of rising wages and core inflation.
Important news for CAD:
Tuesday:
Wholesale Trade
Wednesday:
BOC Interest Rate Decision
BOC Rate Statement
BOC Monetary Policy Report
BOC Press Conference
JPY
Trade Balance figures for the month of March came in at JPY528.5bn vs JPY363.2bn as expected. Exports fell -2.4% y/y vs -2.6% y/y as expected, not as bad as expected and imports missed coming in at 1.1% y/y vs 2.8% y/y as expected. Final industrial production data for the month of February came in at 0.7% m/m vs 1.4% m/m as expected. Preliminary manufacturing PMI came in at 49.5 vs 49.2 the previous month. New export index fell to the lowest reading in the last 3 years caused by trade tensions. The employment component came in higher compared to the previous month. Headline national CPI came in at 0.5% y/y as expected. CPI excluding fresh food ticked up to 0.8% y/y vs 0.7% y/y as expected.
This week we will have inflation data for the Tokyo area as well as employment and consumption data. The BOJ will also release its quarterly outlook and will probably downgrade its forecasts with bank possibly projecting inflation below 2% until 2022. Interest rate is expected to stay the same so outlook report will be of bigger importance.
Important news for JPY:
Thursday:
BOJ Interest Rate Decision
BOJ Monetary Policy Statement
BOJ Outlook Report
BOJ Press Conference
Friday:
CPI
Unemployment Rate
Retail Sales
CHF
Over the weekend SNB chairman Jordan reiterated that there is no need to change monetary policy but that SNB has room to cut rates and intervene if the need arises. Trade balance for the month of March came in at CHF3.18bn vs CHF3.13bn the previous month. Exports were up 0.1% m/m while imports showed a drop of -3.2% m/m. Considering that imports were down -3% m/m the previous month there is a worrisome trend forming. Domestic demand continues to slump.
This week we will have speech by SNB chairman Jordan.
Important news for CHF:
Friday:
SNB Chairman Jordan Speech
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