The Week Ahead – Everything You Need to Know

The last week before Christmas has arrived and markets behaving accordingly. Last week Fed’s meeting result was expected as the central bank raised interest rates by 0.25 basis points. Yet, markets reacted aggressively to the Fed hawkish expectations for 2017 pushing the US Dollar strength to 14 year high.

The week ahead, markets will be watching closely on Fed chair Janet Yellen speech on Monday. After last week growth estimation by the Federal Reserve, signaling three rate hike in the next year, investors will seek further confirmation of the world largest economy.

On Tuesday, markets will focus on BoJ rate decision and policy statement to get an indication of Japan’s economy. The Japanese Yen has  been devalued since US election and Fed rate hike.

UK and US GDP data will be released on Friday.

Here are the main economic events of the upcoming week:

German IFO Business Climate

The German Business climate for December will be released on Monday at 09:00 GMT and expected to rise to 110.9 from 110.4 a month earlier.

Federal Reserve Chair Janet Yellen Speaks

On Monday at 18:30 GMT, Fed chair Janet Yellen will deliver a speech at the University of Baltimore on the state of US job market. As the US employment continues to constantly improve, any hawkish comments by Yellen will effects markets sentiment.

RBA Meeting Minutes

The Reserve Bank of Australia will publish its meeting minutes on Tuesday at 00:30 GMT. The RBA kept its benchmark interest rate unchanged at 1.5% at its December meeting. Markets will be watching for the central bank policy sentiment.

Bank of Japan Rate Decision and Policy Statement

The BoJ rate decision will be released on Tuesday at 03:00 GMT. The Japanese central bank is expected to hold negative interest rates at -0.1% and continue its annually 80 trillion Yen quantitative easing program of Japanese government bonds purchase.

Bank of Japan Governor Haruhiko Kuroda will hold a press conference after the rate decision announcement to discuss Japan’s economy.

UK Q3 Growth Domestic Product

United Kingdom third quarter GDP will be published on Friday at 09:30 GMT. The final estimate is expected to remain unchanged at 0.5% in July-September period while YoY is expected to grow by 2.3%.

US Q3 Growth Domestic Product

On Friday at 13:30 GMT the US will release its final third quarter growth estimation. Q3 growth data is expected to rise by 3.3% compare to 1.4% in the previous quarter. Last week, the Fed increased interest rates by 0.25 basis points and signaled for three rate hikes in 2017.

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The Black Swan is Now White

When Kevin Durant moved to the Golden State Warriors last summer, sports fans were disappointed, amazed and uninspired. The good boy, one of the most valuable basketball players during the last decade, joins the best team, the same team that broke the all-time winning record in a single season. Durant’s decision seems mystifying as now his challenge to win a championship ring actually decreased. But was it?

Can we call his decision a black swan phenomenon as it was an unpredictable event?

“The problem with experts is that they do not know what they do not know”, (Nissim Nicholas Taleb, author of Black Swan). Durant was not doing anything wrong, he joined the best team in the league because he desired to enjoy the game, and for basketball fans to appreciate excellence and the dedication of a winner.

The black swan term relates to an extremely unexpected, rare and beyond normalization event – same as a black swan discovery in days of a pre-assume belief that black swans do not exist.

A number of disruptive events have made 2016 the black swan year. However, just as humans become accustomed to black swans, we will get the feel of Donald Trump as the president of the United States, Europe without the United Kingdom and… Kevin Durant wearing a blue jersey.

Consider the following: A failed coup attempt in Turkey against state institutions to seize control of key places in the country, Italy’s PM resignation post the Italian Referendum indicates the potential to unravel to EU, a significant rise of terror across the world which spreads also into Europe and the US, endeavor of nationalism – both in state institutions and among the middle class in the developed world and rising concerns over a possible war between the US and China.

The fact that unpredictable events occur can represent our new political and new age culture. We are no longer seated and narrow-minded. New opinions create different opportunities that occur instantly. And once people open their mind, putting a note in a box to decide Yes/No, Trump/Clinton becomes the easy part.

Obviously, Donald Trump presidential victory was the most unpredictable event of 2016. The 70 years old billionaire has formed a new controversial political figure, holding new disruptive policy views which include new immigration regulations, applying fiscal policy over monetary policy and protectionism that rises on concerns of global economic stability.  

Similarly, the United Kingdom has been one of the core countries to establish and maintain the European Union. The second biggest economy in Europe seems to enjoy the benefits of being part of the EU rather than a country that would prefer to go back in time being an independent entity.

But the people vote, and their voice was decisive. Brexit – a political event that was unfamiliar a year earlier, is now the reality.

The unpredictable events of 2016 are not a new occurrence. History teaches us that black swans pop up constantly. The common assumption prior to World War One was a military clash between the United States and Great Britain. That did not happen, instead, a black swan appeared in the form of fascism. However, the unpredictable events of the previous year are raising a new notion of change and legitimacy to choose the unfamiliar, hope over habits.

As we enter 2017, the previous year along with the unknown events that might come in the upcoming year might change investors’ concept that the unpredictable does not necessarily create fear, instability, and uncertainty.

The black swan is no longer black.

2016 proved to us that the future might be unpredictable. Online societies, social networks, a capitalist economic system which increases inequality, global communication and the aspiration of a middle class – those can produce not rationalized events in the year to come. Welcome to the 2.0 unpredictable world.

This Week’s Economic Calendar – Italian Referendum and ECB Meeting in Focus

The week ahead will continue the exciting economic and political events that have occurred in previous weeks. After OPEC cut deal and positive nonfarm payrolls data on Friday that supports a rate hike in December, we enter the last month of 2016 with the Italian referendum results on Monday, interest rates decisions and ECB Meeting on Thursday.

Here are the main events for the upcoming week:

Monday

  • Italian Referendum Results will be published on Monday at 10:00 GMT. All latest surveys suggest ‘No’ camp victory. 51 million Italians are eligible to vote whether they wish to stay part of EU. A ‘Yes’ camp win can put in danger the Italian bank system and can cause a deeper economic recession.
  • UK Services PMI will be released at 9:30 GMT. Data is expected to improve slightly to 54.7 from 54.4 a month earlier.
  • US ISM Manufacturing PMI will be release at 15:00 GMT and expected to rise to 55.6 from 54.8.

