Another U.S. Rate Hike before Year-End Another U.S. Rate Hike before Year-End | DZHI - DZH International 
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Another U.S. Rate Hike before Year-End

  • DAR Wong
  • 25 September 2017

Fundamental Outlook   The U.S. building permit and housing starts reveals inflation growth in coming months. FED chair Yellen reaffirms another rate hike before year-end. European Central Bank reassures of inflation recovery in adjusting stimulus program. Bank of England negotiates to pay lower exit fee to European Union with a proposed agenda.

The U.S. building permit rose 1.30 million in August and highest record in more than 2 years. Housing starts grew 1.18 million from July and remained in good growth. Current account deficits narrowed to USD123 billion in the second quarter ended June.

American existing home sales was down for 3 consecutive months in August at 5.35 million. Another report on weekly claims reduced to 259,000 in the week ended 16 September and lowest in 3 weeks.

The U.S. FED Yellen announces trimming of USD4.5 trillion balance sheet to begin in October. Meanwhile, no rate hike has been implemented though FED chair affirms one more hike will come before year-end. Forecast of inflation has been reduced to 1.5 percent this year from previous 1.7 percent.

In United Nation general assembly, President Trump warns seriously of bringing destruction to North Korea if America is left to defend itself or allied nations with no other choice. North Korea leader Kim rebukes Trump’s speech by saying the retaliation of destruction will go beyond Trump’s expectation.

Bank of Japan remains monetary policy unchanged while asset purchase program lasted for past 3 years has failed to drive up inflation to 2.0 percent.

German ZEW sentiment that measures institutional investors’ confidence rises to 17.0 index in September and better than forecast. German manufacturing index hits a 6-year high at 60.6 in September.

Eurozone consumer prices rose 1.5 percent in August on year comparison while core prices grew 1.2 percent on year. European Central Bank President Draghi expresses optimism in inflation recovery and open to calibration to stimulus program over year-end instead of just tapering.

The U.K. retail sales rose 1.0 percent in August and best record in 4 months, after previous month was revised at 0.6 percent gains. Public sector net borrowing reduced GBP5.1 billion in August and lower than forecast in improvement. 

Bank of England Governor Mark Carney says BREXIT has pushed up the inflation in U.K. economy. Policymakers foresee the rock-bottom interest rate has ended and credit tightening will occur in coming months. British Government negotiates to pay EUR24 billion to European Union for retaining a single market access after exit.

 

Technical Forecast   USD/JPY turned down on Friday after topped 112.70 last week. Market could be moving into consolidation with prone to some correction in coming week. Range is expected from 110.50 – 112.50 region with more selling activity. Abandon your short-view should the trend pierce above 112.70 level.

EUR/USD has seen strong bear factor above 1.2000 level recently. This week, the trend might persist in threading sideways for consolidation from 118.00 – 120.00 range as Dollar strength varies. Market trend may swing in uncertain volatility due to fundamental news based on North Korea tension and German election.

GBP/USD has been suppressed recently above 1.3600 resistances. The trend will be heading into profit-taking as traders await for further observation on BEREXIT effects. We reckon the range will move from 1.3250 – 1.3600 region with prone to bearish trend. Beware of breaking above 1.3600 level again that may reverse the market sentiment.

 

Disclaimer: This article is written for general information only. No liability by the writer, publisher or any third party involved in the distribution of this work.

DAR Wong is a registered fund manager in Singapore with 28 years of global trading experiences. You may reach him at dar@pwforex.com


About the Author
DAR Wong (Singapore)
An international speaker with 27 years of trading experience in the global financial markets, DAR is a Market Master and author of “Living Daylight in Stock Market: Monetizing Your Profits in 8 Days”.

DAR Wong is an active market trader, registered fund manager, educator and author.He began his career in 1989 as an institutional Futures trader with Bank of America. DAR Wong specializes in trading global derivatives and financial markets. He has 26 years of experience accumulated through tenure with Bankers Trust, Barclays Bank, Citigroup (Smith Barney Shearson Inc) and as an independent trader.

