Article / 27 June 2013 at 5:22 GMT

3 Numbers to Watch: EZ M3, EU confidence, US income and spending

Juhani Huopainen Juhani Huopainen
Blogger / MoreLiver's Daily

This is a big day in terms of data releases and events. The European Council meets today and tomorrow, trying to hammer together an understanding on the banking union, based on last night’s attempts by the European finance ministers to find a compromise. With only little time ahead of the German elections and the conflicting views of the participants, it is not likely that a lot of progress will be seen.

Also note that there will be plenty of data from Japan in the early hours of Friday. The numbers will tell the markets if  ‘Abenomics’ has started working or not, and that could have an effect on the policy choices of other central banks as well. Markets could start adjusting already toward the US close. Today’s notable speeches include, the Federal Reserve - Dudley 14:00 GMT, Powell 14:30 GMT, Lockhart 16:30 GMT - and from the European Central Bank Mersch at 17:00 GMT.

EZ May Monetary developments in the euro area (M3) (08:00 GMT). The M3 monetary aggregate is expected to have risen by 2.9 percent from one year ago, slightly less than 3.2 percent reported in the previous month. Private loans are expected to have fallen by 0.9 percent from one year ago. The monthly changes have stabilised lately, and the narrow M1 showed a nice increase last month. This usually leads to an increase in the broader aggregate after a lag of several months, but Europe is currently anything but usual at the moment.


Even if loan growth actually materialises, there are many things that could still go wrong later. ECB’s Draghi sounded dovish in his latest speech, but before the German elections, banking union talks and the German constitutional court’s verdict it is hard to believe in any new policy announcements from the central bank. Note that Germany’s June employment statistics are published five minutes before the ECB report.

EZ Credit Stock  

EU June Business and Consumer Surveys (09:00 GMT). Consumer confidence is expected to have improved a lot to -18.8 from -21.9 in May. The improvement in economic confidence is expected to be much smaller, as the industry does not share consumers’ optimism. Lower interest rates and less crisis headlines are probably some of the drivers for the optimism, but as households’ balance sheets have not improved enough yet, any impact on loan demand should be limited.

EZ Confidence  

US May Personal Income and Outlays (12:30 GMT). Personal income is expected to have risen by 0.2 percent and spending by 0.3 percent. Income was flat in April, while spending actually fell by 0.2 percent. Growth rates have been trending lower for the past two years, but that is understandable normalisation after the rapid recovery phase.

us personal income spending

First quarter GDP was yesterday revised to lot lower than expected, from 2.4 percent to 1.8 percent, with private consumption and investments taking the largest hits. I briefly discussed this possibility yesterday, and WSJ has more on this. This revision is too much for the Federal Reserve to ignore, and it is possible that the recent tapering scare could reverse for a while, as markets start expecting additional delays to tapering the asset purchase programmes. The PCE price index is released simultaneously, and as low inflation is one thing that the central bank watches, so should you. Core PCE is expected to have increased by 0.1 percent, which is too little.

While I mentioned yesterday that ‘good news is now good for prices’, this particular data point could be different. If growth is not present, or there is some weakness in the underlying data, I expect EURUSD to correct higher on expectations of an easier Fed. Also, European data and some statements from European leaders could be EUR-positive. Technically this would also make sense, as the 1.30-level has now been reached and there seems to be no willingness to push the pair lower, as the longer technical range's bottom is already quite near. See my view from one week ago for more. 

3 Numbers to Watch is published Monday-Friday on You can choose to be notified whenever a new piece is ready if you become a TradingFloor member - it's free, and you can sign in with Twitter, Facebook, Google or LinkedIn.  You can also follow all the news from our macro team on our Macro Page.

27 June
Mickette Mickette
Relevant infos and so clearly wrapped... thanks Juhani!
27 June
Emmanuel Aye Emmanuel Aye
Mickette, What do u think about shorting eurusd intraday?
27 June
Mickette Mickette
Shorting EURUSD intraday. Waiting at the present moment for confirmation of a possible entry.
27 June
Mickette Mickette
Time to do it. Target 1.3000
27 June
Massimiliano Calabrese Massimiliano Calabrese
Hi Mickette :) Do you think that Home sales will influence the EUR/USD situation? have a nice day!


The Saxo Bank Group provides an execution-only service and all information provided on is solely for general information. When trading through your contracting Saxo Bank Group entity will be the counterparty to any trading entered into by you. does not contain (and should not be construed as containing) financial, investment, tax or trading advice or advice of any sort offered, recommended or endorsed by Saxo Bank Group and should not be construed as a record of our trading prices, or as an offer, incentive or solicitation for the subscription, sale or purchase in any financial instrument. Saxo Bank Group will not be liable for any losses that you may sustain as a result of any investment decision made in reliance on information which is available as part of the or as a result of the use of the Any information which could be construed as investment research has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such should be considered as a marketing communication. Furthermore it is not subject to any prohibition on dealing ahead of the dissemination of investment research. Please read our disclaimers:
- Notification on Non-Independent Investment Research
- Full disclaimer

Show latest activity
Sorry, there was a problem communicating with the servers. We are working hard to solve this. Please try again later.
Oops! There was a problem communicating with the OpenAPI Portfolio service.
Oops! There was a problem communicating with the OpenAPI History service.
Oops! There was a problem communicating with the OpenAPI Reference service.
Oops! There was a problem communicating with the OpenAPI Root service.
Oops! There was a problem communicating with the OpenAPI Trading service.
Sorry, there was a problem communicating with the Financial Calender servers. We are working hard to solve this. Please try again later.
Check your inbox for a mail from us to fully activate your profile. No mail? Have us re-send your verification mail