Tuesday

  • RBA Interest Rate Decision & Statement will be published at 3:30 GMT. Rates are expected to remain unchanged at 1.5%. Markets will be closely watching for any clues regarding Reserve Bank of Australia next policy actions.
  • Eurozone Q3 GDP will be published at 10:00 GMT. Both quarterly and yearly data  are expected to remain unchanged at 0.3% and 1.6% respectively. Any data revolves around the European Union is sensitive as the European Union suffers of low economic growth and political instability after Brexit results and Italian referendum surveys.
  • Canada Trade Balance & Ivey PMI – Canadian trade balance will be released at 13:30 GMT and expected to narrow to C$4.08 billion from C$4.3 billion. The Canada Ivey PMI for November is forecast to fall  to 55.18 from 59.7.

Wednesday

  • Australia Q3 GDP will be published at 00:30 GMT. Growth is expected to fall to 0.3% in Q3 compare to 0.5% in Q2 while YoY Australian GDP is also expected to fall to 2.5% from 3.3%.
  • India Interest Rate Decision will be published at 5:30 GMT. A rate cut to 6.00% from 6.25% is expected.  Indian monetary policy remains accommodative as the decision will help stimulate inflation rate back to central bank’s four percent target in the medium-term while supporting economic growth.
  • Canada Interest Rate Decision will be published at 15:00 GMT. Forecast are vague as some analysts predict a rate cut of 0.25% from 0.5% while others predict Canada Central Bank to hold rates unchanged. Canadian Markets will be interesting to watch during interest rate announcement.
  • Crude Oil Inventories will be published at 15:30 GMT. After OPEC cut deal last week, oil prices surge 12% in three days. Any decrease in supply can stimulate oil prices rally to continue. Stockpiles expected to rise by 500,000 barrels from a fall of 884,000 a week earlier.
  • Japan Q3 GDP will be released at 23:30 GMT. Q3 growth is expected to rise dslightly to 0.6% from 0.5%. YoY growth is also expected to rise to 2.4% from 2.2%.

Thursday

  • China Trade Balance will be published at 02:00 GMT.  Any weak data can spark concerns about global growth.
  • ECB Policy Decision will take place at 12:45 GMT. Interest Rate are expected to remain unchanged, however Draghi’s speech will be in focus as markets are looking for signals to European Economic boost.

Friday

  • China CPI for November will be released at 1:30 GMT. MoM is expected to rise to 0.3% from 0.1% while YoY is expected to remain unchanged at 2.1%.
  • German Trade Balance will be published at 07:00 GMT. Data is expected to rise slightly to 21.5 billion from 21.3 billion.
  • UK Trade Balance will be published at 9:30 GMT and expected to drop to £3.4 billion from £5.2 billion a year earlier.

Markets Volatility Ahead in December – How Can You Make Profits?

As we are approaching the last month of 2016, financial markets reach a boiling point. Yes, Donald Trump’s economic policies hope –  so-called Trumponomics and concerns over the new eccentric US president-elected ease, but as we see 2017 in front, December has a lot of surprises.

1. Federal Reserve December Meeting – On the 13-14 of December, the Federal Reserve members will meet to put an end to the question of the interest rate hike. All signs indicate a rate hike before the end of the year as Fed Watch tool odds pricing 91.7% for an interest rate hike. Markets might be choppy before and after the Fed announcement.

2. On December 4th, Italy Referendum to leave European union can shake financial markets stability. After Brexit decision on June 23 and Trump’s presidential election victory, we can safely say that anything is possible. obviously, the major effect will be on the Euro currency and the European economy. US Dollar strength might continue as capital will flow into the US.

3. OPEC Meeting takes place on the last day of November. In the last four days, crude oil prices dropped 4.00% on Friday, climbed 2.21% on Monday session, lost 3.93% yesterday and at the time of writing, oil prices soar over 8.00%. Oil prices volatility is expected to continue in December as consolidation around 50$ a barrel might find its breakout.

4. European Central Bank Meeting – On December 8th, The (ECB) will hold its monthly meeting. The central bank is preparing to review its securities lending and bond purchase programmes which will be eyed by investors across the globe.

While the European economy faces many obstacles, investors will closely watch Mario Draghi’s Policy action about any stimulus plans to boost economic growth.

Markets volatility might be risky. However, every investor/trader must have tools to take advantages of all opportunities markets contain.

You can use various trading strategies to improve your trading abilities, protect your portfolio and learn how to increase profits in a consistent structure. Our live webinar: ‘The Fastest Way to Consistent Trading Profits’

Everything You Need to Know Before The Market Opens

After a hectic economic period with US president elect – Donald Trump’s new economic policies hopes, we enter a period of fundamental economic data and speculations that revives central banks role.

Markets will continue to focus on US rate hike in December as FOMC meeting minutes and US durable goods can signal the Federal reserve next actions.

UK GDP will shed light on Britain economy since the United Kingdom decision to leave the European Union June 23.

Additionally, Japan’s CPI will can signal the BoJ further stimulus actions to speed up its economic growth to 2% target.

ECB President Mario Draghi Testimony

On Monday 16:00 GMT ECB, President Mario Draghi will testify in front of the European Parliament about the central bank’s annual report. Markets will be watching whether the European central bank will extend its quantitative easing program at its December meeting in order to further stimulus the economy.

As the Euro recently weakened versus most currencies, investors will be looking for indication regarding the central bank actions to stabilize Europe’s economy.

FOMC Meeting Minutes

FOMC Meeting Minutes will be published on Wednesday at 19:00 GMT. After the Federal Reserve left interest rates unchanged at November but signaled a rate hike at December meeting, markets will be looking for more clarity regarding the US central bank’s actions.

Currently, according to Fed Watch tool, markets are pricing 95.4% chances for a rate hike at the Fed meeting in December.

Japan’s October Consumer Price Index

Japanese October CPI will be released on Thursday at 23:30 GMT. The data is expected to fall by 0.1% compare to 0.5% in September. Japan’s core CPI is expected to fall by 0.3% compare to 0.5% a month earlier.

Japan’s CPI negative figures put more pressure on the Bank of Japan to maintain its stimulus program actions.

USD/JPY closed the previous week at 110.90, the pair traded at 101.18 during November.

UK Q3 Growth Domestic Product

UK third quarter economic growth will be published on Friday at 9:30 GMT. Growth is expected to rise by 0.5%, unchanged from the previous month. YoY growth is expected to rise to 2.3% from 2.1% a month earlier.

So What is Trumponomics?

America chose Donald Trump, a billionaire businessman to be the 45th president of the United States, a man of the people, the one who should lead the country and be the leader of the free world.

