Several Fed members are giving speeches this week! Will they give clues on what’s beyond a priced in rate cut in July?
Let’s take a look at the dollar’s potential catalysts:
Retail sales (Jul 16, 1:30 pm GMT)
All was good in the hood for Uncle Sam’s retail activity, as it showed 0.5% increase in May. That might be a tad slower than the expected 0.6%, but it’s faster than April’s 0.3% growth!
The core figure, which excludes volatile items such as autos, also improved by 0.5% after showing 0.4% growth in April.
The relatively strong release, coupled with an upward revision to April’s numbers accelerated the dollar’s intraweek uptrend near the end of the week.
Can dollar bulls expect the same surprise this week? Analysts see retail sales gaining another 0.2% in June, with the core figure expected to print a 0.3% uptick after May’s 0.5% increase.
Are U.S. manufacturers feeling the pinch of the U.S.-China trade war? This week we’ll see sneak peeks of Uncle Sam’s manufacturing industry.
The party starts with the NY manufacturing index (Jul 15, 1:30 pm GMT), which is expected to clock in an index figure of 2.0 after June’s -8.6 reading.
Industrial production (Jul 16, 2:15 pm GMT) is next. If you recall, the report rebounded to a five-month high in May, while the manufacturing output component registered its first monthly gain in 2019. Wowza! This week traders only see a 0.1% gain for the report, lower than May’s 0.4% uptick.
Last but not the least is the Philly Fed manufacturing index (Jul 18, 1:30 pm GMT), which could show us an index reading of 5.0 after printing a 0.3 figure in June.
FOMC member speeches
One of the biggest stories last week is Fed Chairman Powell all but confirming a rate cut in July.
Question is, will Fed members be satisfied with just one rate cut this year? Or do some of them feel like cutting a bit more before the year ends?
The slew of FOMC members speaking this week should give some clarity. New York’s John Williams, who thinks that “arguments for adding policy accommodation have strengthened over time” will give a speech today at 1:50 pm GMT in New York. He’ll be back July 18 at 7:15 pm GMT to talk monetary policy in the same city.
Chicago’s Charles Evans, who thinks that “a couple of rate cuts” that would bring PCE to 2.2% is a “perfectly acceptable, good outcome” has a TV appearance on CNBC on July 16 at 8:30 pm GMT.
St. Louis’ James Bullard is also up with a speech scheduled in New York on July 19, 405 pm GMT. Bullard has recently shared his support for a 50 basis-point rate cut by the end of the year.
Last on this week’s list is Boston’s Eric Rosengren, who will participate in a panel discussion in New York on July 19, 9:30 pm GMT. Rosengren is considered one of the hawkish members in the group.
All of these men are VOTING members on July’s meeting, so y’all better pay attention to what they have to say!
Missed last week’s price action? Read USD’s price recap for July 8 – 12!