The Week Ahead In Forex-Euro

Kiran · 07-28-2008, 03:30 PM

The Week Ahead In Forex-Euro

It will be a busy data week in the Eurozone with both inflation and growth data scheduled to be released. Growth expectations deteriorated during the past
week, mainly on the back of a weaker than expected German ifo business climate survey. As growth in Germany so far has acted as a counterweight to weaker conditions in the rest of the currency zone, a weakening outlook is of relevance to the ECB’s stance on monetary policy.Although ECB members have kept a hawkish rhetoric in general, ECB Governing Council member Liebscher acknowledged that a downside revision to growth cannot be ruled out, and that interest rates are at a good level for now. In addition, crude oil prices continued to depreciate, weighing on inflation expectations. As oil prices remain inflation expectations’ key driver we expect further downside to have a direct impact on ECB members’ rhetoric up ahead. Next Thursday’s release of the EZ CPI estimate for July will be closely followed, and at 4.1% (cons. 4.0%, prev.: 4.2% our economists expect a reading marginally above consensus. Labour data for June will be released on the same day, and at 7.3% (cons. 7.2%, previous: 7.2%) our economists expect conditions to worsen. On Friday, investors´ main focus will be on manufacturing PMIs. Activity is expected to remain under pressure, confirming a trend of deteriorating growth conditions. We expect the EUR to remain under pressure, especially versus the USD and GBP.

Date GMT Event Period UBS Previous Market
28-Jul GE 6:10 GfK Cons. Conf. Survey (Aug) index 3.5 3.9 3.5
29-Jul FR 6:40 Cons. Conf. Indicator (Jul) index -46 -46 -47
29-Jul FR 6:45 Producer Prices (Jun) m-o-m 1.4% 1.3% 0.8%
29-Jul IT 8:00 Hourly Wages (Jun) m-o-m 0.0% 0.6% n/a
29-Jul GE Consumer Price Index (Jul P) y-o-y 3.3% 3.3% 3.1%
29-Jul GE CPI- EU Harmonised (Jul P) y-o-y 3.5% 3.4% 3.3%
30-Jul IT 8:00 PPI (Jun) m-o-m 0.0% 1.5% 0.9%
30-Jul EZ 9:00 Business Climate Indicator (Jul) index 0 0.14 n/a`
30-Jul EZ 9:00 Euro-Zone Cons. Conf. (Jul) index -18 -17 -18
30-Jul EZ 9:00 Euro-Zone Econ. Conf. (Jul) index 93 94.9 93.5
30-Jul EZ 9:00 Euro-Zone Ind. Conf. (Jul) index -6 -5 -7
30-Jul EZ 9:00 Euro-Zone Services Conf. (Jul) index 8 9 8
30-Jul GE Retail Sales (Jun) (Jul 30 - Aug 5) m-o-m -0.5% 0.5% -0.4%
30-Jul GE IFO July Business Climate Survey by Industry (Data Due: Jul 27 - Jul 30)
31-Jul GE 6:00 ILO Unemployment Rate (Jun) % 7.4% 7.4% 7.4%
31-Jul GE 7:55 Unemployment Change (Jul) 000’s -20 -38 -20
31-Jul IT 8:00 Large Comp. Emp. nsa (May) y-o-y n/a 0.0% n/a
31-Jul EZ 9:00 Euro-Zone CPI Estimate (Jul) y-o-y 4.1% 4.0% 4.2%
31-Jul EZ 9:00 Euro-Zone Unemp. Rate (Jun) % 7.3% 7.2% 7.2%
31-Jul IT 9:00 CPI - EU Harmonized (Jul P) y-o-y 4.2% 4.0% 4.2%
31-Jul IT 9:00 CPI (NIC incl. tobacco) (Jul P) y-o-y 4.0% 3.8% 4.0%
01-Aug IT 7:45 PMI Manufacturing (Jul) index 46 46.9 46.0
01-Aug FR 7:50 PMI Manufacturing (Final) (Jul) index 49 47.3 47.3
01-Aug GE 7:55 PMI Manufacturing (Final) (Jul) index 51.5 50.9 50.9
01-Aug EZ 8:00 PMI Manufacturing (Final) (Jul) index 49.5 47.5 n/a
01-Aug IT 17:00 Budget Balance (Jul) EUR bn 3.66 15.8 n/a

