On the Macro
It’s a busy week ahead on the economic calendar, with 77 stats in focus in the week ending 19th February. In the week prior, 33 stats had been in focus.
For the Dollar:
It’s a busy week ahead.
In the 1st half of the week, January retail sales and industrial production figures will be in focus.
Expect retail sales figures to be the key driver.
The focus will then shift to Philly FED Manufacturing PMI numbers and weekly jobless claims figures on Friday.
While we would expect plenty of sensitivity to the jobless claim figures, the PMI numbers will also influence.
At the end of the week, prelim private sector PMI numbers for February wrap things up on Friday. The Services PMI will likely have the greatest impact on the day.
Other stats include wholesale inflation and housing sector data along with NY Empire State Manufacturing figures. These stats should have a muted impact on the markets, however.
On the monetary policy front, the FOMC meeting minutes are also due out on Wednesday. Expect the minutes to influence. The markets will be looking for the Committee to be aligned with Powell’s recent forward guidance.
The Dollar Spot Index ended the week down by 0.62% to 90.480.
For the EUR:
It’s also a busy week ahead on the economic data front.
In the 1st half of the week, economic data for Germany and the Eurozone will be in focus.
2nd estimate GDP numbers for the 4th quarter and ZEW Economic Sentiment figures for February are due out.
Industrial production and trade data for the Eurozone will also draw attention at the start of the week.
On Thursday, finalized January inflation and consumer confidence figures for the Eurozone are due out ahead of a busy Friday.
Prelim private sector PMI numbers for France, Germany, and the Eurozone are due out on Friday.
While Germany’s Manufacturing PMI will have the greatest influence, also expect sensitivity to the rest of the PMIs. Lockdown measures are likely to hurt the services sector further in February. Any impact on the manufacturing sector and expect the EUR to come under pressure.
On the monetary policy front, the ECB monetary policy meeting minutes are due out on Thursday. We can expect plenty of interest. In the last press conference, ECB President stood by the ECB growth forecasts. Lagarde did warn of downside risks, however.
The EUR ended the week up by 0.61% to $1.2120.
For the Pound:
It’s another busy week ahead on the economic calendar.
On Wednesday, January inflation figures are due out ahead of a busy Friday.
At the end of the week, January retail sales and February prelim private sector PMIs will be in focus.
Expect the retail sales and services PMI numbers to have the greatest impact on the Pound.
Other stats include CBI industrial trend orders for February. Barring particularly dire numbers, however, the stats should have a muted impact on the Pound.
The Pound ended the week up by 0.83% to $1.3849.
For the Loonie:
It’s a relatively busy week ahead on the economic calendar.
January inflation figures on Wednesday and December retail sales figures on Friday will influence.
Other stats include manufacturing sales, housing stats, and foreign security purchases. We don’t expect too much influence from the numbers, however.
From elsewhere, expect the PMI numbers from the Eurozone and the U.S to also influence. Week numbers would question the market optimism towards the economic outlook… Any shift in sentiment would weigh on crude oil prices and the Loonie.
The Loonie ended the week up by 0.47% to C$1.2696 against the U.S Dollar.
Out of Asia
For the Aussie Dollar:
It’s another relatively quiet week.
January employment figures are due out on Thursday ahead of wage growth figures on Friday.
Expect the employment numbers to have the greatest impact. Consumer spending remains key to an economic recovery. A weakening in labor market conditions would test support for the Aussie Dollar.
On the monetary policy front, the RBA meeting minutes will also influence on Tuesday.
The Aussie Dollar ended the week up by 1.08% to $0.7761.
For the Kiwi Dollar:
It’s a particularly quiet week ahead on the economic calendar.
Wholesale inflation figures for the 4th quarter are due out on Friday. With no other stats to consider, the Kiwi will be in the hands of market risk sentiment in the week.
Expect the Eurozone and the U.S PMI numbers on Friday to also provide direction.
The Kiwi Dollar ended the week up by 0.35% to $0.7223.
For the Japanese Yen:
It is a busy week ahead.
At the start of the week, 4th quarter GDP and finalized industrial production figures are due out.
Expect the GDP numbers to garner plenty of interest.
The focus will then shift to trade data on Wednesday ahead of inflation figures and prelim PMI numbers on Friday.
The Japanese Yen ended the week up by 0.43% to ¥104.94 against the U.S Dollar.
Out of China
It’s a quiet week ahead. With the Chinese market closed for Chinese New Year, there are no material stats to consider in the week.
The lack of stats will leave geo-politics in focus.
The Chinese Yuan ended the week up by 0.12% to CNY6.4582 against the U.S Dollar.
Capitol Hill and U.S foreign policy remain key areas of focus.
The need for a COVID-19 relief package is becoming more pressing as labor market woes linger.
With the markets now expecting the Democrats to deliver Biden’s $1.9tn, economic growth forecasts are being revised upwards.
Any unexpected speed bumps on stimulus front and expect risk aversion to sweep the markets.
Vaccination rates and availability of vaccines will continue to be key areas of interest.
An upward trend in vaccination rates and a downward trend on infection rates would support riskier assets in the week.