The UK GDP second estimate came in at 0.4% q/q in the fourth quarter of 2017, a tad weaker than the 0.5% figure seen last while missing estimates.

While on an annualized basis, the UK economy’s growth rate accelerated to 1.7% in Q4, beating the consensus forecasts of 1.5% and 1.5% booked in the first readout.

The post UK Q4 GDP revised lower to 0.4% q/q vs. 0.5% expected appeared first on CIX Markets.

February’s fall in Ifo business sentiment suggests that German GDP growth is nearing its peak, but should remain strong, according to Stephen Brown, European Economist at Capital Economics.

Key Quotes

“The fall in the headline Business Climate Indicator (BCI) from 117.6 to 115.4 left it far weaker than the consensus forecast of 117.0 and at a five-month low. While the current conditions component fell, it remained higher than it was in December. The fall in the business expectations component was much larger and left the index at a 10-month low. Weaker expectations could reflect a number of factors, not least the relatively strong euro, signs of slowing demand from China and the drop in German equity prices earlier this month.”

“On the basis of the long-run historical relationship, the Ifo now only points to a slight rise in annual GDP growth from Q4’s 2.9%. And as the indicator has overstated growth in recent quarters and is on track to record its first fall in eight quarters in Q1, it might be more accurate to say that growth is close to its peak. Nevertheless, growth of close to 3% would still be very strong by German standards. And once a government is formed, a small fiscal boost should help to ensure that healthy growth rates are sustained. We therefore maintain our forecasts for above-consensus German GDP growth of 2.7% this year and 2.0% next.”

 

The post Germany: Decline in Ifo Business Climate sentiment suggests growth is nearing its peak – Capital Economic appeared first on CIX Markets.

German IFO came in below expectations for the current month.
Spot looks to gather traction to the 1.2290/1.2300 region.
ECB minutes, Fedspeak next of relevance later in the day.

EUR/USD is now looking to extend the rebound from daily lows and is testing the upper end of the range in the 1.2280/90 band in spite of the lower-than-expected results from German releases.

EUR/USD bid after German data, eyes on ECB

The pair stays in the area of 1.2280/90 after the German IFO series came in below initial estimates for the month of February. In fact, Business Expectations (105.4), Current Assessment (126.3) and Business Climate (115.4) all missed consensus today and dropped from January’s readings.

In the meantime, some selling bias is surrounding the buck today, therefore allowing spot to attempt a bounce to higher levels with gains so far capped by the proximity of the 1.2390 level.

On another direction, EUR will be in centre stage later today as the ECB will release its minutes from the January meeting. The focus of attention will be, as usual, on the members’ views on a potential change in the forward guidance.

Across the pond, weekly initial claims area due along with speeches by New York Fed and permanent voter W.Dudley (centrist), Dallas Fed R.Kaplan (non voter, hawkish) and Atlanta Fed R.Bostic (voter, centrist).

EUR/USD levels to watch

At the moment, the pair is up 0.02% at 1.2285 and a breakout of 1.2353 (10-day sma) would target 1.2371 (21-day sma) en route to 1.2537 (high Jan.25). On the other hand, the next support emerged at 1.2206 (low Feb.9) followed by 1.2167 (50% Fibo of 2014-2017 drop) and finally 1.2165 (low Jan.18).

The post EUR/USD turns positive near 1.2290 post-IFO appeared first on CIX Markets.

   •  USD consolidates hawkish FOMC minutes-led strong gains.
   •  Reviving safe-haven demand offsets USD strength.

The USD/JPY pair stalled its steady rebound near the 107.60 region and has now retreated back closer to the Asian session lows. 

The pair snapped four consecutive days of winning streak and was being weighed down by a fresh wave of global risk-aversion trade, which was seen underpinning the Japanese Yen’s safe-haven appeal. 

Meanwhile, the US Dollar also seems to have entered a bullish consolidative phase, especially after yesterday’s upsurge following a hawkish assessment of the latest FOMC meeting minutes, and also did little to provide any fresh bullish impetus to the major.

It would now be interesting to see if bulls are able to regain their dominant position or the pair continues with its downfall amid relatively thin US economic docket, highlighting the release of usual weekly jobless claims data later during the early NA session.

Technical outlook

Omkar Godbole, Analyst and Editor at FXStreet writes: “While a test of the descending trendline resistance of 108.25 is likely, further gains could be transient, especially if the 10-year US Treasury yield breaks above 3 percent. Also, the weekly 5-MA is sloping downwards and is currently seen at 108.25. So, gains above the same are to be viewed with caution.”

“On the downside, only an end of the day close below the 5-day MA would shift attention to recent low of 105.00,” he further added.
 

The post USD/JPY headed back to daily lows, closer to 107.00 handle appeared first on CIX Markets.

The headline German Ifo business climate index dropped sharply in February, coming in at 115.4 points versus last month’s 117.6 and expectations of 117.0. Meanwhile, the current economic assessment bettered estimates, arriving at 126.3 points in the reported month, as compared to last month’s 127.7 and 127.0 anticipated.

The Ifo Expectations Index – indicating firms’ projections for the next six months missed expectations, arriving at 105.4 in February versus expectations of 107.9 and 108.4 recorded in Jan.

The post German Feb Ifo: Downbeat across all indicators appeared first on CIX Markets.