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2 Feb 2015
This week's headline events - Nomura
FXStreet (Bali) - Franklin Wang and David Fritz, Research Analysts at Nomura, break down the key events for the week ahead, with special attention to the RBA policy meeting on Tuesday, and the US NFP on Friday.
Key Quotes
"This week, there will be a couple of central bank rate decisions and important US, eurozone and Chinese data points."
"In the US, personal income and spending will be released on Monday; the weakness in earnings growth in December suggests that we might see a slower pace of growth in personal income. ISM manufacturing PMI will be released on Monday; Nomura expects a decline to 54.0, slightly below consensus, owing to soft regional manufacturing survey readings. The US employment report will be released on Friday; Nomura is essentially in line with market expectations."
"In the eurozone, we start the week with a series of manufacturing PMIs that Nomura is generally in line with consensus. The Bank of England will release its rate decision on Thursday; we expect no change in policy. German industrial production will be released on Friday; we forecast a 0.2% m-o-m expansion."
"The RBA will be in focus on Tuesday. This is a meeting heavily speculated upon by media and the market. We forecast a 25bp cut with the likelihood slightly above 50% and another 25bp cut in Q2 2015. RBA will also likely note downward revisions to world growth estimates and a more modest downgrade of domestic growth. Comments on inflation will be interesting to watch as Q4 CPI inflation was higher than expected. Comments on the exchange rate will be critical as the Bank mentioned 0.75 as a more desirable level for AUDUSD; these comments will likely have an impact on the FX market."
Key Quotes
"This week, there will be a couple of central bank rate decisions and important US, eurozone and Chinese data points."
"In the US, personal income and spending will be released on Monday; the weakness in earnings growth in December suggests that we might see a slower pace of growth in personal income. ISM manufacturing PMI will be released on Monday; Nomura expects a decline to 54.0, slightly below consensus, owing to soft regional manufacturing survey readings. The US employment report will be released on Friday; Nomura is essentially in line with market expectations."
"In the eurozone, we start the week with a series of manufacturing PMIs that Nomura is generally in line with consensus. The Bank of England will release its rate decision on Thursday; we expect no change in policy. German industrial production will be released on Friday; we forecast a 0.2% m-o-m expansion."
"The RBA will be in focus on Tuesday. This is a meeting heavily speculated upon by media and the market. We forecast a 25bp cut with the likelihood slightly above 50% and another 25bp cut in Q2 2015. RBA will also likely note downward revisions to world growth estimates and a more modest downgrade of domestic growth. Comments on inflation will be interesting to watch as Q4 CPI inflation was higher than expected. Comments on the exchange rate will be critical as the Bank mentioned 0.75 as a more desirable level for AUDUSD; these comments will likely have an impact on the FX market."