Morning Call by Traders University

The FTSE 100 closed lower yesterday by 41 points at 3911. This followed the shock release that UK annual inflation rate (CPI) rose to 3.2% last month. Despite this rise, many economists are still predicting inflation to fall later in the year, with the possibility of deflation, which is massively damaging to the economy in the long term. The DOW gave back 115 points of the large gains made Monday to close at 7660. A pullback had been expected given these massive gains made on the news of government plans to remove bad loans from Bank’s balance sheets. The market is now waiting for any further good news, otherwise further pullbacks are expected. In Forex news today the EUR sees the German Ifo Business Climate figure released at 9.00am. This is a business survey to rate the relative level of current business conditions and is considered leading indicator of economic health. A relatively static result is expected. Then at 11.00am the GBP CBI Realised Sales figures are due with a reduction to -35 expected. Then at 12.30pm we see the USD Core Durable Goods Orders m/m with the expectation to see a modest improvement to -2.00%. Also, the USD New Home Sales results are due at 2.00pm with the expectation of a further slow down to 302K. Then later on into evening the NZD Current Account is released with improvement expected at -4.04B