Forecasting the upcoming week: FOMC Minutes take center stage next week

Agustin Wazne FXStreet

The US Dollar Index (DXY) extended its slide on Friday, holding below 100.00 at fresh lows after a fourth straight soft US data print. The preliminary Michigan Consumer Sentiment survey fell to 51 in August from 55.2, well short of forecasts, capping a week that also brought cooler inflation and a weak Retail Sales report.

As a result, bets on a September Federal Reserve (Fed) rate hike have faded further. The coming week hands the Dollar no top-tier data of its own. Instead, Wednesday's Federal Open Market Committee (FOMC) Minutes from the July meeting take center stage, offering the detail behind the hawkish split that unsettled markets late last month.

US Dollar Price Today

The table below shows the percentage change of US Dollar (USD) against listed major currencies today. US Dollar was the strongest against the Japanese Yen.

	USD	EUR	GBP	JPY	CAD	AUD	NZD	CHF
USD		-0.34%	-0.37%	-0.08%	-0.41%	-0.33%	-0.65%	-0.10%
EUR	0.34%		-0.02%	0.24%	-0.11%	0.00%	-0.31%	0.22%
GBP	0.37%	0.02%		0.28%	-0.08%	0.04%	-0.26%	0.25%
JPY	0.08%	-0.24%	-0.28%		-0.32%	-0.26%	-0.59%	-0.03%
CAD	0.41%	0.11%	0.08%	0.32%		0.07%	-0.23%	0.29%
AUD	0.33%	0.00%	-0.04%	0.26%	-0.07%		-0.31%	0.22%
NZD	0.65%	0.31%	0.26%	0.59%	0.23%	0.31%		0.55%
CHF	0.10%	-0.22%	-0.25%	0.03%	-0.29%	-0.22%	-0.55%

The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the US Dollar from the left column and move along the horizontal line to the Japanese Yen, the percentage change displayed in the box will represent USD (base)/JPY (quote).

Elsewhere, the United Kingdom (UK) delivers a full slate of jobs on Tuesday, inflation on Wednesday and Retail Sales on Friday while Japan opens the week on Sunday with second-quarter Gross Domestic Product (GDP). China's July activity data on Monday and a People's Bank of China (PBoC) rate decision on Thursday set the tone for the commodity currencies, and flash PMIs across the major economies close the week on Friday.

EUR/USD ends the week in the upper 1.1500s, at fresh two-month highs and within reach of 1.1600. The Eurozone calendar is light on surprises: the German ZEW survey lands on Tuesday. Friday's flash PMIs are the main domestic test. With the ECB content to wait, the pair stays a Dollar story.

GBP/USD trades near three-month peaks around 1.3560 as it closes the week. Tuesday brings the UK labor market report, Wednesday the July inflation figures, headline Consumer Price Index (CPI), is seen accelerating toward 3%, and Friday Retail Sales. A hot inflation print would complicate the Bank of England's (BoE) path and could hand Cable fresh support, while a soft set of numbers would give it its first real domestic drag in weeks.

USD/JPY ends the week in the low-159.00s, with a weak Yen offsetting the softer Dollar after the pair's sharp swings earlier this month. Japan's own calendar is busier than usual with second-quarter GDP on Sunday, seen at 0.5% on the quarter, and National inflation figures later in the week.

AUD/USD trades around 0.7080, its best in two months. With the Reserve Bank of Australia (RBA) having already met, attention turns to Thursday's jobs report, employment growth is expected to slow sharply from June's pace and to China. Monday's Chinese Industrial Production and Retail Sales and Thursday's PBoC decision will steer the Aussie as much as anything at home.

West Texas Intermediate (WTI) Oil ends the week in the low-$80s per barrel, firmer on Friday after a choppy stretch. With no major oil-specific data due, the crude story stays tied to the Strait of Hormuz, where traffic has been slow to recover even after the waterway was declared open.

Gold ends the week near $4,380, closing in on $4,400 after a strong run built on the sliding Dollar and fading Fed hike bets. With no top-tier US data due, Wednesday's FOMC Minutes are the key event: a dovish read would extend the move.

Author

Agustin Wazne

FXStreet

Agustin Wazne joined FXStreet as a Junior News Editor, focusing on Commodities and covering Majors.

GBP/USD hits multi-week tops around 1.3560

GBP/USD gathers fresh steam and advances to new three-month peaks near the 1.3560 zone on Friday. Cable’s sharp move higher comes after three daily drops in a row and follows the increasing selling pressure hurting the Greenback.

EUR/USD pops to fresh two-month highs, targets 1.1600

EUR/USD advances markedly, revisiting the upper 1.1500s for the first time since mid-June. The pair’s sharp uptick comes on the back of a strong retracement in the US Dollar amid BoJ intervention chatter and despite steady uncertainty in the Middle East.

Gold picks up pace, approaches $4,400

Gold rebounds toward the $4,400 mark per troy ounce on Friday, reversing the previous day’s pullback. The precious metal’s recovery comes as fresh and intense weakness keep weighing on the US Dollar, while traders keep assessing easing expectations of an imminent Fed interest rate hike and the situation from the Middle East.

Pi Network Price Forecast: PI extends consolidation as bulls eye $0.10

Pi Network (PI) price holds steady on Friday, maintaining a consolidating tone for three consecutive days. Mild retail strength in the PI token remains stable, with Open Interest above $9 million, while social buzz eases. PI token’s technical outlook is mixed, as bearish momentum wanes to neutral, with bulls eyeing the $0.1000 psychological level.

Weekly focus: Some relief in US inflation concerns

Actual inflation data for July came out as expected with a 0.1% m/m increase in headline CPI and 0.2% excluding food and energy. Annual headline inflation remains too high at 3.4% and means that wage earners are experiencing stagnating spending power at best, and core inflation is a bit higher than the inflation target of two percent would suggest.

Why is Crude Oil priced for a reopening the ships haven't made?

Fourteen vessels crossed the Strait of Hormuz on Tuesday. Before the war, the count ran near 120 a day. In the sessions since the waterway was publicly declared open, Brent has drifted back to $87 and West Texas Intermediate (WTI) to $81, both a little lower again on Wednesday, with daily momentum on each unwound from the top of its range in late July to the low twenties now.