Big Data On The Horizon
14-02-2011
Although there wasn’t much in the way of data on Friday, the markets reacted to developments from the Middle East as politics in Egypt took another turn. Upon the resignation from office by President Mubarek, it was apparent that risk appetite resurfaced in the equity markets that were still trading before going into the weekend. However with that being said the USD kept up its pace against the EUR, but this may have more to do with some of the fallout surrounding the Axel Weber story from Germany and his decision not to pursue the job of ECB President. The U.S. did release the Preliminary Consumer Sentiment mark from the University of Michigan and it turned in slightly better than expected outcome of 75.1.
Today will be relatively quiet with data internationally, although Japan has already turned in a poor Preliminary GDP number earlier with a result of minus -0.3%. Europe will publish its Industrial Production data today and it is anticipated to be -0.1%. The Americans and the British will be silent with data today. Thus investors will look at the news from this weekend, which continues to develop in the Middle East, and will perhaps continue to listen to any news from Germany regarding Axel Weber. However, tomorrow will bring plenty of important data, perhaps the most important of the week, as the GDP reports from Germany and France are presented, along with Retail Sales figures from the States. And that is not all, the U.K. will publish inflation statistics. Therefore today could see investors begin to position themselves for any upheavals that could occur upon any surprises tomorrow.
Taking into the context the political news from the Middle East, which has captured the world’s attention the past week and a half, the markets have traded in a rather tranquil manner. The USD has managed to move to a slightly stronger footing against the EUR. The GBP has managed to maintain its higher range against the USD at the same time. And it will be more than interesting to see how these three currencies play out in the next few days of trading if bourses turn bullish internationally.
The economic data from Europe and U.K. have remained lackluster at best. Officials have been blaming bad weather for the downturn in the numbers, but the question is what will happen tomorrow if the GDP numbers from Europe are unkind. Problems persist regarding Sovereign Debt issues, bailout packages, and austerity measures, and how this will be weighed against faltering GDP outcomes - if this should become the case - could prove worthwhile to watch.
The JPY has maintained a fairly tight range even though it finds itself on the slightly weaker side of its chart against the USD. The economic news from Japan continues to be challenging to put it politely. Debt issues are starting to come into focus and the rather troublesome GDP number from earlier today will not be greeted warmly. The JPY remains a strong currency because it is one of the three most important currencies in the world in terms of international trade, but this does not mean that Japan doesn’t have a tough economic road ahead. The AUD gained on Friday after sliding much of the week against the USD. Gold finds itself as of this writing at about 1359.00 USD per ounce. The AUD has battled its way back from the lower edges of its high value and may prove tempting to traders willing to test its range in the coming days.
