Daily Brief, Mar 17: Economic Events Outlook – German Sentiment & UK Labor Report in Play

Posted Tuesday, March 17, 2020 by
Arslan Butt • 2 min read

Good morning, traders.

The coronavirus is still taking the lead, and it’s consistently hitting the world’s biggest markets, causing a significant slowdown in economic growth. Overall, the business activities have been halted, and stock markets are experiencing a bloodbath.

On the news front, the market is mostly ignoring significant economic news as European nations are struggling very hard to deal with coronavirus impact. However, we should keep an eye on the German Zew Economic Sentiment, which is expected to drop from 8.7 to -29.7. During the US session, eyes will remain on the US Retail Sales figures, which are also expected to show a slowdown in the US economy.

Watchlist – Economic Events Today

UK Labor Market Report – 9:30 GMT

It’s a leading indicator of consumer inflation and shows a change in price for businesses and the government pay for labor, including bonuses. Simply put, when companies pay more for the work, the higher costs are usually passed on to the consumer, which leads to inflation.

The unemployment rate is one of the most eyed economic data as it shows a change in the number of people claiming unemployment-related benefits during the previous month. The UK wage growth has been firmly declining in the wake of coronavirus and Brexit concerns.

February’s unemployment rate is anticipated to soar to 3.8%. The claimant count change is expected to have increased slightly from 5.5K to 6.2K during the month of February.

German ZEW Economic Sentiment – 10:00 GMT

Investors should monitor German ZEW Economic Sentiment, which is expected to dip by -29.7 points. For your info, this Zew Economic Sentiment is a survey of about 300 German institutional investors and analysts, which asks respondents to rate the relative 6-month economic outlook for Germany. The well-respected indicator index is released by the Zentrum für Europäische Wirtschaftsforschung and typically drives sharp fluctuations in Euro pairs and European stock Indices.

Lately, it hit a high of 26.7 points in January — displaying substantial pessimism. Economists expect a major dip of -29.7 points, revealing a dramatic drop in the economy.

US Retail Sales m/m – 12:30 GMT

It’s the primary gauge of consumer spending, which accounts for the majority of overall economic activity. Economists are expecting a dip in this month’s retail sales data as it’s forecast to be 0.2% vs. 0.3% during the previous month. Considering this, traders are expected to continue trading the dollar with a bearish bias.

USD – Core Retail Sales m/m

Alongside, the core retail sales will also be in focus as it shows a change in the total value of sales at the retail level, excluding automobiles. The data is due at 12:30 GMT, and the core retail sales are expected to drop to 0.1% vs. 0.3% beforehand.

Good luck, traders, and stay tuned to FX Leaders’ Economic Calendar for live market updates.

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