Weekly Forecast – March 13
Below are the events expected in the following week, and our take on currency movements:
Highlight of the week will be the Federal Reserve policy meeting, but there also are a string of important US and global events during the week with the potential for substantial market volatility.
The Federal Reserve Open Market Committee (FOMC) will announce its latest policy decision on Wednesday amid very strong expectations of a further rate hike to 1.00%. Forward guidance and the latest individual rate projections will be very important for market sentiment with markets looking to assess the potential rate path over the remainder of 2017.
There are also important data releases with a particular focus on the consumer prices and retail sales data which are also due for release on Wednesday.
There are also important surveys in the form of Philadelphia and New York Empire surveys along with consumer confidence data.
The UK will release its latest unemployment and average earnings data on Wednesday, but the latest inflation release will be the following week.
The Bank of England will announce its latest decision on interest rates with no change expected. At this meeting, there will be no inflation report and no press conference from Governor Carney.
Developments surrounding the Article 50 Bill in parliament will also be watched closely during the week as it moves back to the House of Commons with the government still looking to trigger Article 50 this month.
The Euro-zone economic data is not likely to have a major impact during the week, but politics will be an important focus with the Netherlands general election on Wednesday. Opinion polls suggest a very tight race with the performance of the Freedom Party having potentially important regional implications.
Developments surrounding the French Presidential election will also be important with any rhetoric from ECB officials also important.
The Bank of Japan will announce its latest monetary policy decision on Thursday local time and the Swiss National Bank will also announce its latest policy decision on Thursday.
Internationally, the latest G20 meeting will be an important event during the week with the leaders and finance ministers meeting in Germany on the 17-18th. Trade policy is a top priority for the US Administration and this will be the first major meeting for Treasury Secretary Mnuchin. The US will also be facing China, Japan and Germany, all of whom have been criticised by the US Administration.
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