News and Reviews European Economic Zone

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News and Review of European Economic Zone (UK)

 

Sterling Interest Rate Speculation Delivering to 2-Month Peak Level

Monday, August 19, 2013

 

Sterling hit a 2-month highs against a basket of major currencies as improved economic data pushed the UK to consider the potential increase in market interest rates faster than the central bank's policy manual. Bank of England Governor Mark Carney has said it will keep interest rates at a record low of 0.5% until the unemployment rate drops to 7%, which is predicted will be reached by the end of 2016.

 

"The market is looking for a concrete assurance from the BoE on guide future policy, and they do not really get it," said Craig Erlam, market analyst at Alpari. "Too many warnings and none conclusively confirms the interest rate will not change during the 3 years."

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News and Review of European Economic Zone

 

Eurozone current account surplus down in June

Monday, August 19, 2013

 

Eurozone current account surplus declined in June amid shrinking trade surplus in the region, at the point in the data from the European Central Bank on Friday.

 

The surplus in the trade balance, which is a measure widely in a financial position to the international economy, fell to 16.9 billion euros ($ 22.45 billion) after a decline in the month of May which was revised to 19.5 billion euros. Data adjusted for seasonal effects and take into account the number of working days per month.

 

The euro area recorded a trade surplus of 11.8 billion in June, down from an upwardly revised 18.3 billion euros in May. The data showed that exports in the region more than the imports, which in theory is supposed to provide support for the economy in the euro zone.

 

Global demand is still volatile which redundantly restrain export growth, suggesting that domestic demand will continue to play a role in the recovery of the euro zone.

 

The EU statistics agency said Wednesday that the combined GDP of the 17-country euro area has increased by 0.3%, higher than the first three months of this year, largely driven by strong domestic demand from Germany and France.

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News and Review of European Economic Zone (UK)

 

CBI projection Profitable Sterling

Tuesday, August 20, 2013

 

Sterling hit a seven-month peak against a basket of currencies on Monday, fueled by expectations that the Bank of England will probably tighten monetary policy sooner than that implied in the policy manual. Projections, the Confederation of British Industry showed UK GDP will grow 1.2% this year, up from a previous prediction of 1%. For 2014, the projected GDP also increased to 2.3% from 2%. CBI also expect the unemployment rate will decline in the UK next month.

 

Sterling has recorded extensively on the rise this month after guide future policy announced BoE Governor Mark Carney failed to reassure investors about the commitment to low interest rates until late 2016. In its policy guide Carney signaled the central bank will keep interest rates at a record low of 0.5% until the unemployment rate drops to 7%, which is expected to be achieved by the end of 2016.

 

But UK economic data continues to indicate a recent strong recovery has raised doubts about the BoE target.

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News and Review of European Economic Zone

 

Euro Sustains Bundesbank Monthly Report

Tuesday, August 20, 2013

 

The euro appreciated versus the U.S. dollar on Monday after Germany's central bank, in its monthly report, said the commitment to low interest rates if the European Central Bank is not absolute and will depend on the medium-term inflation outlook. Bundesbank is also optimistic that the expansion of German GDP in the 2nd quarter will restore Europe's biggest economy to a more normal growth path.

 

Bergero Andres, vice president and chief corporate trader at Bank of the West in San Ramon, California, said that "the Bundesbank is known to be hawkish when compared with other central banks in the euro zone. Bundesbank attitudes and perceptions change may have helped rally the Euro."

[mynameisandhy]

News and Review of European Economic Zone (Greece)

 

Schaeuble: Greece Needs New Assistance Program.

Wednesday, August 21, 2013

 

German finance minister for the first time on Tuesday acknowledged that Greece would need a third support package, as an informant in Greece said that the amount of money involved in the latest deal will be much smaller than the previous aid.

 

"There will be other programs in Greece," said Wolfgang Schaeuble told the audience in his campaign in northern Germany, his comments raised the prospect that the measures taken can be very unpopular in the country with only five weeks before the national election.

