Andrea ForexMart

 The current Money Fall contest has already started on June 12, 2017 and will end on June 16, 2017.  You can register for the next competition which will take place from June 19, 2017 to June 23, 2017  Note: Registration for the next competition finishes 1 hour before the contest starts. Â

 ECB not yet to Withdraw Stimulus Program  The European Central Bank decided to loosen its monetary policy on Thursday but indicated that it further needs some support from the central bank amid increasing growth. Mario Draghi, ECB president, is very cautious in his announcement regarding the withdrawal stimulus.  During the meeting held on Thursday which is accompanied by 25 members of the council, the bank kept its interest rates and bond-purchase stimulus program steady.  The governing council settled small adjustments towards the 19 emerging countries that utilizes the European currency by stating that interest rates could probably move lower. While Draghi issued another significant change as he described that risk to growth is currently “broadly balanced”, the tweak was announced during the April wherein risk are said to  "tilted to the downside."  Carsten Brzeski, analyst at ING-DiBa, allegorize the bank’s statement to a baby’s first step intended to taper the stimulus effort. The financial institution preserved its bond-buying program at 60 billion euros ($67 billion) each month which will last this year or longer. Moreover, ECB officials were in a stew for the market’s response to the untimely notice that the stimulus will end as the rates will climb higher, undermining the effects.

 Goldman Sachs Higher Rates to Gain More Clients  The Goldman Sachs Bank U.S.A. intends to increase its rates on client deposit by 1.2 percent from the previous 1.05 percent. The rate hike makes them higher than other financial institutions including CIT Bank, Synchrony Bank, and New York Community Bank's My Banking Direct. The average rate is at 0.06 percent 0.06 percent as reported by the U.S. Federal Deposit Insurance Corporation.  They are searching for ways to improve lending in money management and investment banking category which they said to had a rough time with. In 2016,  they introduced Marcus as their primary approach to consumer lending. This rate hike move hopes to expand profit of Goldman Sachs and appeal to additional Main Street clients which will eventually give bigger gains. Also, these deposits open a more robust type of funding and this would have stayed longer during uncertainty.

 Slow Growth of Scottish Economy, EY reports  Based on the forecast of the EY Scottish item club that the GDP growth will be weak falling below expectation with 0.9% growth this year where a half of it is expected for the Britain and will predominantly hit the retail sector. It is anticipated to fall by 0.1% this year and will decrease in a bigger number by 0.5% and 0.3% in 2018 and 2019 respectively.  Consumers will be greatly pressured from this which will increase by 1% in 2017 and below 1% in the succeeding years until 2020 while the employment is assumed to drop by fall this year.  On the other hand, the manufacturing sector will rise following the overall economy for the first time since 4 years ago, because of higher demand and depreciation of sterling which will boost exports.  Overall, the Scottish economy is foreseen to have a sluggish growth than the Britain by 0.7% in 2018 before gaining its momentum again to reach 1.4% growth within this decade.

 US Budget Concerns Casts Doubt on Fed Plans  The US Federal Reserve is more than ready to raise its interest rates this coming June, but the possibility of the Congress rattling up the markets by slowing down progress on increasing the debt ceiling of the US economy has cast a shadow of doubt on the Fed’s next scheduled rate hike on September. Prior to this development, the Fed has been saying that they are currently planning to implement two more rate hikes before the year ends, but has now reverted to saying that the third rate hike for year might be in for some delays if the market gets shaken by possible disagreements on fiscal policies.

 The current Money Fall contest has already started on May 29, 2017 and will end on June 2, 2017.  You can register for the next competition which will take place from June 5, 2017 to June 9, 2017.  Note: Registration for the next competition finishes 1 hour before the contest starts.

 Asian Market Weakened as it Traded Sideways  The stock markets of Asia were unsteady on Tuesday since investors hovered in the sideline prior the publication of the raft of economic statistics scheduled this week. While, the Taipei market coupled with Shanghai, Hong Kong are not in operation due to a holiday.  Moreover, the Nikkei 225 of Tokyo declined by 0.5 percent to 19,576.19, seeing the Kospi of South Korea to plunged to 0.6 percent to 2,338.21, S&P/ASX 200  of Australia lower down by 0.1  percent to 5,701.60. Likewise, Singaporean market had a dip along with the Philippines and New Zealand but the Indonesian benchmark surge.  Jingyi Pan, a market strategist at IG based in Singapore, said that the Asian house market is projected to maintain its thin volumes which start in the countries of China, Hong Kong, and Taiwan which are all closed in consideration of the market holiday.  The data were to be issued this week would likely offer some hints for the investors about the current state of the international economy. Investors anticipate for the consumer confidence index along with the eurozone business data later this day.  On the energy sector, the benchmark for US crude dropped 4 cents up to $49.76 a barrel in electronic trading on the New York Mercantile Exchange. The contract had increased by 90 cents up until $49.80 per barrel yesterday. The Brent crude further decreased by 20 cents till $52.44/barrel in London.

