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31 Mar 2015
German retail sales, UK GDP eyed - Rabobank
FXStreet (Bali) - The Rabobank Research team breaks down the key events to watch for Tuesday, noting German retail sales and UK GDP as the main European data.
Key Quotes
"Next up today are German retail sales (consensus -0.7% MoM/3.4% YoY) and German unemployment (consensus -12K, 6.5%). In short, the labour market is healthy but there is no major consumer boom going on as a result. Yet overall things look reasonably good: again, it’s remarkable what a drop in oil prices and a huge decline in the currency can do for you when you are an export-oriented economy."
"After that another look at UK GDP, and then the first estimate of Eurozone March CPI. The headline measure is seen at -0.1% YoY (i.e., still in deflation, just) but the core measure is expected at 0.7% YoY (low, but positive)."
"Following that we return to US data, this time S&P/CS house prices, where MoM prices are seen rising 0.6% and YoY prices 4.6%. Given nominal earnings are rising half that level at best, that poses a key question: how is anyone going to afford to buy these houses if bond yields rise from current levels? Let’s see where yields are at the end of Q2 and then revisit that issue. We also have the Chicago PMI and US consumer confidence today: the former collapsed to well below 50 last month out of the blue: will we see the expected rebound in March? Both of these key series will play a role in determining where bond yields are heading as we end Q1."
Key Quotes
"Next up today are German retail sales (consensus -0.7% MoM/3.4% YoY) and German unemployment (consensus -12K, 6.5%). In short, the labour market is healthy but there is no major consumer boom going on as a result. Yet overall things look reasonably good: again, it’s remarkable what a drop in oil prices and a huge decline in the currency can do for you when you are an export-oriented economy."
"After that another look at UK GDP, and then the first estimate of Eurozone March CPI. The headline measure is seen at -0.1% YoY (i.e., still in deflation, just) but the core measure is expected at 0.7% YoY (low, but positive)."
"Following that we return to US data, this time S&P/CS house prices, where MoM prices are seen rising 0.6% and YoY prices 4.6%. Given nominal earnings are rising half that level at best, that poses a key question: how is anyone going to afford to buy these houses if bond yields rise from current levels? Let’s see where yields are at the end of Q2 and then revisit that issue. We also have the Chicago PMI and US consumer confidence today: the former collapsed to well below 50 last month out of the blue: will we see the expected rebound in March? Both of these key series will play a role in determining where bond yields are heading as we end Q1."