The government of Greek Prime Minister Alexis Tsipras won a confidence vote on Thursday. 155 of 299 parliament members voted in favour of the government.
European Central Bank chief economist Peter Praet said on Thursday that seeping pessimism weighs on the recovery of the Eurozone's economy.
"The economic environment is characterised by seeping pessimism about the prospects for long-term growth. It holds back a stronger recovery, as uncertainty about the future can feed back into weaker investment today through expectations and confidence channels," he said.
Praet noted that further reforms needed to be implemented
The Bank of Japan (BoJ) released its monthly report on Thursday. The central bank lowered its industrial output forecast for the third quarter, saying that "industrial production have recently been more or less flat", driven mainly by the effects of the slowdown in emerging economies.
The central bank also said that Japan's economy continued to recover moderately.
The inflation is expected to be around zero "for the time being", due to lower energy prices.
The European Central Bank's (ECB) its minutes of September meeting on Thursday. According to the minutes, uncertainty in emerging economies could lead to a slowdown in the Eurozone's economy.
"Uncertainty arising from developments in economic and financial conditions in emerging market economies, particularly China, had clearly increased," the minutes said.
"The slowdown in demand in China could contribute to greater global uncertainty and a possible loss of confidence, which could have a more substantial impact on global growth," the central bank said in its minutes.
The central bank pointed out that it will raise the pace of its asset purchases from September to November 2015 "to prepare for the expected decline in market liquidity in December".
"There was also wide agreement for stressing that the monthly asset purchases of €60 billion would be fully implemented until the end of September 2016, and beyond, if necessary, and, in any case, until a sustained adjustment in the path of inflation, consistent with the Governing Council's aim of achieving inflation rates below, but close to, 2% over the medium term, was visible," the ECB concluded.
EUR/USD: $1.1150/55(E380mn), $1.1400(E413mn)
USD/JPY: Y119.50($1.0bn),Y119.75($1.0bn), Y120.00($830mn), Y120.20($760mn), Y121.00($1.0bn)
USD/CAD: Cad1.3200($400mnn)
AUD/NZD: NZ$1.1025(A$380mn)
The Bank of England's Monetary Policy Committee (MPC) released its October meeting minutes on Thursday. 8 members voted to keep the central bank's monetary policy unchanged. Ian McCafferty voted to hike interest rate by 0.25%.
The consumer price inflation in the U.K. was zero in August, below the central bank's 2% target. The BoE noted that the low inflation was mainly driven by lower prices for energy, food and other imported goods prices.
"With inflation below the target, and the likelihood that at least some spare capacity remains in the economy, the MPC intends to set monetary policy so as to ensure that growth is sufficient to absorb any remaining underutilised resources. That will support domestic cost growth and is necessary to ensure that inflation is on track to return sustainably to the 2% target rate within two years," the minutes said.
The central bank said that a deterioration in the global economy would have a negative effect on the U.K. economy.
"That could occur, for example, were the slowdown currently underway in a range of emerging economies, including China, to intensify," the minutes said.
MPC members pointed out that the interest rate hike will be gradual when the Bank of England starts to raise its interest rate, adding that the decision will depend on the incoming economic data.
The Bank of England (BoE) released its interest rate decision on Thursday. The BoE kept its interest rates unchanged at 0.5% and its asset purchase program unchanged at £375 billion. This decision was widely expected.
Bank of England (BoE) Governor Mark Carney said in September that it will become clearer "around the turn of this year" whether to start raising interest rates or not.
Financial markets suggest that the BoE will start to raise its interest rate by the end of next year or even early 2017.
The central bank expect the U.K. economy to expand 0.6% in the third quarter.
Statistics Canada released its new housing price index on Thursday. New housing price index in Canada rose 0.3% in August, exceeding expectations of a 0.2% gain, after a 0.1% rise in July.
The increase was driven by gains in Toronto and Oshawa region, which rose 0.6% in August.
On a yearly basis, new housing price index in Canada climbed 1.3% in August, after a 1.3% gain in July.
