Talking Points:
Euro Unlikely to Find Fuel in German CPI Data as ECB QE Launch Looms
Larger-Than-Expected US GDP Markdown May Send US Dollar Downward
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Germany’s flash CPI data headlines the economic calendar in European trading hours. The headline year-on-year inflation rate is expected to remain in negative territory, showing a 0.3 percent drawdown in February following a 0.4 percent decline in the prior month. The outcome is unlikely to trigger a meaningful response the Euro considering its limited implications for near-term ECB policy outlook as the central bank prepares to launch QE next month.
Later in the day, the spotlight turns to the second revision of four-quarter US GDP figures. The annualized growth reading is expected to be revised down to 2 percent from the initially-reported estimate of 2.6 percent. US news-flow has tended to underperform relative to forecasts in recent months, warning of a larger mark-down in the cards. Such a result may trim Fed interest rate hike expectations and weigh on the US Dollar.
The greenback faced broad-based selling pressure overnight, falling as much as 0.2 percent on average against its leading counterparts. The move appeared corrective in the context of yesterday’s aggressive rally that produced the largest daily advance in a month. That move followed January’s CPI data that showed a larger than expected monthly rise in core inflation while a separate report showed real Average Hourly Earnings jumped 1.2 percent last month, marking the largest increase since November 2008.
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Asia Session
GMT
CCY
EVENT
ACT
EXP
PREV
23:30
NZD
Building Permits (MoM)
-3.8%
–
-2.3%
23:30
JPY
Jobless Rate (JAN)
3.6%
3.4%
3.4%
23:30
JPY
Job-To-Applicant Ratio (JAN)
1.14
1.15
1.14
23:30
JPY
Overall Household Spending (YoY) (JAN)
-5.1%
-4.1%
-3.4%
23:30
JPY
Natl CPI (YoY) (JAN)
2.4%
2.4%
2.4%
23:30
JPY
Natl CPI Ex Fresh Food (YoY) (JAN)
2.2%
2.3%
2.5%
23:30
JPY
Natl CPI Ex Food, Energy (YoY) (JAN)
2.1%
2.1%
2.1%
23:30
JPY
Tokyo CPI (YoY) (FEB)
2.3%
2.2%
2.3%
23:30
JPY
Tokyo CPI Ex-Fresh Food (YoY) (FEB)
2.2%
2.2%
2.2%
23:30
JPY
Tokyo CPI Ex Food, Energy (YoY) (FEB)
1.7%
1.7%
1.7%
23:50
JPY
Industrial Production (MoM) (JAN P)
4.0%
2.7%
0.8%
23:50
JPY
Industrial Production (YoY) (JAN P)
-2.6%
-3.1%
0.1%
23:50
JPY
Retail Trade (YoY) (JAN)
-2.0%
-1.2%
0.1%
23:50
JPY
Retail Sales (MoM) (JAN)
-1.3%
-0.4%
-0.4%
23:50
JPY
Large Retailers’ Sales (JAN)
0.0%
-0.1%
0.1%
00:00
NZD
ANZ Activity Outlook (FEB)
40.9
–
37.3
00:00
NZD
ANZ Business Confidence (FEB)
34.4
–
30.4
00:05
GBP
GfK Consumer Confidence (FEB)
1
2
1
00:30
AUD
Private Sector Credit (MoM) (JAN)
0.6%
0.5%
0.5%
00:30
AUD
Private Sector Credit (YoY) (JAN)
6.2%
6.0%
5.9%
2:00
NZD
Money Supply M3 (YoY) (JAN)
6.2%
–
6.3%
4:00
JPY
Vehicle Production (YoY) (JAN)
-9.7%
–
-2.5%
5:00
JPY
Housing Starts (YoY) (JAN)
-13.0%
-11.6%
-14.7%
5:00
JPY
Annualized Housing Starts (JAN)
0.864M
0.880M
0.883M
5:00
JPY
Construction Orders (YoY) (JAN)
27.5%
–
3.4%
European Session
GMT
CCY
EVENT
EXP/ACT
PREV
IMPACT
7:00
EUR
German Import Price Index (MoM) (JAN)
-0.8% (A)
-1.7%
Low
7:00
EUR
German Import Price Index (YoY) (JAN)
-4.4% (A)
-3.7%
Low
8:00
CHF
KOF Leading Indicator (FEB)
89
97
Low
9:30
GBP
Lloyds Business Barometer (FEB)
–
52
Low
13:00
EUR
German CPI (MoM) (FEB P)
0.6%
-1.1%
High
13:00
EUR
German CPI (YoY) (FEB P)
-0.3%
-0.4%
High
13:00
EUR
German CPI- EU Harmonised (MoM) (FEB P)
0.6%
-1.3%
Medium
13:00
EUR
German CPI- EU Harmonised (YoY) (FEB P)
-0.5%
0.5%
Medium
Critical Levels
CCY
Supp 3
Supp 2
Supp 1
Pivot Point
Res 1
Res 2
Res 3
EURUSD
1.0862
1.1058
1.1128
1.1254
1.1324
1.1450
1.1646
GBPUSD
1.5137
1.5294
1.5350
1.5451
1.5507
1.5608
1.5765
— Written by Ilya Spivak, Currency Strategist for DailyFX.com
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Source: Daily fx