We bring you a regular overview of the most important economic events that influenced our trading in the second trading week of this month.
The first half of the week already offered us a number of interesting data on interest rates coming from Australia and Canada.
On Tuesday (7.12.2021) the RBA (Reserve Bank of Australia) left interest rates unchanged at 0.10%. The Board of Directors decided at the meeting to keep the cash rate at 10 basis points and to continue buying government securities in the amount of CZK 4 billion. per week until mid-February 2022. Household consumption is recovering strongly and the economy is projected to return to pre-Delta levels in the first half of 2022. However, there is a legitimate concern about the uncertainty surrounding the new Omikron variant.
A day later, new data on interest rate changes came in from Canada, which also left them unchanged at 0.25%, as expected. The BOC (Bank of Canada) continues to reinvest and maintain its holdings of government bonds. The economy continues to recover from the pandemic and grew by 5.5% in the third quarter, as expected. This suggests that the economy has gained considerable momentum. However, the Governing Council believes that the economy needs to continue to be supported significantly. Like everywhere else, Omicron has introduced new uncertainty.
At the end of the week, we were waiting for the incoming GDP data in the UK, which came in slightly worse than in November (0.1% actual, vs. 0.6% previous).
What's in store for the current trading week?
This week we expect increased volatility on currency pairs containing USD, GBP, EUR and JPY. In the first half of the week, data will come from the UK regarding the change in unemployment. Other important data await us in the second half of the week, where we can expect the Fed's interest rate and GDP decision coming out of New Zealand. On Thursday, we will focus our attention on the decision to change interest rates in the EU. The end of the week is likely to be more volatile as well, as Japan will offer us its interest rate decision.
In the photo: RBA Governor Philip Lowe