Exchange Rate News: Weekly Forecast for GBP, EUR, USD and CAD
Pound Sterling (GBP)
Monday of next week will see several British domestic data publications. The most important of these, in terms of wider market movement, will be Net Consumer Credit, Net Lending Sec. on Dwellings, Mortgage Approvals and the seasonally adjusted Manufacturing PMI.
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Monday’s Eurozone Manufacturing PMI will also be of interest to those invested in Sterling given the intimate trading relationship between the Eurozone and the UK.
Tuesday will see the publication of a particularly important domestic data publication to gauge the British economic standing. The Bank of England/GfK Inflation for the Next 12 months surveys the public’s general attitude towards inflation.
Another of Tuesday’s important economic data publications will be the Construction PMI.
Wednesday’s Composite and Services PMI’s will have influence over Sterling movement. Those invested in the Pound will want to pay close attention to the services data, as services represent a huge portion of the UK’s economy.
The Eurozone data on Wednesday will also be of interest and may well affect Sterling movement. In particular the Gross Domestic Product data and retail sales will be influential.
Thursday will be a crucial day in terms of gauging the British economic standing. The Bank of England interest rate decision will be of vital importance. It is expected to remain at the record-low 0.5%; however the dissenting duo from the previous monetary policy meeting may affect proceedings. The Bank of England Asset Purchase Target will also be of importance to both Sterling and wider currency movement.
There are several European domestic data releases on Monday of next week. The German Gross Domestic Product data will be of vital influence, and will be interesting considering the string of poor German economic data publications of late.
Also of interest, in terms of potential market movement, is the German and Eurozone Manufacturing PMI’s.
The Eurozone Producer Prices data on Tuesday will be of interest to those invested in the single currency.
Wednesday’s Eurozone Gross Domestic Product data holds the most weighting in terms of wider market movement. The Eurozone Retail Sales data will also be of significance.
Thursday will have several domestic data publications of varying influence. The most important of these are German Factory Orders, German Construction PMI, German Retail PMI, Eurozone Retail PMI, ECB Marginal Lending Facility and ECB Deposit Facility Rate.
The most important European publication on Thursday will be the European Central Bank’s Rate Decision. It is predicted to remain at the low 0.15%.
Friday’s important economic data publication is German Industrial Production.
US Dollar (USD)
There are no economic data publications pertaining to the United States on Monday.
Tuesday’s US data is varied in terms of their economic weighting. The most important of these is the ISM Manufacturing Survey which is valued for its timeliness, and indeed, during waning boom cycles analysts have pointed out that ISM tends to be one of the biggest market moving economic releases.
The ISM Prices Paid and Construction Spending will also be of interest to those invested in the US Dollar.
Wednesday’s MBA Mortgage Applications and Factory Orders hold the most weighting economically.
The Federal Reserve will publish an interesting economic indicator on Wednesday. Commonly known as the Beige Book, this report is published eight times per year. Each Federal Reserve Bank gathers anecdotal information on current economic conditions in its District through reports from Bank and Branch directors and interviews with key business contacts, economists, market experts, and other sources.
Thursday will see a plethora of economic data publications of varied market weighting. The most important of these publications will be the ISM Non-Manufacturing Composite which is expected to decline to 57 from the previous figure of 58.7.
Employment Change, Trade Balance, Initial Jobless Claims and Continuing Claims will also be of importance on Thursday. Those invested in the US Dollar will be hoping that the labour market data prints positively to increase the likelihood of a near-term interest rate hike.
There will also be several domestic data publications on Friday of varying influence over wider market movement. Most important of these publications will be the Change in Non-Farm Payrolls which is expected to increase from 209,000 to 216, 000, and Unemployment Rate which is forecast to drop from 6.2% to 6.1%.
Household Change in Net Worth, Change in Private Payrolls, Underemployment Rate, Two-Month Payroll Net Revision, Average Weekly Hours All Employees, Change in Household Employment and Labour Force Participation Rate will all have potential to influence ‘Greenback’ (USD) movement.
Canadian Dollar (CAD)
There are very few domestic data publications in Canada’s economic calendar next week.
Tuesday’s RBC Canadian Manufacturing PMI will be of interest to those backing the ‘Loonie’ (CAD) although it doesn’t have much influence over wider market movement.
Wednesday of next week will see the most important Canadian economic data publication. The Bank of Canada will decide on the interest rate, which is currently at 1%.
On Thursday the single publication will be of little consequence in terms of wider market movement. International Merchandise Trade is of interest to those wishing to gauge the economic standing of Canada, however. Merchandise Trade differentiates itself from Trade Balance because it does not record intangibles like services, only reporting on physical goods. Because exports of tangibles like oil, gold and manufacturing contribute to a large part of Canada’s GDP, trade data can give critical insight into developments in the economy and into foreign exchange rates.
There are several economic data publications on Friday of varying importance both economically and in terms of wider market movement. Net Change in Employment and Unemployment Rate will be the most likely candidates to provoke ‘Loonie’ movement.
The Full Time Employment Change and the Ivey Purchasing Managers Index will also be of interest to those invested in the Canadian Dollar.