Weekly Outlook Financial Markets for June 18-22

The Greek elections will be held on Sunday and the aftermath of these elections could stir up the financial markets. Over the weekend the IMF urged Europe to help Irish banks.  The main event of the week besides the Greek elections will be the FOMC meeting to be held between April 19th and April 20th. If there will be big headlines from this meeting it could affect the commodities and forex markets. After the testimony of Bernanke I think there is little chance the Fed will announce another QE program.  There are several other important reports, speeches and events that may affect the financial markets including: U.S Philly Fed, ECB President Speech, U.S housing starts, Japan’s trade balance, U.S existing home sales, China’s manufacturing PMI and U.S. jobless claims. Here is an economic news calendar outlook for June 18th to June 22nd regarding the U.S., EU, China, Japan, Canada, Australia and Great Britain.   

(All times GMT):

Monday, June 18th

All Day – G20 Meeting: the G20 will convene in order to talk over the recent economic developments in the world including the EU debt crisis;

00:30 – Monetary Policy Meeting Australia’s Bank: The minutes of the monetary policy meeting of the reserve bank of Australia presents the main factors that affected the board’s decision to keep the basic interest rate at 3.75%; the minutes of this meeting may affect the Australian dollar exchange rate and consequently major commodities prices including crude oil and gold rates;

Tuesday, June 19th

09:30 – Great Britain CPI: this report will refer to the yearly rate of GB’s consumer price index for May 2012; some expect the May inflation will be lower than in previous month; in the recent report regarding April the annual CPI fell from 3.5% to 3.0%; this news may affect the direction of the British pound;

10:00 –Euro Area ZEW economic sentiment: The upcoming publication will refer to the ZEW indicator of economic sentiment for Euro Area for June 2012. For May 2012 the ZEW indicator for Euro Area fell to -2.4;

10:00 –German ZEW economic sentiment: The upcoming publication will refer to the ZEW indicator of economic sentiment for Germany for June. During May the ZEW indicator for Germany fell to 10.8; as Germany’s economy is progressing, the Euro will plausibly remain strong against other currencies;

13:30 – U.S. Housing Starts: the U.S Census Bureau will present the U.S housing starts for May 2012; this report was historically correlated with gold price – as housing starts rose, gold prices tended to decline the following day (even when controlling to the U.S dollar effect); in the previous report, the adjusted annual rate reached 717,000 in April 2012, which was 2.6% above March’s  rate;

13:30 – U.S. Building Permits: The recent report building permits decreased by 7% (M-o-M) in the adjusted annual rate of building permits and reached 715,000 in April 2012. If this report will continue to show slowdown in the building permits rate, it may indicate that the U.S housing market (from this aspect) isn’t progressing (the recent U.S building permits and housing starts review);

All Day – G20 Meeting: the G20 will convene in order to talk over the recent economic developments in the world including the EU debt crisis;

00:50 – Japanese Trade balance: The Japanese trade balance deficit for April 2012 fell by 22.1% compared with March 2012, to reach 480.1 billion YEN (roughly $6.07 billion) deficit (seasonally adjusted figures). This decrease is due to the decrease in imports by 1.7%, and the growth in exports by 0.5%. Japan is among the leading importing countries of commodities, including crude oil and gold; its trade balance could provide some insight into Japan’s changes in demand goods and services;

Wednesday, June 20th

09:30 – MPC Meeting Minutes: Following the recent MPC meeting, in which it was announced the rate will remain flat at 0.5% and the asset purchase program, will stay at £325 billion, despite the concerns the MPC have about the rising inflation. The minutes of the recent meeting might offer some insight behind this decision and perhaps hint of the future steps of the MPC;

17:30 – FOMC Meeting (Statement): The FOMC will convene for the fourth time this year and will decide at the end of two day of meetings on the its interest rate and monetary policy; I think the FOMC won’t announce of another stimulus plan, especially since the U.S’s economic progress is still growing and especially after the recent testimony of Bernanke; the FOMC statement may affect the US dollar and more than that it will affect gold and silver prices; I speculate if there won’t be another call for a stimulus plan or there won’t be another hint moving toward this direction in the near future, gold and silver prices are likely to fall; if the FOMC will consider another stimulus plan it could push up bullion;