The U.S. Labor Department released its jobless claims figures on Thursday. The number of initial jobless claims in the week ending October 03 in the U.S. declined by 13,000 to 263,000 from 276,000 in the previous week. The previous week's figure was revised down 277,000.
Analysts had expected the initial jobless claims to increase to 274,000.
Jobless claims remained below 300,000 the 31th straight week. This threshold is associated with the strengthening of the labour market.
Continuing jobless claims increased by 9,000 to 2,204,000 in the week ended September 26.
The Organization for Economic Cooperation and Development (OECD) released its leading indicators on Thursday. The composite leading indicator fell to 99.9 in August from 100.0 in July.
It signalled stable growth momentum in Germany and in the Eurozone as a whole.
The growth momentum firmed in France and Italy.
The index for the U.S., the U.K. and China pointed to a loss in growth momentum.
The index for Brazil and Russia showed signs of a weak growth momentum.
The index for Canada pointed to an easing in growth.
Economic calendar (GMT0):
(Time/ Region/ Event/ Period/ Previous/ Forecast/ Actual)
05:00 Japan Eco Watchers Survey: Current September 49.3 47.5
05:00 Japan Eco Watchers Survey: Outlook September 48.2 49.1
05:45 Switzerland Unemployment Rate (non s.a.) September 3.2% 3.3% 3.2%
06:00 Germany Current Account August 24.7 Revised From 23.4 12.3
06:00 Germany Trade Balance August 25.0 15.3
11:00 United Kingdom BoE Interest Rate Decision 0.5% 0.5% 0.5%
11:00 United Kingdom Bank of England Minutes
11:00 United Kingdom Asset Purchase Facility 375 375
11:30 Eurozone ECB Monetary Policy Meeting Accounts
The U.S. dollar traded lower against the most major currencies ahead of the U.S. initial jobless claims data. The number of initial jobless claims in the U.S. is expected to decrease by 3,000 to 274,000 last week.
The Fed will release its latest minutes at 18:00 GMT. Market participants will be looking for signs if the Fed will start raising its interest rates this year.
The euro traded mixed against the U.S. dollar after the negative economic data from Germany. Destatis released its trade data for Germany on Thursday. Germany's seasonally adjusted trade surplus declined to €19.6 billion in August from 22.4 in July. July's figure was revised down from €22.8 billion.
Exports dropped at a seasonally and calendar-adjusted 5.2% in August, while imports fell 3.1%. It was the biggest drop in exports since January 2009.
On a yearly basis, German exports climbed by 5.0% in August, while imports rose by 4.0%.
Germany's current account surplus was at €12.3 billion in August, down from €24.7 billion in July. July's figure was revised up from €23.4 billion.
According to Destatis, manufacturing turnover declined on seasonally adjusted and on adjusted for working days basis by 1.3% in August, after a 1.4% rise in July. July's figure was revised down from a 1.9% increase.
Meanwhile, domestic turnover decreased by 0.9% in August, while the business with foreign customers dropped 1.8%.
Sales to euro area countries declined 2.8% in August, while sales to other countries were down 1.0%.
On a yearly basis, manufacturing turnover in Germany was up on seasonally adjusted and on adjusted for working days basis by 2.8% in August.
The European Central Bank released its latest minutes today. The central bank said uncertainty in emerging economies could lead to a slowdown in the Eurozone's economy.
The British pound traded lower against the U.S. dollar after the release of the Bank of England's (BoE) interest rate decision. The BoE kept its interest rates unchanged at 0.5% and its asset purchase program unchanged at £375 billion. This decision was widely expected.
The Bank of England's Monetary Policy Committee (MPC) released its October meeting minutes today. 8 members voted to keep the central bank's monetary policy unchanged. Ian McCafferty voted to hike interest rate.
The Canadian dollar traded higher against the U.S. dollar ahead of the release of the new housing price index from Canada. Canada's new housing price index is expected to rise 0.2% in August, after a 0.1% gain in July.
The Swiss franc traded mixed against the U.S. dollar ahead of the release of the unemployment data from Switzerland.
