Central Bank Conference: China'S Economic Growth Slowed Sharply

After the European Central Bank has brought great volatility to the market, this week, the four central banks of the Federal Reserve, the Bank of Japan, the Bank of England and the Swiss central bank will convene monetary policy decisions.

In addition, the economic data is also very strong, the United States will release the terrorist data known as retail sales, as well as CPI, PPI and other inflation data, as well as housing market, industrial production and consumer confidence and other data, these data bombs are enough to match the non-agricultural data.

Analysts said that the US monthly import price index fell for 8 consecutive months in February, mainly due to the decline in the cost of gasoline and other parts of the commodity. However, the data were better than expected, mainly because the impact of the strong US dollar began to disappear and oil prices stabilized, indicating that the import deflation of the United States may end with the weakening of the US dollar.

"The more important part of the Fed policy conference is that the Fed will confirm that the improvement of the financial market is not enough to raise the Federal Reserve's interest rate in April, let alone next week, but the probability of raising interest rates later this year is likely to increase," said David Ader, director of CRT Capital Group's bond strategy division.

RDQ Economics chief analyst John Ryding said, "we strongly feel that the strongest period of inflation pressure between the core and the whole has passed, and oil prices have shown signs of stabilization.

If these trends continue, import prices may soon begin to rise, helping to push up domestic inflation in the US.

"Wei"

In the latest research report, Barclay said, "the current situation is good enough for the Federal Reserve to describe the prospect in near balance next week. This implies that the Federal Reserve should increase interest rates in March or April, but it is more likely that in June it will be able to maintain a forecast of 2 times interest rate hikes this year."

The Swiss central bank (SNB) is not expected to adjust its policy on Thursday.

The RBA conference summary may admit to unexpected improvements in the future after much more than expected gross domestic product (GDP) data.

The Australian Federal Bank (CBA) said: "unless the domestic economic growth prospects are seriously deteriorating in general, especially in the job market, and / or the global economic growth prospects are getting dim, such as China's economic growth is slowing down sharply, the RBA will maintain its interest rate unchanged at 2% in 2016."

The Federal Open Market Committee (FOMC) will announce its policy decision on Thursday, March 17th (02:00) in Beijing, and will also announce its updated quarterly economic forecast and future policy outlook.

Janet Yellen, the US Federal Reserve Chairman, will hold a news conference at the following 02:30 in Yellen.

It is widely expected that the Fed will hold back this week, but investors will get clues to follow up interest rates from the statement after the meeting and Yellen's press conference.

Foreign media analysts expect the Federal Reserve to raise interest rates by the end of June, and then raise interest rates before the end of the year.

The Federal Reserve launched its first interest rate increase in nearly ten years last December.

Reuters commented that even in the wake of the global economic downturn, even the United States is facing more and more difficulties, mainly due to weakness in trade and emerging markets.

When the Federal Reserve keeps tightening, it may leave the Fed on Wednesday, postponing the next increase in interest rates, perhaps to June.

Economists surveyed by Bloomberg expect the Federal Reserve to keep interest rates unchanged this week. 55% of economists expect to reiterate the wording of the January statement that officials are "assessing" the global economic and financial dynamics.

This will be seen as a lower probability of raising interest rates in April.

Judging from recent policymakers' statements, FOMC may also hold similar views: Lael Brainard (Lael) warned the global economic slowdown and said in March 7th that from the perspective of risk management, patience needs to be maintained before the prospects become clearer.

In a speech on the same day, Fisher, vice chairman of the Federal Reserve, pointed out that the US economy is likely to encounter the "first wire signal" of inflation at the moment, and Fed officials welcome the trend of Stanley Fischer.

Michael Hanson, senior global economist at Bank of America Corp. in New York, said: "the job market is improving, the strength of the dollar has weakened, and oil prices seem to be at the bottom.

I doubt that their arguments will be positive and healthy, but there will be no clear conclusions about inflation. "

Steven Englander, an analyst at Citigroup Inc., said: "the difference between fed hawks and doves is that their opening rate for June or April will be even less than that of April.

They have no reason to announce the rate hike ahead of time in June, and for them, the market will start to be more reasonable about a month before they intend to raise interest rates, so that the market can basically digest before the real interest rate rises, and the possibility that the interest rate plan will be destroyed by events beyond its control is less likely.

At 20:00 on Thursday in Beijing, the Bank of England will announce interest rates and announce minutes.

It is also certain that it will not adjust its policy, may publish a moderate tone and acknowledge that the economy is facing potential obstacles.

The meeting minutes released at the same time as policy decisions may indicate that the members of the monetary policy committee have agreed to maintain interest rates unchanged for second consecutive months.

Although some policymakers sometimes have the idea of taking stimulus measures, data on Wednesday show that wage growth has accelerated and slowed down in recent months, which will suppress speech related to interest rate cuts.

