Forecasting the upcoming week: Investors’ attention remains on Trump and US CPI

The US Dollar wrapped up its sixth straight week of gains, driven by renewed enthusiasm around what’s been dubbed the "Trump trade." Adding fuel to the rally, Fed Chair Powell’s optimistic take on the domestic economy gave investors more reasons to bet on the Greenback.

The US Dollar Index (DXY) ended the week on a positive note and near the 105.00 barrier amidst mixed US yields and a marked pullback in the risk complex. The RCM/TIPP Economic Optimism Index is due on November 12, seconded by the NFIB Business Optimism Index, and Consumer Inflation Expectations. The usual weekly Mortgage Applications, Inflation Rate, and the API’s weekly report on US crude oil inventories will be published on November 13. Producer Prices are due on November 14, seconded by the usual weekly Initial Jobless Claims, and the EIA’s weekly report on US crude oil stockpiles. Closing the weekly docket will be the publication of Retail Sales, Export and Import Prices, Industrial and Manufacturing Production, the NY Empire State Manufacturing Index, and Business Inventories.

EUR/USD resumed its downtrend on Friday, revisiting the 1.0730 region on the back of the resumption of the buying pressure in the US Dollar. Germany’s final Inflation Rate is expected on November 12, seconded by the Economic Sentiment tracked by the ZEW institute in Germany and the euro area and Current Account results in Germany. The EMU’s Employment Change comes on November 14, followed by the second estimate of Q3 GDP Growth Rate in the euro bloc, Industrial Production, and the ECB Accounts.

Unlike its risk peers, GBP/USD ended the week with modest gains below the 1.3000 barrier, managing to reverse five consecutive weekly declines at the same time. The UK labour market report is due on November 12, while the RICS House Price Balance, the advanced Q3 GDP Growth Rate, Goods Trade Balance, Industrial and Manufacturing Production, Business Investment, Construction Output, and the NIESR Monthly GDP Tracker are all due on November 14.

A choppy week left USD/JPY with marginal losses above the 152.00 hurdle in the weekly chart, setting aside a five-week positive streak. The BoJ Summary of Opinions, Current Account results, Bank Lending, and the Eco Watchers Survey will all be released on November 11. Machine Tool Orders are expected to be released on November 12, while Producer Prices will be released on November 13. The usual weekly Foreign Bond Investment figures will come on November 14, prior to the publication of the flash Q3 GDP Growth Rate, Capacity Utilisation, the final Industrial Production and the Tertiary Industry Index, all expected on November 15.

Despite Friday’s strong retracement, AUD/USD managed well to regain some composure and halt a multi-week bearish leg. The Westpac Consumer Confidence Index comes on November 12 along with the NAB Business Confidence gauge. The Q3 Wage Price Index is due on November 13, while Consumer Inflation Expectations and the Australian labour market report will be unveiled on November 14.

Anticipating Economic Perspectives: Voices on the Horizon

• The ECB’s McCaul will speak on November 11.
• The Fed’s Waller, Barkin, Kashkari, and Harker will speak on November 12, along with the ECB’s Cipollone.
• The Fed’s Logan, Musalem, and Schmid are due to speak on November 13.
• The Fed’s Barkin, Kugler, Williams, and Powell are expected to speak on November 14, seconded by the ECB’s De Guindos and Schnabel.
• The ECB’s McCaul, Lane and Cipollone will speak on November 15.

Central Banks: Upcoming Meetings to Shape Monetary Policies

• Banxico will decide on interest rates on November 14.