Expert Commentary

Dario Perkins, Managing Director at Lombard Street Research Limited, on US and EU economies
Tue, 15 Aug 2017 08:13:52 GMT
Source: Dukascopy Bank SA
 
© Dario Perkins
Eurozone inflation was stable in July and unemployment reached its lowest rate since February 2009. In your opinion, how that can impact the ECB's interest rates?

I think that that the ECB might be happy about the growth outlook, but inflation is still looking really subdued. There is still some more slack in the economy, which would mean the European Central Bank is fairly patient and extremely gradual in its policy. 

Analysts claim that the US may not be the growth champion in the third quarter, what do you think on this matter? 

Compared to the rest of the world, the US growth rate most will probably bounce back, as it was quite weak in the first part of the year. It might not be the growth champion, though I am of the opinion that that the economy is still growing at a pretty strong rate.

What is your forecast for Europe's performance in the next quarter?

I am not 100% sure about my forecast for Europe's performance, but it could probably be about 0.5% over the reported period.

Europe's main stock markets were narrowly mixed at the start of trading on Monday, with London higher and Euro zone's rivals slightly down. What is your forecast for Europe's stock market in the near term?

We do not have a forecast in terms of numbers, but I think that the European stocks will presumably be quite strong, because the economy is strong and profits outlook is very good, as we have seen them recovering quite dynamically as of late.

The EUR/USD pair continued to exhibit a bullish bias. What are the main factors which determine the performance of this pair during the next quarter?

I think it is more about the central bank policies. The Federal Reserve is signaling softer inflation in the United States and is less aggressive in tightening. In Europe, the ECB's Quantitative Easing has been creating some big distortions in yields and depressing the shared currency. As we get to a point where the European Central Bank starts to taper, the Euro will start to head to the North.


Back to feed

To learn more about Dukascopy Bank Forex trading platform, SWFX and other trading related information, please contact us: +41 22 799 4888

To learn more about Dukascopy Bank CFD / Forex trading platform, SWFX and other trading related information,
please call us or make callback request.
For further information regarding potential cooperation,
please call us or make callback request.
To learn more about Dukascopy Bank Binary Options / Forex trading platform, SWFX and other trading related information,
please call us or make callback request.
To learn more about Dukascopy Bank CFD / Forex trading platform, SWFX and other trading related information,
please call us or make callback request.
To learn more about Crypto Trading / CFD / Forex trading platform, SWFX and other trading related information,
please call us or make callback request.
To learn more about Business Introducer and other trading related information,
please call us or make callback request.
For further information regarding potential cooperation,
please call us or make callback request.