US Data Headlines Monday Session

Monday kicks off a highly active week in the financial markets. On the agenda is a steady stream of US economic data and an important speech from one of the Federal Reserve’s policymakers.

European data headline a light European release schedule on Monday. At 07:00 GMT, Nationwide will report on housing prices for February. A few hours later, the British Bankers Association (BBA) will report on mortgage approvals for the month of January. Approvals are expected to drop to 35,928 from 36,115 in December.

Switzerland will also release fourth quarter employment data at 08:15 GMT. Overall employment levels are expected to rise slightly to 4.963 million, compared with 4.956 million in Q3.

Ahead of the New York session, Federal Reserve Bank of St. Louis President James Bullard will deliver a speech. The remarks are scheduled for 13:00 GMT.

In terms of economic data, the Chicago Fed will release its National Activity Index at 13:30 GMT. The monthly report provides an overview of the nation’s overall economic health. For January, the National Activity Index is expected to read 0.15, down from 0.27 in December.

Later in the session, the Department of Commerce will report on new home sales for the month of January. The sale of new residential units is forecast to edge up 0.1% to a seasonally adjusted annual rate of 642,000. New sales dropped 9.3% the month before.

At 15:30 GMT, the Dallas Fed will report on manufacturing conditions in the Texas region. The Manufacturing Business Index for February is expected to read 28.4, down from 33.4 the previous month.  

In currency news, the US dollar extended its recovery on Monday, with the DXY dollar index hitting a high of 90.00. The index bottomed at fresh three-year lows on 15 February but has since recovered 1.5%.

EUR/USD

Since hitting a high near 1.2600 ten days ago, the EUR/USD has given back nearly 300 pips. Although the pair remains in an uptrend, the bulls appear to be losing momentum as the dollar shows signs of rebounding. The pair is currently trading below 1.2300, with immediate resistance found at the 1.2340 region.

GBP/USD

Cable has also tapered off recent highs, as the US dollar continued to rebound from multi-year lows. The GBP/USD touched a session high of 1.3999 on Monday. The bulls are eyeing the 1.4025 level for signs of a bullish breakout.

USD/JPY

The USD/JPY was little changed on Monday, as the pair continued to hold below 107.00. A rebounding dollar drove the USD/JPY to a high of 107.81 last week. However, prices have been trending lower ever since. The pair has established a bottom of 105.70, which is the low from 16 February. A bearish reversal for the greenback could send USD/JPY below this key threshold.