Daily Market Report - 13/08/2014

EUR:
German investor confidence fell to the lowest level since 2012 as the crisis in Ukraine and a sluggish euro-area recovery damp the outlook for Europe’s largest economy. The ZEW Center for European Economic Research in Mannheim said its index of investor and analyst expectations, which aims to predict economic developments six months in advance, dropped to 8.6 in August from 27.1 in July. Economists forecast a decrease to 17. This was the eighth consecutive monthly decline and the biggest in more than two years. 

The drop in the ZEW index confirms the near-term downside risk for the German and euro-zone economies emanating from the Ukraine crisis,” said one senior European economist. And also the 'Putin factor’ could lead to more cautious investment plans for a while.

A worsening stand-off between Russia and the European Union is clouding the outlook for a German economy that probably contracted for the first time since 2012 in the second quarter. The disruption to trade threatens to weigh on the revival in the 18-nation euro area, which has already seen Italy slip back into recession. 

USD:
The Fed has admitted the Non-Farm Payroll and unemployment rate are meaningless due to the "noise" from a record number of workers dropping out of the labour force, Janet Yellen is left with one fall back indicator, the JOLTS survey (Job Openings and Labour Turnover).

US employers reported a whopping 4671K job openings in the month of June, beating expectations and well above the downward revised 4,577K in May. This was the highest openings print since February 2001, and one which suddenly puts the "hawkish" Janet Yellen back in play as it suggests that slack in the jobs market, at least based on the number of job openings, has not only filled the gap, but it is now overflowing.

Key Announcements:

09:30 BST    GBP- UK unemployment claimant count expected to fall to 6.4%

10:00 BST    GBP- EUR - Eurozone Industrial Production  to rise  to 0.3%

10:30 BST    GBP - UK inflation Report

12:30 BST    USD- Retail sales figures (June) expected to be flat at 0.2% 

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