 Fast Track Economic Recovery of India in the First Quarter  The economy of India is considered as the fastest developing major economy globally in the previous quarter, induced by positive performance in manufacturing and services. For short-term, the demonetization has affected the demand but was able to recover. The forecast for this year ranged between 6.5 and 7.8 while the actual data achieved a 7.1 percent growth from January to March this year. It has significantly risen from last year’s Q1 growth of 7.9 percent.  The upswing in the economic growth was mainly pushed by positive domestic factors taking into account a notable progress of the central bank easing of policy rate into lending rates of financial institutions that made investment appealing to investors. Moreover, the infrastructure spending has substantiated growth and probability for better agricultural output when the monsoon rains become beneficial.  On the other hand, the goods and sales tax (GST) is also anticipated to contribute to the economy as its removal will encourage more businesses in India. This will be implemented on July 1st.

 Drop in Oil Prices Discontented Investors in its Low Figure  Oil prices declined by 5 percent following the extension of production cuts by Opec causing other oil producing countries to be dismayed who are expecting a bigger reduction. Consequently, crude prices dropped to the highest percentage drop since early March.  During the last OPEC meeting, they reached an agreement to prolong supply cuts constitute of 1.8 million barrels per day until the first quarter ends next year and investors are anticipating around half a million extra barrels to be contracted. However, Saudi Arabia’s energy minister, Khalid Al-Falih said that other ministers find it unnecessary to lessen the output further and nine months is the “optimum” duration.  On the other hand,  U.S. shale producers are motivated to provide more supplies because of the cheap cost of oil at $50 bpd. Although, they have to be careful since it could exceed the target increase and bring down further the price, stated by the Texas shale oil producer president David Arrington. Â

 Trump Calls for Investigation Following Manchester Leaks  US President Donald Trump has already called for an investigation regarding the “Manchester leaks” in order for the US government to determine how top-secret information were able to make their way towards the headlines of news reports, when these sets of information were actually only divulged to the key allies of the British government. Several UK officials have already expressed their dismay and disappointment with regards to this particular matter, among them being UK Prime Minister Theresa May. The bombings in Manchester last Monday night had killed a total of 22 people and has left more than 100 people with injuries. The victims were attending a pop concert before the bombings occurred.

 Trump Proposed 45 Percent Cut in Mexico Aid from U.S. Spending  On Tuesday, the U.S. spending reserved for foreign aid for Mexico and Central America are to be reduced as proposed by the President Donald Trump. The budget was proposed to trim as much as $3.6 trillion government spending in the following ten years for 2018 budget proposal.Although, this may not get a legislative approval as to how it is currently with other departments cuts especially in the State department.  Mexican aid worth $87.66 million will be lessened over 45 percent from the 2016 expenditure when Trump's proposal is approved. The budget cut will be transferred to the Mexican military including counterterrorism funds and other government programs. One of the officials commented that these deals are focused on bolstering border security and fight against corruption that may have hindered transnational criminal organizations. There will be a meeting to discuss the employment and security concerns in Central America in June.

 China’s Debt-rating Downgraded by Moody’s to A1 from Aa3  The credit rating of China was downgraded by Moody’s Investors Service on Wednesday, the previous Aa3 (Double A-3) were down to A1 which means that the Chinese economy is going to grind lower for the next years as the country showed slow growth and its debt continuously increase. The downgrade is done due to the financial pressure that the government faces after years of credit-driven stimulus.  Craig Erlam, a Senior Market Analyst of Oanda, said in an interview,  “Because talk of Chinese debt and concerns about the size of Chinese debt has been going on for the last few years. They seem to be very reliant on these high levels of growth, which has been slowing.” He further added that the credit downgrade does not surprise him at all.  The second largest economy in the world gained 6.7 percent last year and 6.9 in 2015, this pace is the slowest based on the records since 1990 by which Erlam believes that the following years appears to be challenging.  The bond credit rating company has expectations that the direct debt burden of China’s government will climb higher reaching 40 percent of 2018’s Gross Domestic Product which is close to the 45 percent as the decade ends. However, it remains lower to the 60 percent for the European Union.  The Finance Ministry of the republic claims that the downgrade is based on an improper approach that overestimated the risks on the increasing debt.

