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News and Analysis

Fundamental analysis

Thursday September 13th is a busy day for high impact, economic calendar releases

There are several high impact calendar releases and economic events, that FX traders should remain vigilant of, during Thursday’s trading sessions. Traders who trade the Aussie dollar, should note the latest unemployment figures for Australia, which will be revealed at 2:30am U.K. time, on Thursday morning.

Forecast by Reuters panel of economists to remain at 5.3% of the Aussie workforce for August, the unemployment reading can often move the value of AUD/USD, particularly during times when market liquidity may be low. The consumer inflation expectation figure for Australia will also be published; predicted to come in at 4.0%, this reading (if it misses, or beats forecast) could also move the value of AUD versus its peers.

Focus will turn to the price of sterling versus its peers during Thursday morning’s trading session, as FX markets began to prepare for the Bank of England’s monetary policy committee (MPC), to announce its interest rate decision. The U.K. base rate is widely forecast, by the news agencies Reuters and Bloomberg, to remain unchanged at 0.75%, after the rate was raised as recently as August by a unanimous decision.

Analysts and traders will quickly turn their attention to the statement the MPC delivers with the announcement. The subsequent press conference Mark Carney and his colleagues hold, will also be closely scrutinised for clues as to how united the MPC were in relation to their decision. The assembled journalists will also be looking for any forward guidance, relating to the MPC’s monetary policy, over the short to medium term, particularly in relation to the Brexit process.

At 12:45pm the next high impact calendar event takes place, as Europe’s central bank the ECB will announce their interest rate decision, combined with any information regarding the tapering of the asset purchase scheme (APP), a version of bond buying/quantitative easing. The key interest rate is forecast to remain unchanged at 0.00%, with the deposit rate remaining at -0.4%.

Attention will then turn to the press conference the president of the ECB will hold in Frankfurt, Germany, at 13:30pm U.K. time. Mr. Draghi’s press conferences have recent form for moving the dial, in relation to the value of the euro versus its peers. He’s likely to cover several subjects as he holds court including: trade war/tariff threats, the inflation rate of the single currency trading area and unemployment. He’ll also be obliged to deliver an update on the previous commitment to end the APP, before 2018 ends.

There’s a raft of data published by USA statistics agencies on Thursday, regarding the USA economy. Inflation figures will be revealed; the Reuters CPI forecast is for a fall to 2.8% annually, from the 2.9% figure registered for July, with the monthly figure for August rising to 0.3%. The latest weekly (real) earnings figures, both hourly and weekly, will also be delivered.

The data series (if the forecasts are met) is unlikely to deter the Fed/FOMC from their commitment to raise the key interest rate in the USA twice more during 2018, from its current rate of 2% to 2.5%. As during their Jackson Hole symposium in August, the regional Fed chairs reaffirmed their commitment to raise rates twice more before the year is out, if inflation remains behind their 3% target and employment remains robust.

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Fundamental analysis

Published every afternoon, our fundamental analysis provides an overview of the key events – from interest rate decisions and industry opinion through to central bank committee meetings and economic data releases around the world.

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