DAX steady, investors eye U.S-China talks, German CPI

The DAX index has posted gains in the Tuesday session. Currently, the index is at 11,236, up 0.24% on the day. In economic news, there are no major eurozone or German events for a second successive day. On Wednesday, Germany releases Preliminary CPI and the Federal Reserve will publish its monthly rate statement.

The U.S.-China trade spat will be back in the headlines this week, as Chinese and U.S. officials will hold a second round of talks on Wednesday and Thursday. The stakes are high, as the trade tensions between the two largest economies in the world has taken a toll on the global economy and rocked world equity markets. On Monday, U.S. Treasury Secretary Steven Mnuchin said he expects significant progress in the talks, but warned that the sides would have to tackle “complicated issues”. Tensions between China and the U.S. have escalated in recent weeks, with the U.S. Justice Department filing criminal charges against Huawei, a Chinese technology company. The U.S. is also trying to extradite a senior Huawei executive from Canada.

As the largest economy in the eurozone, Germany is a bellwether for the rest of the bloc. Recent German numbers have been weak, raising concerns about the strength of the eurozone economy. On Friday, German Ifo Business Climate dipped to 99.1, below the 100-level for the first time since 2010. Earlier in the week, a ZEW survey found that institutional investors remain deeply pessimistic about the German and eurozone economies. There was also grim news from the manufacturing front, as German manufacturing PMI slipped to 49.9, falling into contraction territory for the first time since 2013.

US lower as Huawei charges threaten trade talks

Economic Calendar

Tuesday (January 29)

  • There are no German or eurozone events

Wednesday (January 30)

  • 2:00 German GfK Consumer Climate. Estimate 10.3
  • 2:00 German Import Prices. Estimate -0.8%
  • All Day – German Preliminary CPI. Estimate -0.7%
  • 14:00 US FOMC Statement
  • 14:00 US Federal Funds Rate. Estimate <2.50%
  • 14:30 US FOMC Press Conference

*All release times are DST

*Key events are in bold

DAX, Tuesday, January 29 at 7:35 EST

Previous Close: 11,210 Open: 11,200 Low: 11,160 High: 11,240 Close: 11,236

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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.