Monthly Archives: September 2016

Meetings of the central banks will set the tone for trading

The forecast for the week on September 5 – September 9

Stock market

September 8 decision to declare the European Central Bank’s monetary policy. At the current stage of the regulator do not expect changes. With high probability it will keep interest rates at 0%.

Focus on the rhetoric of the head regulator. the euro area economy is far from stable. GDP growth slowed down, inflation remains low (0.2% in annual terms), the index of business activity in the industrial sector, although it held above the mark 50, but it shows a tendency to decrease. All this may lead to the fact that Draghi during his speech will hint to a possible further easing in the future.

Such comments the head of the European Central Bank after the market has reduced expectations of Fed rate in September, will be able to provide support to European indices. In particular, the target of the growth of the German DAX 30 (FDAX) may be the level of 10870 and a further 11,000.

Currency market

September 6 decision on monetary policy and announce the Reserve Bank of Australia. Let me remind you that at the end of the previous meeting rate was lowered by 0.25% to 1.5%. Inflation in Australia has continued to decline (1% in 2Q. 2016 compared to 1.3% in Q1). But while the country keeps a stable growth rate. Covering the regulator does not contain a statement hints at another possible reduction. Also, the Reserve Bank of Australia expressed quite optimistic assessment of economic prospects.

Thus, the chances of monetary policy easing low. Coupled with reduced expectations of Fed rate increase in September, this makes the Australian dollar more attractive. If the Reserve Bank of Australia will keep interest rates at 1,5%, AUD / USD pair will return to the level of 0.7690.

Warning: Profitability in the past does not mean profitability in the future. Any projections are for information only and does not guarantee a result.