Falling oil prices and concerns over the slowdown in the Chinese economy dominated the global markets this week. The transformation of the Chinese economy from the production to services sector weighs on the Chinese economic growth and on the global growth.
Official growth data from China will be released next week. Analysts expect the Chinese economy to expand 6.8% in the fourth quarter, after a 6.9% in the third quarter. The weaker-than-expected growth data is likely to weigh on global stock markets and on oil prices.
Regarding the U.S. economic data, the situation remained unchanged. The labour market continues to strengthen, but inflation and the manufacturing sector remain weak. U.S. retail sales, producer prices and industrial production dropped in December. It is likely that the Fed will delay further interest rate hikes if the situation does not change in the coming weeks and months.
The European Central Bank (ECB) will release its interest rate decision next week. It is unlikely that the central bank will change its monetary policy as it adjusted its stimulus measures in December.
It is likely that the currency pair EURUSD will rise toward the resistance level at $1.1000 or at $1.1100, if the U.S. economic data will be negative or there will be negative news from China and no negative news from the Eurozone.
If the U.S. economic data will be positive and in case of the negative news from the Eurozone, the currency pair EURUSD may test the level at 1.0800.
The British pound was under pressure this week as speculation that central bank will keep its interest rates at low levels for a longer period weighed on the British currency. The Bank of England on Thursday kept its monetary policy unchanged. Low inflation and uncertainty over UK's membership of the European Union are main risks to the country's economy.
Risk Warning: Trading Forex and CFDs on margin carries a high level of risk and may not be suitable for all investors. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75.42% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. Prior to trading, you should take into consideration your level of experience and financial situation. TeleTrade strives to provide you with all the necessary information and protective measures, but, if the risks seem still unclear to you, please seek independent advice.
© 2011-2021 Teletrade-DJ International Consulting Ltd
Teletrade-DJ International Consulting Ltd is registered as a Cyprus Investment Firm (CIF) under registration number HE272810 and is licensed by the Cyprus Securities and Exchange Commission (CySEC) under license number 158/11.
The company operates in accordance with Markets in Financial Instruments Directive (MiFID).
The content on this website is for information purposes only. All the services and information provided have been obtained from sources deemed to be reliable. Telerade-DJ International Consulting Ltd ("TeleTrade") and/or any third-party information providers provide the services and information without warranty of any kind. By using this information and services you agree that under no circumstances shall TeleTrade have any liability to any person or entity for any loss or damage in whole or part caused by reliance on such information and services.
TeleTrade cooperates exclusively with regulated financial institutions for the safekeeping of clients' funds. Please see the entire list of banks and payment service providers entrusted with the handling of clients' funds.
Telerade-DJ International Consulting Ltd currently provides its services on a cross-border basis, within EEA states (except Belgium) under the MiFID passporting regime, and in selected 3rd countries. TeleTrade does not provide its services to residents or nationals of the USA.