The figures assessing the Eurozone’s most prominent economy is set to be released tomorrow 30 July 2013, hopefully providing observers with a clearer picture of the state of the Euro Area’s economic health. Current forecasts predict the German CPI to drop slightly, perhaps indicating incremental improvements in the efforts for recovery.
Analysts point to Germany’s standing as the economic powerhouse of the Eurozone, and the influence that changes to interest rates could have on the rest of the Euro Area. The report comes as the Euro has struggled in recent weeks against many of its competitors and many observers have been unsure of the effectiveness of the Eurozone’s recovery efforts.
Traders are advised to exercise caution amid speculation on the Euro in the lead up to the report. Some volatility can be expected in the coming days in trading for the Euro against peer currencies.
US Consumer Confidence Report to be Released Tomorrow
The report is set to be issued on 30 July 2013, hopefully providing observers with a snapshot of consumer sentiment in the United States. At this time, while some experts have expressed their concern that the levels of confidence may show a slight drop, they do not believe that it will have significant repercussions at this time.
The release of the report comes as the USD has faltered in recent weeks over speculation on the future of quantitative easing activities by the Federal Reserve. Despite promising manufacturing numbers, investors have expressed concern over a potential slowdown on the massive American economy. That said, it was reported today that payrolls in the US are increasing, thus helping to cut unemployment, which has been a significant concern for Fed Chairman Ben Bernake for moving forward with cuts to stimulus. Should these job numbers continue to increase, the Fed may ease back from their monetary policy, which should excite investors considerably.
Traders are advised to proceed with caution in trading the USD against other pairings in the lead up to this report as there is an increased likelihood of volatility.
Hedge Funds Look For a Rally on Gold
It was reported today that a growing number of hedge funds have begun raising their interest in gold, perhaps indicating an increased potential for a rally in the coming days. Experts have pointed to the belief among hedge fund managers that the Federal Reserve is unlikely to enact any cuts to their stimulus activities in the near future, thus maintaining higher prices for the precious commodity. They are believed to have based their decision on continuing unsatisfactory job numbers and a weakened housing market. Analysts note that gold prices have skyrocketed during the recession as traders have looked for alternative places to invest their assets.
Meanwhile, Goldman Sachs has decided to place its bet on the opposite direction, predicting a drop in prices of gold, betting on improving figures for the recovering US economy that may encourage Bernake to move forward with his proposed cuts to stimulus.
Traders can expect a rise in gold prices as the involvement of these hedge funds increases. This may lead to some volatility in the markets.