FXStreet (Guatemala) – Analysts at Rabobank explained that Yet today is all about various crawls.
Key Quotes:
“In Europe we will see if Greece and its creditors can ever get to the finishing line and strike a deal. Headlines are not encouraging, with news that an emergency summit is being held by the IMF, EU, and ECB with a “take it or leave it” offer being mooted.”
“We also have Aussie slices of GDP (net exports) and the balance of payments ahead of the RBA meeting, where no change it expected and as such June will mark a further drag-mark along their slow, agonizing crawl towards realizing that they can’t rebalance a steadily-slowing Aussie economy without cutting rates even further. Yes, I know that suggests they copy the same policy that the Fed, and others, have over-used: but in this case lower rates would be aimed at the currency, and hence the real economy, not just boosting already-overheated asset prices.”
“Then in India theRBI meet (and I’ve just realized that today would be very confusing for anyone who can’t pronounce their vowels correctly: “This morning we have the RB-ai and the RB-ai; the RB-ai are seen on hold but the RB-ai are expected to cut.”) Indeed, in India’s case, despite headline GDP growth of 7.5% YoY in Q1, the market is looking to see rates trimmed by 25bp. That perhaps says more about the underlying quality of the new GDP data than it does about the careful stewardship of RBI Governor Rajan.”
“Over in Europe, aside from Greece, it will be German unemployment, expected -10K in the month, and in the UK, mortgage approvals for April.”
“The main data highlight in Europe, however, is Eurozone CPI for May, where consensus is 0.2% YoY, up from flat, and 0.7% core: in short, a slow crawl out of deflation.”
“In the US we then have the Fed’s Brainard speaking on monetary policy – so likely further “crawl” messages, ahead of factory orders, seen -0.1% MoM (and note that in YoY terms they are doing far more than crawl lower, sitting at -5.3% in March).”
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