 

In Athens, an official from Greece's finance minister told Reuters that the latest aid to shore up the focus will be on financial aid are expected to remain less for the year 2014-2016.

 

"Greece and the lenders will examine some of the ways to overcome any financial difference which Greece will face in the next few years," the official said that in asking his identity secret.

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News and Review of European Economic Zone (UK)

 

Interest Rate Expectations Continue Supporting Sterling

Wednesday, August 21, 2013

 

Sterling traded not far from 2-month highs versus the U.S. dollar weakened, amid fresh doubts about when the Federal Reserve will begin to reduce the stimulus. Cable also continue to reap the support of improved UK economic data recently, which increase the chance to hike interest rates sooner than projected the Bank of England. At the beginning of this month, BoE Governor Mark Carney has pledged to keep interest rates low until unemployment fell to 7%, which, according to a new central bank will be achieved in the next 3 years.

 

But Carney also highlights some of the factors that will allow the central bank to tighten policy, such as inflation rising faster than expected or threatened financial stability.

 

"The additional clause Carney damaging message about interest rates low for a longer time, and has turned into a bullish Sterling. To support it, should UK data continues to show solid results. Which will provide more space for Sterling to move higher , "said Nawaz Ali, UK market analyst at Western Union.

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News and Review of European Economic Zone

 

Euro Zone Recovery Momentum Continues

Thursday, August 22, 2013

 

Eurozone recovery continued to gain momentum in August, with the business activity drove at top speed in a more than 2-years. Markit report on Thursday showed euro bloc composite PMI jumped to 51.7 in August from 50.5 in July. Analysts had previously forecast the composite index will only rise to 50.9. and manufacturing rose to a reading of 50.7.

 

Reported manufacturing activity index also jumped to a 26-month to 51.3 from 50.3 last month, which exceeded expectations of 50.7. While the services sector PMI back perched on the expansion zone with surging up to 51.0 from the previous 49.8.

 

"So far, the growth of business activity in the 3rd quarter still be the best since the spring of 2011. Economic description of the survey results look in line with the expectations of policy makers who are expecting moderate growth," said Chris Williamson, chief economist at Markit.

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News and Review of European Economic Zone (Greece)

 

Greek Bailout Projected Needs More

Thursday, August 22, 2013

 

German Finance Minister Wolfgang Schauble admitted that Greece is likely to require new bailout program after the bailout program that is currently running an end in 2014.

 

In addition there is a risk that Greece may need a bailout from the European Union earlier than previous estimates.

 

The IMF last month projected that Greece needs additional funds approximately 11 billion Euros for 2014 to 2015. European Commission, ECB and IMF, known as the Troika is scheduled to visit Greece again in October to see if the necessary reforms and austerity Greece to reduce its debt further.

 

This condition will complicate the upcoming German elections, given the German parliament showed discomfort against the size scale that is considered the EU bailout is already too big.

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News and Review of European Economic Zone (Germany)

 

German PMI Data Help Euro Recovers

Thursday, August 22, 2013

 

German private sector expanded in August at the fastest pace since January, according to survey results on Thursday, signaling Europe's largest economy is re-expanded after contracting at the end of last year and hampered in early 2013. PMI by Markit which measures the rate of growth of manufacturing and service sectors as well as covering more than two-thirds of the economy, rose to 53.4 in August from 52.1 in July. This data is above the 50 level that separates growth and contraction, helped by a sharp rise in the number of new jobs. German stocks add to gains after the data was released and the euro jumped to a session high against the dollar.

 

"The data is a good outlook, with manufacturing best scoring performance in some unbroken, along with the improvement in the service sector, so that exporters keep growing and the domestic economy recovers," said Chris Williamson, chief economist at Markit. "If there is a job growth rate in the coming months, it will strengthen the recovery outlook prolonged," he added.

[mynameisandhy]

News and Review of European Economic Zone

 

Europe Mixed After GDP Data

Friday, August 23, 2013

 

European stocks tend to move in mixed trading Friday as investors digest the amount of data that has been released this week, with the data growth better than expected sentiment in the market managed to recover the English.