Since Trump spread out his policies, economists and experts vilifying Trump and scorning his views. A closer look at his speeches and statements reveals that there is a reasonably consistent worldview known as Trumponomics and it is not at all stupid.

Trumponomics describes the economic policies of the US president-elect-Donald Trump. It is an old-fashioned fiscal policy that targets to pump economic growth, a changing phenomenon after years of monetary policy rules economic fields.

Although Trumponomics is still a vague term, the plan forms itself in three main elements: Big tax cuts, immigration reform, and protectionist measures. Firstly, Trump convinced US citizens to lower their tax burden. Corporate tax – according to Trump – will be decreased from 35% to 15%, then his plan continues as he will simplify income tax to only three brackets (10%, 20%, and 25%) and last, to enforce estate tax repeal. All of these actions will lower tax rates for all classes, individuals, and Businesses.

The second element of Trump will be a tighter immigration policy that includes the deportation of unauthorized workers. More precisely, 11 million undocumented immigrants. According to Homeland Security, the enforcement division has the capacity to remove roughly 400,000 immigrants in a year. Trump’s plan to deport 11 million in just two years seems unreal and inhuman.

In addition, Trump’s has proposed to build a wall along the Mexican border. The cost of a wall is affordable and possible to build. However, the wall across the border will be a challenge to build as public pressure will set the tone.

The last element is the so-called protection measures. That is the most concerning element of Trump’s plan, both for the US and Global economy and politics. Trump has more to lose taking a protectionist path. Critics claim that the plan can isolate the US economy by provoking a trade war with emerging countries, including Canada, Mexico, and China.

Trumponomics is still a cloud of uncertainty. We must admit that with all the concerns Trumponomics contain, it has a sense of change. We all have to wait and see whether Trump’s statements can come true.

Everything You Need to Know Following Trump’s Victory

Global Markets Trade Modestly Lower

Global share markets are trading lower after Donald Trump elected as the 45th president of United States. Trump’s presidential victory considered negative as his policies reflect uncertainty for US and global economy. Japan’s Nikkei closed down 5.36%, US indices futures are trading lower, S&P 500 is down -1.84%, Nasdaq -2.3% and Dow Jones lost -1.69%.

Although global stocks markets are colored in red, investors are in attempt to reassure Trump’s victory after morning losses.

Pharmaceutical stocks surged in Europe as Donald Trump’s U.S. presidential election win led investors to conclude the threat of drug pricing had receded.

December Fed Rate Hike Odds at 76% After a Fall Below 50%

The Federal Reserve December rate hike is in doubt after Donald Trump’s US presidential victory.

Trump has accused the Fed of keeping low interest rates to help Democratic President Barack Obama and indicated he might replace Janet Yellen after her term ends in January 2018, leading analysts to speculate on whether she would resign earlier.

Odds of a December rate hike fell to as low as 47%. That compares to 82% a day prior to the surprising announcement. However, odds for a rate hike pulled back and currently trading at 76% after markets adaptation of the unpredictable news.

Mexican Peso Sinks 10% as Trump Wins Election

The Mexican peso sinks by the most since 1995 – then it was the Tequila Crisis –  now it’s Donald Trump US president election victory.

Investors concern over Trump’s threats to rip up a free trade agreement with Mexico and building a wall on the southern U.S. border once elected president have made the peso tumbled more than 13% after Trump’s victory.  As of 11:00 GMT USD/MXN trades at 20.013 up 9.26%.

Trades between Mexico and the US has grown to more than $500bn a year since the NAFTA (North American Free Trade Agreement) in 1994, making Mexico the US’s third-largest trading partner after China and Canada.

Safe Haven Assets Shine as Trump win Increases Uncertainty

As Donald Trump declared as the 45th US president, investors piled into safe haven assets.  Precious metals soared as concerns over Trump’s policies weigh on global economic certainty.

Gold touched 1338.20 before pulled back to trade at 1302.15, up 2.18%, Silver is trading +1.78% and Copper soared 2.94%.

Bitcoin is also trading higher at 723.87 up 3.50%.

US Dollar Dragged Down by Fears of Trump’s Victory

US Dollar has weakened versus most currencies after Trump’s presidential win as fears of the new president policies weigh on the US economy.

Safe-haven currencies surged after Donald Trump’s victory . US dollar trades lower versus Euro, British Pound, Swiss Franc, etc.  The Japanese Yen surged to 101.19 from 105.46 and trades at 103.03, down 2.03%. The Australian dollar has also strengthened versus the greenback to trade at 0.7678 losing 1.08%.

The Canadian Dollar and the Mexican Peso – both countries sharing a border with United States – had a negative affect on Wednesday morning. The US dollar soared 0.95% versus the Canadian dollar and 9.26% versus the Mexican Peso.

Markets Await US Presidential Results

It has been the most controversial campaign in the American history – and now after all the scandals, rumors, investigations, and mostly an unpleasant elections race –  it’s almost over.

In two days, we will know whether America has decided to elect Donald Trump or Hillary Clinton to replace Barack Obama as the 45th President of the United States.

Although the Democratic US presidential candidate Hillary Clinton holds a five-point lead over Republican Donald Trump in the latest Washington Post-ABC Tracking Poll released early on Sunday, a change over to Trump’s side is still a possibility.

Still, despite Trump’s attempts to manipulate the polls numbers, it is most likely that Hillary Clinton will win US elections on Wednesday.  According to most predictable scenarios, the Democratic candidate will win 270 electors which is the minimum number required to win US elections. The ‘New York Times’ concluded that Clinton has 268 electors that are guaranteed to the democratic party. According to this model, 113 electors are still swinging and open for competition. Hillary needs at least two electors to win while trump must win all 113 electors.

Theoretically, Trump can reach this number. However, the majority of the polls predict Clinton to win. The website “538” estimates that Clinton will win 291 electors. The Huffington post was more decisive with an estimation of 98.1% that Hillary Clinton will win the presidential race.

It must be noted, the race has tightened significantly in the past week as several swing states that are considered must-wins for Mr. Trump shifted from favoring Mrs. Clinton to toss-ups. According to Real Clear Politics polls, Clinton’s advantage over Trump shrunk to 1.7%.

The economic manifest of both candidates plays a big part in this elections. While Clinton is the “status quo” candidate that will maintain the financial market stability, it is Donald Trump who increases markets’ fear levels and is considered to be one of the most riskier presidential candidates in the American history. Last week, the VIX (Volatility Index) climbed 38% as concerns of ‘Brexit Type’ Response will repeat in the shape of Trump’s win.