 FOMC Minutes Signal Interest Rate Hike Next Month  Fed officials are now more than ready to raise its short-term interest rates after stating in their meeting last month that increasing its rates are now “more than appropriate”. The central bank also moved to begin cutting back on its Treasury and mortgage securities holdings, which is currently worth $4.5 trillion. The Fed also stated in its minutes that they will be allowing an accumulation of these said securities in  the long run without having to reinvest its proceeds to other assets. The Fed’s next policy meeting is scheduled this coming June 13-14 and will be immediately followed by a press conference from Fed Chair Janet Yellen.

 Debt Relief for Greece Still in Progress, No Deal Yet  Intercontinental lenders in Greece has a comprehensive meeting discussing debt sustainability on Monday. The meeting ended failing to reach an agreement about additional debt relief for Greece. Ministers disagreed to grant new loans to Athens but the head of Eurogroup, Jeroen Dijsselbloem says otherwise. He said that they are deliberating and making progress on the next disbursement targeting before summer to be able to pay due debts in July.  In their next meeting, they are optimistic that they will settle a deal in doling out bailout funds to the country on June 15.  They are aiming for a more sustainable agreement which the International Monetary Fund commended and hoping that E.U. governments will support this deal. Although, the deal is not yet ready and will most likely be implemented once the current bailout program has ended next year.

 Food Stamp Program in Peril from Trump’s Tax Cuts  The Supplemental Nutritional Assistance Program or SNAP is currently in peril as Trump’s budget plan could possibly slash over $190 billion from the said food stamp program. These cuts on SNAP will be representing a funding cut of over 29%, since the US government spent over $70 billion on the food stamp program last year. Prior to this particular cut, the Trump administration had recently proclaimed that it will be able to strike a budget balance within a decade without altering the US government’s biggest spending drivers, namely social security and medical assistance. Trump had previously stated that there will be no changes made to these factors during his campaign period.

 The current Money Fall contest has already started on May 22, 2017 and will end on May 26, 2017.  You can register for the next competition which will take place from May 29, 2017 to June 2, 2017  Note: Registration for the next competition finishes 1 hour before the contest starts.

 Japan Exports Rallied for 5 Months  Exports from Japan notably increased for five consecutive months indicating a strong offshore demand and increased shipments of semiconductors and steels that boost economic growth. In April, exports climbed up to 7.5 percent compared with the previous year and lower than the median estimate of 7.8 percent yearly growth.  On the other hand, its trade surplus with the U.S. also decreased by 4.2 percent from a year ago while the exports jumped by 2.6 percent and continuously grows in the past three months because of high volume of car and auto parts shipments. An economist predicts that this upsurge will continue including domestic imports but the protectionist trade policies of Donald Trump raises concerns with Japan being an export-reliant country.

 Extended OPEC Output Cuts Raise Oil Prices  The extension of production output cut from big oil producing countries caused the oil prices to rise. Oil future climbed to the highest in almost a month and key benchmarks reaching gains for two weeks. Brent crude LCOc1 increased by 0.5 percent adding 28 cents at  $52.79  while the U.S. crude oil CLc1 rose by 0.6 percent equivalent to 29 cents at $49.64 a barrel which is the highest since 26th of April. Investors are optimistic that production will reach an estimated 1.8 million barrels per day by the end of March 2018.  OPEC leaders and other oil producing countries will have a policy meeting on May 25 in Vienna. Although, there are signals indicating sufficient supplies from the Saudi Arabia being the biggest oil producer. Investors have mixed sentiment with conflicting concern from the drop in U.S. oil stocks and OPEC oil cuts.

 U.S Labour Market Declined Despite Positive Economic Outlook  Applications for U.S unemployment benefits had fallen circumstantially during the previous week, while the total of jobless Americans declined to a 28-1/2-year low which could lead to a sudden failure on the labor market slack.  The economic development was supported by the data released on Thursday that showed an abrupt expansion towards the manufacturing activity within the Mid-Atlantic states this month. The report says that the shipments for goods accelerated and more working hours for laborers. Further measure for the economic activities increase again in the month of April.  The positive data favors the expected hike in interest rates for the following month, even if the decision of the Fed Reserve depends on the condition of the financial markets, which recently been shaken by the scandals of US President Donald Trump.  Jobless claims benefits were lessened by 4,000 with a seasonal adjustment of 232,000 within the week that finished on May 13 as it experienced a three-weeks consecutive decline, as mentioned by the Labor Department.  Economists penciled last week that claims will reach 240,000 but it currently obtained less than 300,000 by which the threshold is linked with a stabilized job market for 115  successive weeks. This is the longest period recorded since the year 1970 which historically appeared that the market was smaller.  The employment sector reached full employment with the jobless rate gained a 10-year low to 4.4 percent. The U.S economy was able to produced 211,000 number of jobs in April.