19:00 – FOMC Economic Projection: this projection is updated every quarter and includes the FOMC’s estimate on U.S economic growth and inflation for 2012 and 2013. This projection could affect the strength of the US dollar; based on this projection, it could also explain the FOMC monetary policy and recent statement;

19:15 – FOMC Press Conference – Bernanke Speaks: following the FOMC meeting the Chairman of the Fed will give a speech to sum up the main points of the recent FOMC meeting and decisions; Bernanke’s speech could influence stocks, commodities and forex traders;

3:30– China flash Manufacturing PMI: this index will cover 800 companies in 20 industries in China; according to the HSBC Manufacturing PMI report for April 2012 the Manufacturing PMI edged down to 48.7; this index indicates the developments in China’s manufacturing sectors growth; if this negative growth  will continue, this may also adversely affect commodities prices;

Thursday, June 21st

09:00 – Euro Area Manufacturing PMI (June 2012): In the last report regarding May 2012, the Euro Zone Manufacturing PMI declined to 45.1, i.e a contraction. This report will provide an indicator to the economic growth of the Euro zone’s manufacturing conditions; this news, in turn might affect the Euro/USD exchange rate and consequently also major commodities prices;

09:30 –Retails Sales GB (May 2012): This report examines the changes in the retails sales in Great Britain during May 2012. It may affect the path of the British Pound exchange rate. In the previous report regarding April 2012, retails sales fell by 2.3%;

Tentative – British 10 Year Bond Auction: the British government will issue a bond auction; in the previous bond auction, which was held at the beginning of April, the rate reached 2.22%;

13:30 –Retails Sales Canada (April 2012): This report shows the changes in the retails sales in Canada during April 2012. It may affect the direction of USD/CAD exchange rate, which is strongly correlated with commodities prices. In the previous report regarding march 2012, retails sales rose by 0.4%;

13:30 – U.S. Department of Labor– Jobless Claims Weekly Report:  this update will pertain to the weekly changes in the initial jobless claims for the week ending on June 16th; in the latest report the jobless claims rose by 6k to 386,000; this upcoming weekly update may affect the U.S dollar and consequently commodities rates;

15:00 – U.S. Existing Home Sales: This report will pertain to the changes in U.S. existing home sales for May 2012; in the previous report regarding April 2012 the number of homes sold rose: the seasonally adjusted annual rate of 4.62 million home sales – a 3.4% increase; if this trend will continue it may help rally the U.S dollar;

15:00 – Philly Fed Manufacturing Index: This monthly survey presents an estimate for the shifts of the US economy as it measures the manufacturing conditions. In the previous May survey, the growth rate fell from +8.5 in April to -5.8 in May 2012. If this trend will continue this index may adversely affect not only U.S Dollar but also American stock indexes, oil and gold prices (the recent Philly Fed review);

15:30 – EIA U.S. Natural Gas Storage Update: the EIA weekly update of the U.S. natural gas market will pertain to the recent shifts in natural gas production, storage, consumption and price as of June 8th; in the previous report, natural gas storage rose by 67 Bcf to 2,944 Bcf;

17:00 – ECB President Draghi Speaks: Following the ECB rate decision, the Greek elections, the FOMC monetary policy and G20 meeting the President of the European Central Bank, Mario Draghi will speak; his speech may include the recent events in Europe including the future of Greece in the EU;

Friday June 22nd

09:00 – German Business Climate Survey: This survey projects the changes (on a monthly basis) of the business climate of Germany. In the recent report for  May 2012, the business climate index fell from 109.9 in April to 106.9 in May; if this trend will continue, it might adversely affect the Euro;

All Day – European Council Meeting: The European Council Meeting will be held in Brussels and the EU ministers of finance will convene and talk about the recent developments in Europe including in Spain, Italy and Greece. If a decision will be made there, it could affect the forex and commodities markets;

13:00 – Canada’s Core CPI: This report will pertain to the core consumer price index for May 2012 and controlling the volatile components such as energy, fruit and vegetables. According to the Canadian CPI report for April 2012, the CPI rose by 2% during the past 12 month up to April – this is a slightly higher rate than in March; the core CPI excluding food and energy rose by 2.1% from April 2011 to April 2012. This report might affect the direction of Canadian dollar, which is also strongly correlated with commodities prices;

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