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[British Prime Minister’s Office: The British Prime Minister Johnson spoke with the Polish President, saying that the United Kingdom will actively negotiate on Brexit. If an agreement cannot be reached, a trade relationship similar to the EU and Australia will be formed during the transition period. 】

[European Central Bank Schnabel: warns that the euro zone inflation rate may fall below zero]
Isabel Schnabel, a member of the European Central Bank’s Executive Committee, on Saturday vigorously defended the European Central Bank’s monetary stimulus measures, saying that the euro zone inflation rate may fall below zero in the coming months. The European Central Bank’s decision to strengthen its emergency purchase plan this month to deal with the new crown crisis is based on concerns that the weak price dynamics will be entrenched and endanger the entire currency union.

"By next year, the inflation rate may still be close to 0%, and even a negative inflation rate may occur." Schnabel said. "If we stand idly by and watch the epidemic cause rifts in the euro area and create far-reaching differences, in the long run, this will jeopardize the return to single currency policy, then this will be contrary to the thinking behind the euro."

Schnabel's remarks largely refuted the claim that the ECB's unconventional monetary measures in recent years are unnecessary risks. The ECB is currently fighting a ruling by the German Supreme Court. A 2015 debt-purchase plan that is still in operation may be illegal because the ECB has not indicated that it has considered adverse side effects, such as lower interest rates on depositors. Without the purchase of new bonds, “to date, we may be caught in a severe financial crisis, with unpredictable consequences for the development of the euro area’s economy, employment, and prices and wages.”

[Lagarde: The economic recovery will be complex and incomplete, and some areas will undergo permanent changes]
① President of the European Central Bank Lagarde said that the economic recovery will be "limited" after the new crown epidemic, and permanent changes will occur in some economic fields. She pointed out at a web conference on Friday that although the worst phase of the crisis may have ended, the “huge” growth of savings will take time to gradually translate into an increase in investment and spending. The economic recovery will be "incomplete" because trade is unlikely to return to pre-crisis levels and productivity may also decline.

"We probably passed the lowest point, I said this with some worry," Lagarde said. "After the recovery, the aviation industry, the hospitality industry, and the entertainment industry will change their face, and some of them may be irreparably hurt." Lagarde pointed out that the substantially increased government and corporate debt must be repaid. But she also said that monetary and fiscal policies are working together and interest rates are at unusually low levels. The crisis may be transformative because "these changes will breed some industries."

Lagarde also called on policymakers to pay particular attention to the most vulnerable groups, including the poor, young people and women who were most affected by the crisis. "A lot of people are engaged in the catering industry and signed short-term contracts, and these positions are lost first," she said. "Women are always more affected during the crisis."

[US Commerce Secretary: Economic rebound may be postponed to the fourth quarter]
US Secretary of Commerce Ross announced that with Texas, Florida and other states suspending or canceling economic resumption plans, the US economic recovery may appear to have some "little whimpers", delayed from the third quarter of this year to the fourth quarter.

Rose said on the Fox Business Network that consumer spending will help the economy get out of the epidemic. When talking about the outbreak, Rose said that the economy will naturally be "disturbed" during the pandemic.
Note: Trump administration officials including Ross and White House economic adviser Kudlow expect the US economy to improve in the third quarter.

[Fooch warning! The epidemic in some parts of the United States is facing "serious problems, "people are infecting each other"]
On June 26th, local time, officials of the US Centers for Disease Control and National Institute of Allergy and Infectious Diseases, Anthony Fudge, said at the White House epidemic briefing that same day, the new coronary pneumonia epidemic rebound data shows that some parts of the United States are facing "serious" Problem".
Fuch said that the rebound in the epidemic in some areas is due to the premature economic opening, or the failure of the people to abide by the epidemic prevention guidelines. Everyone should not only be "responsible for himself", but also assume "social responsibility" to prevent the epidemic from continuing to spread. "People are infecting each other and eventually vulnerable groups will be infected by you," Fuch said. In an interview with the media the night before, Fuch said that health officials were engaged in "intensive discussions on group testing." That is, testing samples from many people at the same time, officials can use fewer resources to detect more people, so that infected people can be found and quarantined more quickly. (CCTV News)



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Summary of Institutional Perspectives
Imperial Bank of Canada: Global digital tax in European plan will hurt the dollar

NOVOX International Financial Information

Bipan Rai, head of North American foreign exchange strategy at Imperial Bank of Canada, believes that the implementation of digital taxes in European countries will suppress the US dollar because the income of the United States from exporting technology and intellectual property to other countries will be taxed. These taxes will weaken the ability of American technology giants to make huge gains abroad, and these incomes make up for the huge US deficit. The already “big” current account deficit will widen further and may put the dollar under pressure. Some countries in Europe have proposed digital taxes, which supports our strategic view of the weak dollar in the coming months.

Mitsubishi UFJ: short NZD/JPY target 66.00 stop loss set at 70.50

NOVOX International Financial Information

Tokyo Mitsubishi UFJ Bank (MUFG) position report on Friday (June 26) showed that short NZD/JPY, entry point 68.77, target 66.00, stop loss set at 70.50. The bank's analysts said that we believe that the existence of the New Zealand dollar at the current price is overvalued and does not match the trend of other G10 currencies, so there is room for callbacks. The Japanese yen will benefit from the current hedging demand. At the same time, we believe that the hedging value has not yet been fully reflected. If the market sentiment becomes more negative in the next few days or weeks, the yen is expected to usher in further increases, so we choose to short New Zealand dollar against Japanese yen.

USD/CAD hovered at a high of nearly two weeks, and the risk aversion brought additional upside

The USD/CAD breaks the 1.37 mark, reaching a new high since June 1 to 1.3716. On the one hand, the NYMEX crude oil price fell sharply again after touching the US$40 this week, which dragged the Canadian dollar trend. On the other hand, it also deteriorated because of risk appetite. On the contrary, it has prompted funds to return to the dollar-denominated asset market. This makes the US dollar against the Canadian dollar still expected to stand above the 30-day moving average at 1.3664, thus further consolidating the rebound trend in the past two and a half weeks. The continued global epidemic, especially in the Western Hemisphere, has forced investors to re-purchase dollar cash for hedging, and the postponement of the U.S. unblocking process has also continued to hit energy demand. This all implies that the Canadian dollar exchange rate will have a considerable probability of going out of the market. Will be further under pressure.

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NOVOX International Financial Information