The prospect of the Chinese monetary authority's support program for its own economy is likely to provide further support for the German stock market in the coming trading days. In this context, the disappointment over the pessimistic ifo economic outlook could be capped. At the same time, in addition to a speech by Fed Chairman Jerome Powell, attention is likely to turn to the publication of new US price data.
DAX Chart
Source: Tradingview
Planned economic stimulus program by Chinese central bank gives stock markets a boost
The economic stimulus program announced by the People's Bank of China (PBoC) sent the German benchmark index back above the psychologically important 19,000-point mark on Tuesday. For example, the Chinese central bank wants to reduce the minimum reserve ratio for banks by 0.50 percentage points in order to stimulate the economy. At the same time, mortgage interest rates are also set to fall in order to support the real estate market.
The joy over the planned easing of Chinese monetary policy could continue in the coming trading days and weeks.
Focus on numerous US economic data on Thursday
From the point of view of the economic calendar, things are less spectacular today, Wednesday.
The US gross domestic product growth rate does not come into focus until Thursday at 14:30. The weekly initial jobless claims and new orders for durable goods are also likely to move at the same time.
Marathon speech by Fed representatives likely to provide monetary policy impetus
Investors should pay attention to a planned speech by Jerome Powell at 15:20 in the afternoon. Other Fed representatives are also likely to make statements and thus provide monetary policy impetus. Fed Governor Adriana Kugler, Susan Collins (Boston) and Michelle Bowman (Governor) will follow at 15:10. Speeches by Michael Barr (Vice Chair for Supervision), Lisa Cook (Governor) and Neel Kashkari (Minneapolis) are also planned.
US price data could provide important inflation clues
On the last trading day of the week, EU consumer confidence is likely to be the first event to cause movement (11:00 a.m.).
However, the focus on Friday afternoon will be on new data on the so-called "PCE core deflator" for personal consumption expenditure (2:30 pm). According to the latest estimates, an increase of 2.70 percent is expected compared to the same month last year, following 2.60 percent in the previous month. This data is seen as an important guide to future inflation trends.
In the USA, actual consumer prices stood at 2.50 percent in August, which is still above the target of 2.0 percent.
