It’s another busy week for the Greenback!
Has the economy really bounced by more than 30% in Q3 2020?
Check out what dollar traders are looking at for the week ahead.
Advance GDP report (Oct 29, 12:30 pm GMT)
- The first reading clocked in at -32.9%, which was slightly better than expected but still a pretty bad number
- USD fell across the board and didn’t come up for air until the next day
- This is Uncle Sam’s first growth reading for Q3 2020
- Analysts see a 30.0% jump after a 31.4% drop in Q2 2020
- A much better than expected release could inspire risk-taking and weigh on the safe-haven dollar anyway
Other closely watched data releases
- New home sales (Oct 26, 2:00 pm GMT) to gain by another 3.5% after a 4.8% jump in August?
- Durable goods orders (Oct 27, 12:30 pm GMT) seen gaining another 0.4% in September
- Core durable goods orders could inch 0.3% higher after a 0.4% print in August
- CB consumer confidence (Oct 27, 2:00 pm GMT) expected at 101.5 (from 101.8)
- Initial jobless claims (Oct 29, 12:30 pm GMT) to remain at 700K+ this week
- Core PCE price index (Oct 30, 12:30 pm GMT) – the Fed’s preferred gauge for inflation – is could slow down from 0.3% to 0.2% in September
Overall dollar demand
- Uncertainty over the outcome of the U.S. Presidential elections could inspire some traders to flee from the U.S. dollar
- Speculations of a stimulus deal will continue to provide volatility for the major currency pairs
- A closely watched, once-every-five-years meeting of the party head honchos in China can also influence overall risk-taking and the demand for the low-yielding dollar
- Top-tier reports from other economies, such as GDP releases in the Eurozone and policy announcements from the BOC, BOJ, and the ECB can also cause intraday volatility for the dollar
- The dollar has lost value against ALL of its major counterparts in the last month
- It saw its deepest losses against CHF, GBP, and NZD
- Stochastic considers the dollar “oversold” against the Kiwi, euro, and franc on the daily time frame
- USD/CAD and USD/JPY look ready to hit oversold status as well
- The dollar was most volatile against the Kiwi, pound, Aussie, and yen in the last seven days