(US) IMF revises US 2012 GDP forecast to 2.0% from 2.1% prior, 2013 US GDP to 2.3% from 2.4% prior, citing the following:
Insight: On April 17th the IMF raised US 2012 GDP to +2.1% from +1.8% prior; the IMF also raised US 2013 GDP to +2.4% from +2.2% prior
(EU) OECD MAY INFLATION 2.1% V 2.5% PRIOR, lowest since Jan 2011
How to interpret these headlines?
With OECD’s inflation report showing global inflation down to the 2.1%, citing a fall in energy prices and weaker Global Growth Outlook, it is no surprise that all G7 countries are struggling with some facing potential double-dip recessions. Market is obviously waiting now for the next news catalysts and they could come in the forms of ECB Press Conference or NFP Employment Release this week, as both news releases have the potential of changing medium term sentiment for the entire currency market.
As far as IMF GDP Forecasts for the U.S., it’s not a breaking news, market have been aware of this for some time, but the timing of this release ahead of the NFP Friday will bring more attention on US economy and put more pressure on the Federal Reserve if the NFP comes out disappointing… Remember the change in the Last FOMC Statement:
Which led me to believe that if we get a disasterous NFP release, USD will be sold off on speculation of additional Fed easing… All in all I do not expect to see further USD strength from now until after Friday…
Global Growth Outlook And Inflation Downgrade…
July 3, 2012 by Leave a Comment