The event of the week was without question the Fed rate decision. Previously, unimportant data on US retail sales and EU inflation were not released, but the impact of these data has been subdued. The ZEW economic expectations indicator also failed to convince neither Germany nor the EU zone.
Economy and monetary policy
EU: The following data was published from the EU
- Consumer price index from Italy, France, Great Britain and the EU
- ZEW economic expectations for Germany and the EU
- EU trade balance
- Labor market data for Great Britain as well Retail sales
The consumer price index for August in Italy remained unchanged at 0.2% compared to both the previous month and the previous year. Expectations were also unchanged from the previous month. France's CPI rose compared to the previous month. A stagnating value was expected. The EU zone saw no increase compared to the previous month, but a stagnating value was expected. The value increased by 0.1% compared to the previous year. An increase of 0.2% was expected. The core CPI rose slightly less than expected compared to the previous year. The value rose in comparison to the previous month contrary to expectations.
The ZEW economic expectations indicator was surprisingly weak for the month of September. For Germany, the value was only 12.1 after 25 in August. For the EU zone, the indicator fell to 33.3 after 47.6 in the previous month. The EU trade balance for July increased significantly.
The UK labor market data includes the average earnings index, changes in unemployment statistics and the unemployment rate. The average earnings index showed a higher than expected rising trend for July. The unemployment rate was 5.5% in July, less than in the previous month (5.6%). However, the number of unemployed rose in August contrary to expectations. Retail sales were subdued. Compared to the previous year, the result was lower than expected. As expected, the value rose slightly compared to the previous month.
USA: The following data was published from the USA:
- Retail sales
- Industrial production
- Consumer price indices
- Building permits and housing starts
- Philly Fed manufacturing index
Retail sales in August surprisingly fell short of expectations. Industrial production also stagnated more than expected in August. The CPIs were unchanged to falling. As expected, the CPI fell by 0.1% compared to the previous month, while it remained unchanged at 0.2% compared to the previous month. The core CPI was unchanged compared to the previous month and was as expected at 0.1%, while the core VPI was 1.8% lower than expected compared to the previous year.
The start of construction was positive in August, while housing starts could not convince and were below expectations. The important Philly Fed manufacturing index stagnated sharply contrary to expectations.
The important decision of the week came from the USA. Many expected a first rate hike, but this did not happen for the time being. However, the Fed reserves the right to hold a press conference in October when data on the job market improve. The rate hike could therefore take place soon.
TECHNICAL ASSESSMENT OF THE MARKETS:
EUR / USD: After the decision of the Fed, the euro rose against the US dollar on. The USD 1.1375 resistance tested over the past few days has been overcome. This puts resistance at $ 1.1464 on the agenda. Falling below 1.1340 and then below $ 1.1250 per euro would lead to a downtrend, which this time would have the potential to hit the blue uptrend line.
DAX: And what does the DAX do? The leading German index cannot move as a result of the strong US dollar, although it is supported by the US stock market. The DAX remains at the bottom of the bearish flag. This is still intact. A breakdown would likely retest the lows of the past few weeks. On the other hand, a breakthrough would bring the 200 Moving Average into focus as resistance.
GBP / USD: The GBP / USD currency pair is roughly in a sideways range with a slight trend one Top education. Two scenarios are therefore relevant: the breakthrough upwards from the range or the retest of the lower edge of the range and the breakthrough downwards.
Gold: Gold can recover significantly. The Fed decision also plays an important role here. Technically, resistance at $ 1145-1150 per troy ounce is important. In addition, the trend line, which represents an important resistance. The further development will also depend to a certain extent on the development in EUR / USD.