Archive for Financial News – Page 4

Yen softens despite rising US-China tensions

By Lukman Otunuga, Research Analyst, ForexTime

Shares across Asian markets ventured higher on Tuesday morning, following gains on Wall Street overnight as investors shrugged off China’s retaliatory actions against the United States.

In a move that is likely to strain US-China relations even further, Beijing slapped sanctions on U.S. officials in response to similar measures enforced by Washington. Despite this, market sentiment remains optimistic with investors keeping a close eye on negotiations over the next coronavirus stimulus package in the US.

With hopes for additional U.S fiscal supporting risk sentiment, safe-haven currencies like the Japanese Yen and even Dollar have struggled to shine despite mounting tensions between the two largest economies in the world.

USDJPY eyes 106.50

Over the past two weeks, the USDJPY has found comfort within a 150-pip range with support at 105.00 and resistance around 106.50.

Given how both the Dollar and Yen are fundamentally bearish, this could be a slow grind higher or lower. Looking at the technical picture, prices remain bearish on the daily chart as the candlesticks are trading below the 20 Simple Moving Average while the MACD trades to the downside. If 106.50 proves to be reliable resistance, prices could end up declining back towards the 105.00 support.

Alternatively, a breakout above 106.50 may open the gates towards 107.50.

EURJPY remains in an uptrend

A picture is worth a thousand words…

Looking at the EURJPY on the daily charts, prices are firmly bullish as there have been consistently higher highs and higher lows.

The currency pair is finding comfort above the 20 Simple Moving Average while the MACD also points to the upside. A solid breakout above 125.50 will confirm the bullish trend with the new higher low around 124.00. The next key point of interest in such a scenario will be found around 127.00. On the other hand, if 125.50 proves to be a tough nut to crack, prices could sink back towards 123.00.

GBPJPY breakout setup in play

It has been the same story with the GBPJPY over the past two weeks as the currency traded within 110 pip range. All eyes will be on the support at 137.90 and resistance at 139.00.

A decisive breakdown and daily close below 137.90 should pave a path towards 135.00. Alternatively, a breakout above 139.00 may inspire a move back towards 141.00.

Disclaimer: The content in this article comprises personal opinions and should not be construed as containing personal and/or other investment advice and/or an offer of and/or solicitation for any transactions in financial instruments and/or a guarantee and/or prediction of future performance. ForexTime (FXTM), its affiliates, agents, directors, officers or employees do not guarantee the accuracy, validity, timeliness or completeness, of any information or data made available and assume no liability as to any loss arising from any investment based on the same.


Forex-Time-LogoArticle by ForexTime

ForexTime Ltd (FXTM) is an award winning international online forex broker regulated by CySEC 185/12 www.forextime.com

The Analytical Overview of the Main Currency Pairs on 2020.08.11

by JustForex

The EUR/USD currency pair

Technical indicators of the currency pair:
  • Prev Open: 1.17868
  • Open: 1.17365
  • % chg. over the last day: -0.39
  • Day’s range: 1.17220 – 1.17744
  • 52 wk range: 1.0777 – 1.1781

The bearish sentiment prevails on the EUR/USD currency pair. The trading instrument has updated local lows again. The demand for greenback has been partially resumed. Investors continue to monitor the adoption of a new package of measures to support the US economy. At the moment, EUR/USD quotes are consolidating in the range of 1.1725-1.1770. The single currency has the potential for further decline. We recommend opening positions from key levels.

The news feed on 2020.08.11:
  • – ZEW economic sentiment indices in Germany and the Eurozone at 12:00 (GMT+3:00);
  • – Producer price index in the US at 15:30 (GMT+3:00).
EUR/USD

Indicators signal the power of sellers: the price has fixed below 50 MA and 100 MA.

The MACD histogram is in the negative zone, which indicates the bearish sentiment.

Stochastic Oscillator is in the neutral zone, the %K line has crossed the %D line. There are no signals at the moment.

Trading recommendations
  • Support levels: 1.1725, 1.1700
  • Resistance levels: 1.1770, 1.1800, 1.1845

If the price fixes below 1.1725, EUR/USD quotes are expected to fall further. The movement is tending to 1.1700-1.1670.

