|

Forecasting the Coming Week: US inflation figures grab all the attention

Following Monday’s Powell-driven sharp rebound in the US Dollar, the risk-linked galaxy managed to regain some balance as the sessions passed by, sparking a decent recovery in the likes of the single currency and the British Pound in an environment broadly dominated by speculations surrounding the potential timing of interest rate cuts by the Federal Reserve.

On Monday, the only release in the US docket will be the January Monthly Budget Statement. Moving forward, the US Inflation Rate is due on February 13, while Retail Sales, Industrial Production, Business Inventories, the NAHB Housing Market Index and Net Long-term TIC Flows are expected on February 15. Finally, Producer Prices, Housing Starts, Building Permits, and the preliminary Michigan Consumer Sentiment all be published on February 16. The USD Index (DXY) entered a small consolidative range following Monday’s sharp rebound to fresh YTD peaks past 104.00.

In the domestic data space, the Economic Sentiment for both Germany and the euro area tracked by the ZEW institute comes on February 13. Additionally, another revision of the Q4 GDP Growth Rate along with Industrial Production readings is due on February 14. The Balance of Trade figures in the euro bloc for the month of December will close the docket on February 15. EUR/USD ended the week on a positive note, regaining some balance following Monday’s steep decline. The pair continues to target the 1.0800 hurdle in the very near term.

It will be an interesting week, data-wise, in the UK. The labour market report is due on February 13, followed by the Inflation Rate on February 14. On February 15, the GDP figures, Balance of Trade, Construction Output, and Industrial and Manufacturing Production are due, all ahead of the NIESR GDP Tracker, Finally, Retail Sales for the month of January will be released on February 16. The weekly recovery in GBP/USD appears to have stalled just ahead of the 1.2650 zone so far.

In the Japanese calendar, Producer Prices are due on February 13 ahead of Industrial Production and the flash Q4 GDP Growth Rate on February 15. Weekly Foreign Bond Investment and the Tertiary Industry Index are both due at the end of the week. USD/JPY approaches the key 150.00 barrier on the back of the intense pick-up in selling pressure around the Japanese currency.

In Australia, the Westpac Consumer Confidence Index kickstarts the week ahead of the publication of the labour market report and Consumer Inflation Expectations on February 15. It was a choppy week for AUD/USD, which extended the trade in the lower end of the range around the 0.6500 zone.

Anticipating Economic Perspectives: Voices on the Horizon

  • RBA A. Kohler, BoE Governor A. Bailey and Minneapolis Fed N. Kashkari speak on February 12.
  • FOMC Governor M. Barr speaks on February 14.
  • RBNZ Governor A. Orr, ECB Board member J. Nagel are due to speak on February 15, along with BoE MPC members C. Mann and M. Greene.
  • On February 16, San Francisco Fed M. Daly, Atlanta Fed R. Bostic and BoE MPC member H. Pill are also seen delivering speeches.

Author

Pablo Piovano

Born and bred in Argentina, Pablo has been carrying on with his passion for FX markets and trading since his first college years.

More from Pablo Piovano
Share:

Editor's Picks

EUR/USD remains below 1.1850 after US data

EUR/USD struggles to gain traction and trades in a narrow range below 1.1850 on Wednesday. The US Dollar stays resilient against its rivals following the better-than-expected Durable Goods Orders and housing data, limiting the pair's upside ahead of FOMC Minutes. 

GBP/USD stays in narrow channel above 1.3550 ahead of FOMC Minutes

GBP/USD holds its ground following Tuesday's slide and moves sideways above 1.3550 midweek. Although the data from the UK confirmed that inflation cooled in January, the positive shift seen in market mood helps the pair keep its footing as investors wait for the Fed to publish the minnutes of the January policy meeting.

Gold regains some shine, retargets $5,000 ahead of FOMC Minutes

Gold gathers fresh upside traction on Wednesday, leaving part of the weakness seen at the beginning of the week and refocusing its attention to the key $5,000 mark per troy ounce, all ahead of the release of the FOMC Minutes and despite the modest uptick in the US Dollar.

Fed Minutes to shed light on January hold decision amid hawkish rate outlook

The Minutes of the Fed’s January 27-28 monetary policy meeting will be published today. Details of discussions on the decision to leave the policy rate unchanged will be scrutinized by investors.

Mixed UK inflation data no gamechanger for the Bank of England

Food inflation plunged in January, but service sector price pressure is proving stickier. We continue to expect Bank of England rate cuts in March and June. The latest UK inflation read is a mixed bag for the Bank of England, but we doubt it drastically changes the odds of a March rate cut.

Top 3 Price Prediction: Bitcoin, Ethereum, and Ripple face downside risk as bears regain control

Bitcoin, Ethereum, and Ripple remain under pressure on Wednesday, with the broader trend still sideways. BTC is edging below $68,000, nearing the lower consolidating boundary, while ETH and XRP also declined slightly, approaching their key supports.