 

Britain's FTSE has appreciated more than 0.4% post figures 2nd quarter GDP was revised up to 0.7% from an earlier estimate of 0.6%. The surprise successfully restore investor confidence and mood. Germany's DAX also gained about 0.2% after GDP data confirm the economic growth rate of 0.7% in the April-June period of 2013. While the French CAC40 is still stuck in the red zone, with a loss of 0.05%.

 

Amid continued uncertainty surrounding the discourse tapering by the Federal Reserve, the market's focus is likely to shift for a moment to the Fed's annual symposium in Jackson Hole. The event was also attended by the world's central bankers are expected to discuss the latest issues facing the U.S. and global economy.

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News and Review of European Economic Zone (Germany)

 

German Q2 GDP Grows by Investment

Friday, August 23, 2013

 

German economic growth in the 2nd quarter driven by consumption and investment increase due to higher growth in the euro zone.

 

Capital investment rose 1.9% over the previous 3 months and is the first increase in three quarters, while consumption increased 0.5%. Gross Domestic Products in the 2nd quarter and grew 0.7% year on year, the economy grew 0.5%.

 

Economic growth in Germany and France also have helped bring the euro zone out of its longest recession. It is also in line with predictions from the European Central Bank said that the gradual recovery will happen in the euro zone region.

 

While other economic data are also in line with the economic recovery taking place in Germany. German business sentiment survey data by Ifo Research Institute showed an increase for three consecutive months in July. Similarly PMI survey (Purchasing Managers Index) by institutions Markits Economics showed manufaktir and services sector expanded during the month of August. This gives a signal that Europe's largest economy may already be in the path of growth after stagnation in the first quarter and a contraction in the final quarter of last year.

[mynameisandhy]

News and Review of European Economic Zone (UK)

 

UK Q2 GDP Revised Up 0.7% as Exports Increase

Friday, August 23, 2013

 

UK economic growth in the 2nd quarter was revised up to 0.7% from the first quarter due to higher activity in the construction sector, manufacturing and trade. This figure is higher than projected by economists and analysts of 0.6%.

 

Exports rose highest for over a year and have a surplus that contribute to the GDP by 0.3 percentage points. Exports rose 3.6% in the three months to June which is the highest increase since the 4th quarter of 2011 and imports rose 2.5%.

 

While the manufacturing sector grew by 0.7% in the second quarter, higher than the previous estimate of 0.4%. While the revised construction grew 1.4% from 0.9% the previous measurement. The service sector is the largest part of the UK economy remains unchanged alias with 0.6% growth.

 

Pound strengthened against the U.S. dollar after the data was released from $ 1.5605 to 1.5636.

[mynameisandhy]

News and Review of European Economic Zone

 

Weidmann Warns of Risk of ECB Bond Purchases

Monday, August 26, 2013

 

European Central Bank council member Jens Weidmann, on Monday said that the central bank should not distribute more risk to the rest of the Euro zone since many programs have been launched to tackle the financial crisis.

 

"Monetary policy has provided a substantial contribution in preventing further escalation of the crisis," Weidmann said in remarks prepared for a conference in Berlin. "However, the central bank has gone too far into areas that are not well known and dangerous."

 

Weidmann also said the ECB's decision to buy government bonds rated bad credit can distribute the risk of unhealthy budgetary policy to the 17-nation euro bloc members. Only the parliament and the government, as a democratically elected body, who has the right to approve such a redistribution of risk, he added.

 

Jens Weidmann, head of the Bundesbank, has become one of the most vocal critics of the ECB's commitment to reduce the cost of borrowing euro zone countries in trouble. As is known, ECB President Mario Draghi last year has announced that the central bank is prepared to buy up government bonds in the secondary market with an infinite number. A promise is enough to calm financial markets, and to make the ECB has so far not need to follow through with the actual purchase.