Italy united credit bank said: "although the recent sharp decline in sterling trade weighted exchange rate and the huge percentage increase in oil prices will push up inflation, the members of the monetary policy committee will not be willing to voice support for the prospect of raising interest rates as a result of slowing economic growth, weak wage growth and a high degree of uncertainty due to a referendum in Europe."

DailyFX said the market is also widely expected that the Bank of England will keep monetary policy unchanged this week.

After all, not only the business survey in February hinted at a sharp slowdown in economic growth, but the PMI data in the UK had slipped into the level that would normally accompany the central bank to cut interest rates instead of raising interest rates.

Uncertainties surrounding Britain's return to Europe, turbulence in financial markets, moderate wage growth, low growth and low inflation at home and abroad will all be a concern for policymakers to limit the interest rate increase of the Bank of England.

Analysts now generally expect the Bank of England to postpone its expected rise in interest rates to early 2017, reflecting the weakness of the global economy and the continued downturn in inflation.

Contrary to some analysts' views, Will believes that further quantitative easing by the Bank of England may still be effective. He cited the value of private assets held by the Bank of England in the early 1980s as 5% of the annual economic output.

In addition to the Bank of England resolution, British data this week will also attract the attention of sterling investors.

This week, UK employment data will be one of the focuses of the market. If the payroll data can be strong, it will push up the market's inflation expectations, thereby injecting further upward momentum into the GBP / USD.

According to Bloomberg's survey of 24 economists on 10-11 March, 15 people believe that the Swiss central bank may not act in March 17th after the European Central Bank announced its interest rate cut in March 10th and expanded its quantitative easing policy.

33% of respondents expected to increase exchange rate intervention, and 17% predicted that the SNB would cut interest rates.

Foreign media reports pointed out that after the announcement of the European Central Bank's policy, the market expected the Swiss central bank to continue to cut interest rates in March.

The 3 month Swiss Franc interest rate fell to 100.80 from the pre announcement rate of 100.85, reflecting the average forecast for the negative rate of the Swiss franc, which is only slightly below the current deposit interest rate.

According to experts, the Swiss central bank may increase foreign exchange purchases to prevent the franc from rising after the European Central Bank announced last Thursday's ultra ambitious stimulus measures.

But traders and analysts said the European Central Bank expanded its monthly asset purchases to 80 billion euros and cut interest rates by three, without increasing the pressure on the SNB to follow suit at its March 17th policy meeting.

At the same time, the ECB lowered the deposit rate by 10 basis points, which is in line with the general expectation. However, the increase in the size of the monthly purchase debt by 20 billion euros is beyond everyone's expectation.

"The most likely prospect this week is that the Swiss central bank will maintain the deposit rate at minus 0.75%," said Maxime Botteron, analyst at Credit Suisse.

But Botteron points out that the increase in asset purchases by the European Central Bank may lead to the efforts of the SNB to increase the reserve market.

Botteron said: "from the perspective of the Swiss central bank, the most logical response is to further intervene in the exchange market, so as to cope with the expansion of the GDP percentage of the European Central Bank's balance sheet."

Will the Bank of Japan act more?

On Wednesday, the Bank of Japan will announce the meeting on monetary policy. The central bank may also maintain its policy unchanged. The central bank is still trying to appease the market tension caused by the January negative decision to implement negative interest rates.

It is widely expected that after the announcement of the negative interest rate policy in January, the Bank of Japan will not act, but there are also some who speculate that the central bank may further lower interest rates.

It is widely assumed that the BoJ will expand its monetary stimulus measures in the coming months to stimulate stagnant economies.

The Bank of Japan's actions in January failed to boost the stock market and failed to stop the yen's appreciation.

According to Peng Bo, most economists interviewed believe that if the Bank of Japan increases its policy easing, the negative interest rate recently implemented is most likely to become a policy tool; they expect to cut interest rates by the end of 7.

Reported that 80% of respondents believe that President Kuroda Higashihiko further lower the negative interest rate is the most likely.

Nearly 90% of respondents believe that one of the four meetings to the end of 7 will further relax the policy.

Of the 40 economists surveyed by Bloomberg, only 5 predict that the Bank of Japan will boost stimulus at the end of March 15th.

Fukatani Koji, President of FPG securities in Tokyo, said: "I do not think the BoJ will relax its policy this week.

Having said that, the easing policy of the European Central Bank is all around. The Bank of Japan's conference is approaching, and the market believes that anything will happen. "

At the same time, it is widely expected that after the announcement of the negative interest rate policy in January, the Bank of Japan will not act, but there are also some who speculate that the central bank may further lower interest rates.

Informed sources said that the Bank of Japan Policy Committee this week will discuss whether to allow 90 billion dollars of short-term funds to avoid negative interest rates.

Before the securities industry warned that negative interest rates could lead to investment funds into bank deposits.

According to sources, the request of Investment Trusts Association was echoed by some officials of the Central Bank of Japan, because the inflow of investment funds into bank accounts was contrary to the original intention of the prime minister three and the central bank, that is, to encourage more savings to leave deposits and government bonds and turn them into more productive investment funds to stimulate economic growth and end deflation.