EUR/USD: the currency pair traded mixed
GBP/USD: the currency pair fell to $1.5269
USD/JPY: the currency pair climbed to Y119.94
The most important news that are expected (GMT0):
12:30 Canada New Housing Price Index, MoM August 0.1% 0.2%
12:30 U.S. Initial Jobless Claims October 277 274
13:10 U.S. FOMC Member Dennis Lockhart Speaks
17:30 U.S. FOMC Member Charles Evans Speaks
18:00 United Kingdom BOE Gov Mark Carney Speaks
18:00 U.S. FOMC meeting minutes
19:30 U.S. FOMC Member Williams Speaks
EUR/USD
Offers 1.1325-30 1.1350 1.1365 1.1380 1.1400 1.1430 1.1450 1.1475 1.1500
Bids 1.1270 1.1250 1.1235 1.1220 1.1200 1.1180-85 1.1155-60 1.1135 1.1120-25 1.1100
GBP/USD
Offers 1.5335 1.5350 1.5365 1.5380 1.5400-10 1.5425-30 1.5450 1.5480 1.5500-10
Bids 1.5300 1.5280 1.5255-60 1.5240 1.5220 1.5200 1.5185 1.5150 1.5130-35 1.5115 1.5100
EUR/GBP
Offers 0.7380 0.7400 0.7405-10 0.7420 0.7435 0.7450 0..7475 0.7500
Bids 0.7345-50 0.7330-35 0.7300 0.7285 0.7265 0.7250 0.7230 0.7200
EUR/JPY
Offers 135.50 135.85 136.00 136.30 136.50 136.75 137.00
Bids 135.00 134.80 134.40 134.25 134.00 133.75 133.50
USD/JPY
Offers 120.00 20.20-25 120.50 120.65 120.85 121.00 121.30 121.50
Bids 119.50 119.25 119.10 119.00 118.85 118.50 118.30 118.00
AUD/USD
Offers 0.7200 0.7220-25 0.7235 0.7250 0.7275 0.7300 0.7330 0.7350
Bids 0.7150 0.7125-30 0.7100 0.7080-85 0.7060 0.7040 0.7020-25
Destatis released its manufacturing turnover data for Germany on Thursday. Manufacturing turnover declined on seasonally adjusted and on adjusted for working days basis by 1.3% in August, after a 1.4% rise in July. July's figure was revised down from a 1.9% increase.
Meanwhile, domestic turnover decreased by 0.9% in August, while the business with foreign customers dropped 1.8%.
Sales to euro area countries declined 2.8% in August, while sales to other countries were down 1.0%.
On a yearly basis, manufacturing turnover in Germany was up on seasonally adjusted and on adjusted for working days basis by 2.8% in August.
The Hellenic Statistical Authority released its unemployment data on Thursday. The seasonally adjusted unemployment rate in Greece remained unchanged at 25.0% in July. June's figure was revised down from 25.2%.
The number of unemployed fell by 1,984 persons compared with June 2015.
The youth unemployment rate was 48.6% in July.
Japan's Cabinet Office released Eco Watchers' Index figures on Thursday. Japan's economy watchers' current conditions index dropped to 47.5 in September from 49.3 in August. It was the lowest level since January.
Japan's economy watchers' future conditions index rose to 49.1 in September from 48.2 in August.
A reading above 50 indicates optimism, while a reading below 50 indicates pessimism.
Japan's Ministry of Finance released its current account data for Japan late Wednesday evening. Japan's current account surplus fell to ¥1,653.1 billion in August from ¥1,808.6 billion in July, beating expectations for a surplus of ¥1,221.1 billion.
Japan benefits from a weaker yen, which supports income from overseas investments.
The goods trade deficit declined by 61.7% year-on-year to ¥326.1 billion in August.
Exports rose at an annual rate of 3.6% in August, while imports dropped 4.9%.
