Forex Previews

Softer US inflation may build case for more aggressive easing by Fed – Forex News Preview

Posted on March 9, 2020 at 3:32 pm GMT

Consumer and producer price figures – due Wednesday and Thursday, respectively, at 13:30 GMT – will be the main release out of the United States this week. But with the economic climate being presently overrun by the sweeping coronavirus epidemic, the data will probably be overlooked as policymakers pay more attention to forward looking indicators. It also means there’s likely to be more pain to come for the tumbling US dollar, which has been battered by the collapse in Treasury [..]

Week Ahead – Will the divided ECB underdeliver?

Posted on March 6, 2020 at 2:39 pm GMT

The main event next week will be the European Central Bank (ECB) policy meeting, where markets are pricing in a 90% probability for a rate cut even though economists forecast no action. It’s a close call, but the fragmented ECB may opt for more targeted lending measures to shield the economy from the virus fallout, not a rate cut. There’s also a raft of economic data coming up, alongside the UK government budget. All told, markets will continue to dance [..]

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Chinese exports probably plunged in February on virus shutdowns – Forex News Preview

Posted on March 6, 2020 at 2:10 pm GMT

China will report trade numbers for February on Saturday – the first since authorities imposed lockdowns on many cities – and so the data will be seen as an important barometer to how badly business activity was impacted by the outbreak of the coronavirus. Any indication that the factory shutdowns had a far more devastating effect on the economy than is currently being predicted is likely to spark more panic selling of risk assets when markets open on Monday. January [..]

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Canadian jobs data may flag more rate cuts as loonie skids – Forex News Preview

Posted on March 5, 2020 at 3:11 pm GMT

After the Bank of Canada slashed interest rates this week, expectations are running high that more will follow, and the next clue may come from Canada’s jobs numbers on Friday (13:30 GMT). While the BoC’s bigger-than-expected cut this week was primarily motivated by the virus fallout, there have been a few other trouble spots lurking in the Canadian economy lately, which could weigh on the struggling loonie if they appear to have impacted employment growth in February. Jobs growth probably [..]

US nonfarm payrolls: An asymmetric risk? – Forex News Preview

Posted on March 5, 2020 at 11:55 am GMT

The latest US employment data will hit the markets at 13:30 GMT on Friday and although forecasts point to another decent report, that may not be enough to stop the Fed from cutting rates again soon amid virus concerns. As for the dollar, there might be more pain to come in the near term as continued Fed rate cuts would further erode its carry appeal, especially if the ECB fails to live up to the market’s dovish expectations next week. [..]

Bank of Canada to likely cut rates as virus risks grow – Forex News Preview

Posted on March 3, 2020 at 4:39 pm GMT

The Bank of Canada is expected to join the Federal Reserve and Reserve Bank of Australia in cutting interest rates this week as the global wave of central bank action to counter the economic fallout from the coronavirus outbreak begins. The BoC will announce its decision on Wednesday at 15:00 GMT and is widely anticipated to lower its overnight target rate by 25 basis points. Expectations of policy easing have pulled the Canadian dollar to 9-month lows as the virus [..]

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ISM PMIs could upset dollar if virus impact confirmed – Forex News Preview

Posted on February 28, 2020 at 2:29 pm GMT

The deterioration in the US preliminary IHS Markit PMI survey in February was partially attributed to the coronavirus outbreak and markets are now turning their attention to the more important ISM PMI indices for release on Tuesday (manufacturing) and Thursday (non-manufacturing) at 15:00 GMT to confirm potential disruptions in US business activities. Should the numbers ratify concerns, especially those for the services sector, the sliding dollar may push for more losses. ISM services PMI may not show contraction after all  The deadly Covid-19 disease is spreading fast [..]

Week Ahead – RBA and BoC meet: no virus stimulus yet; US jobs report also in focus

Posted on February 28, 2020 at 1:54 pm GMT

Central banks in Australia and Canada will hold policy meetings next week – the first since the outbreak of the coronavirus escalated into a global crisis. But with policymakers having limited firepower, they will probably maintain a wait-and-see approach until a clearer picture starts emerging about the impact of the virus, whose spread has multiplied several-fold in the past week. Investors will also be waiting anxiously for the latest nonfarm payrolls report out of the United States as they push [..]

RBA meeting: Cautious language and rate cut hints – Forex News Preview

Posted on February 28, 2020 at 1:32 pm GMT

The Reserve Bank of Australia (RBA) will wrap up its policy meeting early on Tuesday, at 03:30 GMT. Markets assign a 20% chance for an immediate rate cut, so if the RBA keeps policy unchanged, the aussie could spike higher on the decision. That being said, policymakers will probably strengthen their easing bias and send clear signals that rates may be cut as soon as April, so any positive reaction might remain short lived and the devastated currency could resume [..]

Canadian Q4 GDP eyed ahead of BoC meeting – Forex News Preview

Posted on February 26, 2020 at 2:57 pm GMT

Canada will report GDP numbers for the fourth quarter on Friday (13:30 GMT) when trade tensions and industrial strikes are expected to have ground growth to a near halt. With economic conditions not likely to have improved in the first quarter, the data will be watched carefully by policymakers at the Bank of Canada, who meet next week. In the meantime, the Canadian dollar has stumbled near 4-month lows versus its US counterpart, weighed by weaker oil prices.   GDP [..]

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