Search LOGIN

Week Ahead: July 13

Short Description

China GDP, EU Summit & ECB China GDP is a must-watch for bullish Chinese shares and for forex traders, the EU Summit might see an EU Recovery Fund agreed, the ECB Meeting and MUCH MORE in this week ahead. Thanks! Rich

Video Script

1
00:00:00,344 --> 00:00:01,172
Hi everyone,

2
00:00:01,335 --> 00:00:05,523
this week I’m previewing my top
five things to look out for this week,

3
00:00:05,548 --> 00:00:08,375
 which are China second quarter GDP,

4
00:00:08,400 --> 00:00:11,971
interest rate decisions from;
the European Central Bank,

5
00:00:11,996 --> 00:00:15,214
the Bank of Japan and the Bank of Canada

6
00:00:15,239 --> 00:00:21,029
as well as a face-to-face summit of EU
leaders to examine the EU Recovery Fund.

7
00:00:21,054 --> 00:00:24,599
Since the EU recovery
fund is a hot topic this week,

8
00:00:24,624 --> 00:00:26,362
I have a little quiz question:

9
00:00:26,387 --> 00:00:30,784
What is the most POPULATED
city in the European Union?

10
00:00:30,809 --> 00:00:34,159
Is it Paris, London, Berlin or Rome?

11
00:00:35,332 --> 00:00:38,559
It’s Berlin. Don’t
forget about Brexit guys!

12
00:00:38,607 --> 00:00:44,504
London is no longer in the EU so Berlin
tops the list with 3.7 million people.

13
00:00:44,529 --> 00:00:47,243
If you liked that please
click like button as it

14
00:00:47,267 --> 00:00:50,329
really helps us spread the
word about these videos!

15
00:00:50,354 --> 00:00:52,924
So here you can see
what I think are the main

16
00:00:52,948 --> 00:00:55,871
events and data points
on the economic calendar.

17
00:00:55,896 --> 00:00:58,341
Specifically on my top 5:

18
00:00:58,381 --> 00:01:03,328
Unlike most of the world, China’s
economy is thought to have grown in Q2



19
00:01:03,353 --> 00:01:06,758
but it’s still down on last year by -6.5%.

20
00:01:06,783 --> 00:01:11,355
All the central banks deciding rates this
week are expected to hold them steady

21
00:01:11,396 --> 00:01:14,543
but changes in other
policy areas are more likely.

22
00:01:14,568 --> 00:01:16,553
It’s also worth noting
we have CPI stats for

23
00:01:16,577 --> 00:01:20,816
June out of Germany, the
UK and the US this week.

24
00:01:20,841 --> 00:01:24,197
The outsized growth
relative to its size in recent

25
00:01:24,221 --> 00:01:27,990
years makes China GDP
important for all macro markets

26
00:01:28,015 --> 00:01:30,716
but I’d put extra emphasis
on the Aussie dollar

27
00:01:30,740 --> 00:01:33,265
and of course China
and Hong Kong shares,

28
00:01:33,290 --> 00:01:35,804
which have seen massive
gains in the last week.

29
00:01:35,829 --> 00:01:38,388
There’s a big range of
estimates from minus 5% to plus

30
00:01:38,412 --> 00:01:43,370
3% for quarter-on-quarter
growth so it’s all to play for.

31
00:01:43,395 --> 00:01:47,893
I’d say any positive number is good
for stock markets and the Aussie dollar.

32
00:01:47,918 --> 00:01:51,586
Last time around the Bank of
Japan expanded its corporate

33
00:01:51,610 --> 00:01:55,738
support measures to 110
trillion yen from 75 trillion before.

34
00:01:55,763 --> 00:01:59,424
It just downgraded its economic
forecasts for all Japanese

35
00:01:59,448 --> 00:02:03,045
regions last week so another
expansion seems possible.

36
00:02:03,070 --> 00:02:08,165
I think any growth-boosting measures
could be viewed as positive for the yen.

37
00:02:08,190 --> 00:02:13,282
ECB President Christine Lagarde
told the financial Times last week

38
00:02:13,307 --> 00:02:18,166
that she wants to explore ‘every avenue
available’ to combat CLIMATE CHANGE.

39
00:02:18,191 --> 00:02:21,693
To me, this would mean
buying the bond of or extending

40
00:02:21,717 --> 00:02:25,609
even cheaper loans directly
to so-called green businesses.

41
00:02:25,634 --> 00:02:30,871
She also said the ECB has time to assess
the effectiveness of the stimulus so far,

42
00:02:30,911 --> 00:02:34,644
so that probably means no
policy change this time around.

43
00:02:34,669 --> 00:02:38,592
Canadian Prime Minister Justin
Trudeau got ridiculed last week for saying

44
00:02:38,617 --> 00:02:42,936
“We decided to take on that debt to
prevent Canadians from having to do it.”

45
00:02:42,961 --> 00:02:47,114
Of course we understand his point
but a bigger national debt will need

46
00:02:47,138 --> 00:02:51,291
paying off eventually by taxes
collected on the hard work of Canadians.

47
00:02:51,316 --> 00:02:54,576
But before then – the Bank of
Canada is there to keep interest

48
00:02:54,600 --> 00:02:58,182
rates at rock bottom to allow all
the extra government borrowing.

49
00:02:58,215 --> 00:03:01,307
Based on the confidence shown
by Germany’s Angela Merkel,

50
00:03:01,332 --> 00:03:06,369
it feels to me like the EU Recovery Fund
could actually be agreed at this summit

51
00:03:06,394 --> 00:03:08,867
BUT you never know in politics.

52
00:03:08,892 --> 00:03:12,931
The European Commission has
suggested a 750 billion euro fund

53
00:03:12,955 --> 00:03:16,927
with 500 billion in grants to
the countries most in need.

54
00:03:16,952 --> 00:03:20,059
To please the ‘Frugal four’
countries it might end up

55
00:03:20,083 --> 00:03:23,190
being a smaller fund with
a lower proportion of grants

56
00:03:23,215 --> 00:03:26,327
or just a lot of strings
get attached to the grants

57
00:03:26,352 --> 00:03:29,449
but either way any agreement
should be good news for

58
00:03:29,473 --> 00:03:32,937
the euro and stock indices
like the DAX and Euro Stoxx.

59
00:03:32,962 --> 00:03:36,047
Right thanks everyone, good
luck trading and make sure to

60
00:03:36,071 --> 00:03:39,156
subscribe to our channel so
you don’t miss the next video.

61
00:03:39,157 --> 00:03:44,500
Thanks for watching!


 

Topics :

UNLIMITED ACCESS!

The best way to keep track of your accounts. Get notifications
and access your dashboard any time!

Open a live or demo account, make secure deposits or get latest
market updates for free!