FOREX News Today

European Outlook: Asian stock markets are narrowly mixed, (Nikkei closed flat at 16, 925) U.S. stock futures little changed and U.K. futures slightly higher. Oil prices meanwhile have lifted off lows, but remain firmly below USD 44 per barrel having traded to $43.02 yesterday. Investors are looking ahead to key U.S. jobs data during the European afternoon session, which are hoped to shed some light on the timing of a possible rate hike, although our forecast for a 185k headline increase (median (189k), close to the 3-month average of 190k, might not make a clear case for a September rate hike. The European calendar has Eurozone PPI data for July, as well as the U.K. August Construction PPI, Spanish unemployment numbers and the final reading of Italian Q2 GDP.

US Data Reports: The U.S. ISM drop to a 7-month low of 49.4 from 52.6 in July and a 16-month high of 53.2 in June reversed much of the 8-month climb from the 48.0 expansion-low in December. The ISM sits well below the 59.9 cycle-high in February of 2011, as all the sentiment measures have remained depressed since the oil price plunge starting in Q3 of 2014. U.S. Markit manufacturing PMI slipped to 52.0 in the final August reading, versus July’s 52.9, and from the August preliminary print of 52.1. It was at 53.0 a year ago. New orders declined to 52.7 from July’s 54.2, reflecting a slower pace of growth. That led to a weaker pace of hiring, and resulted in a drop in employment to the lowest level since April.

Fedspeak: Cleveland Fed hawk Lorretta Mester said the low level of rates is not an effective solution to problems in the labor market, noting that she didn’t share the convictions of protestors at Jackson Hole last week who lobbied for the Fed to resolve racial income and employment gaps through extending low rate policy. She views these as “longer-run issues.” Otherwise, she made no other references to policy timing. She also said the US is basically at full employment and the case for gradual rate increases is pretty compelling, though the Fed is not behind the curve. She also supports including “confidence bands” around the Fed’s forecasts. Note she is a voter this year and there is nothing particularly new or changed in her view.

Waiting for Draghi: The summer is coming to an end and the ECB will have the questionable honour of kicking off this month’s round of central bank meetings. For Draghi the key question is whether the mixed data releases and the still low inflation numbers justify further action or mainly mean that the ECB won’t follow the Fed in its path to a policy normalisation. Unfortunately, the impact of currency moves on the growth and inflation outlook, which in turn also hinge on central bank decisions both in the U.S. and the U.K. will make it difficult for Draghi, who won’t have the benefit of hindsight and has to make his bid ahead of Yellen and Carney.

Main Macro Events Today        

• UK Construction PMI – 08:30 GMT – Forecast for a slight rise to 46.6 from 45.9.

• US NonFarm Payrolls – 12:30 GMT – Bloomberg, CNBC, and Thomson Reuters Surveys have a consensus for 180k news jobs – There are very wide estimates this month ranging from +125k from PNC Financial to +255k from Societe Generale. The Unemployment Rate is expected to fall to 4.8% and the Average Hourly Earnings is also expected to fall to 0.2% from 0.3%.

Janne Muta

Chief Market Analyst

If you wish to get the latest forex brokers news,you can visit our Top Forex Brokers official website:

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Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.

FOREX News Today

European Outlook: European stock futures are higher, following on from a mixed session in Asia, where Japanese bourses managed to move higher in tandem with the Hang Seng after improvements in Japan and China manufacturing PMIs. Mainland Chinese bourses meanwhile were in the red. The U.S. jobs report tomorrow is moving into focus and investors and central bankers look to data for clues on the timing of a possible Fed hike. The ECB meanwhile seems eager to prevent any build up of easing speculation ahead of next week’s meeting and Draghi is still remarkably stumm as the block out period for central bank comments starts. Today’s European calendar focuses on PMI readings, which in the case of the final Eurozone reading is not expected to hold major surprises, while the U.K. number is hoped to lift slightly from the post Brexit slump in July.

