News & Analysis at your fingertips.

We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site.

0

Notifications

Notifications below are based on filters which can be adjusted via Economic and Webinar Calendar pages.

Live Webinar

Live Webinar Events

0

Economic Calendar

Economic Calendar Events

0
Free Trading Guides
EUR/USD
Bearish
Oil - US Crude
Mixed
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
Wall Street
Mixed
Gold
Bearish
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
GBP/USD
Bearish
USD/JPY
Bullish
More View more
Real Time News
  • Another turbulent week for the Pound with the currency falling 1.6% against the greenback. Get your $GBPUSD market update from @JMcQueenFX here:https://t.co/WjU4oYpmf7 https://t.co/hkow2om7I6
  • Heads Up:🇺🇸 Fed Williams Speech due at 19:10 GMT (15min) https://www.dailyfx.com/economic-calendar#2020-09-25
  • Commodities Update: As of 18:00, these are your best and worst performers based on the London trading schedule: Oil - US Crude: 0.07% Gold: -0.16% Silver: -0.37% View the performance of all markets via https://www.dailyfx.com/forex-rates#commodities https://t.co/hbSoMksZVd
  • With South Africa recently easing restrictions in an effort to reopen the economy, investors are still wary about the future of the emerging market. Get your $USDZAR market update from @Tams707 here:https://t.co/f5Jmukipg0 https://t.co/o5Dyok2O99
  • IG Client Sentiment Update: Our data shows the vast majority of traders in Ripple are long at 97.38%, while traders in EUR/GBP are at opposite extremes with 65.19%. See the summary chart below and full details and charts on DailyFX: https://www.dailyfx.com/sentiment https://t.co/eO8yAFDUvh
  • Indices Update: As of 18:00, these are your best and worst performers based on the London trading schedule: US 500: 1.06% Wall Street: 0.73% France 40: 0.65% Germany 30: 0.59% FTSE 100: 0.37% View the performance of all markets via https://www.dailyfx.com/forex-rates#indices https://t.co/UFnW7j9LC3
  • Update on #Cryptocurrencies #BITCOIN +0.29% #BITCOINCASH +0.02% #ETHEREUM +0.51% #RIPPLE +3.72% #LITECOIN +2.19%
  • It took some time for USD/MXN to respond to weakness in equity markets, but this week it came to life as U.S. weakness spread across global markets. Get your $USDMXN technical analysis from @PaulRobinsonFX here:https://t.co/G8b6w1wCzH https://t.co/zEtpARMkMg
  • IG Client Sentiment Update: Our data shows the vast majority of traders in Ripple are long at 97.38%, while traders in EUR/GBP are at opposite extremes with 65.20%. See the summary chart below and full details and charts on DailyFX: https://www.dailyfx.com/sentiment https://t.co/WGk95Bnjx5
  • Commodities Update: As of 16:00, these are your best and worst performers based on the London trading schedule: Gold: -0.45% Oil - US Crude: -0.63% Silver: -1.11% View the performance of all markets via https://www.dailyfx.com/forex-rates#commodities https://t.co/RvLy6xA9Is
FX Markets Brace for Big Week: EZ CPI; BOJ, FOMC, & BOE; US NFP

FX Markets Brace for Big Week: EZ CPI; BOJ, FOMC, & BOE; US NFP

2017-10-30 11:20:00
Christopher Vecchio, CFA, Senior Strategist
Share:

Talking Points:

- The Japanese Yen, like the Swiss Franc, continues to track broad risk trends vis-à-vis US Treasury yields.

- The BOE rate hike this week is largely priced-in, meaning forward guidance on the future path of rates will be the determining factor for the British Pound.

- The FOMC meeting this week will be a placeholder before the December rate hike – no surprise given the lack of press conference or a new summary of economic projections.

Join me on Mondays at 7:30 EDT/11:30 GMT for the FX Week Ahead webinar, where we discuss top event risk over the coming days and strategies for trading FX markets around the events listed below.

10/31 Tuesday | --:-- GMT | Bank of Japan Rate Decision

The monthly Bank of Japan Monetary Policy Statement is expected to see rates remain at -0.10% with the 10-year JGB yield target unchanged around 0%. In order to boost inflation to a stable, target, level of 2%, the BOJ controls short-term and long-term interest rates via market intervention, while the central bank has also committed itself to increasing the monetary base until inflation hits target. At the end of the month, the central bank announces which government bond issues it will buy in the next month, with approximate purchase amounts and purchase dates.

