Weekly Outlook for May 28- June 1

Following the ongoing speculation regarding the future of Greece in the EU and the potential ramification it may have on the forex and commodities markets (see here for a review on the potential ramification a Grexit on the bullion market) the Euro continued to decline to its lowest level in nearly two years.   Furthermore,  the recent publications from the U.S including new home sales and core durable goods may have been among the factors to help strengthen the USD; major commodities prices didn’t move much during last week, but all could change if the upcoming publications for the week will show dramatic shift. The week will start on Tuesday for the U.S due to Memorial Day weekend. There are several important publications that may affect the financial markets including: U.S non-farm payroll report, U.S GDP for Q1 2012, U.S pending home sales, a speech by ECB President Draghi, U.S manufacturing PMI, EU monetary development and U.S. jobless claims. Here is an economic news calendar forecast for May 28th to June 1st referring to the U.S., EU, China, Japan, EU, Australia, Canada and Great Britain.   

(All times GMT):

Monday, May 28th

12:30 – Japan Household Spending: According to the previous report, the Japanese housing spending rose by 3.4%; this report could affect the direction of the Yen currency;

Tuesday, May 29th

15:00 – U.S Consumer Confidence: according to the previous monthly update, the consumer confidence index remained unchanged in April (M-o-M). The current expectations are that the April index may decline; this report might affect commodities markets including the natural gas market;

02:30 – Australian Retail Sales: This monthly report will pertain to the developments in Australia’s retail sales report for April 2012. The retail sales (seasonally adjusted) rose by 0.9% in March; this news may affect the strength of the Aussie dollar;

Wednesday, May 30th

08:00 – KOF Economic Barometer: this report offers an outlook of the Swiss economy in the months to come. In the previous press release, the report predicted that the Swiss Economy is headed towards an expansion in 2012;

09:00 – Euro Area Monetary Development: This monthly report will show the development of the M3, M1 and loans to private sector in the Euro area during April 2012. In the previous March report, the annual growth rate for M3 sharply rose to 3.2%. The M1 also increased to 2.7%. Finally, the annual growth rate of loans to private sector remained flat at 1.2%. If the M1 and M3 will continue to increase according this could serve as another indicator for the rising inflation pressures  in the  Euro Area, and it  may affect the upcoming ECB interest rate decision;

Tentative – Italian 10 Year Bond Auction: the Italian government will issue another bond auction; the previous bond auction, which was held a couple of weeks ago, went well as the rate reached 5.66%;

15:00 – U.S. Pending Home Sales: This report present the changes in pending home sales in the U.S. for April 2012; in the previous report the pending home sales index increased by 4.1% (M-over-M). These data are another indicator for the development in America’s real estate market; based on last week’s results on housing sales (new and existing) the pending sales may continue to rise. In such a case US dollar may strengthen;

15:30 – U.S Crude Oil Stockpiles Report: the EIA (Energy Information Administration) will release its weekly update on the U.S oil and petroleum stockpiles for the week ending on May 25th; in the previous weekly report for May 18th, stockpiles increased by 1 million bl to 1,770.97 million bl;

16:30 – ECB President Draghi Speaks: The President of the European Central Bank, Mario Draghi will give a speech at European Policy Council in Brussels. Given the recent changes in Greece and the fragile state in which several EU countries are at, if Draghi will refer to the ECB policy on the European debt crisis this might affect the financial markets;

Thursday, May 31st

07:00 – German Retail Sales: This monthly report will analyze the developments in German retail sales during April. According to March 2012, retail sales increased by 0.8%; if this report will continue to be positive then it could strengthen the Euro;

10:00 – Euro Area Flash Estimate of Annual Inflation: the inflation in Euro Area reached 2.6% in April. If the upcoming inflation rate estimate will change direction and increase, it may lower the chances of ECB lowering the interest rate;

13:00 – FOMC Member Pianalto Speaks: Following the recent FOMC meeting, the FOMC member Pianalto will give a speech. If he will hint of the future steps of the FOMC it might affect the financial markets;

13:15 – ADP estimate of U.S. non-farm payroll: ADP will announce its estimate for the upcoming U.S non-farm payroll change during May 2012 in anticipation for the upcoming no-farm report to be published by Friday;

13:30 – U.S. Department of Labor– Jobless Claims Weekly Report:  this update will pertain to the weekly developments in the initial jobless claims for the week ending on May 26th; in the latest update the jobless claims didn’t change much at 370,000; this upcoming weekly report may affect the U.S dollar and consequently commodities;

13:30 – Second Estimate of U.S GDP 1Q 2012: This will be the second estimate of U.S’s first quarter 2012 real GDP growth. In the first estimate the GDP expanded by 2.2% (annual rate). In the 4Q2011 the GDP growth rate reached 3%, compared with 1.8% increase at 3Q2011. If the second estimate will be much different than the first estimate it could have substantial effect on forex and commodities traders (for the first estimate of 1Q GDP).

15:30 – EIA U.S. Natural Gas Storage Update: the EIA weekly report of the U.S. natural gas market will pertain to the recent developments in natural gas production, storage, consumption and price as of May 18th; in the previous report, natural gas storage increased by 77 Bcf to 2,744 Bcf;

2:00– China Manufacturing PMI: according to the previous Manufacturing PMI report regarding April 2012 the Manufacturing PMI increased to 53.3; this index indicates the developments in China’s manufacturing sectors; if this upward trend will continue, this may also positively affect commodities prices;

Friday June 1st

09:30 – GB Manufacturing PMI: This report will refer to Great Britain’s changes in manufacturing sector during May 2012. In the previous report regarding April 2012 the index fell to 50.5%. This rate means the manufacturing sector is still expanding but at a slower rate; this index might affect GB Pound;

13:30 – Canada’s GDP by Industry: the report will present the developments in major industrial sectors for March 2012. In the previous report regarding February 2012, the real gross domestic product edged down by 0.2%. This report may affect the strength of the Canadian dollar exchange rate which is strongly correlated with commodities prices;

15:00 – U.S. ISM Manufacturing PMI: This report will refer to the monthly changes in the manufacturing sector on a national level during May 2012. During April 2012 the index rose to 54.8%, which means the manufacturing is growing at a faster rate; this index might affect forex, crude oil and natural gas markets;

13:30 – U.S. Unemployment Rate & Non-Farm Payroll Report: in the recent report regarding April 2012, the labor market didn’t expand much as it did during the first quarter as the number of non-farm payroll employment rose by only 115k; the U.S unemployment rate edged down to 8.1%; if the upcoming report will continue to show low growth of nearly 100 thousand mark (in additional jobs), this may raise the chances of the Fed introducing additional stimulus plan in the future; this report might affect not only the U.S dollar, but also gold and silver prices (see here my last review on the U.S employment report).

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