Storm Warning in the UK and Europe! ~ Highlights and Schedule for the Week of November 19 ~
◎ This Week's Highlights
1)British Politics and Brexit Negotiations
Last weekend, several British ministers resigned in succession, and the pound fell sharply. Also, the DUP in Northern Ireland, which is in coalition with the Conservative government, said they cannot cooperate if Prime Minister May stays in office. Prime Minister May is increasingly cornered. This week, stay tuned to the political market.
2)Italy Budget Plan
Italy did not submit a revised draft to Europe. As a result, Europe must react in some way—whether it is to impose fines, request further revisions, or accept Italy's budget. Some reports suggest a decision may come on the 21st.
Additionally, attention is on ratings. Fitch downgraded by one notch in the last review. That places Italy just at the edge of investment-grade. S&P has a negative outlook. If the outlook turns negative, a rating downgrade could occur within a few months. Watch long-term yields for Italy’s downgrade. The spread with Germany around 400 basis points (4%) is a key line to watch.
3)Crude Oil Prices
Prices appear to have entered a correction and have fallen sharply. With demand dipping and crude inventories ample, production-cut talks have not progressed. Pay attention to crude prices and risk-off markets.
4)Will the Dollar's Decline Recover?
With heightened global risk and China's influence near weekend closes, US economic indicators are likely to be affected, pulling long-term yields down and causing stock prices to rebound only modestly. In the past, we considered the dollar for the year-end with a generally bullish view. If the weekend decline stabilizes, it could provide a nice dip. Pay attention to equities and long-term yields.
Dollar/Yen Buy Strategy! – Bold prediction for USD/JPY by year-end –
◎ This Week's Event Schedule
11/19 (Monday)
06:45 NZD Quarterly PPI
12:30 JPY Kuroda, Bank of Japan Governor, Remarks
18:00 EUR Euro Area Current Account
11/20 (Tuesday)
00:45 USDWilliam, New York Fed President, Remarks
09:30 AUDRBA Monetary Policy Meeting Minutes
17:20 AUD Lowe, RBA Governor, Remarks
22:00 HUF Hungary Interest Rate
11/21 (Wednesday)
03:00 CADWilkins, BOC Deputy Governor, Remarks
22:30 USD Durable Goods Orders
22:30 CAD Wholesale Trade
11/22 (Thursday)
00:30 USD Crude Oil Inventories
21:30 EURECB Monetary Policy Meeting Minutes
11/23 (Friday)
00:00 EUR Consumer Confidence
02:00 EUR Mersch, ECB Executive Board Remarks
16:00 EUR Germany GDP
17:15 EUR France Manufacturing ・ Services PMI
17:30 EUR Germany Manufacturing ・ Services PMI
18:00 EUR Euro Area Services ・ Manufacturing PMI
22:30 CAD Canada CPI ・ Retail Sales
11/24 (Saturday)
03:00 USD Baker Hughes Rig Count
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