An alternative could be the growth of the EUR/USD currency pair to 1.1800-1.1830.

The GBP/USD currency pair

Technical indicators of the currency pair:
  • Prev Open: 1.30535
  • Open: 1.30582
  • % chg. over the last day: +0.02
  • Day’s range: 1.30553 – 1.30959
  • 52 wk range: 1.1466 – 1.3516

There is an ambiguous technical pattern on the GBP/USD currency pair. The British pound is being traded in a flat. Quotes are testing local support and resistance levels: 1.3055 and 1.3100, respectively. Financial market participants expect additional drivers. The trading instrument is tending to decline. Positions should be opened from key levels.

The UK released ambiguous labor market data.

GBP/USD

The indicators do not give accurate signals: the price has crossed the 50 MA and 100 MA.

The MACD histogram is near the 0 mark.

Stochastic Oscillator is in the neutral zone, the %K line has crossed the %D line. There are no signals at the moment.

Trading recommendations
  • Support levels: 1.3055, 1.3010, 1.2980
  • Resistance levels: 1.3100, 1.3155, 1.3185

If the price fixes below 1.3055, GBP/USD quotes are expected to correct. The movement is tending to 1.3010-1.2980.

An alternative could be the growth of the GBP/USD currency pair to 1.3140-1.3170.

The USD/CAD currency pair

Technical indicators of the currency pair:
  • Prev Open: 1.33890
  • Open: 1.33508
  • % chg. over the last day: -0.28
  • Day’s range: 1.33009 – 1.33607
  • 52 wk range: 1.2949 – 1.4668

USD/CAD quotes have been declining again. The trading instrument has updated local lows. At the moment, the key support and resistance levels are 1.3290 and 1.3335, respectively. USD/CAD quotes have the potential for further decline. We recommend paying attention to the dynamics of oil prices. Positions should be opened from key levels.

At 15:30 (GMT+3:00), data on building permits will be published in Canada.

USD/CAD

Indicators do not give accurate signals: the price has crossed the 100 MA.

The MACD histogram is in the negative zone, which indicates the bearish sentiment.

Stochastic Oscillator is near the oversold zone, the %K line has crossed the %D line. There are no signals at the moment.

Trading recommendations
  • Support levels: 1.3290, 1.3255, 1.3235
  • Resistance levels: 1.3335, 1.3370, 1.3400

If the price fixes below 1.3290, a further drop in USD/CAD quotes is expected. The movement is tending to 1.3255-1.3235.

An alternative could be the growth of the USD/CAD currency pair to 1.3370-1.3400.

The USD/JPY currency pair

Technical indicators of the currency pair:
  • Prev Open: 105.842
  • Open: 105.936
  • % chg. over the last day: +0.09
  • Day’s range: 105.913 – 106.240
  • 52 wk range: 101.19 – 112.41

The technical pattern is still ambiguous on the USD/JPY currency pair. The trading instrument is in a sideways trend. Investors expect additional drivers. At the moment, the local support and resistance levels are 105.80 and 106.20, respectively. USD/JPY quotes are tending to grow. We recommend paying attention to the dynamics of US government bonds yield. Positions should be opened from key levels.

The news feed on Japan’s economy is calm.

USD/JPY

Indicators signal the power of buyers: the price has fixed above 50 MA and 100 MA.

The MACD histogram is in the positive zone, which indicates the bullish sentiment.

Stochastic Oscillator is in the neutral zone, the %K line is below the %D line, which gives a signal to sell USD/JPY.

Trading recommendations
  • Support levels: 105.80, 105.60, 105.30
  • Resistance levels: 106.20, 106.45

If the price fixes above 106.20, further growth in USD/JPY quotes is expected. The movement is tending to 106.50-106.80.

An alternative could be a decline in the USD/JPY currency pair to 105.50-105.20.

by JustForex

Asia’s recovery supports Oil around 5-month high

By Han Tan, Market Analyst, ForexTime

Oil prices are holding steady around levels not seen since March, after Saudi Aramco expressed a slightly rosier outlook on global markets. Having witnessed a 73 percent year-on-year drop in its Q2 earnings, Saudi Arabia’s government-owned oil giant now believes that demand for crude oil is returning to pre-pandemic levels in Asian economies, which make up the company’s largest regional market.