Hillary Clinton is still the favorite to win these elections, with a clearer path to winning of the Electoral College.

But Mr ‘Brexit’ Trump now has a plausible route to victory, especially if there is a sharp fall in turnout among African-Americans from the levels of the 2012 election.

Markets Reaction to US Elections

On Wall Street, the S&P 500 closed down for the ninth consecutive session — the first time that has happened since 1980.

The recent moves reflect worries that investors aren’t sure whether to believe reassurances from polls. Last week, markets were volatile and risk sentiment was high. Both candidates want to increase spending and cut taxes which would be bullish for stocks and bearish for fixed income.

Analysts said a victory for Mr. Trump, who has threatened to rip up existing US trade agreements, would hit the Mexican peso hardest amid fears that he could spark a global trade war.

Trades between Mexico and the US has grown to more than $500bn a year since the NAFTA (North American Free Trade Agreement) in 1994, making Mexico the US’s third-largest trading partner after China and Canada.

The US Dollar is expected to expand its gains versus other currencies in a scenario of Clinton’s win as attention will be shifted to the federal reserve rate hike in December. A less optimistic vision for the US economy comes in case of  Trump’s win. The US dollar may weaken versus developed countries currencies as investors will seek safe havens currencies and commodities such as Euro, Yen and even the British Pound.

Precious metals will also suffer in case of Trump’s win. Oil prices and natural gas could get a lift as risk-return to markets.

Markets tend to dislike the unknown – hence Donald Trump. When US election results will come out, it will be adapted into financial markets, and fast. The week ahead might be hectic with many opportunities.

The Week Ahead – Central Banks Meetings, Non-Farm Payrolls and US Elections in Focus

As we are approaching the US elections vote on November 8, in the week ahead markets will be watching major economic events before turning attention towards Donald Trump and Hillary Clinton presidential battle.

Japan, Australia, United States and the United Kingdom will take the center stage as interest rate decisions and policy announcements are in focus.

On Friday, the last US non farm payrolls data will be released before the Federal Reserve December meeting to indicate the US economy strength. A strong reading will most likely push Fed members to increase interest rates by the end of the year.

Here are the main events for the upcoming week:

Monday

  • Eurozone Core CPI for October will be released at 10:00 GMT and is expected to rise by 0.8%, the same as in the previous month.  YoY growth is expected to rise by 0.5% compare to 0.4% in September.
  • Eurozone GDP for Q3 will be released at 10:00 GMT. Growth is expected to rise by 0.3% QoQ and 1.6% YoY, unchanged from previous month.

Tuesday

  • Bank of Japan Interest Rate Decision and Policy Announcement will be published at 03:00 GMT. Interest rate is expected to remain Unchanged. However, the BoJ will also publish a monetary policy statement to asses the central bank’s stimulus program. Central bank Governor Haruhiko Kuroda will hold a press conference afterward to discuss the decision.
  • Reserve Bank of Australia Interest Rate Decision will be published at 3:30 GMT and will attract markets attention. The RBA is expected to hold rates unchanged at 1.5% due to better than expected CPI data that was released last week.
  • UK Manufacturing PMI will be released at 9:30 GMT. Data is expected to fall to 54.4 for October from 55.4 in September.
  • US ISM Manufacturing will be released at 14:00 GMT and expected to rise slightly to 51.7 from 51.5 in the previous month.

Wednesday

  • ADP Non-Farm Employment Change will be released at 12:30 GMT and will assist investors to predict Friday’s nonfarm payrolls result.
  • FOMC Statement & Interest Rate Decision will take action at 18:00 GMT. Interest rates are expected to remain unchanged as a rate hike before US presidential election is highly unlikely. The fed will release its statement as investors are watching for signals to a rate hike in December. according to Fed Watch tool, markets are currently pricing 68% for a rate hike in December.

Thursday

  • Bank of England Interest Rate Decision will be published at 11:00 GMT and rates are also expected to remain unchanged with a second rate cut is off the table for now. Markets analysts will be watching comments from BoE regarding the weakness of British pound since the vote to leave the European Union.
  • ISM Non Manufacturing PMI will be released at 14:00 GMT and expected to fall to 56 from 57.1 in the previous month.

Friday

  • US October Non Farm Payrolls will be released at 12:30 GMT. Figure is expected to increase by 173,000 jobs compare to 156,000 in September. Unemployment rate is expected to be improved slightly to 4.9% compare to 5.0% a month earlier. a strong reading will indicate an improving economy and support markets expectations for a rate hike in December.

Check out our real-time Economic Calendar

The Week Ahead – Everything You Need to Know

In the week ahead, US and UK GDP data will be closely watched as US interest rate hike probability increased and markets will analyse Britain economy post Brexit as UK third quarter GDP will cover the first three month since June 23rd vote.

Australian inflation data will also attract attention as markets expect RBA interest rate cut in the coming month.

Here are the main events for the upcoming week:

  1. Bank of England Governor Marke Carney will testify on Tuesday in front of The Lords Economic Affairs Committee at 15:35 GMT. Carney will discuss the consequences of Brexit. In addition, Carney is also expected to discuss about the UK inflation rate and the recent devaluation of the British Pound.
  2. Australian CPI data will be published on Wednesday at 00:30 GMT. The data will attract market attention and could provide clues for whether the RBA will decide to cut interest rate in coming months. Last week, Australian employment data came out negative and increased pressure on RBA. Australian inflation data is expected to rise slightly to 0.5% from 0.4% in the second quarter while on yearly basis Australian CPI is expected to rise to 1.1% from 1.0%.
  3. UK GDP Data will be published on Thursday at 8:30 GMT. Markets will be closely watching UK third quarter growth since the vote on June 23rd to leave the European Union. QoQ growth is expected to rise by 0.3% from 0.7% in the previous quarter. A weak data can signal further easing action by BoE.
  4. US GDP Data will be released on Friday at 12:30 GMT. Q3 growth is expected to rise by 2.7% from 1.4%. The data can support Federal Reserve rate hike in December. According to FedWatch tool, markets are pricing 64% chance for a rate hike by the end of the year.

Check out our real-time Economic Calendar

Events to Watch on The Economic Calendar This week

Here are the main events for the upcoming week:

Monday

  • BOJ Gov Kuroda will hold a Speech at 00:30 GMT. Investors will be watching for any clues to indicate further actions by  Japan’s central bank
  • Eurozone CPI will be released at 9:00 GMT and is expected to rise to 0.4% from 0.2% MoM while YoY is expected to remain unchanged at 0.8%.

