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Weekly Forecast – February 20th


Date of publication: February 20, 2017 | Author: Tim Clayton

Below are the events expected in the following week, and our take on currency movements:

Political developments on both sides of the Atlantic are likely to dominate for the week ahead with uncertainty surrounding the Trump Administration and the French Presidential election.

US

The forthcoming week is relatively lacklustre in terms of economic data with existing and new home sales data due on Wednesday and Friday respectively.

The latest US PMI manufacturing and services-sector data will be released on Tuesday and could be important signals of activity, but market reaction is likely to be limited.

The Federal Reserve minutes from January’s FOMC meeting will be watched closely even though the impact will be lessened by this week’s testimony from Fed Chair Yellen in which she called for further gradual increases in interest rates.

Most attention will focus on any commentary surrounding the likelihood that interest rates will be increased at the March meeting.

Developments surrounding the US Administration will also continue to be a very important focus during the week, especially with markets waiting for President Trump’s tax-cut proposals. Any Treasury comments on currencies and the dollar policy could trigger substantial currency moves.

UK

The UK economic data is unlikely to have a major impact with the revised fourth-quarter GDP and investment data due for release on Wednesday.

At this stage, there are no significant events due from the Bank of England for the week ahead.

Parliament will resume sitting after a recess and markets will monitor trends in the Brexit debate closely as debate surrounds the Article 50 Bill continues in the House of Lords.  The main focus will be on whether the government’s planned timing for triggering Article 50 around March 10th is jeopardised.

Euro-zone

The latest Euro-zone PMI data on Tuesday will be an important focus with markets looking to assess whether momentum in the economy has been sustained and if there is evidence of further upward pressure on prices.

Tensions surrounding Greek debt will be an important focus at Monday’s Eurogroup meeting with the French Presidential election also an important focus.

International

Comments from Reserve Bank of Australia Governor Lowe will be monitored closely during the week with an appearance before the House of Representatives on Friday.

Overall trends in risk appetite and global equity markets will be a key focus during the week ahead.

Forecasts

Currency pair Spot 1-week forecast 1-month forecast
EUR/USD 1.061 1.056 1.075
USD/JPY 112.9 112.2 112.0
EUR/GBP 0.856 0.859 0.850
GBP/USD 1.241 1.229 1.265
AUD/USD 0.766 0.762 0.760
USD/CAD 1.310 1.306 1.320
USD/SGD 1.417 1.414 1.417
USD/HKD 7.761 7.761 7.760
NZD/USD 0.719 0.724 0.715
GBP/JPY 140.0 137.9 141.6
GBP/AUD 1.620 1.613 1.664
GBP/NZD 1.726 1.698 1.769
GBP/SGD 1.758 1.738 1.792
GBP/HKD 9.63 9.54 9.81
GBP/CHF 1.244 1.240 1.249

 

 timTim Clayton is a market analyst with more than 20 years of experience in the financial markets, with particular focus on currencies. Holds an economics degree from University of New York. Writes for multiple publications including Investing.com and SeekingAlpha so he is on top of all the happening in the world of currencies and macro-economics. 

 

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Information expressed in this article and on MoneyTransferComparison.com as a whole does not constitute as financial advice. If you decide to make any actions based on the information you read, we shall not be held responsible.

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