Market themes of the Day: UK wages and German ZEW headline

Mario Blascak, PhD Independent Analyst

What you need to know before markets open
In Europe

Turkey-led market turmoil and the risk-off mood saw the European majors fall lower against the US Dollar on Monday with crisis spillover easing on Tuesday.
Turkey’s Lira fell another to a fresh all-time low of 7.11 against the US Dollar weighing on market sentiment as the US Federal Reserve’s interest rate hiking cycle is taking the toll on emerging markets losing big time once the interest rates become investment vehicle in the developed economies like the US as well.
German GDP rose 0.5% Q/Q in the second quarter while decelerating to 2.3% y/y.
The German ZEW investors confidence is expected to improve to -20.0 in August, up from -24.7 in July. Last time ZEW index was so low Draghi was saving the Euro with his famous “whatever it takes”.
The Eurozone Q2 GDP is expected to rise 0.3% Q/Q while increasing 2.1% y/y.
The Eurozone industrial production is expected to fall -0.4% m/m while increasing 2.5% y/y.

In the UK

The UK Sterling was under selling pressure falling to a fresh 13-month low of 1.2730 but managed to recover to 1.2470.
The UK labor market report is due expected to confirm the previous strength with wages rising 2.7% y/y in June while the unemployment rate is set to remain stuck to a 4-decade low of 4.2% in July. For details read my Preview here and learn how to trade the report with GBP/USD in Yohay’s primer here.

In the US

The small business optimism index is due with little-to-no market effect expected.

In China

Fixed-asset investment, industrial production and retail sales in China were lower than expected in July, while property investment ticked up according to official China’s statistics.

Author

Mario Blascak, PhD

Independent Analyst

Dr. Mário Blaščák worked in professional finance and banking for 15 years before moving to journalism. While working for Austrian and German banks, he specialized in covering markets and macroeconomics.

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