Oil & Gold: Commodities under pressure – WTI crude has traded under the $45/bbl mark for the first time since August 15, touching $44.49 lows, as the combination of higher U.S. inventories, and a firm dollar continue to weigh. Bigger picture, an OPEC production freeze is not expected at the September meeting in Algiers, despite recent comments from Iraq’s oil minister, who said he would support a freeze. Loggerheads between Saudi and Iran, who has insisted on bringing its production back to pre-sanction levels, will likely result in no agreement to cap output. Gold dropped to new two-month lows of $1,304.10 from near $1,316.00, on a reported large sale (nominal $4 bln-plus), rumored to be linked to the cutting of a large long position. This may have been the result of the in-line ADP jobs data, and ahead of Friday’s official employment report. A solid NFP outcome on Friday will up the odds for a September Fed rate hike, which would likely weigh heavily on gold prices.

US Data Reports: Revealed an August Chicago PMI drop to 51.5 from 55.8 in July and a 17-month high of 56.8 in June, as these numbers unwind the mid-year auto-retooling boost, while ADP posted a firm 177k August rise after a big July boost to 194k from 179k. For producer sentiment, we expect the ISM-adjusted average of the major surveys to slip to 51 from 52 in July but a lower 50 in May and June. The ADP gain signals slight upside risk for our 185k August payroll estimate, given the 20k downside bias in as-reported ADP, alongside upside risk from tight claims and producer sentiment, but downside auto sector risk as sales drop to the 17.2 mln area in August after the July pop to a 17.8 mln rate.

Fedspeak: Minneapolis Fed’s Kashkari wants to see core inflation rise and needs more data before considering a rate hike, speaking on DJ News. Sounds like the moderate regional Fed president is still on the dovish side of the fence, though he’s not a voter in this rotation. These comments came from a video interview in which he reiterated calls for too-big-to-fail reforms and said monetary policy is a blunt tool, but offered little else on rate hike timing per se.

Main Macro Events Today        

• US Manufacturing ISM  August ISM is out today and is expected to decline slightly to 52.0 (median 52.0) from 52.6 in July and 53.2 in June. Already released measures of producer sentiment for August have been weaker so one to watch at 14:00 GMT.

• US Initial Jobless Claims data for the week of August 27 is out Thursday and should reveal a headline increase to 269k (median 264k) from 261k in the week prior and 262k before that. More broadly, we expect claims to set a higher average in August at 263k from 260k in July. This supports our nonfarm payrolls forecast which we currently have at 185k with a 4.8% unemployment rate for August.

Janne Muta

Chief Market Analyst

If you wish to get the latest forex brokers news,you can visit our Top Forex Brokers official website:

http://www.topforexbrokerscomparison.com

Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.

FOREX News Today

European Outlook: Asian stock markets are mixed, the Japanese Nikkei 225 close up 0.97% at 16,887, with banks and oil producers leading gains. The Hang Seng is little changed and the ASX down, but mainland Chinese markets are moving higher. U.S. stock futures meanwhile are little changed and FTSE 100 futures are heading south. Oil prices are little changed on the day after the front end WTI future fell below USD 47 per barrel Tuesday amid firm U.S. confidence data as Fed’s Fischer repeated that rate hikes will be data dependent and that the economy is close to full employment. The European calendar has more August inflation data, with the overall Eurozone number now seen steady at 0.2% y/y, after weaker than expected German data yesterday. German unemployment is also seen steady in August, while the July Eurozone unemployment rate is expected to fall to 10.0% from 10.1%.