 

 

Looking at Oil prices from a technical perspective, the stunning surge since April is clearly waning. As the Oil benchmarks approach their respective 200-day simple moving averages, it remains to be seen whether crude can break above this resistance level.

The onus appears to be on fundamental factors to drive oil prices higher, allowing WTI futures to add to its 4.7 percent month-to-date gain, with Brent futures having added 3.7 percent thus far in August.

There has to be clearer signs that the world’s consumption of Oil can move closer to pre-pandemic levels by way of a recovery in global economic activity. In other words, more factories have to resume operations, more motorists have to resume their regular routes, and more planes have to return to the skies. According to data by FlightRadar24, commercial flights worldwide climbed by nearly six percent last week, but the average number of flights remains some 33 percent lower than the pre-pandemic average.

On the supply side of the equation, the likes of Russia and Saudi Arabia are beginning to ease off their production cuts this month, as the OPEC+ alliance plans to bring back nearly two million barrels a day back into global markets. Should OPEC+ members continue to struggle with adhering to their respective output quotas, such factors could temper any attempts to send Oil prices higher.

In the event that markets are tipped back into oversupplied conditions, that could see Oil prices unwind recent gains, especially if hopes over the global economic recovery gives way to the realization that this slog into the post-pandemic era is set to be dragged out for longer.

 

Disclaimer: The content in this article comprises personal opinions and should not be construed as containing personal and/or other investment advice and/or an offer of and/or solicitation for any transactions in financial instruments and/or a guarantee and/or prediction of future performance. ForexTime (FXTM), its affiliates, agents, directors, officers or employees do not guarantee the accuracy, validity, timeliness or completeness, of any information or data made available and assume no liability as to any loss arising from any investment based on the same.


Forex-Time-LogoArticle by ForexTime

ForexTime Ltd (FXTM) is an award winning international online forex broker regulated by CySEC 185/12 www.forextime.com

Markets advance intact with SP 500 near new record – 11.8.2020

By IFCMarkets.com

Top daily news

Global markets are rising currently after a bullish session on Monday. US equities ended mostly higher Monday while technology shares declined as investors rotated away from high-growth stocks.

Forex news

Currency Pair Change
EUR USD +1.05%
GBP USD -0.26%
USD JPY +0.18%
The Dollar strengthening has halted currently . The live dollar index data show the ICE US Dollar index, a measure of the dollar’s strength against a basket of six rival currencies, added 0.1% Monday as the Bureau of Labor Statistics reported the number of job openings in the US rose 518,000 to 5.8 million, climbing for a second month in a row. EUR/USD continued sliding Monday while GBP/USD reversed higher as Sentix overall business sentiment  index for the euro-zone economy climbed by +4.8 points for the fourth time in a row, reaching -13.4. Both pairs are little changed currently. AUD/USD continued sliding yesterday while USD/JPY continued advancing with both pairs higher currently.

Stock Market news

Indices Change
Dow Jones Index +0.66%
GB 100 Index +1.04%
Nikkei Index +1.76%
Hang Seng Index +0.86%
Futures on three main US stock indexes are higher currently ahead of the housing starts report at 16:15 CET today. Companies continue reporting second quarter results. As of Friday, companies representing 89% of the SP 500’s market capitalization had reported second-quarter results, with 81% of them beating their lowered projections. The three main US stock indexes posted returns ranging from -0.4% to 1.3% Monday. European stock indexes are advancing currently after back to back gains yesterday led by bank shares. Asian indexes are mostly rising today led by Nikkei and followed by Hong Kong’s Hang Seng Index as China Association of Automobile Manufacturers reported China’s auto sales grew for a fourth straight month in July.

Commodity Market news

Commodities Change
Brent Crude Oil +0.58%
WTI Crude +0.92%
Brent is extending gains today. Oil prices ended solidly higher on Monday after Saudi Aramco Chief Executive said over the weekend there had been a “partial recovery” in demand: the US oil benchmark West Texas Intermediate (WTI) for September added 1.8% Monday and is up currently. October Brent crude rose 1.3% to $44.99 a barrel on Monday.

