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25 Jan 2016
Focus on central banks with German IFO in the limelight – Danske Bank
FXStreet (Delhi) – Research Team at Danske Bank, suggests that the focus will remain on central-bank responses to recent market turmoil with notably the Fed and Bank of Japan meetings this week.
Key Quotes
“Today both ECB's Draghi and Lautenschlager are set to speak , which could make for some further policy-maker reflections following last week's signal from the central bank that the ECB will cut rates again in H1.
Main release today is the German IFO expectations , which should be followed closely to judge any impact on economic sentiment of the latest market jitters. We look for a drop in 'current conditions' but a rise in the 'expectations' component. Last week the German manufacturing PMI declined from 53.2 to 52.1, driven mainly by weaker export orders.
Overall, downside risks to our expectation of higher euro-area GDP growth are continued financial uncertainty and global weakness but our expectation of higher GDP growth is due mainly to higher domestic demand and, so far, the euro area has remained rather resilient to the weakness in emerging markets.”
Key Quotes
“Today both ECB's Draghi and Lautenschlager are set to speak , which could make for some further policy-maker reflections following last week's signal from the central bank that the ECB will cut rates again in H1.
Main release today is the German IFO expectations , which should be followed closely to judge any impact on economic sentiment of the latest market jitters. We look for a drop in 'current conditions' but a rise in the 'expectations' component. Last week the German manufacturing PMI declined from 53.2 to 52.1, driven mainly by weaker export orders.
Overall, downside risks to our expectation of higher euro-area GDP growth are continued financial uncertainty and global weakness but our expectation of higher GDP growth is due mainly to higher domestic demand and, so far, the euro area has remained rather resilient to the weakness in emerging markets.”