Tuesday

  • The RBA (Reserve Bank of Australia) Meeting Minutes will be released at 00:30 GMT and can shed light on recent decisions made by Australian policy makers.
  • UK CPI will be published at 8:30 GMT. YoY inflation rate is expected to rise by 0.9% compare to previous 0.6% while MoM is expected to rise by 0.3% compare to 0.1% in August.
  • US CPI – The YoY US inflation rate will be released at 12:30 GMT and forecasts to rise to 1.5% from 1.1%. YoY core inflation rate is expected to hold steady at 2.3%.  The data can indicate further clues for Fed’s rate hike in December.

Wednesday

  • At 2:00 GMT China’s GDP will be released and expected to remain unchanged at 1.8% for the Q3. Chinese YoY growth is also expected to remain unchanged at 6.7%.
  • UK Unemployment Rate & Claimant Count Change  will be published at 8:30 GMT. UK employment rate is forecasts to hold steady at 4.9% while figure for claimant count is expected to rise to 3000 from 2400 in September.
  • US Housing Starts and Building Permits will be released at 12:30 GMT. Housing starts forecat to rise to 1175K from 1142K while building permits also expected to rise to 1163K from 1152K.
  • Bank of Canada Rate Decision will take action at 14:00 GMT. Rates are expected to remain unchanged at 0.5%. The BOC will also provide its Monetary Policy Report.
  • Crude Oil Inventories will be released at 14:30 GMT. Stockpiles are expected to drop by 800K barrels after a rise of 4.9 million barrels in the previous week.

Thursday

  • Australia Employment Data will be publishes at 00:30 GMT. Employment change expected to grow by 15,000 after a drop of 3900 in August while employment rate is expected to rise slightly to 5.7% from 5.6% a month earlier.
  • UK Retail Sales will be released at 8:30 GMT. MoM figure is expected to rise by 0.3% after a drop of -0.2% a month earlier while YoY sales growth are expected to decrease to 4.8% compare to 6.2% in August.
  • ECB Interest Rate Decision will be published at 11:45 GMT. Although ECB president Mario Draghi is not expected to announce any changes, markets will be watching for more easing  from the European central bank. Later on, the ECB press conference will take action at 12:30 GMT.
  • US Existing Home Sales will be released at 14:00. Figure expected to rise to 5.38M from 5.33M.

Friday

Canada CPI & Retail Sales will be published at 12:30 GMT. YoY growth expected to rise by 1.5% compare to 1.1% a month earlier while MoM forecast to rise by 0.2% after a drop of -0.2% in the previous month. Canada retal sales data is expeected to rise by 0.3% compare to a previous drop of -0.1%.

Check out our real-time Economic Calendar

This Week’s Economic Calendar – Everything You Need to Know

Here are the main events for the upcoming week:

Sunday

  • Japan Tankan Large Manufacturers Index  for Q3 will be published at 23:50 GMT. Figure is expected to rise to 7 from 6 in the previous quarter.M

Monday

  • UK PMI will be published at 8:30 GMT and expected to weaken slightly to 52.1 from 53.3.
  • September US ISM Manufacturing will be released at 14:00 GMT and forecast to show improvement with index rise to 52 from 49.4 in August.

Tuesday

  • Reserve Bank of Australia Interest Rate Decision will be released at 3:30 GMT. The Australian central bank is expected to hold interest rate unchanged at 1.5%. Market will be watching for future policy plans.
  • Japan Consumer Confidence will be released at 5:00 GMT and expected to rise slightly to 42.3 from 42 in the previous month.
  • September UK Construction PMI will be released at 8:30 GMT. Data is forecast to show further improvement rising to 50.5 from 49.2 in August.
  • ECB Non Monetary Policy Meeting will take action in Frankfurt and can provide more information of ECB stimulus policy.

Wednesday

  • Australia Retail Sales will be published at 00:30 GMT and expected to rise 0.2% compare to 0.0% the previous month.
  • US ADP Employment will be published at 12:15 GMT. The report is expected to show growth of 170K compare to 168K in the previous month. Data will be monitored closely by markets as nonfarm payrolls will be released two days after and can provide information about US economic growth.
  • Canada Trade Balance will be published at 12:30 GMT. Canadian deficit is expected to remain unchanged at -C$2.5B.
  • US Trade Balance will be released at 12:30 GMT and deficit is expected to hold steady at -$40B.
  • US ISM Non Manufacturing data will be released at 14:00 GMT and expected to improve to 53 from 51.4.

Thursday

  • Australia Trade Balance will be published at 00:30 GMT.Forecast to narrow to -$2.1B from -$2.4B in the previous month.

Friday

  • UK Trade Balance and Manufacturing Production will be published at 8:30 GMT. UK deficit is expected to narrow to 3.1B from 4.5B. Manufacturing data is expeted to rise by 0.5% compare to a decrease of 0.9% in July.
  • US Non Farm Payrolls – The big event of the week will be published at 12:30 GMT. After disappointing data last month with 126K, the forecast 170K new jobs have been created this month. Investors will analyse the data to predict December rate hike chances.
  • Canada Employment Rate & Employment Change will be published at 12:30 GMT. Employment Rate is expected to remain unchanged at 7.0% while 2200 new jobs were added compared to 26,200 a month earlier.

Check out our real-time Economic Calendar

 

 

This Week’s Economic Calendar – OPEC Meeting and Central Banks in Focus

Central banks continue to set the tone as BoJ overhauls its stimulus program and Federal Reserve has left interest rates unchanged but prepares the markets for a rate hike in December.

In the weak ahead, markets will absorb central banks decisions and will focus this week central banks speeches with Draghi, Kuroda and Janet Yellen are all due to speak. Traders will also be looking to the informal meeting of OPEC that will take place in Algeria from 26-28 of September. On Friday, crude Oil dropped 3 Percent as Investors Reduce Chances of Output Agreement.

