Forecasting the upcoming week: Fedspeak should keep investors entertained

The US Dollar (USD) ended the week slightly lower, coming under renewed selling pressure late in the week after hitting multi-month highs. At the same time, a historic US government shutdown continued to weigh on sentiment, while expectations for another Federal Reserve rate cut in December lost further momentum.

The US Dollar Index (DXY) closed the week with modest losses, setting aside two consecutive weekly advances. The move lower in the index came despite hitting multi-month tops north of the key 100.00 barrier earlier in the week. In the meantime, with the US federal government shutdown still unresolved, data releases on the US docket are expected to remain marginal. The NFIB Business Optimism Index and the ADP Employment Change Weekly are due on November 11. The usual weekly MBA Mortgage Applications are due on November 12, prior to the API’s weekly report on US crude oil inventories. On November 13 will come the EIA’s weekly report on US crude oil stockpiles.

EUR/USD managed to regain balance in the second half of the week, largely surpassing the 1.1500 barrier and allowing it to clock a positive week after two consecutive pullbacks. The Sentix Investor Confidence index in the Euroland is due on November 10. The ZEW Economic Sentiment in Germany and the euro area is due on November 11, while the final Inflation Rate in Germany will be the salient event on November 12. The Industrial Production in the euro bloc comes on November 13, while Balance of Trade and the second estimate of the Q3 GDP Growth Rate will wrap up the calendar on November 14.

There was no respite for the selling pressure around the British Pound for yet another week, prompting GBP/USD to retreat for the third week in a row. The BRC Retail Sales Monitor will precede the release of the UK labour market report on November 11. On November 13 will come the RICS House Price Balance, seconded by the preliminary Q3 GDP Growth Rate, Balance of Trade, Industrial and Manufacturing Production, Construction Orders, and the NIESR Monthly GDP Tracker.

USD/JPY halted its recovery after reaching fresh tops past the 154.00 barrier, leaving behind two weekly advances in a row at the same time. The BoJ will publish its Summary of Opinions on November 10, alongside the Reuters Tankan Index and the advanced Coincident and Leading Economic indexes. Bank Lending figures are due on November 11, followed by Current Account results and the Eco Watchers Survey. Machine Tool Orders are due on November 12, while Producer Prices and the weekly Foreign Bond Investment figures will come out on November 13. The Tertiary Industry Index will close the calendar on November 14.

AUD/USD ended the week with marked losses, reversing three advances in a row and returning to the sub-.6500 region. The final Building Permits and Private House Approvals are expected on November 10. The Westpac Consumer Confidence index is due on November 11 along with the NAB Business Confidence index. Home Loans and Investment Lending for Homes are due on November 12. The Australian labour market report takes centre stage on November 13 alongside Consumer Inflation Expectations gauged by the Melbourne Institute.

Anticipating economic perspectives: Voices on the horizon

• The BoJ’s Nakagawa speaks on November 10.
• The RBA’s Jones will speak on November 11, followed by the ECB’s Lagarde.
• The Fed’s Williams, Barr, Paulson, Miran, Waller and Bostic speak on November 12, alongside the ECB’s Schnabel and De Guindos, and the BoE’s Pill.
• The RBA’s McPhee will speak on November 13, followed by the Fed’s Hammack and the ECB’s Buch, Donnery, Elderson and Machado.
• The Fed’s Logan and Bostic will speak on November 14, seconded by the ECB’s Elderson, Buch and Lane.
• The ECB’s Schnabel speaks on November 15.

Central banks: Upcoming meetings/releases to shape monetary policies

• The BoJ will publish its Summary of Opinions on November 10.
• The Riksbank will release its Minutes on November 11.