Forex Previews

Pound firmer after UK growth picks up pace in Q4

Posted on January 28, 2016 at 11:42 am GMT

The preliminary estimates of UK GDP growth showed the British economy expanded by 0.5% in the fourth quarter of 2015 compared to the previous quarter. The figure is in line with consensus estimates and is an improvement on the third quarter’s 0.4% rate. After disappointing growth for much of the year, today’s data should disperse fears that the UK was heading for a sharper slowdown. However, looking at the year-on-year rate, growth was 1.9% in the fourth quarter – the [..]

Fed slightly more cautious as it keeps rates on hold

Posted on January 27, 2016 at 8:25 pm GMT

The Federal Open Market Committee concluded its two-day policy meeting today and kept interest rates unchanged as expected at its first policy decision of the year. In December, the FOMC decided to raise the federal funds rate for the first time since 2006, increasing it by 25bps to a range of 0.25-0.50%. A tightening labor market and a sustained economic recovery since the financial crisis had prompted the Fed to start the normalization of interest rates even as inflation remains [..]

Australian inflation edges higher in Q4, lifting aussie

Posted on January 27, 2016 at 11:28 am GMT

Inflation in Australia edged higher in the fourth quarter of 2015 as tobacco and travel costs rose sharply. CPI rose by 1.7% year-on-year in the final quarter of last year, beating expectations of a 1.6% annual rise and compares with a rate of 1.5% in the previous quarter. However, the figure was still below the Reserve Bank of Australia’s target of 2-3%. The RBA’s preferred measures, the weighted mean and the trimmed mean were more muted though, indicating that there [..]

Attention turns to Fed and BoJ meetings amid market volatility and oil rout

Posted on January 26, 2016 at 11:43 am GMT

Two major central banks will hold their policy meeting this week, with the US Federal Reserve and Bank of Japan meeting for the first time in 2016. While the Fed is almost certain to keep rates steady on Wednesday, there’s been increased speculation in recent days that the BoJ might surprise with policy easing on Friday. The renewed slide in oil prices since the start of the year has brought back the threat of deflation. Crude oil prices were back [..]

Week Ahead – Central banks in focus again as Fed, BoJ and RBNZ meet; GDP data to be watched

Posted on January 22, 2016 at 12:32 pm GMT

The continued fall in oil prices has raised expectations of policy easing by the Reserve Bank of New Zealand and the Bank of Japan as they meet next week. But they may decide to stand pat for now like the Fed is expected to when it also holds its policy meeting. On the data front, GDP releases for the US and UK for the fourth quarter of 2015 will be watched closely. Starting the week with Japan, which will see [..]

Euro drops 1% after Draghi suggests possibility of further ECB easing in March

Posted on January 21, 2016 at 3:38 pm GMT

The European Central Bank made no surprises when it decided to keep monetary policy unchanged today at its first meeting of the year. January’s decision comes just six weeks after the ECB cut its deposit rate to -0.3% and extended the duration of its asset purchase program by 6 months. However, at the press conference that followed today’s announcement, Mario Draghi, President of the ECB, was keen to stress that the downside risks to the Eurozone economy and price stability [..]

Kiwi drops to 4-month low as weak inflation raises hopes of more rate cuts

Posted on January 20, 2016 at 11:22 am GMT

Inflation in New Zealand fell to the lowest level since 1999 as the annual rate of increase in the consumer price index declined to 0.1% in the final quarter of 2015. Expectations were for the inflation rate to stay unchanged at 0.4%. On a quarterly basis, CPI fell by 0.5% from the previous quarter, sharply below forecasts of a 0.2% fall. The drop was mainly attributed to an 8.1% decrease in petrol prices. The sharper-than-expected drop in inflation puts the [..]

Pound slumps on Carney remarks as markets ignore strong inflation data

Posted on January 19, 2016 at 3:28 pm GMT

The British pound was caught between two directions today after dovish comments from the Bank of England’s governor contrasted the strong inflation data from earlier in the day. The Bank’s Governor, Mark Carney, reiterated his dovish view on Tuesday saying that he would like to see signs of notable progress in three areas before raising interest rates. They comprise of economic growth accelerating to above trend, domestic cost pressures picking up and core inflation moving towards the 2% target. Speaking [..]

China posts slowest annual growth since 1990 on manufacturing pain

Posted on January 19, 2016 at 11:08 am GMT

China’s economy grew at the slowest pace in 25 years in 2015, with GDP growth easing to 6.9% from 7.3% in 2014. During the final quarter of 2015, the economy expanded by 1.6% quarter-on-quarter, slightly below estimates of 1.7% growth. But year-on-year growth met expectations at 6.8%, which is the slowest growth since 2009 at the height of the financial crisis. Other indicators released today underlined the weakening but stable trend. Industrial output in December grew by 5.9% year-on-year, down [..]

Oil rout intensifies as Iran re-enters global oil market

Posted on January 18, 2016 at 11:40 am GMT

Oil prices extended their slide on Monday after the international community decided to lift sanctions on Iran over the weekend. The decision to ease sanctions against Iran comes after the International Atomic Energy Agency said in its report that Iran has fulfilled its obligations under last year’s nuclear accord that prohibits Iran from developing nuclear weapons. Analysts estimate that Iran will be able to raise production by 500,000 barrels a day immediately after the suspension of sanctions. This would add [..]

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