Start your trading prep for the week with a quick review of last week’s forex action and an overview of catalysts lined up for the major currencies.
The Greenback had its share of good days, particularly during the release of the FOMC minutes, but was unable to finish the previous trading week on a positive note when the NFP report disappointed.
This week’s major reports, namely the CPI and retail sales figures, won’t come around until Friday, so dollar price action could be driven by what Fed policymakers have to say. Read more.
Thanks to stronger than expected jobs figures, the Loonie left its peers eating dust last week, even though it drew little support from the crude oil rally.
The lack of top-tier data from Canada this week could leave the currency with less to hang on to, though, so it might be more sensitive to other catalysts instead. Read more.
EUR & CHF
Hawkish ECB rhetoric paved the way for a positive euro run in the previous week, allowing the shared currency to have a stronger reaction to upbeat data like the services PMI.
Another round of medium-tier reports are on this week’s docket, but euro traders might hold out for more policymakers’ remarks in the ECB minutes. However, recall that the shared currency had a bearish reaction to the December statement even as the central bank upgraded growth forecasts. Read more.
Sterling was able to shrug off a couple of PMI misses as underlying data and trends showed a lot of promise. Besides, PM May’s announcement of her plans to reshuffle the cabinet spurred expectations of a stronger Brexit bargaining stance.
The attention could be fixed on who PM May taps as her new cabinet ministers, especially since there’s not much in the way of top-tier reports other than the U.K. manufacturing PMI. Read more.
Bond yields and risk sentiment were the main drivers of yen price action in the previous week, and we might see more of the same behavior in the next few days.
In particular, the lower-yielding currency could give up its risk-off gains to the U.S. dollar if FOMC members continue to shore up expectations for Fed tightening. Read more.
The Aussie was having a pretty good week riding on the back of gold price gains and upbeat Chinese data until the Land Down Under’s trade balance was released and caused bears to jump in.
This week would be another light one, with only the Australian retail sales on tap. Chinese CPI and trade balance are on the docket. Read more.
Positive Chinese data also lifted the commodity-related Kiwi for the most part of last week, even with the slight dip when risk-taking took a hit.
There are no top-tier reports due from New Zealand this week, which means that the higher-yielding Kiwi could be vulnerable to changes in sentiment once again. Read more.