Key Releases – Fundamental Analysis Report 20 Feb 2021
United States of America
USD is declining against all major world currencies.
Also to extremely poor statistics on the labor market, new negative reports of losses as a result of severe frosts continue to come. Today, Bloomberg released statistics showing a significant decline in the export of reduced natural gas and oil. It is noted that due to abnormal frosts, more than 80% of wells for the production of liquefied natural gas have suspended their work. Deliveries to LNG refineries fell to a 4-month low, while domestic demand for gas and electricity increased significantly.
EUR is strengthening against all other world currencies but declining against AUD.
Today, investors are focusing on a large block of reporting from the Eurozone countries. Manufacturing prices in Germany in January rose 1.4% from the previous 0.8%. Consumer prices in France fell 0.1% over the same period, as analysts expected. At the same time, business activity in the country’s manufacturing sector with the forecast for February unexpectedly increased to 55.0 points. Business activity in the German manufacturing sector rose to 60.6 points. Italy’s consumer price index rose by 0.7% in January, better than the expected 0.2% rise.
GBP is strengthening against the dollar but declining against EUR, JPY, and CHF.
Today’s block of macroeconomic statistics from the United Kingdom disappointed investors. The Core retail sales index for January was down by 8.8%, much more than the 2.6% decline expected. Retail sales declined by 8.2% over the same period, beating an estimated 2.5% decline. Also, business activity indices rose unexpectedly. The Composite PMI was 49.8 points, up from 41.2 points earlier, the Manufacturing PMI reached 54.9 points, and Service PMI increased to 49.7 points.
JPY is strengthening against USD, CHF, and GBP but declines against EUR.
Japan has had two earthquakes in a row, on Sunday and this morning. On Thursday, the magnitude was lower, at 4.7 points but the epicenter was located in the same place, east of Fukushima Prefecture. Macroeconomic statistics slightly supported the national currency. Service PMI for February fell to 45.8 points, and the Manufacturing PMI was 50.6 points.
AUD is strengthening against all major world currencies.
During today’s press conference, Australian Prime Minister Scott Morrison in a harsh manner commented on yesterday’s incident with Facebook. Morrison called the restrictions imposed by the social network a threat to the country and called for developing and adopting a code for the media space as soon as possible. In the company, the blocking of news portals in Australia was called nothing more than a system failure. Another factor that influenced the rate of the national currency was the growth in retail sales, which amounted to 0.6% instead of the expected 2.0%.
Oil quotes turned around and began to decline.
The main positive factor for oil is gradually weakening. Freezing temperatures in the United States, which caused a drop in energy production by almost 4 million barrels, are receding. The National Weather Service is reporting warming from next week. Most refineries will be back on track with power and transport infrastructure restored. It is obvious that the recovery process will last for some time, and this factor will continue to have a negative impact on asset prices.