Back
7 Jan 2015
EU CPI and Fed's minutes eyed - Westpac
FXStreet (Bali) - Sean Callow, FX Strategist at Westpac, breaks down the key events to watch for on Wednesday, with most of the attention centered around the EU CPI and Fed's minutes.
Key Quotes
"The Westpac MNI China consumer sentiment index for Dec is due at 12:45pm Syd/9:45am local. The Nov headline index of 111.0 was about flat m/m, barely above multi-year lows. The main value in the survey should be in the details, which showed some glimmers of hope in Nov."
"The European calendar is busy. In Germany, we will see Nov retail sales and Dec unemployment. The highlight though should be the advance reading on Eurozone Dec CPI. Consensus is for the core rate to remain at 0.7% y/y but with energy prices sliding, the headline rate is seen slipping to -0.1% y/y from 0.3% y/y in Nov. This would be a low since Oct 2009. The ECB targets headline inflation (near 2%) though sometimes it plays down the headline rate. ECB president Draghi gives the impression that he will announce new easing measures on 22 Jan regardless of the precise inflation rate in Dec but EUR should be sensitive all the same."
"The US calendar features Dec ADP private payrolls and the Nov trade balance. Consensus is 225k on ADP, though caution will be reinforced by the large gap between Nov ADP of 208k and the official estimate of private payrolls, 314k."
"Later in the session it’s the minutes from the FOMC’s 16-17 Dec meeting. At this meeting the FOMC said it could be “patient” raising rates and that this was “consistent” with the “considerable time” phrase. Then in the press conference, Chair Yellen said patience probably means no change at the next “couple” of meetings at least, which sparked a USD bounce. There were two hawkish dissents and one from the dovish side."
Key Quotes
"The Westpac MNI China consumer sentiment index for Dec is due at 12:45pm Syd/9:45am local. The Nov headline index of 111.0 was about flat m/m, barely above multi-year lows. The main value in the survey should be in the details, which showed some glimmers of hope in Nov."
"The European calendar is busy. In Germany, we will see Nov retail sales and Dec unemployment. The highlight though should be the advance reading on Eurozone Dec CPI. Consensus is for the core rate to remain at 0.7% y/y but with energy prices sliding, the headline rate is seen slipping to -0.1% y/y from 0.3% y/y in Nov. This would be a low since Oct 2009. The ECB targets headline inflation (near 2%) though sometimes it plays down the headline rate. ECB president Draghi gives the impression that he will announce new easing measures on 22 Jan regardless of the precise inflation rate in Dec but EUR should be sensitive all the same."
"The US calendar features Dec ADP private payrolls and the Nov trade balance. Consensus is 225k on ADP, though caution will be reinforced by the large gap between Nov ADP of 208k and the official estimate of private payrolls, 314k."
"Later in the session it’s the minutes from the FOMC’s 16-17 Dec meeting. At this meeting the FOMC said it could be “patient” raising rates and that this was “consistent” with the “considerable time” phrase. Then in the press conference, Chair Yellen said patience probably means no change at the next “couple” of meetings at least, which sparked a USD bounce. There were two hawkish dissents and one from the dovish side."