EUR/USD: $1.1150/55(E380mn), $1.1400(E413mn)
USD/JPY: Y119.50($1.0bn),Y119.75($1.0bn), Y120.00($830mn), Y120.20($760mn), Y121.00($1.0bn)
USD/CAD: Cad1.3200($400mnn)
AUD/NZD: NZ$1.1025(A$380mn)
The Bank of France lowered its growth forecast for the third quarter on Thursday. The French economy is expected to expand 0.2% in the third quarter, down from the previous estimate of a 0.3% growth.
The downward revision was driven by a weaker industrial output.
The Bank of France's business sentiment index for the industry sector declined to 97 in September from 98 in August.
"Production of transport equipment, and notably automobiles, declined after several months of growth. Most of the other sectors remained flat or saw modest growth," the central bank said.
The Bank of France's business sentiment index for the services sector was up to 97 in September from 96 in August.
Destatis released its trade data for Germany on Thursday. Germany's seasonally adjusted trade surplus declined to €19.6 billion in August from 22.4 in July. July's figure was revised down from €22.8 billion.
Exports dropped at a seasonally and calendar-adjusted 5.2% in August, while imports fell 3.1%. It was the biggest drop in exports since January 2009.
On a yearly basis, German exports climbed by 5.0% in August, while imports rose by 4.0%.
Germany's current account surplus was at €12.3 billion in August, down from €24.7 billion in July. July's figure was revised up from €23.4 billion.
Japan's Cabinet Office released its core machinery orders data on late Wednesday evening. Core machinery orders in Japan dropped 5.7% in August, missing expectations for a 3.2% rise, after a 3.6% fall in July.
On a yearly basis, core machinery orders slid 3.5% in August, missing expectations for a 4.2% increase, after a 2.8% gain in July.
This data indicates that capital spending in Japan is weaker than expected, and it could lead to the expansion of quantitative easing by the Bank of Japan.
Machinery orders declined 3.2% in August from a month earlier, driven by electronics, steel and car manufacturers.
Orders from non-manufacturers plunged 6.1% in August, driven by falls in orders from financial services and shipping.
The Fed released its consumer credits figures on Wednesday. Consumer credit in the U.S. rose by $16.02 billion in August, missing expectations for a $19.0 billion increase, after a $18.94 billion gain July. July's figure was revised down from a $19.1 billion rise. The increase was driven by gains in both revolving and non-revolving credit. Revolving credit climbed by $4.0 billion in August, while non-revolving credit jumped by $12.0 billion.
Former Fed Chairman Ben Bernanke said in an interview on Wednesday that the Fed' decision not to raise its interest rates in September was reasonable.
He also said that the U.S. economy is strong.
"We have a pretty good domestic expansion. The household sector, which is driving growth, has been solid for a while," Bernanke said.
EUR / USD
Resistance levels (open interest**, contracts)
$1.1359 (4355)
$1.1321 (3160)
$1.1293 (2277)
Price at time of writing this review: $1.1253
Support levels (open interest**, contracts):
$1.1220 (3013)
$1.1186 (5246)
$1.1144 (2072)
Comments:
- Overall open interest on the CALL options with the expiration date October, 9 is 57115 contracts, with the maximum number of contracts with strike price $1,1400 (5479);
- Overall open interest on the PUT options with the expiration date October, 9 is 68162 contracts, with the maximum number of contracts with strike price $1,1000 (5743);
- The ratio of PUT/CALL was 1.19 versus 1.19 from the previous trading day according to data from October, 7
GBP/USD
Resistance levels (open interest**, contracts)
$1.5600 (1472)
$1.5500 (1687)
$1.5401 (1672)
Price at time of writing this review: $1.5315
Support levels (open interest**, contracts):
$1.5199 (2382)
$1.5100 (3224)
$1.5000 (2104)
Comments:
- Overall open interest on the CALL options with the expiration date October, 9 is 25782 contracts, with the maximum number of contracts with strike price $1,5200 (1802);
- Overall open interest on the PUT options with the expiration date October, 9 is 24063 contracts, with the maximum number of contracts with strike price $1,5100 (3224);
- The ratio of PUT/CALL was 0.93 versus 0.95 from the previous trading day according to data from October, 7
* - The Chicago Mercantile Exchange bulletin (CME) is used for the calculation.