Consumer price inflation in Japan rose by +0.7% in September 2017, in-line with market expectations but still well-below the BOJ’s +2% target. It’s worth pointing out that of the +0.7% gain in prices, +0.5% can be attributed to recent gains in energy (+7.6% y/y). It’s also worth noting that as of the end of September 2017, the BOJ owned approximately 45% of all outstanding Japanese government debt. Expect the BOJ to retain the mantle of ‘most dovish G7 central bank’ for the foreseeable future.

Pairs to Watch: AUD/JPY, EUR/JPY, USD/JPY, Gold

10/31 Tuesday | 08:30 GMT | EUR Euro-Zone Consumer Price Index (OCT A)

Inflation remains low in the Euro-Zone, despite near-term advances on the headline CPI figures. European Central Bank President Mario Draghi, at the ECB policy meeting last week, noted that an "ample degree of stimulus is still needed," pointing to "domestic price pressures [remaining] muted" and that "core inflation has yet to show convincing upward trend" to justify the ECB's patience on rates. Incoming inflation figures point to price pressures unchanged at +1.5% y/y in October, perhaps enough to prevent the Euro from falling much more sharply but not enough to spark a complete turnaround.

Pairs to Watch: EUR/GBP, EUR/JPY, EUR/USD

11/01 Wednesday | 18:00 GMT | USD Federal Reserve Rate Decision

The Federal Reserve’s October policy statement should reaffirm the desire to raise rates by the end of the year, although that much information is already priced-in to rates. Given that it is a non-press conference, non-summary of economic projections (SEP) meeting, markets are pricing a 0% chance of a rate move this week, and instead focusing on December, when the odds of a Fed rate hike are now above 93%; prior to the September FOMC meeting, the implied probability was only 45%. Barring a new perspective that convinces market participants that current pricing on 2018 rates hike is wrong (market is pricing in one, Fed says three), this particular FOMC meeting may yield little for the US Dollar.

Pairs to watch: EUR/USD, USD/JPY, DXY Index, Gold

11/02 Thursday | 11:00 GMT | GBP Bank of England Rate Decision

Super Thursday will see Bank of England latest monetary policy announcement and the MPC Quarterly Inflation Report. All UK policy measures are expected to remain unchanged, while the QIR is expected to see near-term growth expectations and inflation forecasts hold steady. The BOE will join the shift among central banks to a more hawkish stance, with rates markets pricing in almost a 100% chance of a 25-bps hike this Thursday. The most recent inflation report showed that price pressures increased from August to September (+2.9% to +3.9% y/y on the headline), and now that the base effect of the weaker British Pound thanks to Brexit has been eliminated, it seem like inflation won’t push much higher than +3% y/y in the near future. It is very possible, if not likely, that this BOE rate hike is ‘one-and-done.’ Guidance on the future path of rates will be the key factor for the British Pound.

Pairs to Watch: EUR/GBP, GBP/JPY, GBP/USD

11/03 Friday | 12:30 GMT | USD Change in Nonfarm Payrolls and Unemployment Rate (OCT)

The key issue surrounding the September US Nonfarm Payrolls report is whether or not the US labor market will remain strong enough to justify a more aggressive pace of Fed tightening in 2018. Current expectations for the data are modest, with the Unemployment Rate expected to hold at 4.2%, and the headline jobs figure to come in at +310K – a clear ‘give-back’ after Hurricanes Harvey and Irma distorted the August payroll figures (producing the first negative NFP in seven years). The trend of +200K jobs growth per month has recently been a psychological level for markets, but Fed leaders and centrists (the Goldilocks of the Fed; not too hawkish or too dovish) tend have another number in mind.

In October 2015, San Fran Fed President John Williams wrote in a research note that he believed growth of +100K jobs per month was enough to sustain the growth in the labor force and maintain the current unemployment rate. In December 2015, Chair Janet Yellen reiterated this same view. And, in late-February 2016, she noted that the economy can maintain its current unemployment rate by producing between 75K and 125K jobs per month. By the Atlanta Fed Jobs Growth Calculator, assuming a 4.3% longer term unemployment rate, the economy only needs +112K job growth per month to sustain that level through the end of 2017.

Read more: After ECB Policy Meeting, Euro Adrift Looking for a Life Boat

--- Written by Christopher Vecchio, CFA, Senior Currency Strategist

To contact Christopher, email him at cvecchio@dailyfx.com.

Follow him in the DailyFX Real Time News feed and Twitter at @CVecchioFX.

To receive this analyst’s reports, sign up for his distribution list.

Don’t trade FX but want to learn more? Read the DailyFX Trading Guides.

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

DISCLOSURES