Hotforex.com - Market Analysis and News.

Re: Hotforex.com - Market Analysis and News.

Postby HFblogNews » Tue Nov 26, 2019 5:40 am

Date : 26th November 2019.

Equities continue lower ahead of ECB – 26th November 2019.


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Risk-on runs on – European stock markets are slightly lower in opening trade, as the stock markets run out of steam after the rally seen yesterday.

Always trade with strict risk management. Your capital is the single most important aspect of your trading business.

Please note that times displayed based on local time zone and are from time of writing this report.

Click HERE to access the full HotForex Economic calendar.

Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding on how markets work. Click HERE to register for FREE!

Click HERE to READ more Market news.


Andria Pichidi
Market Analyst
HotForex

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.
HotForex is an award winning, fully regulated and licensed online forex and commodities broker. Offers various accounts, trading software and trading tools to trade Forex and Commodities for individuals, fund managers and institutional customers.
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Re: Hotforex.com - Market Analysis and News.

Postby HFblogNews » Mon Dec 02, 2019 4:53 am

Date : 2nd December 2019.

Events to Look Out For Next Week 2nd December 2019.


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*Welcome to our weekly agenda, our briefing of all the key financial events globally. Following another cautious week, after trade jitters and the prospect of further protests in Hong Kong weighed on sentiment, two interest rate decisions and NFP data stand out in the announcement schedule next week. The US-China trade tensions, upcoming UK elections and OPEC meeting in Vienna continue to dominate the week.

Monday – 02 December 2019

* Building Permits (AUD, GMT 00:30) – Building permits are a known leading indicator of the housing and the overall market. Following the moderation of decline in dwelling approvals in September for Australia, it will be interesting to observe whether permits will increase or pullback once again. The consensus for October is at -4.0% m/m, compared to the spike at 7.6% last month.

* Manufacturing PMIs (EUR, GBP, USD, GMT 08:55-14:45) – The UK manufacturing PMI is expected to hold below neutral at 48.1. The Euro Area PMI is expected to remain at the same levels as last month, at 46.6 and German number at 43.8, while the US ISM PMI in November is expected to increase to 50.5 compared to 48.3. The sentiment surveys have been erratic in recent months likely due to competing perspectives on the trade war, troubles abroad, and stock price gyrations.

Tuesday – 03 December 2019

* Interest Rate Decision (AUD, GMT 03:30) – No surprises are expected even though in the last RBA statement Governor Lowe admitted that there are downside risks and admitted that the bank could ease again if necessary. He also suggested that previous easing steps are already supporting the economy and while the bank is monitoring developments there was nothing to signal immediate moves.

Wednesday – 04 December 2019

* Gross Domestic Product (AUD, GMT 00:30) – Third quarter GDP for Australia is expected to have settled at 1.4% y/y.

* Employment Data (USD, GMT 13:15) – US ADP Employment Change is anticipated to grow by 138K in November from 125K last month.

* ISM Non-Manufacturing PMI (USD, GMT 15:00) – The ISM-NMI index is expected to rise to 55.0 in November from 54.7 in October. Sentiment has received ongoing support, however, from tight labor markets, high consumer confidence levels, and firm GDP and consumption growth. We should see at least some November updraft following the settlement of the UAW-GM strike.

* Interest Rate Decision (CAD, GMT 15:00) – In October, the Bank of Canada maintained the 1.75% rate setting, matching widespread expectations. However, the announcement was overall dovish and the Bank seems like it has opened the door wide open to a rate cut if the resilience of the domestic economy shows signs of faltering.

Thursday- 05 Decemmber 2019

* OPEC meeting in Vienna

* Gross Domestic Product (EUR, GMT 10:00) – Third quarter GDP s.a. for Europe is expected to have settled at 0.2% q/q, unchanged from the second quarter.

