DAX Steady as German Consumer Confidence Remains High

The DAX index has inched lower in the Wednesday session. Currently, the DAX is trading at 12,641.00 points. On the release front, German Consumer Climate improved to 10.4, beating the estimate of 10.2 points. The ECB released its semi-annual Financial Stability Review, which was generally positive. Later in the day, ECB President Mario Draghi will speak at an event in Madrid. German Consumer Climate improved to 10.4, beating the estimate of 10.2 points. In the US, today’s highlight is the Federal Reserve minutes from the May policy meeting.

The Federal Reserve raised rates back in March, and the markets are expecting the Fed to press the rate trigger again in June. The odds of a rate hike have increased to 83%, according to the CME Group. Just last week, the likelihood of a rate increase stood at 73%. Despite the market speculation, Fed policymakers are keeping their cards close to their chest, at least in their public appearances. On Tuesday, Philadelphia Fed President Patrick Harker said that a June move was a “distinct possibility”, but cautioned that a weak inflation report could delay a rate hike. Earlier in the week, Robert Kaplan, President of the Dallas Fed, stated that three interest increases in 2017 was “appropriate”. The Fed minutes are expected to underscore support for a June move, but may not shed much light on what happens after that. Still any clues about the Fed’s rate plans could shake up the listless EUR/USD.

With President Trump out of town on his first overseas visit, the White House presented Trump’s 2018 budget proposal to lawmakers in Congress. Trump is eager to pick up the axe and slash government spending, and the budget proposes major cuts to the Medicaid health program, disability benefits and food stamps. Trump has outlined an ambitious program to cut government spending by $3.6 trillion in the next 10 years and achieving a balanced budget by 2020. The budget includes $25 billion for paid leave after childbirth and some $200 billion for infrastructure programs. Trump’s budget will face tough opposition on Capitol Hill, with both Democrats and Republicans likely to demand changes. Still, with the Trump administration beset by Congressional investigations, the White House can point to the budget as a step forward in his agenda to slash government spending.

Trump Releases Budget Plan For Tax Payers

Economic Calendar

Wednesday (May 24)

  • 2:00 GfK German Consumer Climate. Estimate 10.2. Actual 10.4
  • 4:00 ECB Financial Stability Review
  • Tentative – German 10-y Bond Auction
  • 8:45 ECB President Mario Draghi Speaks
  • 14:00 US FOMC Minutes

*All release times are EDT

*Key events are in bold

 

DAX, Wednesday, May 24 at 6:55 EDT

Open: 12,634.50 High: 12,661.75 Low: 12,617.00 Close: 12,641

This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.

Kenny Fisher

Kenny Fisher

Currency Analyst at Market Pulse
Kenny Fisher joined OANDA in 2012 as a Currency Analyst. Kenny writes a daily column about current economic and political developments affecting the major currency pairs, with a focus on fundamental analysis. Kenny began his career in forex at Bendix Foreign Exchange in Toronto, where he worked as a Corporate Account Manager for over seven years.