Here are the main events for the upcoming week:

  1. German IFO Business Climate for September will be published on Monday at 8:00 GMT. Figure is expected to rise to 106.8 from 106.2.
  2. US New Home Sales will be published on Monday at 14:00 GMT and expected to fall to 597K from 654K in the previous month.
  3. On Monday at 15:05 GMT, ECB presidnet Mario Draghi will testify before the European parliaments committee on economic and monetary affairs. Later on this week, on Wednesday, Draghi is set to speak about current developments in the Euro area.
  4. On Tuesday at 00:50 GMT the BoJ meeting minutes will be published and can shed light on Japan’s easing policy program.
  5. US Consumer Confidence will be release on Tuesday at 14:00 GMT. The dada measures level of consumer confidence in economic activity. Forecast to fall to 99.8 from 101.1.
  6. On Wednesday at 6:00 GMT German Consumer Confidence data will be released and expected to fall slightly to 10.1 from 10.2.
  7. US Durable Goods Orders will be published on Wednesday at 12:30 GMT. It is forecast to fall by -1.5% after a gain of 4.4% in the previous month.
  8. On Wednesday at 14:00 GMT Federal Reserve chair Janet Yellen will testify before the house financial services committee. Markets will be watching to see support for a December rate hike.
  9. BoJ governor Haruhiko Kuroda will speak at the National Securities Industry Convention on Thursday at 6:35 GMT. Kuroda’s speech will attract markets attention after last week Bank of Japan’s announcement to target Japanese bonds interest rates.
  10. German Unemployment Data & Inflation Rate – On Thursday at 7:55 GMT unemployment change is expected to fall by 5000 compare to a drop of 7000 in August. Unemployment rate is expected to remain unchanged at 6.1%. German Inflation Rate will be published at 12:00 GMT and expected to rise to 0.6% from 0.4% in the previous month.
  11. Eurozone Business confidence will be released on Thursday at 9:00 GMT and expected to rise by 0.1 from 0.0 the previous month.
  12. US GDP Growth for second quarter will be published on Thursday at 12:30 GMT. Expected to rise to 1.3% from 0.8% the previous quarter.
  13. On Thursday at 20:00 GMT Federal reserve chair Janet Yellen will speak at the minority bankers forum in Kansas city. Yellen’s speech will be closely monitored as investors expect a rate hike in December after last week’s Federal Reserve decision to leave interest rate unchanged.
  14. Japan Unemployment Rate & Inflation Rate will be published on Thursday at 11:30 GMT. Unemployment rate is expected to hold steady at 3.0%. Inflation rate for August is also expected to remain unchanged at -0.4%.
  15. China Caixin Manufacturing PMI will be released on Friday at 1:45 GMT and expected to fall to 49.3 from 50.0.
  16. UK GDP Growth Rate will be published on Friday at 8:30 GMT. QoQ is expected to rise by 0.6% compare to 0.4% while YoY expected to rise by 2.2% from 2%.
  17. Eurozone Unemployment Rate for August will be published on Friday at 9:00 GMT and expected to fall to 10.0% from 10.1% in the previous month.

Check out our real-time Economic Calendar

 

Fed keeps Options Open, What to Expect From FOMC Meeting

The Federal Reserve is likely to hold interest rates unchanged at its policy meeting today after disappointing economic data over the last month, economists said, although some think it is a closer call than the market expects. The central bank will release a statement and new economic projections at 18:00 GMT followed after by a press conference from Fed Chair Janet Yellen.

The Federal Reserve raised its overnight interest rate to a range of %0.25-%0.50 in December, the first hike in nearly a decade, but has held rates steady during this year.  Alongside the policy statement, Fed officials will also provide a new set of forecasts for economic growth, unemployment, inflation and the path of interest rates.

Economists said they could not rule out a surprise rate hike at the FOMC meeting, particularly since Yellen said that “the case for an increase in the federal funds rate has strengthened in recent months.”

According to FedWatch tool, odds for a rate hike for September stands on 15% while December rate hike chances are 48%. In case the fed decides to hold interest rate unchanged, analysts will pay attention for signals of a rate hike in December.

While the majority of Fed watchers think the Fed will raise rates in December, some are calling for a broad rethink of the strategy for gradual rate hike.

The clearest preview of Wednesday’s likely decision came from Fed Governor Lael Brainard in a speech last week that warned against raising interest rates too soon. “Today’s new normal counsels prudence in the removal of policy accommodation,” she said in Chicago, adding that the case to raise rates is “less compelling.”

Brainard was not reflecting the views of all her colleagues on the FOMC, but her speech contained some of the reasons that could be cited for the Fed’s patience. And, as Fed Chair Janet Yellen has mentioned before, the risks of raising rates too quickly are higher than those of being patient.

The Fed’s meeting also comes ahead of an election that’s brought the future of the Fed, and of monetary policy, into focus.  Last week, Republican presidential nominee Donald Trump said Yellen is keeping rates “artificially low to get Obama retired,” suggesting that there could be serious consequences afterwards.

The real impact of higher rates would not be on the economy, a hike of  25 basis-point hike would be a minor change over US and global economy. However, a rate hike can formulate a new monetary policy for central banks.

The Federal Open Markets Committee, is expected to leave its benchmark interest rate unchanged. However, after a almost a decade of near-zero interest rates, it might be the first sign of a new gradual tightening policy.

 

This Week’s Economic Calendar – All Eyes on Fed & BoJ

In the week ahead, markets will be focused on Federal Reserve rate decision and the Bank of Japan interest rate decision & policy announcement on Wednesday.

After the ECB and the Bank of England rate decisions remained unchanged, investors will shift their focus to the Fed rate decision. Currently, markets are pricing a 12% chances of a rate hike on Wednesday and 45% for December according to Fed Watch Tool.

Investors will also be looking to Wednesday’s Bank of Japan policy announcement. The BoJ stimulus the Japanese economy with negative interest rate and 80 trillion yen a year. However, speculations are for further interest rate cut into a deeper negative territory.

Here are the main events for the upcoming week:

  1. On Tuesday at 1:30 GMT, the Reserve Bank of Australia minutes meeting will be published. No policy changes are expected but hints for further decisions by RBA policymakers will be watched.
  2. US Housing Starts and Building Permits will be released on Tuesday at 12:30 GMT. Building permits are expected to rise to 1.170 million from 1.14 million. Housing starts are expected to fall to 1.19 million from 1.21 million.
  3. BoJ Interest Rate Decision & Press conference – The bank of Japan will release its interest rate decision on Wednesday at 3:00 GMT. BoJ governor Kuroda will hold a press conference at 6:00 GMT.
  4. Federal Reserve Rate Decision – One of the biggest events of the year. Although chances for a rate hike are low at 12%, markets will keep an eye on Fed press conference for more information. Fed rate decision and FOMC economic projections will take action on Wednesday at 18:00 GMT. Later on, at 18:30 GMT, Fed chairman Janet Yellen will hold a 30 minutes press conference.
  5. Eurozone Consumer Confidence will be released on Thursday at 14:00 GMT. The figure is expected to fall to -9.2 from -8.5 the previous month.
  6. US Existing Home Sales will be released on Thursday at 14:00 GMT and expected to rise slightly to 5.45M from 5.39M.
  7. On Friday at 7:30 GMT German Manufacturing PMI for September will be released. Forecast of a rise to 53.9 compared to 53.6 in August.
  8. Canada CPI – On Friday at 12:30 GMT Canadian YoY inflation will be released and expected to rise to 1.5% compared to 1.3%, MoM also expected to rise to 0.2% after -0.2% the previous month.