Gold Market News

Metals Change
Silver -1.66%
Gold prices are edging lower today. December gold added 0.6% to $2039 an ounce on Monday.

Market Analysis provided by IFCMarkets.com

Conduent Shares Soar on Better than Expected Q2 Earnings and Strong New Business Signings

Source: Streetwise Reports   08/07/2020

Shares of Conduent Inc. traded 76% higher after the company reported stronger than expected Q2/20 financial results that included a 90% Yoy growth in new business contract signings.

Conduent Inc. (CNDT:NASDAQ) yesterday announced second quarter 2020 financial results for the period ended June 30, 2020.

The company’s CEO Cliff Skelton remarked, “We continued to make progress in the second quarter as a result of the hard work from our associates and support from our clients. Our Government segment performed particularly well this quarter, driven by larger volumes in the Government payments space and our Transportation business proved to be more resilient than anticipated. New business signings showed significant growth on top of last quarter’s strong results and our pipeline is now stronger than it has been in a long time…We remain focused on positioning the company for long-term growth, while taking the time to build a sustainable base of business.”

The company advised that Q2/20 revenue exceeded estimates due to better than expected results in the Government and Transportation segments. The firm stated that revenue was somewhat lower compared to Q2/19 due to prior year lost business and COVID-19 related impacts.

Conduent noted that it experienced higher than expected activity in its Government business mainly from “increased volumes in its Supplemental Nutrition Assistance Program and Pandemic Supplemental Nutrition Assistance Program (SNAP and P-SNAP) and Unemployment Insurance pre-paid cards offerings.”

The company mentioned that though it tolling business is still below historical pre-COVID-19 levels, it did recover some and the rest of its Transportation segment was impacted slightly less than expected. The firm stated that its Commercial business segments which include Transaction Processing, Healthcare and HR Services offerings were negatively impacted by COVID-19.

The firm highlighted that in Q2/20 it achieved strong sales performance with $623 million in new business signings, a 90% increase over Q2/19 and a 92% increase over Q1/20. Conduent noted that this represents the strongest signings quarter for the company since its spin-off as a standalone public company. The company explained that the new business signings were with a diverse mix of customers across its Commercial, Government, and Transportation business segments.

The company pointed out that it is remains on target to overachieve on the FY/20 $100 million cost reduction program and continues to focus on efficiency, growth and quality projects as part of its strategic transformation program that aims to improve client performance optimization and retention and to enhance service level agreement monitoring.

For Q2/20 the company reported revenue decreased by 8.6% to $1,016 million, compared to $1,112 million in Q2/19. The firm posted a much lower GAAP net loss in Q2/20 of $51 million, compared to a GAAP net loss of $1,029 million in Q2/19. The company additionally listed that diluted EPS from continuing operations in Q2/20 was ($0.25), compared to diluted EPS of ($4.94) in Q2/19.

Conduent’s CFO Brian Webb-Walsh commented, “Our focus on delivering for clients while managing our costs is clearly showing in our results. We performed well in the second quarter and our business showed resiliency in the face of the COVID-19 pandemic. We also now expect to overachieve on our $100M cost program for 2020. Given current trends, we anticipate Q3/20 revenue to be $960 million to $1.01 billion and an Adjusted EBITDA margin of between 10.0-11.5% in Q3/20.”

Conduent is based in Florham Park, N.J., and delivers what it calls mission-critical ​services and solutions on behalf of businesses and governments. The firm’s solutions and services are designed and implemented to automate workflow, improve efficiency, reduce costs and enable revenue growth. The company advised that its clients include most of the Fortune 100 companies and over 500 government entities and that “its differentiated services and solutions improve experiences for millions of people every day, including two-thirds of all insured patients in the U.S., 11 million employees who use its HR Services, and nearly 9 million people who travel through toll systems daily.”

Conduent started off the day with a market capitalization of around $472.5 million with approximately 209.1 million shares outstanding and a short interest of about 2.5%. CNDT shares opened 70% higher today at $3.86 (+$1.60, +70.80%) over yesterday’s $2.26 closing price. The stock has traded today between $3.61 and $4.65 per share and is currently trading at $3.99 (+$1.73, +76.55%).