* Trade balance (USD, GMT 13:30) – The trade deficit is expected to widen in October to -$53.5 bln from -$52.5 bln in September. The exports are anticipated to hold steady at $206.0 bln, while imports should rise 0.4% to $259.6 bln. Both exports and imports face headwinds from a decline in vehicle trade with the UAW-GM strike, as well as a drop in petroleum prices following the Saudi drone bombing in September.

Friday – 06 December 2019

* Event of the Week – Non-Farm Payrolls (USD, GMT 13:30) – A 190k November nonfarm payroll rise has been forecasted, following a 128k increase in October. This reflects a November reversal of the UAW-GM strike impact that left a restrained 128k October rise, with an estimated 40k November bounce in factory jobs after the -36k October drop.

* Labour Market Data (CAD, GMT 13:30) – October employment revealed a 1.8k drop in jobs, contrary to expectations for a measured gain (median 15k), following the 53.7k jump in September. However, the November reading is anticipated to jump back to 15.9K while the unemployment rate is expected to rise as well at 5.6% m/m from 5.5% last month.

Always trade with strict risk management. Your capital is the single most important aspect of your trading business.

Please note that times displayed based on local time zone and are from time of writing this report.

Click HERE to access the full HotForex Economic calendar.

Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding on how markets work. Click HERE to register for FREE!

Click HERE to READ more Market news.


Andria Pichidi
Market Analyst
HotForex

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.
HotForex is an award winning, fully regulated and licensed online forex and commodities broker. Offers various accounts, trading software and trading tools to trade Forex and Commodities for individuals, fund managers and institutional customers.
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Re: Hotforex.com - Market Analysis and News.

Postby HFblogNews » Tue Dec 03, 2019 6:07 am

Date : 3rd December 2019.

Sterling Awaits Election Result – 3rd December 2019.


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Sunderland South and the direction of Sterling – Why the first constituency to declare its new MP could have a significant bearing on the direction of Sterling on Election night next week.

Always trade with strict risk management. Your capital is the single most important aspect of your trading business.

Please note that times displayed based on local time zone and are from time of writing this report.

Click HERE to access the full HotForex Economic calendar.

Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding on how markets work. Click HERE to register for FREE!

Click HERE to READ more Market news.


Stuart Cowell
Head Market Analyst
HotForex

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.
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Re: Hotforex.com - Market Analysis and News.

Postby HFblogNews » Wed Dec 04, 2019 6:05 am

Date : 4th December 2019.

FX Update – December 4 – Risk Off – 4th December 2019.


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AUDJPY, H1
The Yen has rallied on a safe-haven bid as global stock markets turn lower after President Trump, nearly two months after announcing the limited “Phase 1” trade deal with China, said that trade negotiations may be postponed until after the 2020 presidential election. This after announcing intentions to tariff steel imports from Brazil and Argentina. Disappointing Q3 GDP out of Australia, a country that is highly exposed to the US-China trade, was also in the mix. Growth came in at 0.4% q/q in the antipodean economy, against a median of 0.5%. USDJPY printed a 13-day low at 108.43, while EURJPY and AUDJPY descended into respective one-week low territory and is the biggest moving pair today, down some -0.6%. The Australian Dollar has been the day’s biggest loser out of the main currencies. AUDUSD more than reversed gains seen yesterday on the less dovish than expected RBA statement, in making a low of 0.6814. The AUDJPY triggered lower yesterday on the Crossing EMA Strategy, H1 at 13:00 GMT (1) move down to T1 (2), retraced to Entry (3) to close T2 flat. It then triggered lower again (4) and moved to T1 (5) and T2 (6) for a net move of 47 pips for both legs lower.

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The Dollar, outside the case of USDJPY, has held firm, finding its own safe haven bid. The sharpest in six months drop in the U.S. 10-year T-note yield yesterday was a reflection of this safe haven bid, which is why forex markets haven’t been trading on yield differential dynamics in the latest phase. Both EURUSD and Cable both drifted moderately lower, before a bid on Sterling saw cable breach 1.3000 and trade over 1.3040 and post a new six month high. Elsewhere, EURCHF has dropped for a third consecutive trading day, this time hitting a three-week low at 1.0923. The decline in the cross have correlated with the prevailing risk-off phase that started at Friday’s release of disappointing U.S. manufacturing ISM data.