** - Open interest takes into account the total number of option contracts that are open at the moment.
Economic calendar (GMT0):
Time/ Region/ Event/ Period/ Previous/ Forecast/ Actual
05:00 Japan Eco Watchers Survey: Current September 49.3 47.5
05:00 Japan Eco Watchers Survey: Outlook September 48.2 49.1
05:45 Switzerland Unemployment Rate (non s.a.) September 3.2% 3.3% 3.2%
06:00 Germany Current Account August 23.4 12.3
06:00 Germany Trade Balance August 25.0 15.3
The U.S. dollar is steady today as investors await FOMC meeting minutes due 18.00 GMT. Remarks of policymakers help to understand which financial and economic conditions determined opinions of committee members.
The pound little changed ahead of Bank of England interest rate decision. The central bank is unlikely to change its monetary policy in October. BOE Governor Mark Carney said that the bank should get a better understanding of optimal timing of a first rate increase closer to the end of the year. In September 8 out 9 members of the monetary policy committee voted to keep benchmark rate unchanged, although minutes of the meeting said that the time to raise rates is coming. Thus the BOE may raise rates sooner than many market participants expect.
The Australian dollar declined amid comments by Reserve Bank of Australia head of economic research John Simon, who said that low interest rates are not risky, they are appropriate given slow global economic growth. Simon also said that concerns over low rates are overdone. These comments suggest that the RBA will continue cutting rates and the AUD will fall further.
EUR/USD: the pair rose to $1.1260 in Asian trade
USD/JPY: the pair traded within Y119.80-10
GBP/USD: the pair fell to $1.5295
The most important news that are expected (GMT0):
(time / country / index / period / previous value / forecast)
11:00 United Kingdom BoE Interest Rate Decision 0.5% 0.5%
11:00 United Kingdom Bank of England Minutes
11:00 United Kingdom Asset Purchase Facility 375
11:30 Eurozone ECB Monetary Policy Meeting Accounts
12:30 Canada New Housing Price Index, MoM August 0.1% 0.2%
12:30 U.S. Continuing Jobless Claims September 2191 2205
12:30 U.S. Initial Jobless Claims October 277 274
13:10 U.S. FOMC Member Dennis Lockhart Speaks
17:30 U.S. FOMC Member Charles Evans Speaks
18:00 United Kingdom BOE Gov Mark Carney Speaks
18:00 U.S. FOMC meeting minutes
19:30 U.S. FOMC Member Williams Speaks
(pare/closed(GMT +3)/change, %)
EUR/USD $1,1237 -0,28%
GBP/USD $1,5315 +0,54%
USD/CHF Chf0,9734 +0,65%
USD/JPY Y119,98 -0,19%
EUR/JPY Y134,83 -0,47%
GBP/JPY Y183,75 +0,34%
AUD/USD $0,7200 +0,56%
NZD/USD $0,6613 +1,03%
USD/CAD C$1,3065 +0,23%
(time / country / index / period / previous value / forecast)
05:00 Japan Eco Watchers Survey: Current September 49.3
05:00 Japan Eco Watchers Survey: Outlook September 48.2
05:45 Switzerland Unemployment Rate (non s.a.) September 3.2% 3.3%
06:00 Germany Current Account August 23.4
06:00 Germany Trade Balance August 25.0
11:00 United Kingdom BoE Interest Rate Decision 0.5% 0.5%
11:00 United Kingdom Bank of England Minutes
11:00 United Kingdom Asset Purchase Facility 375
11:30 Eurozone ECB Monetary Policy Meeting Accounts
12:30 Canada New Housing Price Index, MoM August 0.1% 0.2%
12:30 U.S. Continuing Jobless Claims September 2191 2205
12:30 U.S. Initial Jobless Claims October 277 274
13:10 U.S. FOMC Member Dennis Lockhart Speaks
17:30 U.S. FOMC Member Charles Evans Speaks
18:00 United Kingdom BOE Gov Mark Carney Speaks
18:00 U.S. FOMC meeting minutes
19:30 U.S. FOMC Member Williams Speaks