The Stage is Set for the FED Decision

Daily Update – 31st July 2019

Yesterday's Focus

• JPY Bank of Japan Interest Rate Decision, Bank of Japan Monetary Policy Statement

• EUR Harmonized Index of Consumer Prices

• USD Pending Homes Sales

Yesterday's Explained

On Tuesday, the BOJ decided to hold interest rates steady at their meeting overnight. The bank says though, that is will not hesitate to lower rates and stimulate the economy if momentum toward the 2.0% inflation target wanes.​ Form US, President Trump recurred to twitter to, once again, take it on its Asian rival, complaining about China not buying more agricultural products as promised, accusing it of delaying negotiations until the outcome of the 2020 presidential election in the US. 

European data came in mixed, as the EU Economic Sentiment Indicator for July was better-than-expected. However, Boris Johnson also repeated that the current Withdrawal Agreement is non-viable. After speaking with Irish PM Leo Varadkar, a statement from Johnson’s office indicated that the UK government is open to any negotiations, but that’s now on the EU to decide. The same statement said that the UK will leave the EU on October 31 "no matter what" and that they will never put physical checks or infrastructure on the Irish border. Meanwhile, Scottish First Minister Nicola Sturgeon said that she believed that the government is heading for a no-deal Brexit, and that will affect Scotland negatively, opening another battlefront for Johnson.

 

Today's Market

• EUR Gross Domestic Products, Unemployment Rate

• USD Fed Interest Rate Decision,  Fed Monetary Policy Statement

Today’s Focus 

With a pre-set regularity, a nation's Central Bank has an economic policy meeting, in which board members took different measures, the most relevant one, being the interest rate that it will charge on loans and advances to commercial banks. In the US, the Board of Governors of the Federal Reserve meets at intervals of five to eight weeks, in which they announce their latest decisions. A rate hike tends to boost the local currency, as it is understood as a sign of a healthy inflation. 

The Gross Domestic Product released by the Eurostat is a measure of the total value of all goods and services produced by the Eurozone. The GDP is considered as a broad measure of the Eurozone economic activity and health.