DAR is the author of “8 Ways to Invest in China’s Emerging Market” and contributes frequently to regional media, including financial TV/Radio programmes, newspapers and magazines for professional traders and active investors.

He is a popular and sought after international speaker who has presented to financial professionals and investors throughout the region including Singapore, Malaysia, Indonesia, Thailand, Hong Kong, China, Cambodia, Myanmar, Philippines, Sri Lanka, India, South Korea, Laos, Vietnam, United Kingdom and Middle East (UAE).

DAR is registered with NASD (now known as FINRA) series 3 and 5 as approved by National Futures Association (NFA) of USA and holds a current portfolio as Fund Strategist and Advisor with Dektos Investment registered with Monetary Authority of Singapore.

DAR is profiled as “One of the most successful traders – Market Masters” in Brent Penfold’s bestselling book “The Universal Principles of Successful Trading “. In January 2015, DAR was honored with Outstanding Award for International Financial Market Analysis granted by ASEAN Commerce (Thailand).

DAR is the author of "8 Waysto Invest in China's Emerging Market" and contributes frequently to regional media, including financial TV/Radio programmes, newspapers and magazines for professional tradersand active investors.1

He is a popular and sought after international speaker who has presented to financialprofessionals and inverstors throughout the region including Singapore, Malaysia, Indonesia, Thailand, Hong Kong, China,Cambodia, Myanmar, Philippines, Sri Lanka, India, South Korea, Laos, Vietnam, United Kingdom and Middle East(UAE).2


Year
2003 - Set up ASPRI to provide hedging advisory for corporate clients and training for financial professionals
2009 - Released first book “8 Ways to Invest in China’s Emerging Market”
2010 - Profiled as “one of the most successful traders – Market Masters” in Brent Penfold’s bestselling book “The Universal Principles of Successful Trading” along with Larry Williams, Andrea Unger, Michael Cook, and Daryl Guppy etc
2011 - Received “Spirit of Enterprise”awarded by Singapore Management University in Singapore
2012 - Honored with Individual Diamond Career (Thailand) awardedby Royal Privy Council of Kingdom of Thailand
2013 - Appointed Vice Chairman of ASEAN-China Commerce Association and led a delegationtothe annual China-Asean Expo in Guangxi Province, China
2014 - Fund Manager cum Director in Dektos Investment Corporation registered with Monetary Authority of Singapore
2015 - Released new book “Living Daylight in Stock Market - Monetizing Your Profits in 8 Days” in January
2015 - Honored with Outstanding Award in International Financial Market Analysis awarded by ASEAN Commerce (Thailand)
2016 - Honored with Medal of Integrity by Royal Councilin Palace of Palembng, Indonesia

References

1.TV programs on ChannelNewsAsia (Singapore);Radio on 95.8 Capital (Singapore); Newspapers such as The Borneo Post (Malaysia), 资汇报 (Malaysia); Regional financial magazines such as The Analyst (India), 东盟商界(ASEAN, China), 资本杂志 (Malaysia).

2.Spoke at events for CME Group, Euronext LIFFE, Tokyo Commodity Exchange, Singapore Exchange, Korea Exchange, Bursa Malaysia, Thailand Futures Exchange, Jakarta Futures Exchange, Indonesia Commodity and Derivatives Exchange, Tokyo Commodity Exchange, Interactive Brokers, Xinhu Futures, Hangzhou Money Fair, China (Shenzhen) International Finance Expo, China (Guangzhou) International Finance Expo, Euromoney, CIMB, Maybank, RHB, UOB Bank, Asia Trader & Investor Convention, Global Rubber Conference, International Rubber Conference, Malaysia Rubber Board, International Rubber Research and Development Board,Malaysia Ministry of Agriculture, Rubber Industry Smallholders Development Authority, Vietnam Rubber Association, Cambodian Rubber Association, Bureau of Agriculture Research Philippines, Myanmar Rubber Planters & Producers Association etc.