The upcoming week features interest rate decisions from three major central banks, namely the Federal Reserve, Bank of Japan and Bank of England, as well as top tier data from around the world, including Eurozone PMIs, UK CPI, and New Zealand GDP, where data has taken a sharp downturn of late. Traders will also be monitoring the latest developments regarding the US-China trade spat, US-Iran war of words and the Tory party leadership contest. There will be something for everyone.

Undoubtedly, next week’s main event is likely to be the FOMC rate decision on Wednesday. While rate cut expectations have risen sharply of late, no one is seriously expecting the Fed to loosen its belt at this meeting, despite the weakness in core consumer prices in May. However, what we and most other analysts expect is that the Fed will probably use this meeting to prepare the markets for a potential trim in the July and possibly September and/or December meetings. Look out for the updated dot plots and economic projections.

Here is a full highlight of the upcoming week:

Monday

There is nothing significant on Monday with the exception of Empire State Manufacturing Index and a couple of other not-so-important US macro pointers.

Tuesday

RBA’s meeting minutes, German ZEW survey, Canadian manufacture sales and some housing market data from the US (building permits and housing starts) will be released on Tuesday. These macro pointers are only likely to impact local currencies, albeit mildly. But they probably won’t have much of an implication on the wider markets.

Wednesday

CPI data from UK and Canada will provide FX traders some distraction ahead of the day’s main event: FOMC.

Although the Fed is expected to hold policy unchanged at this meeting, many analysts believe the central bank will nonetheless prepare the markets for potential rate cuts later on in the year, with some suggesting July, September and December as likely dates when rates are expected to be cut. However with expectations being so slow now, the FOMC could surprise by adjusting the dot plots on interest rates outlook only slightly lower: instead of three, it might just signal two cuts in 2019. That could give rise to a potential short term squeeze on the dollar shorts against currencies which have outperformed of late (such as yen and gold).

Thursday

Thursday will kick off with the release of New Zealand GDP (actually it will still be Wednesday for UK and US traders), followed by the Bank of Japan rate decision slightly later. The BoJ has almost run out of ammunition, so it’s hands will be tied. We don’t expect any new policy announcements.

Thursday will also see the release of UK retail sales and a rate decision from the Bank of England. Some BoE policy makers have recently suggested that interest rates should be higher than where they are at the moment, because UK data has been surprisingly resilient. But with other major banks turning dovish and some already cutting interest rates amid concerns over a global slowdown, and not to mention ongoing political and Brexit uncertainties in the UK, the BoE’s Governor Mark Carney may well provide a more dovish assessment of domestic interest rates than the markets expect.

Friday

The first half of Friday’s session will all be about Eurozone PMIs, given concerns over global growth. Should these PMIs disappoint expectations then Eurozone yields and the single currency could fall even more. From North America, the key data on Friday will be retail sales.

Risk Warning Notice Foreign Exchange and CFD trading are high risk and not suitable for everyone. You should carefully consider your investment objectives, level of experience and risk appetite before making a decision to trade with us. Most importantly, do not invest money you cannot afford to lose. There is considerable exposure to risk in any off-exchange transaction, including, but not limited to, leverage, creditworthiness, limited regulatory protection and market volatility that may substantially affect the price, or liquidity of the markets that you are trading. Margin and leverage To open a leveraged CFD or forex trade you will need to deposit money with us as margin. Margin is typically a relatively small proportion of the overall contract value. For example a contract trading on leverage of 100:1 will require margin of just 1% of the contract value. This means that a small price movement in the underlying will result in large movement in the value of your trade – this can work in your favour, or result in substantial losses. Your may lose your initial deposit and be required to deposit additional margin in order to maintain your position. If you fail to meet any margin requirement your position will be liquidated and you will be responsible for any resulting losses.

Feed news

Latest Forex Analysis

Editors’ Picks

EUR/USD below 1.1200 on Draghi's dovishness, amid Trump-Xi meeting announcement

EUR/USD is trading below 1.1200 after ECB President Draghi opened the door to rate cuts. Presidents Trump and Xi will hold an extended meeting at the G-20 Summit. The news cheered markets.

EUR/USD News

GBP/USD hovers above 5-month lows ahead of Conservative leadership contest

GBP/USD is hovering above 1.2500, close to the five-month lows. Conservatives will vote in the second round of their leadership contest. Boris Johnson is set to win again.

GBP/USD News

USD/JPY rallies beyond mid-108.00s on Trump's positive comments

Trump said he will have an extended meeting with the Chinese President next week. This comes on the back of Draghi's dovish comments and triggers risk-on trade. Fading safe-haven demand weighs heavily on the JPY and remained supportive.

USD/JPY News

Fed Preview: Proto-easing

Fed Funds 2.25%-2.50% target range predicted to be unchanged. Market expecting confirmation of easing bias into the second half. FOMC statement wording, especially "patient" and the economic projections important.

Read more

Gold surges through $1350 level, back closer to 14-month tops

Gold built on its strong intraday positive momentum and spiked to fresh session tops, beyond the $1350 level during the early North-American session.

Gold News

Majors

Cryptocurrencies

Signatures