[mynameisandhy]

News and Review of European Economic Zone

 

ECB's Nowotny comments Rescuing Euro

Monday, August 26, 2013

 

The euro appreciated versus most major currencies after ECB policymaker, Ewald Nowotny, said that he did not see enough reason for the central bank to cut interest rates. Comment was made after a survey showed activity grew faster euro zone. 2nd estimate of German GDP growth also mengkonfimasi 0.7% in the 2nd quarter, which fueled domestic demand. A number of improvements in economic data has delivered euro hit a 6-month highs versus the U.S. dollar earlier this week.

 

"The euro looked unstoppable for a while, but the normalization of the story about the Fed will soon restore the strength of the dollar," said Chris Turner, chief currency strategist at ING.

[mynameisandhy]

News and Review of European Economic Zone (UK)

 

Flagging! Sterling Reluctant Rally Ahead of Carney

Monday, August 26, 2013

 

The British currency - Pound seems lethargic depressed when entering the European trading session on Monday (26/8) because investors showed concern ahead of a speech from the Governor of the central bank's policy of England (BoE), Mark Carney this week.

 

Markets seem concerned because Carney is expected to attempt to stem the rise in UK interest rates policy speech next Wednesday. Carney even in expectation will reaffirm its commitment to low interest rates as defined in the policy guidelines for the future.

 

Investors to take a position at Sterling declined although it appears that a revised GDP release on Friday (23/8) noted the expansion of the previous quarter. The British government released a revised GDP q / q in the second quarter at the rate 0.7% up from 0.6% the previous figure. While the data is revised GDP y / y also experienced an increase to a level of 1.5% from the previous quarter to 1.4% last year.

 

Until about 1500 GMT, sterling was weak in the area range from $ 1.5564 after limited only able to rally to at $ 1.5583. While in session Friday (23/8), Queen Elisabeth's currency jumped to $ 1.5636 and ended at closed at $ 1.5568.

[mynameisandhy]

News and Review of European Economic Zone

 

Germany: The Case of Greek Bailout Will not be Repeated

Tuesday, August 27, 2013

 

There will be no such thing as bail out what has been applied to Greece, as long as Angela Merkel's coalition party backers win in elections next month. Thus the assertion German Finance Minister, Wolfgang Schaeuble, told media today.

 

"To achieve the ideals of a strong European region, each party must perform their respective duties and not give aid money to each other," said Schaeuble told CNN. He believes if Chancellor Merkel re-elected as head of government, then Germany can continue with its work to help the region's economic improvement efforts. To achieve a strong Europe, all countries are called in order to boost its competitiveness and not rely on the power of the blue like a German major continents. "We want a strong Europe, and not nuanced German Europe," he said.

 

The Finance Minister's comments came ahead of a general election on 22 September, in which Merkel's reputation is at stake after the decision to help the European bailout program. So far there are four countries that still depend on the operational support of EU funds and the IMF that Greece, Portugal, Ireland and Cyprus.

 

The euro zone is separated from the pressures of recession after its economy grew 0.3% in the second quarter. Previously the rate of economic contraction for 18 months due to the prolonged crisis struck. Unemployment rate is still high, but concerns over the spread of endemic debt fading. Respond to this reality, Schaeuble admitted that the Eurozone issue is really over. But he admits current conditions are much better than a few years ago. "You can see for yourself how bond yields are now fairly stable. Economy recovered in most of the member states and the average deficit of euro zone dropped by half," said Schaeuble. Hung up, Schaeuble insisted that Greece would never be given another bailout, but on the other hand there will be no haircuts or accept option losses for holders of assets as it used to. That commitment also applies to other countries that are problematic (for Merkel served as chancellor).

[mynameisandhy]

News and Review of European Economic Zone (Germany)

 

Export prospects Spur German Business Sentiment

Tuesday, August 27, 2013

 

German business sentiment surged in August amid an improving outlook for exports, referring to the Ifo report on Tuesday. This data is also increasingly emphasized Europe's largest economy accelerated after a weak start to the year with.

 

Ifo business confidence index has recorded a version of the growth for the 4th consecutive month with a rose to 107.5 in August from 106.2 in July, which exceeded expectations of 107.0. This report is also in line with the German PMI data that had already been released, which drove business activity at its fastest pace in 7 months.