 

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Dollar net short bets increase slowed despite US manufacturing expansion

By IFCMarkets.com

US dollar bearish bets increase slowed with total net shorts reaching $28.93 billion from $24.28 against the major currencies during the one week period, according to the report of the Commodity Futures Trading Commission (CFTC) covering data up to August 4 and released on Friday August 7. The increase in net short dollar bets resulted from decreases in bearish bets on Australian dollar and significant increase in bullish bets on Japanese yen, Swiss franc and euro as euro-zone GDP decreased by 12.1% in the Q2 – markedly less than in the US. At the same time Markit reported the manufacturing activity across the euro zone expanded for the first time since early 2019. The bearish dollar bets rose again despite Institute for Supply Management report its manufacturing PMI rose to an above-expected reading of 54.2 in July. Readings above 50 indicate expansion in factory activity. Another negative factor was the US Labor Department report 1.434 million Americans filed for first-time unemployment benefits in the prior week, a rise of 14,000.

CFTC Sentiment vs Exchange Rate

August 05 2020 Bias Ex RateTrend Position $ mln Weekly Change
CAD bearish negative -1740 -806
AUD bearish negative -75 284
EUR bullish negative 26640 3559
GBP bearish negative -1202 851
CHF bullish negative 1596 446
JPY bullish negative 3716 325
Total 28934

 

commitment of traders net long short
commitment of traders weekly change
market sentiment ratio long short positions
Market Analysis provided by IFCMarkets.com

Technical outlook: GBPUSD waits for UK jobs data

By Lukman Otunuga, Research Analyst, ForexTime

It was not a bad start to the trading week for Sterling which appreciated across the board.

The Pound’s positive performance over the past few weeks has certainly defied expectations, especially when factoring how Brexit related uncertainty and shaky economic fundamental from the UK continue to weigh on sentiment.

Expect the Pound to be heavily influenced by the upcoming jobs data on Tuesday especially when considering how the government’s £33.8 billion furlough scheme will be coming to an end in October. An increase in unemployment may force the Bank of England to fire its final rate cut bazooka sooner than expected in an effort to stimulate economic growth. Such a development may haunt investor attraction towards the Pound, resulting in the GBPUSD breaking below the 1.3000 support level with the first point of interest rate 1.2850.

Alternatively, a better than expected figure could rekindle buying sentiment towards the Pound with bulls eyeing 1.3200.

Looking deeper into the technical picture, the GBPUSD remains bullish on the daily charts as there have been consistently higher highs and higher lows. Prices are trading above 20 & 200 Simple Moving Average while the MACD trades to the upside.
A solid breakout above the 1.3200 will confirm that 1.3000 is the new higher low with 1.3300 acting as a medium-term goal for bulls.

Disclaimer: The content in this article comprises personal opinions and should not be construed as containing personal and/or other investment advice and/or an offer of and/or solicitation for any transactions in financial instruments and/or a guarantee and/or prediction of future performance. ForexTime (FXTM), its affiliates, agents, directors, officers or employees do not guarantee the accuracy, validity, timeliness or completeness, of any information or data made available and assume no liability as to any loss arising from any investment based on the same.


Forex-Time-LogoArticle by ForexTime

ForexTime Ltd (FXTM) is an award winning international online forex broker regulated by CySEC 185/12 www.forextime.com

The Week Ahead: Technology Supremacy

By Orbex

USDCAD Rebounds as Sino-US Tensions Brew

The US dollar could see a silver lining in the tensions between the US and China. President Donald Trump’s executive orders to ban popular Chinese apps WeChat and TikTok are the latest escalations in already souring relations between the two powers

While the battle for tech supremacy unfolds, the prospect of Chinese retaliation is likely to drive investors off risky assets, as a reminiscence of previous trade wars. Due to this, the greenback could see more buying interests and rise again as a safe haven currency.

The buck has bounced off the February low of 1.3220. A meaningful rally would need to pierce through the 1.3600 cluster.

EURCHF Rises as Investors Put Faith in Euro

The euro has been inching up against most pairs thanks to newfound confidence in the union. The massive recovery package was more of a political message that underpinned the EU’s credibility. The bullish turnaround is expected to sustain itself as the European block now seems to be better positioned politically and economically in the crisis.