 Congress Rift Might Dampen Trump’s NAFTA Dream  The Trump administration has already started the first part of its renegotiations with regards to the North American Free Trade Agreement with Canada. But this first step towards NAFTA adjustments has created a rift between some Republican and Democrat senators, with the backers of the said agreement clashing with dissenters. These negotiations are expected to corner Trump especially now that his political policies are being put at stake by a political crisis within the US economy.

 New Fintech Rules will be Imposed by Brazilian Central Bank  Brazil’s central bank is interested in implementing regulations to the FinTech sector to provide support for the industry startups and other firms in engaging and improving the Brazilian nation that is currently suffering from a recession.  As published in the recent report of Reuters, the monetary authority of the country, Banco Central do Brasil (BCB) is planning to put into effect such rules for this year to sustain growth to  FinTech companies and further services available in the Federative Republic of Brazil   According to Otavio Damaso, the BCB’s Chief of Staff, the advancement of FinTechs and innovative products seems positive for improving the financial system of the country since the economy is experiencing a worst depression.  The economy of Brazil got an 8 percent rate in March 2017 which is lower during December 2014. In the past, the country is known to be one of the fastest growing economies around the globe, then political controversies and mismanagement of funds arise creating jobless 13 million individuals.  During the former years, the traditional financing options caused banks to charge borrowers higher interest rates, this open doors for many fintechs to influence the Latin America’s biggest economy to offer loans at a cheaper price.

 Australia’s Record Low Wage Growth at 1.5%  The household debt climbed to an all-time high that affects spending and inflation that moved Australian wages sluggishly. This raised concern to the Reserve Bank of Australia and lower than the target of 2 to 3 percent leading to two rate cuts last year to a record low of 1.5 percent.  The wage price index climbed to 0.5 percent in the first quarter compared to the quarter before while the annual wage growth maintained at 1.9 percent which is significantly half less a decade ago. Although the central bank is pointing out that the wage growth decreases indicating less pressure to labor costs.  It is anticipated that inflation will recover early next year while wages rises slowly with the progressing jobs market. Data shows that the public sector to be gaining more appeal to investors with 2.4 percent increase compared to the 1.8 percent in the private sector. recovery of mining investments following a stagnant growth.

 Economic Data of China Indicates Slow Growth  The economy of China further provided below-expected results of its economic indicators as the fixed-asset investment (FAI), manufacturing output and retail sales in the month of April declined.  The output of the industrial sector gained 6.5% in the earlier year, compared with the 7% projection of polling analysts of Bloomberg while 7.1% predicted by Reuters.  While factor output rose by 7.6% during March which is the fastest in two years. Fixed investments expanded by 8.9% in the months of January to April 2017, figures are based on the data released by the National Bureau of Statistics, as polls projected 9.1%  The sales of retail boosted by 10.7% in April from the first quarter of the year. According to forecasts of experts, the rise will reach 10.6% which is lower versus the past period of 10.9% development. Whereas, the growth in private investment that accounts for an approximately 60% of the national sum value, dropped to 6.9% and acquired 7.7% in Q1.This indicates that the small and medium-sized private companies will remain to experience difficulty in finances.  The target growth of China is close to 9% allocated for the FAI’s 2017 while there are expectations that the retail sales will surge to 10% generally.  The second largest economy in the world had obtained a 6.9% expansion in the first quarter which is the most powerful since 2015. China had lessened its economic objective to give way to the policymakers in boosting reforms and to control financial risks.

 April Retail Sales Data for US Increases by 0.4%  A highly positive retail sales data for the US economy has further reaffirmed speculations that the country’s economic status is regaining its momentum following a previously weak slew of data last winter. However, these positive economic reports were pockmarked by a drop in earnings reports. But economists are saying that the country’s economy could possibly be in for stronger consumer data in the second quarter of 2017, which is apparently not surprising since the US labor market is continuously showing signs of steady improvement.

 Thailand’s Strong First Quarter GDP growth  The export data of Thailand for first quarter moved at its most rapid  “quarterly pace” in the past four years and eases the monetary policy to support low key investment activities. Although it faces uncertainties with capital outflow and global trading protectionism, the U.S. Fed is taking signifying that it is gaining momentum to recovery.  The agency reduced its monetary projection from 3.0 - 4.0 percentage to 3.3 - 3.8 percentage economic advancement forecasts while its export progress has been elevated to 3.6 percent from 2.9 percent. The rise in exports is mainly due to steep costs of commodities more than the volume of trades.  The central bank retained its key percentage interest rate at 1.50 percent since April 2015 and the upcoming policy review is scheduled on May 24 and expected also kept unchanged. Yet, there is a possibility for the Thai central bank to increase its rates by 25 basis points later in the year because of both sturdy growth statistics and probable augmented U.S. rates.