Forecasting the upcoming week: Fed speakers and flash PMIs take the driver’s seat

The US Dollar (USD) notched another positive week, underpinned by growing optimism over the recently clinched US-China trade agreement. Investor focus now shifts to upcoming US PMI prints and Fed officials’ views on the likely rate path in the months ahead.

The US Dollar Index (DXY) extended its rally, consolidating above the key psychological threshold at 100.00. The upward move was supported by optimism surrounding the US–China trade deal and the market’s repricing of the Fed’s rate trajectory. Looking ahead, the CB Leading Index is scheduled for May 19, followed by the API’s weekly report on US crude inventories on May 20. The MBA Mortgage Applications release is due on May 21, alongside the EIA’s weekly report on US crude oil stockpiles. A busy day on May 22 includes the Chicago Fed National Activity Index, advanced S&P Global Manufacturing and Services PMIs, Existing Home Sales, and Initial Jobless Claims. The week concludes with New Home Sales on May 23.

EUR/USD remained under pressure, though it found support above multi-week lows near 1.1060. On May 19, the spotlight falls on the final Inflation Rate in the euro area. Germany’s Producer Prices are set for release on May 20, along with EMU’s Current Account, Construction Output, the Labour Cost Index, and the European Commission’s flash Consumer Confidence. On May 22, markets await preliminary HCOB Manufacturing and Services PMIs for Germany and the eurozone, followed by Germany’s IFO Business Climate and the ECB Monetary Policy Meeting Accounts. The calendar wraps on May 23 with Germany’s final Q1 GDP Growth Rate and the ECB’s Negotiated Wage Growth.

GBP/USD traded sideways near the upper boundary of its recent range, ending the week modestly lower, with resistance firmly in place near 1.3400. The UK data calendar begins on May 21 with the UK Inflation Rate, followed by Public Sector Net Borrowing, CBI Industrial Trends Orders, and advanced S&P Global Services and Manufacturing PMIs on May 22. GfK’s Consumer Confidence and Retail Sales are due on May 23.

USD/JPY held onto weekly gains for the fourth consecutive week, despite easing back from levels above 148.00 to settle closer to the 146.00 zone. Japan’s Tertiary Industry Index is due on May 19, with Balance of Trade results following on May 21. Key releases on May 22 include the Reuters Tankan Index, Machinery Orders, Foreign Bond Investment, and preliminary Jibun Bank Manufacturing and Services PMIs. The closely watched Inflation Rate rounds out the week on May 23.

AUD/USD posted a second straight weekly loss, weighed down by continued selling pressure after recent year-to-date highs above 0.6500. Market focus now turns to the RBA’s interest rate decision on May 20, followed by the Westpac Leading Index on May 21. Flash S&P Global Manufacturing and Services PMIs will be released on May 22.

Anticipating economic perspectives: Voices on the horizon

• The Fed’s Bostic, Jefferson, Williams, Logan and Kashkari speak on May 19.
• The Fed’s Barkin, Bostic, Collins, Musalem and Kugler will speak on May 20, along with the ECB’s Donnery, Cipollone and Buch, and the Boe’s Pill.
• The Fed’s Daly, Hammack and Barkin speak on May 21, seconded by the ECB’s Lane.
• The BoJ’s Noguchi speaks on May 22, ahead of the RBA’s Hauser, the BoE’s Breeden, Dhingra and Pill, the ECB’s Elderson and De Guindos, and the Fed’s Williams.
• The ECB’s Lane and Schnabel will speak on May 23, along with the Fed’s Cook.

Central banks: Upcoming meetings to shape monetary policies

• The PBoC will decide on rates on May 20 (3.10% act., 3.10% exp., 3.60% act., 3.60% exp.)
• The RBA meets on May 20 (4.10% act, 3.85% exp.)