Check out our real-time Economic Calendar

The Week Ahead – Everything You Need to Know

  1. On Tuesday at 1:30 GMT, Australia NAB Business Confidence will be published. The data is expected to rise to 6 from 4 in the previous month.
  2. On Tuesday at 8:30 GMT, UK Inflation Rate will be released and forecasts to remain unchanged at 0.6%. Prices are expected to grow in August by 1.4% from 1.3% in July.
  3. German Zew Index will be published on Tuesday at 9:00 GMT. It is expected to rise to 2.6 from 0.5 in the previous month.
  4. On Wednesday at 00:30 GMT, Australia Consumer Confidence Index for September is expected to rise to 3.7% from 2.00%.
  5. UK Claimant Count Change & Unemployment Rate will be released on Wednesday at 8:30 GMT. The figure for August UK Claimant Count Change is expected to decrease by 800 compared to a decrease of 8600 in July. The unemployment rate is forecasted to rise to 5.00% from 4.9% in the previous month.
  6. EIA Crude Inventories will be released on Wednesday at 14:30 GMT. The crude inventory report is expected to remain unchanged.
  7. On Thursday at 1:30 GMT, Australia employment change, and the Unemployment rate will be released. The figure for August employment change is forecasted to rise by 10,000 compared to 26,200 new jobs in July. The unemployment rate is expected to hold steady at 5.7%.
  8. UK August Retail Sales will be released on Thursday at 8:30 GMT. The data is forecasted to fall by 0.4% compared to 1.4% growth in July.
  9. UK Interest Rate Decision, MPC Meeting Minutes, BoE Quantitative easing and BoE Meeting. On Thursday at 11:00 GMT, markets will focus on the BoE stimulus program plans. UK interest rate is expected to remain unchanged at 0.25% and  Quantitative easing is also forecast to remain unchanged at 435B. No policy changes from BoE are expected but hints for further decisions by UK policymakers will be in focus.
  10. US Retail Sales will be released on Thursday at 12:30 GMT. Retail Sales are forecast to rise by 0.2% compared to 0.0% the previous month.
  11. On Friday, US CPI will be released at 12:30 GMT. YoY core inflation rate is expected to rise by 2.1% compared to 2.2% in July while the overall inflation rate for August is expected to rise to 0.9% compared to 0.8% in the previous month.
  12. US Michigan Consumer Confidence will be published on Friday at 12:30 GMT and forecasted to decrease slightly to 89.5 compared to 89.8 from the final report in August.

Check out our real-time Economic Calendar

The Week Ahead – All the Things You Need to Know

In the week ahead, markets will take in the outcome of the US nonfarm payrolls & unemployment data that was released on Friday and will continue to focus on further predictions of US rate hike in September & December.

US markets will be closed on Monday for Labor Day.

Here are the main economic events for the upcoming week:

  1. On Monday at 1:45 GMT, China Caixin PMI will be released. The data is expected to remain steady at 51.7.
  2. UK Services PMI will be released on Monday at 8:30 GMT and forecast to rise to 49.4 from 47.4. The data can shed lights on the UK economy post-Brexit.
  3. On Monday at 9:00 GMT, July Eurozone Retail Sales will be published. Sales are expected to rise by 0.6% in July compared to 0.0% in the previous month. YoY sales are expected to rise by 2%, an increase from 1.6% in the previous year.
  4. The RBA (Reserve Bank of Australis) Interest Rate Decision will be published on Tuesday at 4:30 GMT. Rates are expected to remain unchanged at 1.5%. However, keep an eye for any comments from policymakers regarding further changes of Australian economic policy.
  5. Eurozone third quarter GDP will be released on Tuesday at 9:00 GMT. Expectations for quarterly growth to rise by 0.3% from 0.6%. YoY is expected to rise by 1.6% compared to 1.7% in the previous year.
  6. On Tuesday at 14:00 GMT, the US ISM Manufacturing PMI will be released and expected to decline slightly to 55 from 55.7.
  7. Australia Growth Domestic Product(GDP) will be released on Wednesday at 1:30 AM. Growth for the second quarter is expected to rise by 0.7%, a decline from 1.1% while YoY growth falls to 3.00% from 3.1% a year earlier.
  8. Canada Interest Rate Decision – The BoC will release its rate decision on Wednesday at 14:00 GMT. Rates are forecasted to remain unchanged at 0.5%.
  9. On Wednesday at 11:50, Japan’s second-quarter GDP is expected to hold at 0.00% compared to 0.5% in the previous quarter. YoY growth is expected to decrease significantly to 0.2% from 2.00%.
  10. ECB Interest Rate Decision – Markets will focus on this event this week to get hints for European monetary policy. The interest rate is expected to remain unchanged at 0.0%. The ECB conference will attract the market’s attention to see whether further stimulus actions are expected.
  11. China’s Inflation rate will be released on Friday at 1:30 GMT. MoM CPI is expected to be 0.0%, a decrease from the previous data of 0.2%. YoY forecasts to rise by 1.8% unchanged from the previous month.
  12. Germany & UK Trade Balance – German balance of trade will be published on Friday at 6:00 GMT and expected to post a surplus of €20.7B compared to €24.9B in June. UK balance of trade will be released at 8:30 GMT and expected to narrow to £4.5B from £5.1B in the previous month.
  13. Canada Employment Data will be published on Friday at 12:30 GMT. the unemployment change is expected to hold steady at 6.9% while employment change figure is expected to grow by 3200 new jobs compared to July fall of 31,200.