Always trade with strict risk management. Your capital is the single most important aspect of your trading business.

Please note that times displayed based on local time zone and are from time of writing this report.

Click HERE to access the full HotForex Economic calendar.

Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding on how markets work. Click HERE to register for FREE!

Click HERE to READ more Market news.


Stuart Cowell
Head Market Analyst
HotForex

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.
HotForex is an award winning, fully regulated and licensed online forex and commodities broker. Offers various accounts, trading software and trading tools to trade Forex and Commodities for individuals, fund managers and institutional customers.
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Re: Hotforex.com - Market Analysis and News.

Postby HFblogNews » Fri Dec 06, 2019 6:10 am

Date : 6th December 2019.

Happy Non-Farm Friday – 6th December 2019.


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Happy Non-Farm Friday – The Dollar majors have remained comfortably within their respective ranges from yesterday, ahead of trade talks, NFP and the OPEC+ decision.

Always trade with strict risk management. Your capital is the single most important aspect of your trading business.

Please note that times displayed based on local time zone and are from time of writing this report.

Click HERE to access the full HotForex Economic calendar.

Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding on how markets work. Click HERE to register for FREE!

Click HERE to READ more Market news.


Andria Pichidi
Market Analyst
HotForex

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.
HotForex is an award winning, fully regulated and licensed online forex and commodities broker. Offers various accounts, trading software and trading tools to trade Forex and Commodities for individuals, fund managers and institutional customers.
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Re: Hotforex.com - Market Analysis and News.

Postby HFblogNews » Mon Dec 09, 2019 3:05 am

Date : 9th December 2019.

Events to Look Out For Next Week 9th December 2019.


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*Following the OPEC meeting this week and the surprisingly strong US payroll data, three interest rate decisions are scheduled next week. Other than Central Banks, the event of the week is the UK Parliamentary Election on Thursday.

Monday – 09 December 2019

* RBA’s Governor Lowe speech (AUD, GMT 22:05) – Due to speak at the AusPayNet Summit, in Sydney.

Tuesday – 10 December 2019

* Consumer Price Index (CNY, GMT 01:30) – September’s Chinese CPI is seen unchanged at 0.7% while the PPI figure is expected to decline further to -1.2%. The overall reading for CPI is estimated to post a gain up to 2.9% y/y.

* ZEW Economic Sentiment (EUR, GMT 10:00) – Economic Sentiment for October is projected at -27 from the -22.5 seen last month, as the current conditions indicator for Germany turned negative. The overall Eurozone reading though is expected to decline slightly further to -33.0 from -22.4. A lower than expected outcome, ties in with the stagnation in market sentiment at the start of the month.

Wednesday – 11 December 2019

* Inflation Rate (USD, GMT 13:30) – A 0.2% November headline CPI rise is expected with a 0.2% core price increase, following respective October readings of 0.4% and 0.2%. As-expected gains would result in a headline y/y increase of 2.0%, up from 1.8% last month. Core prices should set a 2.3% pace for a second consecutive month. We expect an up-tilt in y/y gains into Q1 of 2020 due to harder comparisons and some lift from tariff increases that should leave gains in the 2.4% area, which may help ease concerns about persistent inflation undershoots of the Fed’s 2% objective.

* Interest Rate decision and conference (USD, GMT 19:00) – The FOMC is widely seen on hold even after the robust payroll data, with no shift in rate policy for the foreseeable future. Indeed, the data validated the pause and left policymakers in a state of Fed Nirvana, at least for now. Fed Chair Powell will reiterate the economy and policy are in a “good place.” There is little risk of any downside “material changes” in the outlook anytime soon given the solid path for jobs growth. And, GDP will likely continue to modestly outpace the official Fed estimates, just as a benign inflation trajectory caps risk of rate hikes from the Fed as well. Hence, the focus will be on the Fed’s quarterly forecast update (SEP) and Chair Powell’s press conference.

