Fundamental Analysis

Weekly Roundup Report 26/05/2017

• July 18, 2017

EVENT RECAP: WEEK ENDING 26^th MAY 2017

Asia Pacific The New Zealand Annual Budget release highlighted New Zealand’s need for globalisation and the benefit of international trade, with the economy growing by 14% since 2012. The treasury intends to invest 1 billion NZD in the Business Growth Agenda over the next four years and another 134 NZD on New Zealand’s Trade Agenda.   North America According to the FOMC Meeting Minutes, most policymakers agreed that it would “soon be appropriate” to raise the Fed Funds Rate. As always with the Fed, any moves will be data dependent and based on whether key metrics fall in line with expectations. Inflation and output figures were disappointing and are under review. GDP figures came out better than expected at 1.2% annualized growth against estimates of 0.9% annualized growth for the first quarter. Core Durable Goods Orders were disappointing; a contraction in orders by 0.4% raises concerns for the manufacturing sector. In Canada, the central bank decided to keep the main interest rate steady at 0.5% as inflation is somewhat in line with projections. Business investment, consumer spending and the housing sector are strong.   United Kingdom The trading week started on a sombre note for the U.K. as reports of a terrorist attack in Manchester impacted Sterling rates, albeit for a short period of time. Economic growth reached 0.2% between the last quarter of 2016 and the first quarter of 2017 according e Office for National Statistics. The result for the second estimate was worse than the initial estimate of 0.3% growth for the quarter.   Europe Business optimism in Germany hit the highest level since 1991 in May, according to the Ifo Business Climate report. A broad range of sectors have seen growth including consumer spending, business investment and exports.