FOREX News Today

Japan and the BOJ: Japan’s PM Mr Abe has announced a meeting with the press next Wednesday June 1 the expectations are that he could announce the date of a snap election and/or if the much heralded sales tax hike will go ahead next year as planned. In parliament the BOJ’s governor Mr Kuroda repeated that they will add further stimulus if required, that deflation is still not completely behind them and that it would be desirable if the exchange rate moved in a stable manner and reflected the fundamentals. USDJPY remains unmoved just shy of 110 at 109.96.

Eurogroup agree Greek debt relief: As expected the Eurozone and IMF agreed debt relief package for Greece. “On the package of reforms Greece had committed to last summer, we now have full agreement,” said Jeroen Dijsselbloem, the Dutch finance minister who presided over the meeting of finance ministers. Once all 19 eurozone members have formally signed off on the new deal, Greece will get €10.3 billion ($11.48 billion) in fresh loans, which would be given out in several installments. A first slice, of €7.5 billion could come as early as June. “It is an important moment in the long Greek program,” Dijsselbloem said. The IMF warns that Greek debt, which currently stands at 180% of GDP, would shoot to 300% of GDP without debt restructuring.

US New home sales beat estimates with a 16.6% April surge to a 619k expansion-high after big Q1 boosts, just as the median price surged to a $321,100 all-time high after upward Q1 revisions, leaving a robust start to the critical spring season for the housing sector. Inventories slipped 0.4% from a six-year high in March. New home sales are poised for a new quarterly cycle-high in the 560k area in Q2, after a 532k (was 517k) cycle-high in Q1. New home sales have risen 129% from the 273k record-low in February of 2011, alongside smaller cyclical climbs of 45% for pending home sales and 58% for existing home sales from lows in 2010. We saw big cyclical climbs of 145% for housing starts and 118% for permits from lows in 2009, and 151% for new home construction from a low in 2011. We previously saw a 1.7% April existing home sales rise to a 5.45 mln pace, a 6.6% April housing starts bounce to a 1.172 mln pace, and a 3.6% April permits rise to a 1.116 mln rate.

Fedspeak A US Federal Reserve rate hike in June or July wasn’t set in stone, but labor data suggested it was time to pull the trigger, St. Louis Fed President James Bullard told CNBC. “There’s no reason to prejudge June,” Bullard said, adding that the Federal Open Markets Committee would look at the data and decide then. Muddying the waters on the timing of the move, Bullard noted that there was no reason the Fed must hold a press conference in conjunction with a rate hike. A press conference is scheduled to follow the June 14-15 meeting, but one is not scheduled after the July 26-27 meeting. “We can wait until we get to the meeting, see what the latest data says, and try to make a good decision there. I think on the issue of press conferences, we have made many moves over the years without press conferences,” he said.

Main Macro Events Today

• BOC Interest rate Decision: No change in rates is expected in the announcement today, but Governor Poloz could emphasize the caution in the Bank’s cautiously optimistic outlook. Economic data has featured some high-profile disappointments since the April announcement: Exports and manufacturing shipments both fell in February and March. Investment intentions for 2016 showed an expected reduction in spending. And the oil sands production stoppage has tripped the Q2 GDP outlook into negative territory (we see real Q2 GDP falling 0.5%). But it is not all doom and gloom, as the U.S. economy is seeing enough improvement that prospects have firmed for two Fed rate hikes this year, with one possible as soon as June. And oil prices have firmed. We suspect the BoC will still view the ingredients as being present for the expected recovery. Recent data will be deemed consistent with an economy undergoing a difficult rebalancing, with Federal government stimulus seen providing a key lift later this year. We see the announcement as remaining consistent with an extended period of steady policy while they maintaining that they have the room to implement further accommodation if needed.

• German IFO:  The Ifo Business Climate reading for May should benefit from robust orders inflows and ongoing strong consumer demand, which already helped to lift the current conditions reading in the ZEW yesterday. We are looking for a rise in the overall reading to 106.8 from 106.6. However, the significant negative surprise in the ZEW headline number yesterday (it was less than half of expectations) highlights downside risks.

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

RBA Governor Stevens: Very committed to inflation-targeting monetary policy, inflation very low and below the RBA’s target, inflation target is not rigid and the inflation target does not demand kneejerk responses. Inflation targeting will work well into the future and finally there is quite some years of fiscal repair work for the government in the period ahead. More Dovish tones from Governor Stevens,  AUDUSD down from overnight highs of 0.7256 to 0.7222 following his comments.

IMF “unconditional” debt relief for Greece: The conclusion of its debt sustainability analysis (it’s first one of Greece since mid last year). The 10-year Greek yield was down by 28 bp, putting yields at the lowest since last November, after the Greek parliament today passed the latest EUR 5.4 bln austerity-measures package, which will qualify it for a EUR 11 bln injection of bailout cash. This should make it a formality for Eurozone officials to sign-off on at today’s Eurogroup meeting. The IMF warns that Greek debt, which currently stands at 180% of GDP, would shoot to 300% of GDP without debt restructuring.

More Mixed US data : US Markit manufacturing PMI dipped to 50.5 in flash print for May, the lowest since September 2009. The index fell to 50.8 in April from 51.5 in March. It was 54.0 a year ago. The index hit a high of 57.9 in August 2014 and has generally been on a downward trajectory ever since. New orders declined versus April and are expanding at the slowest rate since December 2015, in large part thanks to weakness from foreign demand. But, input prices rose for a second straight month, though inflation remained moderate overall and was running at a slower overall pace than the series average. The recovery in producer sentiment from winter lows is proving more anemic than hoped, though sentiment has still increased on net since February despite May setbacks for the Empire State and Philly Fed headlines. The ISM-adjusted average of the major measures is poised to sustain the 51 April figure, following a 53 eight-month high in March, but much lower 49 averages in January and February. The employment components for both Empire State and Philly Fed increased, and we saw further gains in the Philly Fed price component as oil prices rebounded.

Fedspeak: Fed’s Williams repeated 2 to 3 rate hikes seem about right for 2016, with 3 or 4 in 2017. The timing will depend on economic data, he cautioned, adding the Fed will move slowly on removing accommodation he added. The FOMC will leave the balance sheet as it is for now. He forecasts about 2% growth for this year, though there are some headwinds from abroad, but it’s important that the Fed doesn’t overreact to financial market turmoil. He remains concerned about low inflation expectations, however. He sees encouraging signs that wages are picking up, though low wages remain a puzzle. There’s nothing new in these remarks from Williams, who is not a voter this year. Earlier, Bullard, a voter, speaking from Beijing, noted some data are supporting the FOMC’s views for rate hikes, while other reports are supporting the lesser views of the markets. There are some signs that U.S. growth is below trend, though the labor market’s performance has been very good.

Main Macro Events Today

• German Final Q1 GDP: German Q1 GDP, which is likely to confirm overall growth at 0.7% q/q. The quarterly growth rate is much stronger than initially expected, and the breakdown, which will be released for the first time, likely to confirm that overall expansion was boosted by strong consumption and domestic demand. Survey data already points to a slowdown in growth dynamics in the second quarter and the different timing of Easter this year may distort comparisons, so that the first half of the year may have to be seen as a whole.

• German May ZEW: German ZEW Economic Sentiment is seen improving to 11.4 from 11.2. Markets are starting to digest raised bets of a June Fed hike and with oil prices moving higher investor confidence seems to remain underpinned. Reduced Brexit bets may also help, but much will depend on when responses came in and there still is some risk of a negative surprise amid uncertainty as the period of ever easier monetary policies across the world is slowly coming to an end.

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.