Thursday- 12 Decemmber 2019

* Parliamentary Election – Brexit will be a focal point with the December 12 election. While the Conservative party with a working majority is the clear odds-on favourite outcome of the election, the outcome of the general election is by no means a sure-fire certainty, however, especially in light of the predictive failures of pollsters and betting markets at elections in the UK and elsewhere in recent years.

* SNB Interest Rate Decision and Conference (EUR, GMT 08:30) – The central bank is widely expected to keep policy settings unchanged as ongoing uncertainty on the global growth outlook, along with weakness in the Eurozone economy, support the view that the central bank’s negative interest rate and the threat of ad hoc currency interventions remain necessary to keep the franc under control, and prevent inflation from falling. The central bank has kept the door to additional measures open as it keeps a close eye on geopolitical trade tensions and Brexit developments.

* ECB Interest Rate Decision and Conference (EUR, GMT 12:45 &13;30) – Lagarde’s first press conference. The “risk” is that it will be equally uneventful as her testimony before the European Parliament. It is very likely on Thursday, to be confirmed that: The ECB remains ready to act again and tweak all its measures if necessary, but has already done a lot and now needs to keep an eye on the side effects of the very expansionary monetary policy, while politicians need to do their bit to support the economy.The ECB won’t be reducing the degree of stimulus any time soon and we effectively see the central bank on hold through next year, unless there is a major change in circumstance.

Friday – 13 December 2019

* Retail Sales and Industrial Production (USD, GMT 13:30) – A gain is expected up to 0.3% November for both the retail sales headline and the ex-auto figures, following a 0.3% October headline with a 0.2% ex-auto figure. There’s considerable uncertainty, however, given seasonal distortions around the holidays, especially including Black Friday and Cyber Monday swings, and with six fewer shopping days between Thanksgiving and Christmas.

Always trade with strict risk management. Your capital is the single most important aspect of your trading business.

Please note that times displayed based on local time zone and are from time of writing this report.

Click HERE to access the full HotForex Economic calendar.

Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding on how markets work. Click HERE to register for FREE!

Click HERE to READ more Market news.


Andria Pichidi
Market Analyst
HotForex

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.
HotForex is an award winning, fully regulated and licensed online forex and commodities broker. Offers various accounts, trading software and trading tools to trade Forex and Commodities for individuals, fund managers and institutional customers.
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Re: Hotforex.com - Market Analysis and News.

Postby HFblogNews » Tue Dec 10, 2019 6:21 am

Date : 10th December 2019.

FX Update – NZD & GBP remain Bid – 10th December 2019.


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NZD & Sterling

The New Zealand Dollar posted a fresh four-month high versus the Australian Dollar, while NZDUSD and NZDJPY saw two-day highs. A shift in RBNZ policy expectations and an associated rise in NZ yields have been underpinning the kiwi. The 10-year US T-note yield advantage relative to the NZ 10-year yield has narrowed by some 15 bps since late November. It is expected that this trend will taper out at some point, as RBNZ monetary policy is historically sensitive to movements in the currency. The longest rallying kiwi pair is the NZDCAD which is now in its 29th day and 280 pips (4.6 x ATR) north of the key 20-day simple moving average, 19 days over the 50-day moving average and 6 days over the important long term 200-day moving average and psychological 0.8600. Next Resistance is R3 and the upper Bollinger band at 0.8750. MACD and RSI both remain positive.

