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3 Jun 2014
Day ahead, key events coming up - Rabobank
FXStreet (Guatemala) - Analysts at Rabobank noted the upcoming events that are key and in focus.
Key Quotes:
“The Spanish May manufacturing PMI has registered 52.9, a little below the market consensus but a notch above the April reading of 52.7. The market is expecting Italian, French and German May readings to remains broadly in line with April. German CPI data is expected at 1.1% y/y, reflecting the soft inflation pressures in the Eurozone at present.”
“On Thursday we expect the ECB to cut both the deposit and refi policy rates by 10/15bp and announce a number of measures aimed at improving the transmission mechanism. This could be one of the tools that have been subject to much attention in the market (i.e. cut in reserve requirement ratio, suspension of SMP sterilisation, introduction of a new – conditional – LTRO with a fixed rate) or more of a ‘curve ball’ measure (e.g. changes to the collateral framework, expanding of the alternative credit claims framework, capping bank access to the ECB’s current and deposit account facilities). Talk over the weekend across the financial press pointed to some form of targeted LTRO, the FT suggested that this would depend on “banks’ commitments to support credit creation in certain areas” while Faz suggested that the LTRO will be around EUR40bn in size and will be aimed at SMEs via the banking channel and De Spiegel suggested a 4yr maturity”.
“In addition, to the ECB, the BoE, RBA and BoC hold meetings this week. Steady policy is expected to be confirmed by all except the ECB”.
“The release of the US non farm payrolls data on Friday will crown an event packed week. Currently the market consensus stands at 215K”.
“On top of today’s Eurozone releases, UK credit data are due and also US ISM for May will be released. Both Fed and ECB speak is scheduled to continue today”.
Key Quotes:
“The Spanish May manufacturing PMI has registered 52.9, a little below the market consensus but a notch above the April reading of 52.7. The market is expecting Italian, French and German May readings to remains broadly in line with April. German CPI data is expected at 1.1% y/y, reflecting the soft inflation pressures in the Eurozone at present.”
“On Thursday we expect the ECB to cut both the deposit and refi policy rates by 10/15bp and announce a number of measures aimed at improving the transmission mechanism. This could be one of the tools that have been subject to much attention in the market (i.e. cut in reserve requirement ratio, suspension of SMP sterilisation, introduction of a new – conditional – LTRO with a fixed rate) or more of a ‘curve ball’ measure (e.g. changes to the collateral framework, expanding of the alternative credit claims framework, capping bank access to the ECB’s current and deposit account facilities). Talk over the weekend across the financial press pointed to some form of targeted LTRO, the FT suggested that this would depend on “banks’ commitments to support credit creation in certain areas” while Faz suggested that the LTRO will be around EUR40bn in size and will be aimed at SMEs via the banking channel and De Spiegel suggested a 4yr maturity”.
“In addition, to the ECB, the BoE, RBA and BoC hold meetings this week. Steady policy is expected to be confirmed by all except the ECB”.
“The release of the US non farm payrolls data on Friday will crown an event packed week. Currently the market consensus stands at 215K”.
“On top of today’s Eurozone releases, UK credit data are due and also US ISM for May will be released. Both Fed and ECB speak is scheduled to continue today”.