Daily Market Report – 31/07/2014 EURSpain has progressed another step away from the eurozone crisis, by releasing its strongest growth since the crisis began. Spanish GDP increased by 0.6% in the second quarter of 2014 which is better than the 0.5% expected, and means growth increased from the 0.4% growth in January-March. With this said, Spain is also being hit by the deflationary strains in the eurozone. New inflation figures, released yesterday show that the consumer EURSpain has progressed another step away from the eurozone crisis, by releasing its strongest growth since the crisis began. Spanish GDP increased by 0.6% in the second quarter of 2014 which is better than the 0.5% expected, and means growth increased from the 0.4% growth in January-March. With this said, Spain is also being hit by the deflationary strains in the eurozone. New inflation figures, released yesterday show that the consumer prices index fell by 0.3% annually in July. In Germany inflation hits a new four-year low. Inflation dropped this month to 0.8%, the lowest it has been since February 2010. The drop is likely to create uncertainties of deflation in the 18-member eurozone, where inflation fell to 0.5% in June. USDEyes were on the US yesterday to see if the economy has bounced back from its winter contraction.The US economy grew by 4% on an annualised basis in the second three months of 2014. This was much better than expected, and means US GDP rose by 1.0% on a quarter-on-quarter basis. Also, business investment has risen strongly during the quarter by 5.5%, along with government spending and investment in home building all rising as well. Exports jumped by 9.5%, having fallen by 9.2% in the first quarter as ice and snow disadvantaged US companies. Some economists are worried that the growth figures are too good to be true because companies expanded their inventories – stocking up on goods and materials for the future, so ultimately the figures may not be a true reflection of how well the US economy The IMF says the growing tensions over Ukraine could undermine financial markets in Europe and beyond with a lot of Europe’s largest companies having strong ties to Russia. Key Announcements:10:00 BST – EUR- Eurozone inflation (July) YoY expected to be unchanged at 0.5%10:00 BST – EUR- Eurozone unemployment rate (June) expected to be unchanged at 11.6% 13:30 BST- USD- Initial jobless claims expected to be higher at 301K Our dealers are available via e-mail ([email protected]) or by phone (0207 220 8181).