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Elsewhere in the forex realm, most dollar pairings and associated cross rates have remained in narrow ranges, holding within respective Monday ranges in thinned-out year-end conditions. EURUSD has remained particularly directionally challenged, seeing less than a 10-pip range during the Asia-Pacific session until the entry of the London interbank market. USDJPY managed a 12-pip range. The stellar US jobs report of last Friday has had little lasting impact on the Dollar. Markets seem non-committal, partly due to seasonal considerations and partly amid a certain anxiety ahead of the weekend’s deadline for the US to hike tariffs on a further $160 bln worth of Chinese goods. A delay in this deadline is possible, if a phase-1 deal fails to come to fruition, while an implementation of the new tariffs would mark an escalation in the trade war and cause a significant risk-off response in illiquid year-end global markets.

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Sterling has settled after rallying yesterday, unaffected by the slight dip in GDP and the worse than expected trade balance, Cable holds the 1.3150 pivot point. Markets have factored in a Conservative victory with an outright majority at Thursday’s UK general election, based on public opinion polling, though political pundits have been stressing that undecided votes are making this election tricky to call. Polls have suggested most undecided voters are people who voted for Labour in 2017, suggesting there is a possibility for an unexpectedly strong showing for Labour, however, the surge in tactical voting to prevent a Johnson majority is difficult to calculate, and there have been no clear signs of this. The key YouGov MRP opinion poll will be updated later today; last time (November 27) it predicted a Conservative majority of 67 seats.



Always trade with strict risk management. Your capital is the single most important aspect of your trading business.

Please note that times displayed based on local time zone and are from time of writing this report.

Click HERE to access the full HotForex Economic calendar.

Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding on how markets work. Click HERE to register for FREE!

Click HERE to READ more Market news.


Stuart Cowell
Head Market Analyst
HotForex

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.
HotForex is an award winning, fully regulated and licensed online forex and commodities broker. Offers various accounts, trading software and trading tools to trade Forex and Commodities for individuals, fund managers and institutional customers.
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Re: Hotforex.com - Market Analysis and News.

Postby HFblogNews » Wed Dec 11, 2019 6:51 am

Date : 11th December 2019.

FOMC Preview – 11th December 2019.


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FOMC Preview

No policy changes or surprises are expected with today’s announcement (19:00 GMT) and Chair Powell’s press conference 30 minutes later. It will be interesting to see if, as expected, the voting is unanimous this time round. The FOMC members have expressed significant differences of opinion during 2019 as three rate cuts were implemented. The apparent paradox of low unemployment and low inflation, the new “norm”.

The two-digit unemployment rate (U-3) in November edged down to 3.53% from 3.56% in October, and a 3.52% cycle-low in September, all below the 3.58% prior cycle-low in April and a 4.00% rate at the beginning of the year. Current readings remain much lower than the 4.2% long-run unemployment rate projection noted in the September SEP, it is expected that this estimate will be trimmed today.

Headline CPI rose 0.4% in October while the core index rose by 0.2%, for respective y/y gains of 1.8% and 2.3%, versus September figures of 1.7% and 2.4%. Today the November headline is expected to fall again to 0.2% and the core remains flat at 0.2% too. The Fed’s favoured inflation gauge, the PCE chain price measure, rose 1.3% y/y in October and expectations are for an uptick to 1.4% in November. The core PCE chain price measure rose 1.6% y/y in November, versus 1.7% in September, and expectations are for the pace to hold at 1.6% in November. The FOMC’s latest median estimates for 2019 inflation are 1.5% for the headline and 1.8% for the core.

Hence, the focus will be on the Fed’s new quarterly forecasts, with expectations raised and likely to be mostly bullish results with a bump up in the median growth projection and a drop in the median dot to reflect a steady stance through 2020. However, the individual dots are likely to show both, forecasts for cuts and hikes. Chair Powell is expected to reiterate the US economy and policy are in a “good place,” (a phrase he has used a number of times lately) and could sound a little more upbeat after the strong jobs report. But, he will continue to warn of downside risks. The FOMC isn’t likely to announce any new measures on reserve management operations (QE?) or a repo facility. All steady into 2020 and beyond.

