The most important economic events expected this week 10 to 13 December 2019

Tuesday, December 10, 2019 - 17:20
Point Trader Group
The most important economic events expected this week 10 to 13 December 2019

Inflation in the United States: Wednesday, 4:30 pm. The consumer price index report hours before the Fed's decision, which could affect the Fed's expected tone. Back in November, the core CPI showed disappointment due to a drop to 2.3% annually, and a loss of its strength after a few strong months. Consequently, Core PCE - the Fed's preferred inflation gauge - fell to 1.6%, moving away from the 2% target. A similar result is expected. The monthly Core CPI rose 0.2%, and is expected to be the same as well.

Federal Reserve Decision: Wednesday, 10:00 pm. We also have a press conference at 10:30 pm. After three consecutive interest rate cuts, the world's most powerful central bank is set to see a fiery meeting at the last meeting of 2019. Jerome Powell, chairman of the Federal Reserve, recently stated that he sees the economy “pretty good” however, not all indicators Economic favorable, as manufacturing remains sluggish. The Fed's comments on inflation and employment - responding to nonfarm payrolls - will be important, because these are the bank's tasks.

UK elections: Thursday, exit polls at 01:00 am, and full results on Friday morning. The British are invited to vote in a national poll for the fourth time in several years, after half the usual parliamentary term. The transformations and turns in the House of Commons over Britain's exit from the European Union are seen as the main reason persuading Prime Minister Boris Johnson to choose an extraordinary winter election. Investors prefer that the Conservatives maintain the Prime Minister by an overwhelming majority, leading to the ratification of the Brexit agreement and its appropriate market policies. Jeremy Corbyn, Labor leader, wants to renegotiate a softer version of leaving the European Union and allowing a referendum, while staying on the table. While the markets want to completely cancel Britain's exit from the European Union, they fear the uncertainty of renegotiating the deal, the viability of the coalition government or the minority government that will emerge, and most importantly, Corbin's leftist hardline policies. Here are five scenarios:

The first scenario

Voting by an overwhelming majority like YouGov's expectations in an MRP poll, it might be the optimal result that would send the pound up.

The second scenario

The small majority may also be positive, but if Johnson is forced to rely on Britain's exit from the European Union, the GBP / USD might eventually drop after initial gains.

The third scenario

The third option is a suspended conservative parliament vying for an agreement with the Northern Irish Federal Democratic Party. (The small faction is likely to demand more than the previous agreement with its predecessor Theresa May. However, if the government is formed, the pound may rise after the initial drop.

The fourth scenario

The fourth option is that the Labor Party can form a coalition or a minority government. If the Liberal Democrats are in a position to condition the cooperation of a different Prime Minister in place of Corbyn, then the initial depreciation of the pound could be followed by a significant rise.

The fifth scenario

The fifth option is that Corbin enters Downing Street. In this case, the British Pound may falter greatly.

UK elections take place when markets are open, and a new government may be formed on Friday, so volatility can be significant throughout the night and also throughout Friday.

Swiss interest rate decision: Thursday, the Swiss National Bank has been keeping the interest rate unchanged for nearly five years - it will most likely remain the same at the next meeting. Any changes in their intentions may affect not only the franc but also the euro.

European Central Bank decision: Thursday, 02:45 pm. Press conference at 3:30 pm. Christine Lagarde is chairing her interest rate decision amid a growing dispute over the bank's loose monetary policy. While Lagarde is a dove that supports quantitative easing and low interest rates, she has achieved a quiet tone in her first public appearance. French politics aims to achieve unity for the bank and is unlikely to make any drastic decisions. However, despite her extensive political experience, the former IMF Managing Director may escape unwanted comments at his first press conference, which drives the markets. Its call for governments to do more - a key component of Draghi's comments - will be of great importance.

American Retail Sales: Friday, 4:30 pm. While markets will absorb British political developments, the most important consumption report from the United States is set to move the dollar. Consumption accounts for about 70% of the US economy, and the indication of what White Friday added to the economy will be of interest. Sales increased 0.3% in October while core sales increased 0.2%.

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