Summary:
- ECB is widely expected to roll out a set of measures to address slowing growth and stubbornly low price growth
- Turkish central bank is expected to cut rates as inflation continues normalizing
- US CPI likely to show the slightly higher pace of growth
10:00 am BST - Retail sales and industrial output for July from EMU
12:00 pm BST - CBRT rate decision: The consensus calls for a 275 bps rate cut in terms of the one-week repo rate. Keep in mind that inflation in Turkey has been in a downtrend in recently which could embolden Recep Erdogan to stick to its unorthodox notion regarding a relationship between rates and prices.
Start investing today or test a free demo
Create account Try a demo Download mobile app Download mobile app12:45/1:30 pm BST - ECB rate decision/press conference: The European Central Bank is broadly expected to spell out a set of measures aimed at addressing both sluggish economic growth and disappointing inflation. Hence, expectations suggest that a 10bps depo rate cut, a launch of QE of 30 billion EUR per month and of course this has to be accompanied by the dovish guidance signalling readiness to act further if necessary. At the same time, the ECB is likely to announce a so-called tiering system so as to alleviate downward pressure on banks’ profitability stemming from negative rates. As media reports suggest, such a system could be designed in a way to include up to 30% of excess reserves. Finally, the central bank will present its new set of staff macroeconomic projections, which are not expected to take market observers off-guard at all (mild downward revisions to both CPI and GDP are on the cards). To sum up, a lack of any of the above-mentioned measures would risk a surge in the common currency, which a scenario the ECB would like obviously to avoid.
1:30 pm BST - CPI from the US for August: Yesterday's report on PPI brought the numbers being slightly higher than expected creating some upward pressure before today’s release on CPI. Although, a relationship is rather weak and not straightforward between PPI and CPI, expectations suggest CPI to be at 1.8% YoY (unch) and core CPI to be at 2.3% YoY (up from 2.2% YoY in July).
1:30 pm BST - Weekly jobless claims from the US
7:00 pm BST - A monthly budget statement from the US for August
The content of this report has been created by XTB S.A., with its registered office in Warsaw, at Prosta 67, 00-838 Warsaw, Poland, (KRS number 0000217580) and supervised by Polish Supervision Authority ( No. DDM-M-4021-57-1/2005). This material is a marketing communication within the meaning of Art. 24 (3) of Directive 2014/65/EU of the European Parliament and of the Council of 15 May 2014 on markets in financial instruments and amending Directive 2002/92/EC and Directive 2011/61/EU (MiFID II). Marketing communication is not an investment recommendation or information recommending or suggesting an investment strategy within the meaning of Regulation (EU) No 596/2014 of the European Parliament and of the Council of 16 April 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC and Commission Delegated Regulation (EU) 2016/958 of 9 March 2016 supplementing Regulation (EU) No 596/2014 of the European Parliament and of the Council with regard to regulatory technical standards for the technical arrangements for objective presentation of investment recommendations or other information recommending or suggesting an investment strategy and for disclosure of particular interests or indications of conflicts of interest or any other advice, including in the area of investment advisory, within the meaning of the Trading in Financial Instruments Act of 29 July 2005 (i.e. Journal of Laws 2019, item 875, as amended). The marketing communication is prepared with the highest diligence, objectivity, presents the facts known to the author on the date of preparation and is devoid of any evaluation elements. The marketing communication is prepared without considering the client’s needs, his individual financial situation and does not present any investment strategy in any way. The marketing communication does not constitute an offer of sale, offering, subscription, invitation to purchase, advertisement or promotion of any financial instruments. XTB S.A. is not liable for any client’s actions or omissions, in particular for the acquisition or disposal of financial instruments, undertaken on the basis of the information contained in this marketing communication. In the event that the marketing communication contains any information about any results regarding the financial instruments indicated therein, these do not constitute any guarantee or forecast regarding the future results.
