The Fed justified the changes to guidance mainly because of
external conditions. Among them were trade tensions, a weakening global
economy, and risk of a hard Brexit. These are not the main factors the Fed has
historically based its decisions upon. The central bank’s key objective is to
foster economic conditions that promote stable prices and maximize sustainable
employment.
Looking at Friday’s economic data, the U.S. economy still seems to
be in good shape. Job growth in January blew expectations, with NFP surging by
more than 300K. Although December’s figure was knocked lower, the three-month
average is still significant at 241,000. These facts may indicate that the Fed
has somewhat surrendered to market pressure and Trump’s criticism.
If the U.S. economy continues to perform well, the Fed has no
choice but to return to gradual tightening, which may again lead to volatile
markets. However, one set of data may
not be enough to judge upon.
It will be interesting to listen to Fed speakers this week
including Fed Chair Jerome Powell, St Louis Fed President James Bullard, and
Cleveland Fed President Loretta Mester. If they are not overwhelmed by recent
data releases and remain aligned to their dovish stance, this may provide a
further boost to equities.
The Bank of England is meeting on Thursday and will deliver its
quarterly inflation report. We do not expect any changes to policy but may see
slight changes to inflation and growth forecasts. The Pound is unlikely to move
on changes to economic forecasts, as most traders remain focused on whether
Prime Minister Theresa May will be successful in squeezing any compromises out
of the EU regarding the Irish backstop.
The earning season remains in full swing this week with more than
100 S&P 500 firms due to release results. Despite 70% of S&P 500
companies so far managing to beat on the bottom line, more companies are
issuing negative guidance than positive. According to FactSet, the S&P 500
is now projected to report a year-on-year decline in earnings for 2019. This
will undoubtedly upset equity bulls.
Have you heard this? Many Nigerian exporters have been defrauded of huge amount of money in the process of exporting commodities to foreign countries. Do you know why? They were not trained on export operations, management, documentations and the best methods of payment in export trade. This is terrible!!! Nigerians cannot continue to lose money to foreigners in the course of export business. Exporters, why don’t you get a practical manual that teaches the stages of export trade from processing and packaging of commodities to receipt of payment by the foreign buyers. It teaches export operations, export management, export documentations and methods of payment in export trade? It is a contemporary step-by-step guide to export trade. It tells all the contemporary dynamics in export trade. To get it, click on the link below:
http://www.tectono-business.com/2016/02/contemporary-step-by-step-guide-to.html
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