5, 2011
(Allthingsforex.com)
– In the
aftermath of a
cautiously
optimistic
employment
report, the
trading week
ahead will
bring a
sequence of
U.S. consumer
spending and
sentiment data,
along with two
major European
events- the
Bank of England
interest rate
announcement
and the EU
Summit, which
could have a
significant
impact on the
future
direction of
the pound
sterling and
the euro.
In
training for
the new trading
week, here is
the outlook for
the Top 10
spotlight
economic events
that will go
the markets
around the
globe.
1. NZD-
Reserve Bank of
New Zealand
Interest Rate
Announcement,
Wed., Mar. 9,
3:00 pm,
ET.
With
the Prime
Minister of New
Zealand in suspense
for a reduction
of interest
rates because
of
"virtually
no growth for
the current
financial
year" and
the market
aggressively
pricing such
expectations,
the Reserve
Bank of New
Zealand could
deliver a rate
cut by 0.25%,
bringing the
benchmark rate
to 2.75% from
3.0%. If the
central bank
does not open
the door to
further rate
cuts, the New
Zealand dollar
could find an
opportunity to
right some of
its recent
losses.
2. JPY-
Japan GDP-
Combined Domestic
Product,
the main
measure of
economic
activity and
growth, Wed.,
Mar. 9, 6:50
pm, ET.
The
final revision
of the Q4 GDP
should confirm
the preliminary
estimate which
indicated that
the Japanese
economy
contracted by
0.3% q/q in the
fourth quarter
of 2010.
3. AUD-
Australia
Employment
Circumstances and
Unemployment
Rate,
the main gauges
of employment
trends and
labor market
conditions,
Wed., Mar. 9,
7:30 pm, ET.
Recovery and
rebuilding
efforts
following the
floods in
Queensland
could continue
to stimulate
job foundation
"down
under" as
the Australian
economy adds up
to 21.5K jobs,
lesser than the
24K new jobs
bent in the
previous month.
The
unemployment
rate is
forecast to
remain
unchanged at
5.0%.
4. GBP-
U.K. Industrial
Production and
Manufacturing
Output,
the main gauges
of industrial
activity
measuring the
output of
factories,
mines and
utilities,
Thurs., Mar.
10, 4:30 am,
ET.
The
U.K. industrial
activity is
forecast to
rise by 0.5%
m/m in January-
same as the
0.5% m/m
reading in the
previous month,
while the
manufacturing
output picks up
the pace by
0.8% m/m,
recovering from
the 0.1% m/m
drop in
December.
5. GBP-
Bank of England
Interest Rate
Announcement,
Thurs., Mar.
10, 7:00 am,
ET.
Three
Monetary Policy
Committee
members voted
for a rate hike
at the last
meeting, while
the Bank of
England
Governor Mervyn
King called
raising the
benchmark
interest rate
as a gesture to
fight inflation
"self
defeating".
The huge
inquiry is who
will win- the
Governor or the
"rate
hawks"?
Making the
right choice
on future
monetary policy
could become an
even more
hard
proposition,
taking into account the
potential
threat of
stagflation-
tenaciously high
inflation
coupled with
possible
economic
slowdown on
rising oil
prices and on
the U.K.
government's
massive
spending cuts.
Although the
well-known
hawks are
expected to
vote for a rate
hike once
again, the
majority of the
MPC members
would be likely
to choose to
keep the
reputation-quo for
another month,
maintaining the
benchmark
interest rate
at the confirmation
low level of
0.5%. The GBP
could stay
supported ahead
of the meeting,
but if there is
no announcement
of a rate hike
and if there
aren't
more MPC
members to join
the hawkish
camp, we could
witness some
unwinding of
long GBP
positions.
6. USD-
U.S. Jobless
Claims,
an vital
gauge of
employment
trends and
labor market
conditions,
Thurs., Mar.
10, 8:30 am,
ET.
Last
week's
jobless claims
report
registered the
largest drop in
first-time
applications
for
unemployment
benefits since
May, 2008.
Early jobless
claims fell to
368K for the
week ending
February 26,
below the 375K
"magic
number"
estimated by
economists to
indicate a
significant
decline in
unemployment.
Forecasts are
pointing to
another
positive
reading of 673K
for the week
ending March
5.
7. CAD-
Canada
Employment
Circumstances and
Unemployment
Rate,
the main gauges
of employment
trends and
labor market
conditions,
Fri., Mar. 11,
7:00 am, ET.
The
Canadian
economy is
expected to add
up to 32K jobs
in February,
lower than the
69.2K new jobs
bent in the
previous month.
The
unemployment
rate is
forecast to
pull back to
7.7% from 7.8%
in
January.
8. USD-
U.S. Retail
Sales,
an vital
gauge of
consumer
spending
measuring sales
at retail
establishments,
Fri., Mar. 11,
8:30 am, ET.
Consumer
spending in the
U.S. is
expected to
pick up the
pace with
retail sales
rising by 0.5%
m/m in
February, up
from 0.3% m/m
in
January.
9. USD-
U.S. Consumer
Sentiment,
the University
of Michigan's
monthly survey
of 500
households on
their financial
conditions and
outlook of the
economy, Fri.,
Mar. 11, 9:55
am, ET.
The
U.S. consumers
are forecast to
remain
optimistic for
another month
as the
preliminary
estimate of the
consumer
sentiment index
reaches 77.3 in
March, slightly
lower than the
77.5 reading in
the previous
month.
10. EUR-
European Union
Summit,
a meeting of EU
leaders to
discuss the
impact of the
unrest in North
Africa and the
Middle East, as
well as the
debt crisis and
economic
issues, Fri.,
Mar. 11, All
Day
Consequence.
Although the
main focus of
the EU Summit
will be the
turmoil in
Libya and the
Middle East and
its impact on
the economy, we
could also see
discussions on
how to contain
the debt
crisis,
counting
possible
expansion of
the European
Financial
Stability
Facility fund.
With the 5-year
CDS on
Portuguese
sovereign debt
back on the
rise and debt
obligations
coming due for
Spain and
Portugal,
should the
summit fail to
deliver an
agreement on
permanent
solutions to
stop the debt
crisis from
spreading, the
euro could
suffer the
consequences.
Source: Fxstreet.com
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