Thursday November 23rd
03:15 - 04:30 ET
European PMI Data
The PMI data Purchasing Managers' Index measures the performance of the manufacturing and services sector. A reading above 50 indicates an expansion of the manufacturing sector compared to the previous month, below 50 represents a contraction, while 50 indicates no change.
What to expect
A higher than expected reading should be taken as positive/bullish for the currency, while a lower than expected reading should be taken as negative/bearish for the currency.
PMI data, especially from the euro area can have an impact on the European markets in general. Less favourable or worse than expected Eurozone nation PMIs figures can negatively affect the euro as would be the same for GBP with UK PMI data.
It’s the flash data that has the potential for larger market reactions, as it’s the first bit of data that shows how well the economy is doing in both sectors.
07:30 ET
ECB Meeting Minutes
Sometimes the Meeting Minutes can get overlooked, as it is more or less similar to the Rate Statement that is released a month prior. That’s not to say it isn’t important. The Meeting Minutes detail the conversation that was held over the 2 day meetings before the rate decision was made.
What was discussed between ECB members lays out what members are feeling in general in regards to monetary policy, the economy and any international influences that may be more pronounced.
Friday November 24th
02:00 ET
Gross Domestic Product (GDP) is the broadest measure of economic activity and is a key indicator of economic health. The quarterly percent changes in GDP show the growth rate of the economy as a whole.
What are the fundamental effects?
A higher real GDP improves the standard of living for Germans, however, a GDP growth due to inflation erodes living standards because people pay more for the same. The GDP can be used as a report card for the Govt. and Bundesbank to view how well or poorly their policies are working. The GDP reflects the final value of all output in the German economy, regardless of whether a product was sold or placed in inventory.
How does it affect the markets?
CURRENCY - Robust economic activity can firm up interest rates, which increases the demand for the Euro. If inflation accelerates and stays high, it can lower Germany’s’ competitiveness in the world and worsen trade.
STOCKS - A healthy economy generates more business earnings, whiles a sluggish business environment depresses sales and income. However, higher prices will erode household purchasing power and may force interest rates to go higher.
BONDS - If the economy is growing at or below the pace projected by economists, the bond market is likely to react positively. If GDP figures exceed expectations, and inflation pressures are rising, interest rates may be raised, meaning bond prices will lower, and yields will rise.
04:00 ET
German ifo Business Climate
The German Ifo Business Climate Index rates the current German business climate and measures expectations for the next six months. It is a composite index based on a survey of manufacturers, builders, wholesalers and retailers. The index is compiled by the IFO Institute for Economic Research.
A higher than expected reading should be taken as positive/bullish for the EUR, while a lower than expected reading should be taken as negative/bearish for the EUR.
German ifo Expectations
German Business Expectations rates the expectations of businesses in Germany for the following six months. It is a sub-index of the German Ifo Business Climate Index.
A higher than expected reading should be taken as positive/bullish for the EUR, while a lower than expected reading should be taken as negative/bearish for the EUR.
German ifo Current Conditions
The German Current Assessment rates current business conditions in Germany, without considering future expectations. It is a sub-index of the German Ifo Business Climate Index.
A higher than expected reading should be taken as positive/bullish for the EUR, while a lower than expected reading should be taken as negative/bearish for the EUR.
The results are released the same month as the survey is taken. More than 7000 businesses are surveyed