Today’s Key Market Drivers: 26th July 2018
“The ECB’s July statement will be the key economic data number today.”
Traders eagerly await the release of the European Central Bank’s July policy statement today for confirmation Europe’s most influential Central Bank won’t be adjusting monetary policy for the balance of 2018. Investors and traders are expecting the ECB will wind down it’s trillion Euro money printing program for good in December, however, any hint of this being extended into 2019 would not be met favourably by traders and it would see the Euro fall sharply in value.
Currently, Donald Trump and European Commission President Jean Claude Junker are meeting to discuss trade tariffs and the outcome of these discussions will likely impact the Euro. The US has recently imposed tariffs on European imports and the Commission President has indicated the European Commission intends to fire back with $20 Billion of its own tariffs. Reports this morning suggest Trump has managed to win some concessions and the Dow Jones index rallied on the positive news. I don’t often mention stocks in this report but what grabbed my attention when I flicked on my screens today was the 20% drop in the share price of Facebook after missing its latest company earnings estimates. Facebook also advised the market that it expected a slowdown in growth and this sent the stock into freefall in after-hours trading. The stock lost over $120 Billion in market value within minutes of the earnings release. It is reported that 1.47 Billion people around the world log onto their Facebook account each day.
Australian second-quarter Inflation data missed estimates on Wednesday coming in 0.4% for the quarter vs the 0.5% expected. Annualised inflation was expected to be 2.2%, however, this also just missed coming in at 2.1%. The dip in inflation just reaffirms the fact the RBA has no case to raise the official cash rate and couple this together with a potential mortgage crisis in the coming 12 months and the probability is the cash rate will stay on hold for another 12 months.
Looking ahead to the economic calendar today and there is no medium or high impacting news scheduled for the Asian trading session. The ECB’s monthly report is due for release at 9.45pm AEST and in the US trading session, the market will receive US Trade Balance data.
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About the Author: Andrew Barnett
Andrew is a professional trader and successful investor who has a strong focus on education. He is a regular Sky News Money Channel Guest and one of Australia’s most awarded and respected financial experts and is regularly contacted by the Australian Media for the latest on what is happening with the Australian Dollar. Director at LTG GoldRock, Andrew Barnett, guides thousands of traders around the world in the live market on a daily basis, advising them on buy and sell directions, as well as trading his own personal account. Andrew, a regular keynote speaker at trading and wealth-creation events throughout the Asia Pacific region, is an authorized representative registered with the Australian Securities and Investment Commission (ASIC).
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