China is in the highlight and it is all thanks to the positive data from Beijing. We will also discuss Janet Yellen speech at Stanford and pay attention to the most important macroeconomic events of today’s session. Welcome to the Friday market overview of Comparic.com
The most anticipated data during the Asian session was undoubtedly the Chinese report on changes in the level of gross domestic product. The quarterly report positively surprised investors, indicating an increase in China’s GDP by 6.8% per year (previous forecast assumed only 6.7%). On a quarterly basis it was slighter worse – indicator, according to consensus increased by 1.7%.
Positive data on the entire economy apparently overshadowed slightly worse report on changes in the level of industrial production in December (6.0% y/y vs expected 6.1%). But makes up retail sale, which second month in a row is positively surprising with strong increases. In December, the indicator rose by 10.9% compared to the previous year.
An important moment in the past hours was also speech of the Fed chairman at Stanford University. Janet Yellen spoke about monetary policy, reminding the audience that it is not wise to strive to overheating. Thus she strengthened slightly dollar, hinting that the Fed probably will not be too slow in subsequent increases in interest rates.
The tone of the whole speech, especially when compared with Wednesday’s, is described by commentators as moderately hawkish. Yellen was more cautious and although we can expect increases in the rates in next months, we must remember the dependence of the rate hiking to data flowing from the US economy.
What to look for?
Economic calendar for Friday’s session is moderately full. Before noon, the most important will be the publication of British report on retail sales. The December data will be made public already at 10:30.
The session will begin American Canadian publications on December change in the level of CPI and retail sales. Forecasts indicate that consumer inflation is accelerating the development of prices in Canada, which should positively affect the valuation of CAD. USD/CAD after a two-day rally now corrects the following:
Not without significance for the US dollar will also be an evening speech by the president of the United States, Donald Trump, who will become today inaugurated. The whole ceremony of inauguration of the 45th US president will begin about 16:00 (GMT+1). About 18:00 Donald Trump will take an oath, and just after deliver his speech. Evening on the market can be marked by increased volatility in the USD, so it is worth considering to start the weekend earlier ?
