ECB Added the Euro Some Negative (Weekly Review)

The main event of the past week was the meeting of the European Central Bank. According to its results, the level of interest rates was not changed, which fully corresponded to the forecasts of financial market participants. Also, in full accordance with their expectations, the ECB lowered the forecast for economic growth in the Eurozone economy to 1.1%, although at the end of last year the Central Bank expected it to grow by 1.7% and the third round of the LTRO program was announced.

Also, the euro continued to decline across virtually the entire spectrum of the market, in particular against the USD, and as a result the level of 1.1200 was broken and the 1.1180 mark was tested. The EUR still managed to finish the week above the 112th figure, which, nevertheless, in no way changes the negative forecast on it. Eurozone weak macroeconomic indicators and interest rate differential remain the main negative factors for the euro, so the risks of retesting bears of the 12th figure remain high.

Along with continuing uncertainty about the prospects for the termination of UK membership in the European Union, whose terms are inexorably approaching, the growth of the British pound was replaced by its fall, which resulted in test of 1.2962 paired with the USD. This week will be a series of votes in the British Parliament, and their results may affect the dynamics of the GBP. Prior to the votes, pressure on it can be maintained, and bears can again test the current minimum.

Schedule for this week:

Monday, March 11
12:30 GMT - USA. Retail Sales;
12:30 GMT - USA. Retail Control (Jan).

Tuesday, March 13
00:00 GMT - USA. Fed Chair Powell Speaks;
00:30 GMT - Australia. Home Loans;
00:30 GMT - Australia. NAB Business Confidence;
02:15 GMT - PRC. Foreign Direct Investment (FDI);
06:30 GMT - Australia. Reserve Bank of Australia Assistant Governor Debelle Speaks;
09:30 GMT – United Kingdom. Manufacturing Production;
09:30 GMT - United Kingdom. Industrial Production;
09:30 GMT - United Kingdom. GDP;
12:30 GMT - USA. Consumer Price Index (CPI) excluding food and energy;
12:30 GMT - USA. Consumer Price Index (CPI);
12:30 GMT - USA. Core Consumer Price Index (CPI);
18:00 GMT – United Kingdom. UK Parliament vote on Brexit deal.

Wednesday, March 14
23:30 GMT - Australia. Westpac Consumer Confidence;
23:50 GMT - Japan. Core Machinery Orders;
10:00 GMT - Eurozone. Industrial Production;
12:30 GMT - United Kingdom. Annual Budget Release;
12:30 GMT - USA. Durable Goods Orders.

Thursday, March 15
23:50 GMT - Japan. Foreign Investments in Japanese Stocks;
00:00 GMT - Australia. MI Inflation Expectations;
02:00 GMT – PRC. Industrial Production;
02:00 GMT – PRC. Retail Sales;
07:00 GMT - Germany. Harmonised Index of Consumer Prices (HICP);
12:30 GMT - USA. Initial Jobless Claims;
14:00 GMT - USA. New Home Sales.

Friday, March 16
21:30 GMT – New Zealand. Business NZ Purchasing Managers' Index (PMI);
22:50 GMT - Canada. Bank of Canada Governor Council Member Wilkins Speaks;
02:00 GMT - Japan. Bank of Japan Interest Rate Decision;
02:00 GMT - Japan. Bank of Japan Press Conference and Monetary Policy Statement;
02:00 GMT - Japan. Bank of Japan Governor Kuroda Speaks;
10:00 GMT – Eurozone. Consumer Price Index (CPI);
10:00 GMT - Eurozone. Core Consumer Price Index (CPI);
13:15 GMT - USA. Industrial Production;
14:00 GMT - USA. The University of Michigan Consumer Sentiment Index.

Author: Anthony Porter, IAFT Analyst