Week Ahead – Economic Indicators (Europe)

Hey, Traders!
For the March 9th week, here is a list of all of the major economic indicators being released during the EU Session, with a brief synopsis of what they represent and what to possibly expect from the markets in reaction.

Tuesday
German ZEW
The ZEW Indicator of Economic Sentiment is calculated from the results of the ZEW Financial Market Survey. The ZEW is followed closely as a precursor and predictor of the IFO Sentiment Survey and as such is followed closely by market participants. The data is released around the middle of the month for the current month. The survey provides a measure of analysts’ view of current economic conditions as well as a gauge of expectations about the coming six months. The latter measure tends to have a larger market impact and reflects the difference between the share of optimistic analysts and the share of pessimistic analysts. About 350 financial experts take part in the survey.
German ZEW Current Conditions
This survey summarizes the net percentage of positive and negative responses regarding the expectations for economic growth in the next 6 months, as given by financial analysts from banks, insurance companies and large industrial enterprises. For example, if 50% believe that the economic situation will improve and 20% believe it will get worse, the result will be +30.
What to expect:
A reading that is stronger than forecast is generally bullish for the Euro, while a weaker-than-forecast reading is generally bearish for the Euro.

Wednesday
Eurozone CPI
The consumer price index (CPI) is an average measure of the level of the prices of goods and services bought for the purpose of consumption by the vast majority of households.
What to expect:
Over the long run, the bond market will rally when increases in the CPI are small. The equity market rallies with the bond market because low inflation promises low interest rates and is good for profits. A higher than expected reading should be taken as positive/bullish for the EUR, while a lower than expected reading should be taken as negative/bearish for the EUR.

Thursday
UK Employment
The ILO (International Labour Organisation) Unemployment Rate released by the National Statistics is the number of unemployed workers divided by the total civilian labor force. It is a leading indicator for the UK Economy. If the rate is up, it indicates a lack of expansion within the U.K. labor market
What to expect:
As a result, a rise leads to weaken the U.K. economy. Generally, a decrease of the figure is positive (or bullish) for the GBP, while an increase is negative.

BoE Interest Rate Decision
Check out our prep document.

ECB Interest Rate Decision
Check out our prep document.