Friday’s GDP data could stir up some short-term volatility. An upbeat number could only confirm the underlying optimism. The 30-day moving average around 1.0700 is the immediate support. June’s high of 1.0900 is the next target in sight.

GBPAUD Bounces from 12-Month Low

After breaking above July’s consolidation range, the pound is looking for a catalyst to make up lost ground against the Aussie.

The Bank of England maintained its interest rates last week and gave no signal of going sub-zero. Along with less-dovish economic projections, the currency may have found a floor for a rebound. UK’s employment and GDP data could offer ammunition for a rally should it materialize. The downside risk would be a flamboyant Aussie carrying on on its rally.

The pound has retreated from the 1.8400 resistance. The psychological level of 1.8000 near the MAs is the immediate support to monitor.

NZDJPY Looks to Break Out as RBNZ Meets

Despite global risk sentiment, the New Zealand dollar has slowed down its advance against the Japanese yen. The kiwi’s appreciation is a headache for the Reserve Bank of New Zealand (RBNZ) as it hinders the country’s competitiveness during these difficult times. Markets expect the central bank to remain dovish in the upcoming policy meeting. As long as the bank keeps the possibility of negative rates on the table, the currency is likely to see its upside restrained.

The pair is hovering around the MAs after it pulled back from the double top at 71.60. A failure to break out would lead to a test of the key support at 68.20.

By Orbex

Weekly Fundamental Bulletin: RBNZ, Australia Jobs & Eurozone GDP

By Orbex

Last Week’s Highlights

BoE Leaves Rates Steady but Gives a Cautious Outlook on Economy

The Bank of England held its monetary policy meeting on Thursday. While leaving interest rates unchanged at 0.10% it also left the bond-buying program steady at £745 billion.

The decision to leave interest rates unchanged was unanimous. The central bank said that it does not expect the UK’s economy to rise more than the pre-coronavirus level at least until the end of 2021.

In the short term, policymakers were optimistic. According to the officials, the GDP is forecast to shrink by 9.5% in 2020, compared to the 14% contraction that was forecast in May.

US Services & Manufacturing Activity Picks Up in July

Both measures of activity, covering services, and manufacturing saw a modest increase in July. Data from the Institute of Supply Management showed manufacturing activity rising to 54.2 in July, up from 52.6 in June.

The non-manufacturing services activity grew to 58.1, up from 57.1 in June. The data represents an increase in growth in both sectors.

The services activity is up for two consecutive months. However, overall, business remained concerned about the labor market despite a short term increase in new orders activity.

New Zealand Unemployment Rate Falls to 4% in Q2 2020

The latest data from New Zealand showed that the unemployment rate fell to 4.0% on a seasonally adjusted basis. This was down from 4.2% in the previous quarter.

Economists forecast that the unemployment rate could rise to 5.8% during the period. The employment change fell 0.4% on the quarter compared to estimates of a 2.0% decline.

Meanwhile, the labor cost index rose by 2.1% on the year with private sector wages rising 1.7% while public sector wages rising 3%.

German Exports & Industrial Production Rises in June

There was some positive news from Germany this week after data showed an improvement in both exports and industrial production numbers.

Exports and imports grew faster than in the previous month. Exports rose 14.9% on the month, following on a 8.9% increase in May. Imports grew by 7% in June from 3.6% in May.

Meanwhile, industrial production rose at a pace of 8.9% in June. The data was higher than the 7.4% increase in May. On a yearly basis, German industrial production fell 11.7% in June compared to 19.5% in May.

US Unemployment Rate Dips to 10.9% in July

The latest monthly labor market report from the Commerce Department showed that the unemployment rate fell to 10.9% from 12.3% previously.

Economists polled expected the jobless rate to fall to 11.1%. The US economy also added 418.5k jobs during the month. The data was also more than the estimates of 395k. However, it was about half of the jobs added in June.

There was also a modest pick up in the hourly earnings. Wages rose by 0.2% on the month against a forecast of a 0.5% decline. Wages for the previous month was revised down to show a 1.3% contraction.

