Last week the USD went up in the currency market. Positive US macro-economic statistics has raised investors’ expectations of the interest rate hike before the end of this year, may be in September. Investors continue to withdraw money from safe-haven assets, such as gold and the Yen, oil prices also continue to decline despite the reduction in oil reserves in the USA.
At the meeting last week the ECB left interest rate unchanged. The volume of bond purchases was also left unchanged at the level of 80 billion euros (88 bilion USD) per month; interest rate was kept at 0% (the rate on deposits for the commercial banks is -0.4 per cent). The ECB President Mario Draghi did not speak about future prospects of the Bank's policy in his speech.
Macro-economic data scheduled for the release this week is as follows:
00:45 (GMT+2) – Foreign trade balance of New Zealand.
15:45 – Markit preliminary business activity index (PMI) in the USA for July.
16:00 – US consumer confidence index for July; sales of new homes in the USA for June.
22:30 – American Petroleum Institute (API) will issue report on changes in oil reserves in the USA for the previous week.
03:30 – Australian inflation data for Q2, including consumer price index and core inflation index; if inflation in Q2 is below the forecast, the RBA can lower interest rate at the meeting on 2 August.
08:00 – Gfk consumer confidence index in Germany for August, a leading indicator assessing consumer confidence into economic growth of the country.
08:00 – consumption indicator UBS in Switzerland for June, consisting of five components: sales of new cars, activity in the retail sales sector, the number of nights booked in hotels of Switzerland, consumer confidence and volume of credit card transactions.
10:30 – British GDP for Q2 (includes 3-month period before Brexit). British GDP is one of the highest in the world. It is expected that the index will grow by 2.1% on annual basis. Leading sector of the British economy is a service sector (75% of GDP), financial service sector amounts to 27.7 % of GDP. The country is one of the leading financial centers of the world; its exports amounts to 10 % of the total world export of financial services (banking, insurance, brokerage, advisory, and software). If British GDP shows the decline, interest rate in the UK can be lowered at the meeting of the Bank of England on 4 August. This fact may also cause the decline in the Pound.
14:30 – Orders for durable goods in USA for June. This index shows the value of orders received by manufacturers of durable goods and which require large investments. It is expected that the index will decline by 1.1% against the previous month ( 2.3% in May).
16:00 – Pending home sales in the USA in June.
16:30 – US Department of energy will issue a weekly report on oil and oil products stocks in the warehouses.
20:00 – Interest rates decision by the US Fed. Changes are not expected. Investors' attention will be focused on the Fed's comments as they may indicate future prospects of its monetary policy in the USA
08:30 – press conference of the Bank of Japan, it is expected that the head of the Bank Mr. Kuroda will assess prospects for Japanese economy and price dynamics and will indicate outlook of the monetary policy in the country. Next day (on Friday) the Bank of Japan will make interest rate decision.
09:55 – unemployment rate in Germany for July. Changes are not expected. Currently unemployment rate is at the level of 6.1%.
11:00 – consumer confidence and business climate indices, as well as business optimism sentiment in the Eurozone for July (final release).
14:00 – Preliminary consumer price index in Germany for July.
14:30 – Initial applications for unemployment benefit in the USA for the previous week
01:05 – Gfk consumer confidence index in the UK for July. This is a leading indicator showing consumer confidence into the economic activity in the country.
01:30 – Important Japanese macro-economic statistics fir June-July.
03:00 – Interest rate decisions by the Bank of Japan and following up. It is expected that the rate will be lowered to -0.2%. This decision will trigger sharp rise in the JPY and the rise in the Japanese stock market. If the rate remains unchanged, the Yen will continue to rise in the market.
Expectations of the decrease in the interest rate caused the rise in the pair by 600 points in the past two weeks. According to some predictions the Bank of Japan will increase the program of asset purchase up to 1 trillion yens (9.7 billion USD) per year and expand government bond purchase program and investment trusts of real estate by 67%.
09:00 – KOF leading indicator index in Switzerland for July. This index shows economic stability in the country.
10:30 – consumer lending in the UK for June.
11:00 – Preliminary macro-economic statistics of Eurozone: GDP in Q2, unemployment rate in June, consumer price index for July.
14:30 – US preliminary macro-economic statistics for Q2: GDP, price index and personal consumption expenditures.
14:30 – Canadian GDP for May.
19:00 – Oilfield services company Baker Hughes will issue report on the number of operating drilling rigs in the USA, which is an important indicator of activity in the US oil sector. This index has a strong impact on the oil prices. At the moment there are 462 operating rigs in the USA
source - liteforex.com