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Discussion in 'Forex - Currencies Forums' started by Andrea ForexMart, Jan 18, 2018.

  1. KostiaForexMart

    KostiaForexMart Senior Investor

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    26.02. German economy nears stagnation in first quarter with coronavirus outbreak

    The German Institute for Economic Research DIW reported that Germany’s economy is close to stagnation in the first quarter of 2020 due to the coronavirus outbreak. According to the organization, the country's GDP will increase by only 0.1% compared with the previous quarter, and the industrial sector of the economy will be mainly hit.

    The head of the economic department of the institute, Klaus Michelsen, also noted that the impact of the coronavirus epidemic remains unclear, and the damage cannot be calculated. However, experts are confident that German industry will suffer the most, since an outbreak of the virus will inevitably lead to interruptions in the supply of wholesale products from China.

    According to the Federal Statistical Agency of Germany (Destatis), German GDP in the IV quarter of 2019 remained unchanged compared with the previous three months. Over the past year, Europe’s largest economy has grown by only 0.6%, at the lowest rate since the 2013 eurozone debt crisis.
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  2. KostiaForexMart

    KostiaForexMart Senior Investor

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    02.27. European stock exchanges fall by more than 3% on concerns over coronavirus

    Major European stock indexes on Thursday evening accelerated the pace of decline and are already falling by more than 3%. Experts note that the pressure on the exchanges is caused by concerns for the global economy, which is under pressure from the situation with the coronavirus.

    In particular, the British FTSE 100 index falls by 3.02%, to 6824.55 points, the French CAC 40 – by 3.28%, to 5502.16 points, and the German DAX – by 3.1%, to 12357.11 points.

    Investors continue to assess the risks of a slowdown in the global economy amid the continued spread of the coronavirus, which is becoming a pandemic. Coronavirus and related quarantine measures pose risks to many areas of the economy, including trade, transportation and tourism.
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  3. KostiaForexMart

    KostiaForexMart Senior Investor

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    28.02. Eurozone inflation expectations drop to record low

    A key market indicator of long-term inflation expectations in the eurozone fell to a record low amid growing concerns about the spread of coronavirus in Europe.

    The five-year indicator of inflation expectations fell to 1.1182%, which was the lowest level in history. The indicator measures the level of expected inflation in the eurozone over a five-year period.

    The previous record low was recorded in October 2019 at around 1.12%.
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  4. KostiaForexMart

    KostiaForexMart Senior Investor

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    02.03. Italy's GDP growth slowed in 2019 to 0.3%, a minimum for 5 years

    According to official figures, Italy's economic growth in 2019 has slowed to its lowest level since 2014 of 0.3% compared with 0.8% in 2018. Italian authorities predicted a recovery rate of 0.1%, a consensus forecast by experts provided for an increase of 0.2%.

    Consumer spending in Italy last year increased by 0.4%, government spending decreased by 0.4%. Business investment grew by 1.4%, including investment in construction jumped 2.6%. The volume of exports from Italy in 2019 increased by 1.2%, the volume of imports decreased by 0.4%.

    Italy's budget deficit last year amounted to 1.6% of GDP, which is the lowest since 2007. In the previous year, the budget deficit was 2.2% of GDP. The public debt indicator remained at the level of 2018 – 134.8% of GDP.

    The official forecast for 2020 assumes a country's GDP growth of 0.6%, but many experts note the possibility of a recession in the economy due to the spread of coronavirus. The Italian government intends to revise the budget parameters for 2020 to take into account the urgent costs of supporting the economy in the context of the spread of coronavirus.

    The authorities plan to spend at least 3.6 billion euro to support the economy, including the provision of tax benefits to businesses, as well as measures to support exporters to mitigate the negative effects that the spread of coronavirus could have on the economy.
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  5. KostiaForexMart

    KostiaForexMart Senior Investor

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    03.03. Central Bank of Australia lowered rate to record low

    The Central Bank of Australia has lowered its key interest rate from 0.75% to 0.5% per annum. The regulator reduces the rate for the fourth time in less than a year, bringing it to a record low. Prior to this, the rate was reduced in June, July and October 2019. This decision was unexpected for market participants, and only two economists surveyed by Reuters predicted a rate cut.

