29 Apr 2015
Key events for day ahead; plenty on show - Rabobank
FXStreet (Guatemala) - Analysts at Rabobank noted the key events ahead for the day that has plenty to offer.
Key Quotes:
"Today has plenty to offer. We start with a package of Eurozone numbers: M3 for March, seen accelerating further to 4.3% YoY and 4.1% 3MMA (though that is ECB led for now); then the ECB’s Hansson speaking; then Eurozone confidence numbers; and then German CPI."
"However, the larger focus is Q1 US GDP, which “live tracking” from the Atlanta Fed has pegged as weak. Market consensus is just 1.0% QoQ annualized vs. 2.2% in Q4, with personal consumption dropping from 4.4% to 1.7% and the core PCE deflator dipping to just 1.0%. Of course, what we will actually get is anyone’s guess given the statistical tricks the GDP report can often pull, especially at a times of falling energy prices (recall one usually subtracts inflation from nominal GDP to reach real GDP: yet if one subtracts negativeinflation one must actually add to real GDP)."
"Ordinarily GDP alone would be enough to move USD and bond yields, but we then get the FOMC meeting decision, which promises an even wilder ride. Will the Fed look through weaker recent data (as it did – correctly – with Q1 last year)? In that case, expect USD to soar. Or will they move closer to our house view of a first Fed hike in Q4 this year? In which case, there may be more downside for USD yet. Regardless, we can expect a sharp market reaction today: is it to be batons or bats, Ms. Yellen?"
Key Quotes:
"Today has plenty to offer. We start with a package of Eurozone numbers: M3 for March, seen accelerating further to 4.3% YoY and 4.1% 3MMA (though that is ECB led for now); then the ECB’s Hansson speaking; then Eurozone confidence numbers; and then German CPI."
"However, the larger focus is Q1 US GDP, which “live tracking” from the Atlanta Fed has pegged as weak. Market consensus is just 1.0% QoQ annualized vs. 2.2% in Q4, with personal consumption dropping from 4.4% to 1.7% and the core PCE deflator dipping to just 1.0%. Of course, what we will actually get is anyone’s guess given the statistical tricks the GDP report can often pull, especially at a times of falling energy prices (recall one usually subtracts inflation from nominal GDP to reach real GDP: yet if one subtracts negativeinflation one must actually add to real GDP)."
"Ordinarily GDP alone would be enough to move USD and bond yields, but we then get the FOMC meeting decision, which promises an even wilder ride. Will the Fed look through weaker recent data (as it did – correctly – with Q1 last year)? In that case, expect USD to soar. Or will they move closer to our house view of a first Fed hike in Q4 this year? In which case, there may be more downside for USD yet. Regardless, we can expect a sharp market reaction today: is it to be batons or bats, Ms. Yellen?"