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USDIndex remains biased to the down side but has support around 97.40 and the 200-day moving average. A breach of this key support zone brings in 97.00 and the October low of 96.85. A break over 97.80 (the confluence of the 20 and 50-day moving averages) and 98.00 would be required before a re-test of the recent high at 98.50 could be considered.


Always trade with strict risk management. Your capital is the single most important aspect of your trading business.

Please note that times displayed based on local time zone and are from time of writing this report.

Click HERE to access the full HotForex Economic calendar.

Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding on how markets work. Click HERE to register for FREE!

Click HERE to READ more Market news.


Stuart Cowell
Head Market Analyst
HotForex

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.
HotForex is an award winning, fully regulated and licensed online forex and commodities broker. Offers various accounts, trading software and trading tools to trade Forex and Commodities for individuals, fund managers and institutional customers.
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Re: Hotforex.com - Market Analysis and News.

Postby HFblogNews » Thu Dec 12, 2019 6:00 am

Date : 12th December 2019.

Lagarde prepares ECB debut – 12th December 2019.


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Policy unchanged
Projections unlikely to change much
Clues about review sought
Style in focus


Presiding over her first presser of the European Central Bank today, Lagarde is expected to confirm once again the current policy setting, giving time to ECB to focus on the planned review of its overall policy framework.

Final Eurozone GDP and PMI readings broadly supported this neutral picture, while the confidence that a deep recession can be avoided is strengthening (Figure 1) despite the fact that German manufacturing and production numbers still look weak. The exports and the overall trade are actually holding up much better than expected, which together with still strong labour markets is underpinning hopes the net exports and consumption will continue to support growth not just in Germany.

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As there is nothing in the data really to challenge the ECB’s overall policy stance, the focus firstly turns into the tone and presentation style that President Lagarde will have. The “risk” is that the presser will be equally uneventful as her testimony before the European Parliament. Lagarde’s team building exercise seems to have worked and at least in public there has been a pretty consistent message since she took over, which is very likely to be confirmed today. Additionally it will be interesting to see whether she will back fully Draghi’s package.

Citi Bank: All key interest rates will likely be left unchanged, and the forward guidance reaffirmed. The main interest at this meeting will be the new Eurosystem staff projections, extended to 2022, to gauge whether the September package will be sufficient to bring inflation back into line with the ECB’s target over the forecast horizon. If not, investors’ attention will quickly turn to the ECB’s toolbox and what instruments the Governing Council would be willing to use and when, in order to defend its credibility in the absence of large fiscal support. The upcoming strategic review of monetary policy will also likely be the focus of many questions.

Hence as reported by Citi, other than Lagarde’s style, ECB projections could also monopolize the attention. Even though, the ECB remains ready to act again and tweak all its measures if necessary, it has already done a lot and now needs to keep an eye on the side effects of the very expansionary monetary policy, while politicians need to do their bit to support the economy.

The central bank won’t be reducing the degree of stimulus any time soon with many analysts supporting that this will continue until mid-2020 unless there is a major change in circumstance.

Central bankers will be conducting a comprehensive review of the policy framework, however, with a special focus on the inflation target. A more symmetric definition, which stresses that the ECB can see through lengthy inflation overshoots as well as periods of too low headline rates is likely to come in the first quarter of next year. The inclusion of owner-occupied housing costs into the HICP number also remains a challenge especially as house prices are rising rapidly in some centres, also thanks to the low interest rate environment.

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Bund yields have nudged higher over the past week, but the German 10-year so far failed to move lastingly above -0.3%. Uncertainty on trade and Brexit are keeping a lid on yields, although there is the risk that if things go the way markets want and a phase one trade deal is confirmed and in the UK PM Johnson gets his majority, there could be a sharp rise in yields, if markets price out further easing and start to look ahead to central banks removing some of the stimulus.

However this is far away for now, while central bankers are not looking eager to add further easing.


Always trade with strict risk management. Your capital is the single most important aspect of your trading business.

Please note that times displayed based on local time zone and are from time of writing this report.

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Andria Pichidi
Market Analyst
HotForex

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