Market Overview 2018-07-30

simple-blue-stacked-area-chart-infographics-animation-as-technology-business-science-stats-or-data-analysis-background_bkofs0qv__F0003

Last Friday all eyes were on the advanced GDP reading from the US, where the results have shown that the United States economy had accelerated in the 2nd quarter, where the seasonally-adjusted annual rate of 4.1% in the period April-June was almost double the expansion we have seen in the first quarter of the year, which was 2.2%. In addition, President Trump has predicted ahead of the news release, that the US economy will be seen as in ‘terrific’ shape, which obviously did come true.  

According to Bloomberg during his speech in Illinois on Thursday, Trump expressed his doubts that the expansion would come to 5.3% as some economists have predicted, however he has stated that 4% would be satisfactory. The strong reading that came from the US, supports the expectation that Fed will have additional two rate hikes in 2018. As Fed Chairman Jerome Powell has testified to Congress on the 17th of July, with a strong job market and inflation that is close to the Fed objective, as well as the risks to the outlook being balanced, the best way to proceed is to gradually raise the federal funds rate. Nevertheless, with the trade war with China round the corner placed pressure on the economy and some analysts are not so optimistic that the current acceleration would last. As a reminder, Trump has placed 25% duties on $34 billion worth of Chinese goods that has commenced on the 6th of July, which has provoked a response from China, where Beijing stated targeting US made cars, soybeans and some other agricultural products.

On the other continent, Chief EU Negotiator Michel Barnier rejected the British proposal for a common rulebook. Time is running and Brexit negotiations are far from being concluded. UK is facing a problem with insolvency, where between April and June this year, almost 29k people have registered as insolvent and according to the Office for National Statistics, households surpassed their income last year for the first time since 1988. The numbers have risen concerns regarding debt problems that consumers are facing and it appears that they were influenced by high inflation that have occurred in 2016 with the fall of the pound after the Brexit vote. Furthermore, looking at the overall economy of the UK, it seems it is doing rather well, however the expected BoE interest rate rise may cause even more problems to the consumers. According to the Insolvency Service, one out of 433 people have registered as insolvent in England and Wales, which is the high majority of Britain’s population.  

Source : Exclusive morning call from FXCC, Monday, 2018-07-30, 07:00 GMT

FXCC Forex Trading

Market Overview 2018-07-23

Related Posts

 

Comments

No comments made yet. Be the first to submit a comment
Already Registered? Login Here
Guest
Monday, 10 December 2018
If you'd like to register, please fill in the username, password and name fields.

Captcha Image

High Risk Attention and Disclaimer

HIGH RISK - ATTENTION : Forex imply an elevate level of risk which might be not suitable for all investors. Leverage generate further exposition and loss risks. Before to take decision of trading forex, consider carefully yours investment objectives, expertise level and propensity to risk. Past performance is not indicative of future results. Your starting investment might be lost partially or totally. Don’t invest money you cannot afford to lose.  
DISCLAIMER : Pages contained in this web site in any case constitute neither financial counsel service nor solicitation to public saving. Nothing contained in this web site constitute solicitation, offer or recommendation to purchase or sell any investment or to commit in any transaction. Nothing contained in this web site constitute solicitation to investment, fund raising or management for third party. Opinions, article, analysis report, operational report and other documents realized from INDOFOREX.INFO which have to do with market speculation, are dedicated to sustain our individual trading and in any case to represent, solicitation, advice or invest invitation. The web site has just a guise of sharing, cultural and expertise. Although the indication quoted are provided with a mere informative scope, we refuse all responsibility, charged to web site Administrator, for possible negative consequences which should come from an operational funded on their observance.