07-28-2008, 03:30 PM	#1 (permalink)
Kiran Status: Administrator Join Date: Feb 2008 Posts: 165	The Week Ahead In Forex-Euro The Week Ahead In Forex-Euro It will be a busy data week in the Eurozone with both inflation and growth data scheduled to be released. Growth expectations deteriorated during the past week, mainly on the back of a weaker than expected German ifo business climate survey. As growth in Germany so far has acted as a counterweight to weaker conditions in the rest of the currency zone, a weakening outlook is of relevance to the ECB’s stance on monetary policy.Although ECB members have kept a hawkish rhetoric in general, ECB Governing Council member Liebscher acknowledged that a downside revision to growth cannot be ruled out, and that interest rates are at a good level for now. In addition, crude oil prices continued to depreciate, weighing on inflation expectations. As oil prices remain inflation expectations’ key driver we expect further downside to have a direct impact on ECB members’ rhetoric up ahead. Next Thursday’s release of the EZ CPI estimate for July will be closely followed, and at 4.1% (cons. 4.0%, prev.: 4.2% our economists expect a reading marginally above consensus. Labour data for June will be released on the same day, and at 7.3% (cons. 7.2%, previous: 7.2%) our economists expect conditions to worsen. On Friday, investors´ main focus will be on manufacturing PMIs. Activity is expected to remain under pressure, confirming a trend of deteriorating growth conditions. We expect the EUR to remain under pressure, especially versus the USD and GBP. Date GMT Event Period UBS Previous Market 28-Jul GE 6:10 GfK Cons. Conf. Survey (Aug) index 3.5 3.9 3.5 29-Jul FR 6:40 Cons. Conf. Indicator (Jul) index -46 -46 -47 29-Jul FR 6:45 Producer Prices (Jun) m-o-m 1.4% 1.3% 0.8% 29-Jul IT 8:00 Hourly Wages (Jun) m-o-m 0.0% 0.6% n/a 29-Jul GE Consumer Price Index (Jul P) y-o-y 3.3% 3.3% 3.1% 29-Jul GE CPI- EU Harmonised (Jul P) y-o-y 3.5% 3.4% 3.3% 30-Jul IT 8:00 PPI (Jun) m-o-m 0.0% 1.5% 0.9% 30-Jul EZ 9:00 Business Climate Indicator (Jul) index 0 0.14 n/a` 30-Jul EZ 9:00 Euro-Zone Cons. Conf. (Jul) index -18 -17 -18 30-Jul EZ 9:00 Euro-Zone Econ. Conf. (Jul) index 93 94.9 93.5 30-Jul EZ 9:00 Euro-Zone Ind. Conf. (Jul) index -6 -5 -7 30-Jul EZ 9:00 Euro-Zone Services Conf. (Jul) index 8 9 8 30-Jul GE Retail Sales (Jun) (Jul 30 - Aug 5) m-o-m -0.5% 0.5% -0.4% 30-Jul GE IFO July Business Climate Survey by Industry (Data Due: Jul 27 - Jul 30) 31-Jul GE 6:00 ILO Unemployment Rate (Jun) % 7.4% 7.4% 7.4% 31-Jul GE 7:55 Unemployment Change (Jul) 000’s -20 -38 -20 31-Jul IT 8:00 Large Comp. Emp. nsa (May) y-o-y n/a 0.0% n/a 31-Jul EZ 9:00 Euro-Zone CPI Estimate (Jul) y-o-y 4.1% 4.0% 4.2% 31-Jul EZ 9:00 Euro-Zone Unemp. Rate (Jun) % 7.3% 7.2% 7.2% 31-Jul IT 9:00 CPI - EU Harmonized (Jul P) y-o-y 4.2% 4.0% 4.2% 31-Jul IT 9:00 CPI (NIC incl. tobacco) (Jul P) y-o-y 4.0% 3.8% 4.0% 01-Aug IT 7:45 PMI Manufacturing (Jul) index 46 46.9 46.0 01-Aug FR 7:50 PMI Manufacturing (Final) (Jul) index 49 47.3 47.3 01-Aug GE 7:55 PMI Manufacturing (Final) (Jul) index 51.5 50.9 50.9 01-Aug EZ 8:00 PMI Manufacturing (Final) (Jul) index 49.5 47.5 n/a 01-Aug IT 17:00 Budget Balance (Jul) EUR bn 3.66 15.8 n/a

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