    The head of the Reserve Bank of Australia, Philip Law, said that the spread of coronavirus could have a significant impact on the country's economy, and it is difficult to predict how harmful the consequences would be. The politician also noted that the Board of Governors of the Central Bank is ready to further soften monetary policy in order to support the Australian economy.
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  6. KostiaForexMart

    KostiaForexMart Senior Investor

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    04.03. US Federal Reserve cut the rate unscheduled for the first time since 2008

    The Federal Reserve Board unexpectedly lowered its base interest rate from 1.5-1.75% to 1-1.25%, dropping it by 50 basis points at once. Market participants expected that the regulator would make a decision on a rate change only at the meeting on March 18.

    The Fed has taken emergency measures in connection with the spread of the coronavirus, which creates additional risks for economic activity, and the fall of markets. The last time a rate cut occurred outside of a scheduled meeting of the regulator was during the 2008 crisis.

    It is noted that the Central Bank came to such decision amid pressure from the US Presidential Administration Donald Trump.
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  7. KostiaForexMart

    KostiaForexMart Senior Investor

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    10.03. Saudi Arabia will increase oil supplies to 12.3 million barrels per day in April

    Saudi Arabian State Oil Company Saudi Aramco intends to increase oil supplies to 12.3 million barrels per day in April. The company expects this to have a positive long-term financial effect.

    According to the OPEC monthly report, in January, Saudi Arabia produced 9.7 million barrels of oil per day. The authorities said that the country's production capacity is 12 million barrels per day. Moreover, the Kingdom has tens of millions of barrels of oil in strategic reserves, which can be used if necessary.

    Riyadh has already announced that it has been lowering oil prices for buyers from all regions since April, after OPEC and its allies, including Russia, could not agree on Friday to further reduce production.
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  8. KostiaForexMart

    KostiaForexMart Senior Investor

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    11.03. Bank of England urgently cut rate to deal with coronavirus effects

    The Bank of England unexpectedly lowered its base interest rate in an attempt to support the British economy amid the spread of coronavirus in the country. Yesterday, the Monetary Policy Committee voted unanimously to lower the rate by 50 basis points to 0.25%.

    The regulator did not change the volume of the government bond purchase program (435 billion pounds) and kept the purchase volume of corporate bonds at 10 billion pounds. At the same time, the central bank lowered its countercyclical capital buffer for banks from 1% to 0% and launched a new small business lending support scheme.

    The regulator noted that although the extent of the economic shock from COVID-19 is very uncertain, business and production activity in the country may significantly weaken in the coming months.

    This emergency cut in the Bank of England rate was the first since the global financial crisis of 2008. As a result of this step, the rate returned to a record low level achieved after the Brexit referendum in 2016.
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  9. KostiaForexMart

    KostiaForexMart Senior Investor

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    12.03. The ECB has kept rates unchanged, but introduced a stimulus package against coronavirus

    According to the results of the European Central Bank (ECB) meeting, the regulator left key interest rates at the same levels, but presented a package of incentives to combat the effects of coronavirus. The Central Bank has announced measures to support bank lending and has expanded its program of quantitative easing (QE) by 120 billion euros.

    The ECB kept the interest rate on loans at zero, the deposit rate was kept at -0.5% per annum, the margin lending rate remained at 0.25% per annum. The Governing Council noted that the ECB's key interest rates will remain at their current or lower levels until inflation approaches the target level of the regulator.

    ECB Htad Christine Lagarde said earlier this week that Europe could face a serious economic shock comparable to the 2008 global financial crisis if the authorities in the region do not take the necessary measures to combat coronavirus.
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  10. KostiaForexMart

    KostiaForexMart Senior Investor

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    13.03. The EU will allocate 37 billion investment to combat the effects of coronavirus

    The European Union decided to create an investment initiative of €37 billion as part of a package of measures to protect the region’s economy from the effects of a coronavirus outbreak. This was stated today by the President of the European Commission Ursula von der Leyen.

    Additional measures that the executive branch of the European Union will take include the provision of flexibility to member states regarding budget deficit rules and government aid.

    The EU will also use 1 billion euros of EU money to guarantee up to 8 billion euros in loans to 100,000 companies affected by the coronavirus epidemic to support the corporate sector.

    The Head of the European Commission at the same time noted her conviction that the EU will be able to withstand economic shock only if each member state lives up to its full responsibility.
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