IronFX Daily Commentary by Sakis Paraskevov | 01/02/2016
February 1, 2016 9:55 am
China’s manufacturing continues to shrink • The official and the final Caixin manufacturing PMIs for Jan. showed that the manufacturing sector continues to contract. • Even though Caixin PMI stayed below 50, it increased a bit, which caused AUD and NZD to strengthen somewhat. • These soft data increase the probabilities for further easing by the PBoC.
Today is PMI day: • France, Germany & Eurozone: Final manufacturing PMIs for Jan. are exp. to confirm the preliminary estimates. • UK: Manufacturing PMI for Jan. is exp. to decline. This could prove GBP-negative. • Sweden & Norway: Manufacturing PMIs for Jan. • US: Personal income & spending for Dec, both exp. to have slowed. Core PCE rate for Dec. Also, final Markit & ISM manufacturing PMIs for Jan. Overall, could be USD-negative. • Canada: RBC manufacturing PMI for Jan. Usually not major market mover. • Speakers: ECB President Mario Draghi, ECB Executive Board member Benoit Coeure and Fed Vice-Chair Stanley Fischer.
This week: • Tuesday: RBA rate decision. The Bank is expected to remain on hold, focus on the tone of the statement. • Wednesday: US ADP employment report is exp. 220k vs prev. 257k. Despite the decline, this is still a strong figure. • Thursday: BoE policy meeting. We expect the Bank to remain on hold. Focus will be on the minutes of the meeting and on the votes. • Friday: US employment report for Jan.: NFP is exp. at 200k vs 292k prior. Another solid report could add to expectations for further rate hikes and prove USD-positive. Canada’s unemployment rate for Jan. is also coming out.
China’s manufacturing continues to shrink
• The official and the final Caixin manufacturing PMIs for Jan. showed that the manufacturing sector continues to contract.
• Even though Caixin PMI stayed below 50, it increased a bit, which caused AUD and NZD to strengthen somewhat.
• These soft data increase the probabilities for further easing by the PBoC.
Today is PMI day:
• France, Germany & Eurozone: Final manufacturing PMIs for Jan. are exp. to confirm the preliminary estimates.
• UK: Manufacturing PMI for Jan. is exp. to decline. This could prove GBP-negative.
• Sweden & Norway: Manufacturing PMIs for Jan.
• US: Personal income & spending for Dec, both exp. to have slowed. Core PCE rate for Dec. Also, final Markit & ISM manufacturing PMIs for Jan. Overall, could be USD-negative.
• Canada: RBC manufacturing PMI for Jan. Usually not major market mover.
• Speakers: ECB President Mario Draghi, ECB Executive Board member Benoit Coeure and Fed Vice-Chair Stanley Fischer.
This week:
• Tuesday: RBA rate decision. The Bank is expected to remain on hold, focus on the tone of the statement.
• Wednesday: US ADP employment report is exp. 220k vs prev. 257k. Despite the decline, this is still a strong figure.
• Thursday: BoE policy meeting. We expect the Bank to remain on hold. Focus will be on the minutes of the meeting and on the votes.
• Friday: US employment report for Jan.: NFP is exp. at 200k vs 292k prior. Another solid report could add to expectations for further rate hikes and prove USD-positive. Canada’s unemployment rate for Jan. is also coming out.
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