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Important economic data is released today both in the European and American Session, with a focus on inflation rate in Germany, a speech from ECB President Mario Draghi, employment change and industrial production in the Eurozone, US retail sales and weekly US crude oil inventories. Moderate to high volatility is expected for the Euro, the US Dollar and the Canadian Dollar due to the release of the weekly US crude oil inventories.

These are the main economic events for today to focus on:

European Session

  1. Germany Inflation Rate Final, ECB Draghi Speech, Sweden Consumer Price Index with a Fixed Interest Rate and Inflation Rate, ECB Praet Speech, Italy Retail Sales, Eurozone Industrial Production and Employment Change, ECB Constancio Speech, ECB Coeure Speech, Russia Balance of Trade

Time: 07:00 GMT, 08:00 GMT, 08:30 GMT, 08:45 GMT, 09:00 GMT, 10:00 GMT, 10:45 GMT, 13:00 GMT, 16:15 GMT

A plethora of economic data is released in the European Session, which can move the Euro. Higher than expected or rising Inflation Rate in Germany and increased figures for Employment Change and Industrial Production in the Eurozone will be positive for the Euro, reflecting the presence of inflationary pressures in the largest economy of the Eurozone and also increased economic activity for the Industrial Sector. As seen from the graph, the Inflation Rate in Germany is expected to increase in the following years and reach the rate of 2.47% in 2022, compared to the projected rate of 1.52% in 2018.

Germany Inflation Rate

This statistic shows the average inflation rate in Germany from 2012 to 2016, with projections up until 2022. In 2016, the average inflation rate in Germany had amounted to about 0.38 percent compared to the previous year. The forecast is for a final Inflation Rate in Germany of 1.4% on a yearly basis, lower than the previous rate of 1.6%.

Higher than expected or rising Inflation Rate in Sweden will also be positive for the Swedish Krona, as it will increase the probabilities of future interest rate increases by the Central Bank in Sweden to fight inflation. The forecast is for an unchanged CPIF at 1.7% on a yearly basis and an increase of the Inflation Rate at 0.7% on a monthly basis, higher than the previous figure of -0.8%. Increased Retail Sales in Italy and Industrial Production in the Eurozone will be supportive for the Euro, with the expectations being of a decline foe the Industrial production and the Employment Change in the Eurozone, while Retail Sales in Italy are expected to decline for a second consecutive month. This economic data may influence negatively the Euro.

The Balance of Trade in Russia is expected to have an increase in the surplus with a figure of $14.45 Billion, higher than the previous figure of $13.7 Billion, which should be positive and supportive for the Russian Ruble, due to the increased capital inflows in Russia, and increased demand for goods and services denominated in the local currency. Several Speeches from ECB officials and the President of ECB will be monitored as they have the potential to move the Euro based on the statements related to economic conditions in the Eurozone.

American Session

  1. US PPI, Core PPI, Retail Sales, Business Inventories, US Crude Oil Inventories

The Producer Prices are a measure of inflation from the perspective of producers as they reflect the average change over time in the selling prices received by domestic producers of goods and services. Higher prices reflect inflationary pressures and are positive for the US Dollar. The forecast is for a decline and a figure of 0.2% on a monthly basis compared to the previous figure of 0.4%.

The main economic event which can move the US Dollar is the release of the US Retail Sales. Higher Retail Sales are positive for the US Dollar, as they reflect increased consumer spending, which is correlated with higher economic growth measured by the GDP Growth Rate. As seen from the chart the US Retail Sales have a volatile trend, with latest figure being the biggest drop in 11 months.

US Retail Sales

The forecast is for a figure of 0.4%, higher than the previous figure of -0.3%. Also declining or lower than expected readings for the Business Inventories are positive for the US Dollar indicating unsold goods held by manufacturers, wholesalers and retailers, with very low levels of inventories being indicative of a robust economy due to strong demand of goods by the consumers. The expectation is for a figure of 0.3%, lower than the previous figure of 0.4%. Any significant positive or negative economic surprise for the weekly US Crude Oil Inventories can move the Oil Prices and the USD/CAD currency pair.

Pacific Session

  1. New Zealand Gross Domestic Product

Time: 21:45 GMT

GDP measures the overall production and consumption of goods and services in a country, with increased figures being indicative of economic expansion being positive for the local currency. The forecast is for a figure of 3.1%, higher than the previous reading of 2.7%, which should be positive for the New Zealand Dollar.

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