7 Dec 2015
Key events taking place: watch Central Banks - Nomura
FXStreet (Guatemala) - Analysts at Nomura offered the key events in the week ahead and noted the three Central Banks meeting.
Key Quotes:
"US data: JOLTS (Tuesday 15:00), Retail Sales ex-Auto MoM (Friday 13:30), PPI ex-Food and Energy (Friday, 13:30) 2. China: Foreign Reserves (Sunday), Trade Balance (Monday), CPI YoY (Tuesday 01:30), PPI YoY (Tuesday 01:30), Retail Sales (Saturday 05:30), Industrial Production YoY (Saturday 05:30)
Central banks: RBNZ (Wednesday 20:00), SNB (Thursday 08:30), BoE (Thursday 12:00) – Only change expected is from RBNZ (25bp cut) 4. GDP data: Japan (Monday 23:50), Eurozone (Tuesday 10:00).
"Three major central banks are scheduled to announce their rate decisions next week. We believe that the RBNZ will cut its policy rate by 25bp at next week’s meeting, although, in our view, it will be a close decision. On one side, the activity data suggest that the growth outlook is not worsening; on the other side, there are further signs that inflationary pressures have moderated, given NZD appreciation, weak wages, and the increase in the unemployment rate. If the RBNZ decides to leave rates unchanged, the rate cut could be delayed until the March meeting, when the RBNZ releases the SMP, which seems a very long delay (see RBNZ likely to cut rates to 2.50%, 3 December 2015).
The market disappointment around the ECB has lowered expectations for the SNB, but expectations for further rate cuts still exist, albeit not a full 25bp cut, based on rate pricing. We do not expect further easing from the SNB at the next meeting, but we expect the Bank to keep its dovish bias at the meeting and to keep its wait-and-see stance for now. The possibility of a small rate cut to match the ECB’s 10bp deposit rate cut cannot be ruled out, but the SNB is unlikely to overdeliver relative to the current market pricing next week.
Since the BoE’s dovish November inflation report, there has not been much domestic news, and foreign central banks appear to be delivering on their divergent policies, albeit by less than the market had recently come to expect. We do not expect the BoE to change its policy guidance, with only one of the nine members seeing the need to dissent in favor of an immediate rate hike."
Key Quotes:
"US data: JOLTS (Tuesday 15:00), Retail Sales ex-Auto MoM (Friday 13:30), PPI ex-Food and Energy (Friday, 13:30) 2. China: Foreign Reserves (Sunday), Trade Balance (Monday), CPI YoY (Tuesday 01:30), PPI YoY (Tuesday 01:30), Retail Sales (Saturday 05:30), Industrial Production YoY (Saturday 05:30)
Central banks: RBNZ (Wednesday 20:00), SNB (Thursday 08:30), BoE (Thursday 12:00) – Only change expected is from RBNZ (25bp cut) 4. GDP data: Japan (Monday 23:50), Eurozone (Tuesday 10:00).
"Three major central banks are scheduled to announce their rate decisions next week. We believe that the RBNZ will cut its policy rate by 25bp at next week’s meeting, although, in our view, it will be a close decision. On one side, the activity data suggest that the growth outlook is not worsening; on the other side, there are further signs that inflationary pressures have moderated, given NZD appreciation, weak wages, and the increase in the unemployment rate. If the RBNZ decides to leave rates unchanged, the rate cut could be delayed until the March meeting, when the RBNZ releases the SMP, which seems a very long delay (see RBNZ likely to cut rates to 2.50%, 3 December 2015).
The market disappointment around the ECB has lowered expectations for the SNB, but expectations for further rate cuts still exist, albeit not a full 25bp cut, based on rate pricing. We do not expect further easing from the SNB at the next meeting, but we expect the Bank to keep its dovish bias at the meeting and to keep its wait-and-see stance for now. The possibility of a small rate cut to match the ECB’s 10bp deposit rate cut cannot be ruled out, but the SNB is unlikely to overdeliver relative to the current market pricing next week.
Since the BoE’s dovish November inflation report, there has not been much domestic news, and foreign central banks appear to be delivering on their divergent policies, albeit by less than the market had recently come to expect. We do not expect the BoE to change its policy guidance, with only one of the nine members seeing the need to dissent in favor of an immediate rate hike."