FXStreet (Guatemala) - Analysts at Rabobank give us our daily outlook for what we can expect from the calendar.

Key Quotes:

“Today has Australian trade data for May. Last month saw a disappointing swing into deficit and the expectation is for a further AUD200m deficit this month. The correlation between China’s credit impulse and Aussie exports continues to argue that there is still downside risk for the trade balance ahead, but that may not show up in full just yet: indeed, the FX market continues to shrug these concerns off for now (yet another example of global liquidity - and Australia’s “high” interest rate of 2.50% - beating such fundamentals) and an upside surprise today may even see AUD retake 95 for the first time since November last year”.

“The UK Nationwide house price survey will likely show the property market apparently remains insufficiently frothy ( at 11.2% YoY?) for policymakers to continue to act forcefully on it: recall that despite new limits on some mortgage loans the BoE have also said they will only be truly concerned about a housing bubble if prices rise another 20% over the next three years”.

“In the Eurozone we have May PPI, seen flat MoM and -1.0% YoY: yes, that means deflation at the factory gate, which is likely to keep the pressure on the ECB”.

“In the US we have ADP employment, where the expectation is 205K jobs added vs. 179K last month. It must be slightly galling for ADP to go to all the effort to produce this survey only for the market to only pay attention if the results start to correlate with the BLS payrolls report that follows: it must feel like being a local band that only get the audience’s attention when they perform cover versions of another artist’s hits (and even then no-one wants to buy their CDs or T-Shirts outside). There are also factory orders (seen -0.3% MoM) and Yellen lectures on central banking at the IMF, which should be by far the most important event of the day given central bank liquidity’s influence”.

“There are of course plenty of political risks for the markets to focus on should they deign that such developments actually matter for asset prices. For example, in Ukraine President Poroshenko has declared the ceasefire with pro-Russian separatists over and has said he will instead attack, suggesting much more fighting is to come; the new “Islamic Caliphate” in Iraq/Syria is apparently causing real worries about contagion in Jordan and Saudi Arabia, with both countries now reinforcing their borders against possible incursions; and a major escalation in fighting between Israel and Hamas, which could inflame an already volatile region, is also possible. However, if Yellen gives a “more of the same ahead” message, markets seem most likely to remain buoyant regardless”.

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