Economic Updates

The British Bankers' Association reported that, mortgage approvals in the UK declined unexpectedly to 32,288 in January, from a downwardly revised 33,440 approvals in the previous month.

The French budget minister, Jerome Cahuzac stated that, France needs an extra EUR6.00bn in 2014 to make up for a shortfall in government finances as the temporary tax hikes will end in 2013.

The European Central Bank (ECB) executive council member, Benoit Coeure, stated that the French government should honour its commitment to reduce the country's structural deficit in 2013, and take steps to minimise any overshoot of its budget deficit target. In an interview to a French newspaper, he urged the French authorities to take appropriate measures to convince its peers in the region that they are committed to keeping to the European Union's deficit regulations.

The French and German finance ministers have urged the Troika and Cyprus to expedite the talks on a bailout deal for the troubled euro area nation. In a joint statement, French Finance Minister, Pierre Moscovici and his German counterpart, Wolfgang Schaeuble welcomed the result of the Cypriot election and expressed hope that the new government would 'quickly continue' with the bailout negotiations.

Joerg Asmussen, a board member of the ECB, stated that early economic indicators point to speedy recovery in Germany and expects the euro area’s largest economy to swing to growth in 1Q13 after witnessing a contraction in the last quarter.            

ECB Governing Council member, Jens Weidmann, suggested that, the central bank should move back toward traditional monetary policy and away from its current path which is too close to fiscal policy.

The Federal Reserve Bank of Dallas reported that, manufacturing activity indexin the region dropped to a reading of 2.20 in February, from a reading of 5.50 in the previous month.

A survey from the National Association for Business Economics indicated that, the US will grow gradually, but uncertainty surrounding the fiscal imbalances will reduce the real growth in 2013. The survey reported that, real GDP in the US will grow 2.4% from 4Q12 to 4Q13. Further, it is expected that, the real GDP growth in the US to improve to 3.0% in 2014, higher than the 1.5% actual growth in 2012.

Dennis Lockhart, the President of the Federal Reserve Bank (Fed) of Atlanta, has opined that the central back should continue with its current bond buying program atleast into the second half of the year, as employment situation still remains bleak. He also indicated that the central bank is yet to reach a point where potential costs of quantitative easing would outweigh its benefits. 

The US House Republican leaders have urged the US President, Barack Obama, to work out a deal with Senate leaders to avert across the board spending cuts set to begin from 1 March 2013.

Guy Debelle, the assistant Governor of the Reserve Bank of Australia, has indicated that the central bank, if needed, could lower the interest rate further, if a stronger Australian Dollar continued to have a negative impact on the economy. However, he has warned that lower interest rate could increase upside risks to inflation.

Thank you Anchor Capital


Back Back to top

Forex Risk Warning