 

"The business climate in the manufacturing sector rose sharply to its highest level since April 2012 as the company is more optimistic about export prospects," said Kai Carstensen in charge of the Ifo survey.

 

Signs of recovery in euro zone began to spread to southern Europe and indications that China, the main purpose German export machine, began to regain growth momentum, the mood appears to have also helped businesses in Germany.

 

However, the Ifo business confidence index is still below the historical peak level at 115.0 which is printed in February 2011.

[mynameisandhy]

News and Review of European Economic Zone (UK)

 

Carney BoE: Britain Still Solid Growth Prospects

Wednesday, August 28, 2013

 

Has just published the first critical comment BoE Governor, Mark Carney is likely dovish, after his comments that indicate potential BoE cut interest rates if the bond yield rate hurt the U.S. economic recovery.

 

In addition to the Bank of England (BoE) will also loosen liquidity constraints for the banking sector in meeting the 7% level permodalam. Carney also warned that monetary guide provided (forward guidance) death decree will change the attitude of the BoE to add stimulus to the economy. Expectations of Fed stimulus reduction itself may be different with the steps that will be executed BoE.

 

Additionally Carney stated that the English pretty solid growth prospects, but not so rapidly. This comment indicates that the BoE is quite optimistic about the growth of the UK economy but still above potential opportunities monetary easing if still needed.

 

Pairing GBPUSD jumped signikan shortly after Carney's comments are quite optimistic on the growth rate. In addition, the investors who previously did short selling in pounds feel disappointed after Carney did not provide further detail why inflation will not rise and prevent rate hikes earlier if the rate of growth of the UK economy is still solid.

 

So far the GBPUSD pairing pelemahannya a -0.14% decrease in the level of 1.5530, away from daily lows at 1.5430.

[mynameisandhy]

News and Review of European Economic Zone (UK)

 

Sterling Drops Ahead of Speech Carney

Wednesday, August 28, 2013

 

Sterling fell a second straight day against the dollar on speculation the Bank of England Governor, Mark Carney, will be re-confirmed its intention to keep borrowing costs at the lowest level. Carney is scheduled to make a speech on this day.

 

BoE policymakers would maintain interest rates at 0.5% and asset purchases totaling £ 375 billion at their last meeting that ended last August 1. In addition to the conflict in Syria also trigger increased demand for safe-haven assets such as the dollar. GBPUSD is currently trading at around 1.5479 1.5550 away from daily highs. Sterling also fell against the euro to its lowest level in three weeks EURGBP is currently trading at around 0.8636 0.8609 away from daily lows.

So far the GBPUSD pairing pelemahannya a -0.14% decrease in the level of 1.5530, away from daily lows at 1.5430.

[mynameisandhy]

News and Review of European Economic Zone

 

Merkel: Greece Should Not Left to Join the Euro

Wednesday, August 28, 2013

 

German leader Angela Merkel blames Social Democrat predecessor, Gerhard Schroeder, who let Greece adopted the Euro. Merkel argued down to block the entry of Greece has been at the root of the problems that afflict the current euro zone.

 

"Greece should not be allowed into the euro," Merkel said in a political rally in Rendsburg on Tuesday. Chancellor of the Christian Democrat, who is preparing to face the upcoming elections on the 22 of September, also stressed the need for reform in the troubled country to maintain the region's economic health.

 

"The euro is not a currency. And for that reason, we have to show solidarity. Yet solidarity is always associated with the responsibility for reform," he added. Prospect of greater financial support for Greece has evolved into hot issue in Germany, which is the biggest contributor to the bailout program for Athens.

[mynameisandhy]

News and Review of European Economic Zone (Germany)

 

German Unemployment Claims Rise in August

Thursday, August 29, 2013

 

German jobless claims unexpectedly showed an increase in August, although the unemployment rate remained steady amid signs of accelerating growth in Europe's largest economy, according to a report employment agencies Bundesagentur fur Arbeit Thursday.