Check out our real-time Economic Calendar

The Week Ahead – All the Things You Need to Know

  1. On Monday at 12:30 GMT, US PCE Index will be published. The price index for consumer spending in June 2016 is expected to rise by 0.1% MoM.
  2. On Monday at 23:30 GMT, Japan unemployment rate is expected to remain unchanged at 3.1%.
  3. On Tuesday at 09:00 GMT, the Eurozone Business confidence will be released. The forecast is for a decrease to 0.25 from 0.39.
  4. Germany Inflation rate will also be published on Tuesday at 12:00 GMT. The YoY figure is forecast to hold steady at 0.4%. MoM German inflation rate is expected to fall to 0.2%, a decrease from 0.3% released last month.
  5. On Wednesday at 7:55 GMT Germany unemployment rate for August is expected to remain at 6.1%. The unemployment change for August is forecast to fall by 3000 compared to a higher drop of 7000 in July.
  6. Eurozone Unemployment rate will be released on Wednesday at 9:00 GMT. Forecasts for the EU unemployment rate to hold at 10.0%, a minor decrease from last month – 10.1%.
  7. US ADP Unemployment change will be an important indicator of US economic strength. The data will be released on Wednesday at 12:15 GMT and can shed lights on the US nonfarm payrolls data that will be released later on Friday. The US economy will be in the spotlight after Janet Yellen speech last Friday. The takeaway from the speech and the market action indicates that the Fed wants to raise interest rates, but strong data will support the Fed’s policy plans.
  8. Canadian GDP – On Wednesday at 12:30 GMT, the Canadian economy for the second quarter is expected to shrink by -0.9% from an increase of 0.6% in the previous quarter. The annualized rate for Q2 is also expected to shrink by -1.00% compares to 2.4% last year.
  9. On Thursday at 1:00 GMT China manufacturing & non-manufacturing PMI will be published. The figure for manufacturing PMI forecast to a slight drop of 49.5 compared to 49.9. Non-manufacturing PMI is also expected to drop to 52.7 compared to 53.9. On the same day, the figure for China Caixin manufacturing PMI will be published at 1:45 GMT and is expected to decline compared to 50.6.
  10. US ISM Manufacturing PMI – The data will come out at 2:00 GMT and expected to rise to 53.2 from 52.6 previously.
  11. On Friday at 05:00 GMT, Japan Consumer Confidence is expected to rise to 41.44 from 41.3.
  12. Nonfarm Payrolls & Unemployment data – US labor is forecast to increase by 190K compared to the high data that was released last month – 255,000. Additionally, unemployment change forecast to remain the same as the previous month at 4.9%. US balance of trade is expected to narrow to 43 billion compared to 44.51 billion.

Check out our real-time Economic Calendar

10 Things You Need to Know This Week

Japan Growth Domestic Product Q2

On Sunday at 23:50 GMT, Japan will publish its economic growth for the second quarter. The figure for Japan GDP is expected to fall to 0.2% from 0.5% in the previous quarter. YoY data is expected to weaken to 0.7% from 1.9% the previous year.

Australia RBA Minutes

On Tuesday at 1:30 GMT the Reserve bank of Australia will cover the latest policy decisions made by RBA. The minutes might reveal some clues regarding easing policy plans by the Australian policymakers.

UK Consumer Price Index

UK CPI will be published on Tuesday at 8:30 GMT. Prices are expected to rise by 0.5% in July after an increase of 0.5% in June.

On the same day, BoE governor Mark Carney and other committee members will give us a glimpse of UK economic outlook and inflation prospects.

German Zew August

The Zew sentiment data is expected to rise by 1.7 from -6.8 in the previous month. Zew Current condition index is forecast to climb to 50.0 from 49.8.

US Core CPI

US Price growth will be published at 12:30 GMT on Tuesday and expected to rise by 0.3% in July from 0.2% the previous month. On yearly base, core CPI is expected to rise 1.0% compared to 2.3% a year earlier.

UK Claimant Count Change & Unemployment Rate

On Wednesday at 8:30 GMT, July climate count change is forecast to surge to 8800 from 400. July unemployment rate is forecast to rise to 5.0% from 4.9%.

FOMC Minutes Meeting

On Wednesday at 18:00 GMT, the federal reserve will publish its minutes of July policy meeting. At their last meeting, the Fed committee left interest rates unchanged, noted that the labor market is strong and specify decreasing global risks.

Fed funds futures for September are trading at 15% chance of a rate hike and 45.1% for December.

Australia & New Zealand Employment Change

On Tuesday at 22:45 GMT, the New Zealand unemployment rate is expected to be released at 5.2% compared to 5.7% in the previous quarter.

On Thursday at 1:30 GMT, the Australian unemployment rate is expected to rise to 5.9% from 5.8%.

UK Retail Sales

On Thursday at 8:30 GMT, sales in July are expected to grow by 0.3% compared to a fall of 0.9 the previous month. YoY sales are expected to rise to 4.2% from 4.3% a year earlier.

Canada Consumer Price Index

Canada CPI will be published on Friday at 12:30 GMT. The Monthly figure moves to -0.1% from 0.2%. YoY price growth is forecast to rise by 1.3%, down from 1.5% in June. Core CPI is expected to hold at 2.1% YoY.

Russian Economy Shrinks 0.6%, Ruble Strength Continues amid Carry Trades

On August 8th, the Russian central bank announced that Russia’s economic recession is over. According to the central bank estimation, growth in the fourth quarter will reach a positive figure of 0.5%. However, analysts argue that the Russian economy is not indicating any signs of significant improvement which can validate the end of the recession.

As investors seeking higher yield than near zero interest rate, Russia’s 10.5% interest rate has become the best carry trade opportunity. Carry trades are appealing to investors as yields in developed markets are near zero.

Investors have taken advantage of carrying trades and so far returned 11% this year, the second-best performance among emerging-market currencies after Brazilian Real, benefiting a gap of 10% between Russian and US interest rates. That’s despite oil prices slide in the past year that has worsened government’s budget deficit.

USD/RUB daily chart

Russia, the world’s largest producer of crude oil and the second-largest producer of natural gas revenues more than half of Russia’s federal budget from oil and natural gas.

The correlation between the ruble and oil is the highest among major developed and emerging-market currencies. The ruble has been volatile lately as Brent oil prices fluctuated below $50 per barrel. Brent crude oil is currently trading at $43.66.

“They’ve talked about diversifying their economy, but oil is their major export. And it really drives a lot of it—growth, budget numbers, etc.,” Said Win Thin, global head of emerging-market currency strategy at Brown Brothers. “If the price of your biggest export goes down, that’s a term of trade deterioration and your currency would tend to weaken.”

Looking forward, the ruble, trading at $64.57 is on a crossroad and will be much affected by both oil prices and investors in search for higher yields.