It was a quieter week on the economic calendar, in the week ending 26th February.
A total of 52 stats were monitored, following 72 stats from the week prior.
Of the 52 stats, 27 came in ahead forecasts, with 19 economic indicators coming up short of forecasts. There were 6 stats that were in line with forecasts in the week.
Looking at the numbers, 26 of the stats reflected an upward trend from previous figures. Of the remaining 26 stats, 22 reflected a deterioration from previous.
For the Greenback, it was back into the green, following two consecutive weeks in the red. The Dollar Spot Index rose by 0.57% to end the week at 90.879. In the previous week, the Dollar had fallen by 0.13% to 90.364.
Out of the U.S
It was a relatively busy week on the economic data front.
The first half of the week was relatively quiet, however, with consumer confidence figures the key stat on Tuesday.
Consumer confidence was on the rise in February, supporting the market’s optimistic outlook on the economic recovery.
On Thursday, jobless claims and core durable goods orders were also positive.
Initial jobless claims fell back from 841k to 730k in the week ending 19th February.
There was also an upward revision to 4th quarter GDP figures. The U.S economy expanded by 4.1%, up from a 1st estimate 4.0%.
At the end of the week, inflation and personal spending figures also drew plenty of attention.
In January, personal spending jumped by 2.4%, more than reversing a 0.4% decline from December.
Inflationary pressures were also on the rise, albeit marginally. The FED’s preferred Core PCE Price Index ticked up from 1.4% to 1.5% at the start of the year.
On the monetary policy front, FED Chair Powell looked to calm market nerves over inflationary jitters over 2-days of testimony.
The calming was short-lived, however, which ultimately led to a jump in the Dollar at the end of the week to close out in positive territory.
In the equity markets, the NASDAQ slid by 4.92%, with the Dow and S&P500 falling by 1.78% and by 2.45% respectively.
Out of the UK
It was a relatively quiet week on the economic data front.
On Tuesday, December’s unemployment rate and January’s claimant count figures were in focus.
Claimant counts rose by 20k, reversing a 20.4k fall from December. The unemployment rate ticked up from 5.0% to 5.1% in December.
While the numbers were Pound negative, government plans to ease lockdown measures supported the Pound early in the week. The Pound had visited $1.41 levels before risk aversion sent the Pound back to sub-$1.40 levels.
In the week, the Pound fell by 0.59% to end the week at $1.3933. In the week prior, the Pound had risen by 1.21% to $1.4016.
The FTSE100 ended the week down by 2.12%, reversing a 0.52% gain from the previous week.
Out of the Eurozone
It was a relatively busy week on the economic data front, with the French and German economies in focus.
From Germany, both business and consumer confidence improved in February and March respectively. Better than expected figures provided EUR support ahead of a pullback later in the week.
German GDP numbers for the 4th quarter were also better than 1st estimate figures giving further support to the EUR.
At the end of the week, however, numbers from France disappointed. The French economy contracted by more than previously thought, with consumer spending sliding in January.
While the stats were skewed in favor of the EUR, risk aversion weighed at the end of the week to leave the EUR in the red.
On the monetary policy front, ECB President Lagarde spoke early in the week, stating that the ECB was monitoring bond yields closely. The comments came as market jitters began to creep in over possible reinflation that could curb spending and shift central bank policy outlooks.
For the week, the EUR fell by 0.36 % to $1.2075. In the week prior, the EUR had fallen by 0.01% to $1.2119.
For the European major indexes, it was bearish week. The CAC40 and the DAX30 fell by 1.22% and by 1.48% respectively, with the EuroStoxx600 sliding by 2.38%.
For the Loonie
It was a quiet week. The markets had to wait for Friday for RMPI numbers, the only stat of the week.
The RMPI jumped by 5.7% in January, following a 3.5% rise in December.
In spite of the positive numbers, however, risk aversion plagued the Loonie late in the week.
Mid-week the Loonie had visited C$1.24 levels, with a week high $1.24679 before falling back into the red.
In the week ending 26th February, the Loonie fell by 0.98% to C$1.2738. In the week prior, the Loonie had increased by 0.64% to C$1.2615.
It was a bearish week for the Aussie Dollar and the Kiwi Dollar.
In the week ending 26th February, the Aussie Dollar slid by 2.07% to $0.7706, with the Kiwi Dollar ending the week down by 0.90% to $0.7233.
A Friday sell-off left the pair in the red for the week.
For the Aussie Dollar
It was a relatively quiet week.
Key stats included 4th quarter wage growth, construction work done, new CAPEX, and January private sector credit figures.
It was a mixed set of numbers that had limited impact on the Aussie Dollar.
Wage growth rose by 0.6% in the 4th quarter, following a 0.1% rise in the 3rd quarter, while construction work took an unexpected fall.
Private new CAPEX impressed, rising by 3% to reverse a 3% fall from the 3rd quarter.
On the credit side, however, private sector credit saw a softer increase, weighed by a further fall in personal credit.
While the stats were mixed, it was a shift in market sentiment late in the week pulled the Aussie Dollar into the red.
For the Kiwi Dollar
It was a busy week.
Retail sales, business confidence and trade data were in focus in the week.
The stats were skewed to the negative, with retail sales falling by more than expected in Q4.
Business confidence also softened in February, with new Zealand’s annual trade surplus narrowing in January.
On the monetary policy front, the RBNZ kept policy unchanged, which was in line with expectations. Unlike the RBA, the RBNZ held back from any surprise moves, giving the Kiwi Dollar a boost.
Risk aversion late in the week reversed the gains, however. The Kiwi Dollar had visited $0.74 levels before a late pullback.
For the Japanese Yen
It was a relatively quiet week, with no major stats until Friday.
At the end of the week, inflation, industrial production, and retail sales were in focus.
While retail sales were down by 2.4% in January, year-on-year, industrial production impressed, rising by 4.2%. In December, industrial production had fallen by 1.0%, with retail sales having fallen by 0.2%.
Deflationary pressure eased in February, which was also positive. Tokyo core consumer prices fell by 0.3% year-on-year, following a 0.4% decline in January.
While the stats were skewed in favor of the Yen, demand for the Dollar spiked as the week progressed, pulling the Yen into the red.
The Japanese Yen fell by 1.06% to ¥106.57 against the U.S Dollar. In the week prior, the Yen had fallen by 0.49% to ¥105.45.
Out of China
It was a particularly quiet week on the data front. There were no stats to provide the markets with direction in the week.
In the week ending 26th February, the Chinese Yuan fell by 0.25% to 6.4737. In the week prior, the Yuan had risen by 0.01% to CNY6.4577.
The CSI300 tumbled by 7.65%, with the Hang Seng sliding by 5.43%.