 

Germany reported unemployment claims rose by 7,000 in August after a record drop in the same amount in July. This figure decreased by 5,000 to confront expectations of economists. German labor market is still confirmed as one of the strongest in the Euro zone with entrenched unemployment rate near a record low, with no change at 6.8%.

 

"The increase in August was also partly due to the implementation of new labor policies by the government, which seems not much help," said BA chief Frank-Juergen Weise. The government has changed the requirements to help self-employed, which contributed to a decrease of 50% in requests for help this year, according to a spokesman for BA.

[mynameisandhy]

News and Review of European Economic Zone (UK)

 

Carney's speech S****e Sterling weakness

Thursday, August 29, 2013

 

Sterling moved away from 2-week lows versus the U.S. Dollar after the first policy speech Governor of the Bank of England was not much change expected rate hike faster than policy guidelines. This was reflected in the Sterling overnight interbank average rates (SONIA) are still indicating risk first rate hike within the next 2 years. Previous investors expect Mark Carney will try to curb the surge in the UK money market rates, following a series of solid economic data.

 

"While discussing the increase in market interest rates, Carney did not show concern for the conditions," said Philip Rush, economist at Nomura. "He has not focused on that."

 

In his first policy speech since taking office as the Governor of the BoE, Carney said that the UK's economic recovery will continue. But it does not guarantee the unemployment rate will drop rapidly to a level where the central bank will consider a rate hike by the future policy guidelines.

[mynameisandhy]

News and Review of European Economic Zone (UK)

 

Carney: BOE Can Add Stimulus If Needed

Friday, August 30, 2013

 

Bank of England Governor Mark Carney said that policy makers may add stimulus if it was needed, it was reported by the Daily Mail, quoting from an interview.

 

"The stimulus could be larger if needed," Carney said when asked whether the central bank will be Rev their monetary easing program, based on a quote from a newspaper based in London. "Stimulus will not be reduced. We must be absolutely clear about it. There should be a remarkable level of stimulus. "

 

Carney joined the Bank of England in July and announced policy guidelines in this month, which said that policy makers plan to keep interest rates at a record low at 0.5% at least for the next three years. BOE maintain the QE program at 375 billion pounds ($ 581 billion) on August 1.

 

"We will provide stimulus for economic growth to reach the level where it will grow to be independent," said Carney told the Daily Mail.

 

Policy guidelines related to the unemployment rate, which currently stands at 7.8% level. The central bank said that they would consider Rev interest rates until the unemployment rate drops to the level of 7%, a level that may not be seen until 2016

 

"We have to start looking for a response rate of income and what is very important is when people have a real revenue growth," Carney said, according to the report.

[mynameisandhy]

News and Review of European Economic Zone (Greece)

 

Greek Experience Seventh Year Economic Recession

Friday, August 30, 2013

 

IMF spokesman Gerry Rice reported in the media today, although there has been no further discussion on the Greek bailout program., But the Greek economic collapse and potential in its seventh year recession might cause further bailout request.

 

Around 40,000 small and medium sized businesses is likely to go bankrupt in the third semester of 2013 as rising costs at 90,000 tenag akerja despite the banking rescue program implemented before the summer season.

 

However enters election season German, Greek bailout discussion is difficult to proceed in this phase. This situation shows that the euro zone problems are still quite far to say was over.

[mynameisandhy]

News and Review of European Economic Zone (UK)

 

British Invasion Possible Pull Away From Syria

Friday, August 30, 2013

 

British Prime Minister, David Cameron, seems to meet an obstacle to military action to Syria, and a possible early sign of the UK would withdraw from the Syrian conflict. Cameron faces disapproval from members of parliament and the British public.

 

Early next week the British parliament will hold a vote on whether the UK will follow the U.S. military action in Syria or tidak.Cameron likely to be defeated in parliament vote for military action to Syria, although Western governments say the Syrian government has been responsible for the use of chemical weapons which killed at least 1,300 people in the city of Damascus.

 

The situation was the question of whether the United States would launch military action without the support of the UK. While the French parliament will hold an emergency session on the situation in Syria on September 4.