Economic calendar: IFO and BoC rate decision in the spotlight

Summary:

  • German IFO for April will equip investors with more information regarding sentiment among entrepreneurs
  • Low expectations ahead of today’s BoC meeting, focus will be on an inflation report
  • DoE release will come during the crunch time for oil prices

9:00 am GMT - IFO release: Preliminary PMI from German manufacturing failed to register a material rebound compared to a remarkably low level seen in March. On the other hand, IFO bounced back in March and a reading for April could shed more light on sentiment among German companies. Taking into account that both series are correlated one may suppose that another rise in IFO for April could sow a grain of hope with regard to subsequent months. The consensus calls for a slight improvement to 99.9 from 99.6. The index for expectations is forecast to have risen to 96.1 from 95.6 while the index for current assessment is expected to have decreased to 103.5 from 103.8.

3:00 pm GMT - Bank of Canada’s rate decision: After the Federal Reserve took a more dovish approach, the probability to see many more rate hikes in Canada has decreased. On the other hand, the inflation data for March surprised to the upside with the three core measures hovering around 2%. Either way, expectations ahead of today’s meeting are low and point to neither a cut nor a rise in rates. Instead, market participants could pay attention to the quarterly inflation release set to be published 30 minutes after the rate decision.

3:30 pm GMT - US oil inventories by DoE: The API report produced a surprising increase in oil inventories last month raising the bar ahead of today’s DoE release. The official consensus points to a 0.8 million barrels increase, however, market participants could be tilted to a higher number. Note that the data is coming during the crunch time for oil prices after Donald Trump signalled that there would be no prolongation of waivers for Iranian crude imports.

The USDCAD is trading in the vicinity of its technical resistance before the BoC’s rate decision. Source: xStation5

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