ITALEXIT Seems Inevitable

Daily Update - 07th March 2018

Yesterday’s Market

• German SPD coalition vote and Italian elections results
• EUR Markit Services PMI & Markit PMI Composite
• GBP Markit Services PMI & Markit PMI Composite
• USD Markit Services PMI, Markit PMI Composite & ISM Non-manufacturing PMI

Yesterday’s explained

Sunday was an important day for EU politics as there were German SPD coalition Vote and Italian elections. Angela Merkel set for fourth term after months of political deadlock. The impact was seen start of the day as euro started positively. The negative PMI from Euro impacted the currency drop meanwhile the positive PMI from UK helped the GBP. 

Italian election results are still a concern for Eurozone. The anti-establishment Five Star Movement and League parties are expected to from a coalition government what would be considered as an anti-EU government. Trumps statement on tariffs on steel and aluminum imports have more impact than the Positive PMI from US as better than expected Markit PMI & ISM Non-manufacturing data did not strengthen the Dollar.

Today’s Market

• AUD RBA Rate Statement, Interest Rate Decision & RBA's Governor Philip Lowe Speech
• GBP MPC Member haldane Speech
• USD Factory Order & FED's William Dudley Speech

Today’s Focus

Today is the Important day for Australia as RBA will release their Rate decision and rate statement. Decisions regarding this interest rate are made by the Reserve Bank Board and are explained in a media release which announces the decision after each Board meeting. Later, a speech is scheduled by the RBA Governor Philip Lowe. Along with that GBP MPC Member Haldane Speech is also important for UK economy.

Next up will be Fed's William Dudley speech. He will have an opportunity to strengthen the dollar following a hawkish testimony from FED Chair Jerome Powell Last week. The day will end with US Factory Orders for February, which is a measure of the total orders of durable and non-durable goods