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28 Feb 2014
European Open: pessimism ahead of Eurozone inflation numbers
FXStreet (London) - Overnight we had a mixed bag, with the session starting in a risk off mode before confidence returning towards the end of the session, with AUD and NZD the beneficiaries.
Australian private sector credit rose by 0.4 percent month-on-month and 4.1 percent year-on-year, with housing credit running at 5.6 percent year-on-year, it's highest level since November 2011. In addition, government financial statements for December showed revenues outrunning forecasts by AUD1.7bn while expenses fell AUD1bn further than expected
New Zealand posted further strong business confidence numbers at 71, concreting expectations of a Reserve Bank of New Zealand rate hike at the central bank's next meeting on 13 March.
German retail sales surprised to the upside, coming in at 0.9% year-on-year against a -1.7 percent consensus, boosted by a big jump in January sales, up 2.5 percent compared to the 1.0 percent consensus.
Harmonised Eurozone inflation numbers due at 10:00 GMT are likely to show further disinflationary pressures in the Eurozone, on top of the further contraction in Eurozone private lending seen earlier this week and weakening German inflation. Consensus expectations are for a 0.7 percent HICP print, but risks lie to the downside.
Ahead of next week's Bank of Canada interest rate meeting, Canadian fourth quarter GDP to be released today is expected to gain 2.6 percent, down from 2.7 percent in the third quarter. The main drag is expected to come from net exports, on reduced US demand, however we have seen signs of resilient consumer spending which may counterbalance the drag from exports.
Revised US fourth quarter GDP numbers are expected to see a downward revision from their initial 3.2 percent reading, dragged by a downward-revised consumption number. In line with recent weak numbers attributed to disruptive US weather conditions, consensus expectations are for a decline in the February Chicago PMI to 57.0 from 59.6, however we could see a slide further.
Australian private sector credit rose by 0.4 percent month-on-month and 4.1 percent year-on-year, with housing credit running at 5.6 percent year-on-year, it's highest level since November 2011. In addition, government financial statements for December showed revenues outrunning forecasts by AUD1.7bn while expenses fell AUD1bn further than expected
New Zealand posted further strong business confidence numbers at 71, concreting expectations of a Reserve Bank of New Zealand rate hike at the central bank's next meeting on 13 March.
German retail sales surprised to the upside, coming in at 0.9% year-on-year against a -1.7 percent consensus, boosted by a big jump in January sales, up 2.5 percent compared to the 1.0 percent consensus.
Harmonised Eurozone inflation numbers due at 10:00 GMT are likely to show further disinflationary pressures in the Eurozone, on top of the further contraction in Eurozone private lending seen earlier this week and weakening German inflation. Consensus expectations are for a 0.7 percent HICP print, but risks lie to the downside.
Ahead of next week's Bank of Canada interest rate meeting, Canadian fourth quarter GDP to be released today is expected to gain 2.6 percent, down from 2.7 percent in the third quarter. The main drag is expected to come from net exports, on reduced US demand, however we have seen signs of resilient consumer spending which may counterbalance the drag from exports.
Revised US fourth quarter GDP numbers are expected to see a downward revision from their initial 3.2 percent reading, dragged by a downward-revised consumption number. In line with recent weak numbers attributed to disruptive US weather conditions, consensus expectations are for a decline in the February Chicago PMI to 57.0 from 59.6, however we could see a slide further.