Upcoming Economic Events

RBNZ to Keep Interest Rates Unchanged

The Reserve Bank of New Zealand will be holding its monetary policy meeting this week. According to the general estimates, economists do not expect the RBNZ officials to change interest rates at this week’s meeting at 0.25%.

However, there is a possibility that the central bank will expand its quantitative easing program. The RBNZ’s QE program currently stands at 60 billion NZD.

That said, this remains doubtful as recent economic data showed that the impact of the Covid-19 was not as bad as expected.

Australia Unemployment to Rise in July

The monthly labor market report from Australia is due this week. Forecasts show that the unemployment rate will rise from 7.4% to 7.8% in July.

However, investors might shrug aside the data given that some major parts of Australia are in a lockdown once again. Ahead of the jobs report, we will also get the quarterly wage price index.

No changes are forecast as the wage price index is forecast to remain steady at 2.1% on the quarter and 0.5% on the year.

Eurozone Quarterly GDP to Confirm a 12.1% Contraction

The preliminary GDP report from the eurozone is due out during the week. Economists foresee that the economic activity contracted by yet another 12.1% in the three months ending June 2020.

The data comes on the back of various eurozone economies, including Germany, slipping into contraction during the second quarter of the year.

US Inflation & Retail Sales on Tap

The monthly inflation data will be coming out of the US. Economists forecast that headline consumer prices rose by 0.8% in July on a year over year basis. This marks a notable increase from 0.6% in June this year.

The core inflation rate is forecast to rise at a slower pace of 1.1% on the year, down from 1.2% previously. Later in the week, the retail sales report will show how Americans spent amid the pandemic uncertainty.

By Orbex

Major UK, EU & Australia Data Coming Up

By Orbex

This is the week many analysts have been waiting for, as we get a series of pivotal data that will give us some insight into how the pound, euro and Aussie dollar might behave in the medium term.

We also might have some surprises in just who is facing the COVID challenge the best.

Finally a recovery for UK jobs?

The UK leads with the major data releases, starting with employment figures on Tuesday.

The star of the event is the ILO unemployment rate, which is an average for April-May-June months. It’s projected to come in at 4.2% compared to 3.9% prior, which included a month of pre-shutdown.

The fresher data to look out for is the claimant count change, for which there isn’t any consensus among analysts.

So, we could see some volatility in the aftermath. Remember the higher this figure, the worse it is for the pound.

UK Economy Doing Worse than the Continent?

On Wednesday, the UK reports its Q2 GDP numbers, which are projected to show a quarterly drop of -22.5% in the economy, compared to -1.7% in the first quarter.

Naturally, the period covering the worst of the COVID situation would have a significantly negative result. Everyone already knew the UK was in recession, but this would make it official.

Annual GDP is projected to come in at -15.0%, actually an improvement over the prior measure of -22.8% in May.

What traders are likely to focus on is the June monthly change in GDP, since that’s the freshest information. The consensus is for a substantial rebound, growing at 8.0% compared to 1.8% in May.

Will the Australian Labor Market Improve Despite the Outbreak in Victoria?

On Thursday, we expect Australia to announce 40K new jobs created in July, compared to 210.8K in June. The slowing pace is being attributed to the reimposition of lockdowns in the state of Victoria.

The unemployment rate is expected to move higher to 7.8% compared to 7.4% prior.

However, the participation rate is expected to increase by a full percentage point, suggesting that the comparative unemployment rate has decreased. There are just more people looking for work.

How Many More Jobs is the EU expected to Lose?

The EU rounds out the week reporting both employment and GDP figures at the same time.

The common economic area is expected to report a Q2 employment change of -0.1%, a slight improvement from -0.2% in the first quarter.

But, taken on an annualized basis, employment is expected to still be better than the prior year.

Confirming the Hit to the EU Economy

Finally, we have the preliminary Q2 GDP figures for the eurozone, which are expected to affirm the advance figures we’ve already seen.

Unless there is a significant revision to the prior figures, we wouldn’t expect much of a market reaction. Quarterly GDP is expected to be confirmed at -12.1% for Q2, and on an annualized basis, that would be -15.0%.

By Orbex