The USD takes centre stage: The dollar has held firm while the yen has continued to underperform. USDJPY rose for a fourth straight session, this time making a one-month high of 103.22. Yesterday the pair broke and closed above the 50-day moving average at 102.69, which now reverts as support. Most yen crosses have followed, with EURJPY also making a one-month peak, and AUDJPY a two-week high. The weaker yen has been tonic for Japanese stock markets. Increased odds for a September rate hike by the Fed, juxtaposed to the likelihood of further easing by the BoJ at its September 20th-21st policy meeting, have been underpinning USDJPY, which we expect to remain the case in the coming weeks, although Friday’s U.S. jobs report will be a key determiner. EURUSD, meanwhile, has remained heavy in the mid 1.11s, though holding above yesterday’s three-week low at 1.1132. Cable has also remained heavy, on net, with a bounce after an above-forecast reading of the August Gfk UK consumer confidence survey failing to sustain. At -7, this is the second lowest in over two years, while the UK Lloyds business confidence survey fell to a near five-year low of 16 in August, down from 29 in July.

US Data Reports: The U.S. consumer confidence pop to an 11-month high of 101.1 reversed the July drop to 96.7  from 97.4 to leave the measure still-below the 103.8 cycle-high in January of 2015. Despite today’s consumer confidence upswing, the full array of confidence indicators continues to trend sideways in 2016. The Michigan sentiment index fell to 89.8 from 90.0, versus a 98.1 cycle-high last January. The IBD/TIPP index rose to 48.4 in August from 45.5 in July but a similar 48.2 in June, versus a 54.0 cycle-high in October of 2012. The Bloomberg Consumer Comfort index has risen slightly to a 43.6 average thus far in August from a 43.4 average in both June and July, versus a 45.7 cycle-high average in April of 2015. Confidence faces an ongoing lift from low gasoline prices, stock market and home price gains, and an expected GDP bounce in the second half of 2016 as the inventory unwind and petro-hit to factories diminishes. Yet, confidence faces a political headwind from the highly negative and unsettling tone of the U.S. election campaigns.

Fedspeak: Fed VC Fischer may be out on a hawkish limb on his own, speculates a Bloomberg article that is in line with the muted market reaction to his words overnight compared to the reaction in which he hijacked the Jackson Hole calm following Yellen’s speech Friday. Others such as Bullard and Lockhart have been more circumspect on the “hike or two” front this year, leading some analysts to wonder if Fischer is more of an outlier rather than a shadow Chairman. In January he concluded that four hikes this year were probable, which obviously has yet to be met. Of course, the August payrolls report could be the swing factor for or against a September hike, by Fischer’s own admission.  The next round of Fedspeak will be from doves Rosengren and Evans, who will take part in a closed panel discussion from China ahead of the US open Wednesday, while moderate Kashkari talks about the role of the Fed board. This could slow the USD rise ahead of ADP’s today and NFP data on Friday.

Main Macro Events Today        

• Canadian GDP  Real Q2 GDP, is expected to fall 1.8% after the 2.4% increase in Q1. The temporary halt to oil sands production and the impact on related services that was due to the Fort McMurray wildfire will factor in the Q2 GDP fall. Also, real exports plunged 19.9%, suggestive of a big drag from net exports. Real GDP is expected to rebound 4.0% in Q3 as shuttered production comes back on-line and rebuilding commences in the region.

• Eurozone HICP After yesterday’s weaker than expected German HICP number we have lowered our forecast for the overall Eurozone rate to 0.2% y/y, which would leave it unchanged from July. The Spanish HICP rate rose markedly, to -0.3% y/y from -0.7% y/y, but the Belgian headline rate also ticked lower and the French reading, due early today, is also seen unchanged. Inflation rates are only very gradually moving higher and remain firmly below the ECB’s definition of price stability. With confidence indicators showing that especially the manufacturing sector is waking up to the risks of the Brexit scenario and the impact of drop of the Pound against the EUR, the data will add to the arguments of the doves ahead of the September ECB meeting.

Janne Muta

Chief Market Analyst

If you wish to get the latest forex brokers news,you can visit our Top Forex Brokers official website:

http://www.topforexbrokerscomparison.com

Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.