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Historically low interest rates to boost economic recovery

Mon, Jan 12 2009, 09:16 GMT
by Guillermo Alcalá

FXstreet.com


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The week we leave behind has reminded us the negative economic moment we are going through, a situation with complicated solutions, we have seen some example this week, namely in England with the BoE cutting interest rates once again, to 1.5% this time, the lowest Bank Rate since the bank started to set monetary policy in 1694.

In the Euro Area economy continues looking gloomier and gloomier, with unemployment figures rising at a fast pace and industrial production declining as fast. Germany, the main economy in the Euro area has seen evidence of the decline of its Industrial sector, manufacturing production declines continuously, and factory orders have weakened to historically low levels.

The situation in the U.S. does not show any considerable improvement. The FOMC minutes have described the current situation in rather negative terms, and the employment report this week has confirmed the worst expectations, 2008 has closed with a loss of 2.3 million jobs in the U.S., the wo4rst number since 1945.

next week we have several important indicators, focus will be, mainly in the ECB's monetary policy decision on Thursday, the bank lending key rate in the Euro Area is now at 2.5% and rumour has that the ECB could follow the BoE and trim rates by some 50 b.p. in yet another attempt to kick start economy.

U.S. retail sales will be published on Wednesday, an important indicator to assess the impact of the whole economic downturn upon consumption

 

Monday January 12th

  • 15:30 Canada Bank of Canada Business Outlook Survey - December
  • 23:50    Japan    Trade Balance - BOP Basis - November (Previous: ¥1113.2B)
  • 23:50    Japan    Adjusted Current Account - November (Previous: ¥145B)

Tuesday January 13th

  • 00:01    United Kingdom    BRC Retail Sales Monitor - All - December (Previous: -2.6%)
  • 09:30    United Kingdom    Goods Trade Balance - November (Previous: -£7.8B)
  • 09:30    United Kingdom    Total Trade Balance - November (Previous: -£3.9B)
  • 13:00    United States    Bernanke speaks at London School of Economics
  • 13:30    Canada    International Merchandise Trade - December (Previous: $3.78B)
  • 13:30    United States    Trade Balance - November (Previous: -$57.1B)
  • 21:45    New Zealand    Building Permits - November (Previous: -21.9%)

Wednesday January 14th

  • 10:00    European Monetary Union    Industrial Production w.d.a. - November (Previous: -5.3% y/y)
  • 13:30    United States    Import Price Index - December  (Previous: -6.7% m/m; 4.4% y/y)
  • 13:30    United States    Retail Sales - December (Previous: -1.8% m/m; Ex Autos -1.6%)
  • 19:00    United States    Fed's Beige Book
  • 23:50    Japan    Core Machinery Orders - November (Previous: -4.4%)

Thursday January 15th

  • 00:30    Australia   Unemployment Rate - December - (Previous: 4.4%)
  • 07:00    Germany    Consumer Price Index - December (Previous: -0.5% m/m; 1.4% y/y)
  • 09:00    European Monetary Union    Consumer Price Index - December  (Previous: -0.5% m/m; 2.1% y/y)
  • 12:45    European Monetary Union     ECB Interest Rate Decision (Previous: 2.5%)
  • 13:30    European Monetary Union    ECB Trichet's Speech
  • 13:30    United States    NY Empire State Manufacturing Index - December (Previous: -25.76)
  • 13:30    United States    Producer Price Index - December (Previous: -2.2% m/m; 0.4% y/y)
  • 15:00    United States    Philadelphia Fed Manufacturing Survey - January (Previous: -32.9%)
 
Friday January 16th
   
  • 00:30    Japan    BoJ's Governor Shirakawa Speech
  • 08:15    Switzerland    Producer and Import Prices - December (Previous: -1.4% m/m; 1.1% y/y)
  • 10:00    European Monetary Union    Trade Balance n.s.a. - November (Previous: €0.9B)
  • 13:30    United States    Consumer Price Index - December  (Previous: -1.7% m/m; core CPI: 0.0% m/m; 2.0% y/y)
  • 14:00    United States    Net Long-term TIC Flows - November (Previous:     $1.5B)
  • 14:15    United States    Industrial Production - December (Previous: -0.6% m/m)
  • 15:00    United States    Reuters/Michigan Consumer Sentiment Index Preliminary - January (Previous: 60.1)

Published on  Mon, Jan 12 2009, 09:17 GMT


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