The main market mover of last week was the GDP of United States. After the disappointment of the preliminary data, the growth of the US economy was strong in the first quarter.
US GDP, in its second version, showed a variation of 1,2%, against the 0,7% previously reported. Analysts had expected an improvement in growth of + 0,9%.
On an annualized basis, the US Gross Domestic Product grew by 2,2%, against 2,3% expected by analysts.
Two weeks ago it was published also the Eurozone GPD which revealed that euro area has risen 0,5% over the previous quarter, as expected by analysts, the same variation was confirmed for the fourth quarter of last year. On an annual basis, Eurozone GDP is 1,7%, against the expected +1,7%.
As for the Old Continent, last week have been published also the data on the manufacturing PMI and the current balance of payments.
Markit’s PMI manufacturing index for the Eurozone economy was above expectations, while the services sector went down.
In the preliminary version of May, the PMI manufacturing index rose to 57,0 against analysts’ forecasts. In the services sector, however, the PMI index showed a drop from 56,4 to 56,2.
About the balance of payments, international transactions in the euro area reached 34,1 billion euros. The previous month’s result was slightly down to 37,8 billion.
The award for the surprise-market-mover of the week goes to the United States. Unemployment subsidy applications have declined.
The market mover passed from 236.000 requests for the last survey to 232.000. Analysts predicted an increase in unemployment benefits of 240.000.
In the meantime, the euro dollar exchange rate continues to rise and the expectations for a further increase are confirmed. EUR / USD does nothing but benefit from the weakness of the US dollar after President Trump’s uncertain policy.
The dollar could go further if the Fed will fail without announcing a rise in rates at the June meeting.
The list of the most important market movers of the incoming week (from the 29th of May to the 2nd of June) have the Non Farm payrolls on top. The US labor market report will look for final confirmation of a Federal Reserve rise in interest rates at the June meeting.
Moving to the North, traders on the Canadian dollar are waiting for the release of Canada’s GDP.
In Asia, China is once again protagonist with its industry-leading update, which will enable the world to test the health of the world’s second largest economy.
In the euro zone, investors are waiting for inflation data, the main indicator that will help the European Central Bank to define the duration of the tapering, the gradual reduction of the monetary policy stimulus plan.
Meanwhile, in the United Kingdom, as the forthcoming elections are approaching, the Economic Calendar will report on manufacturing and construction data that will once again define the impact of Brexit on the British economy.
We would like to remind you that American and British markets will be closed on Monday, May the 29th, because of Memorial Day and in London, on the occasion of the Bank Holiday; ‘Piazza Affari’ (Italian stock market) will be open on Friday, June 2, despite the Republic Day.