Weekly Forecast – March 20
Below are the events expected in the following week, and our take on currency movements:
The economic data releases are relatively limited in the US and Europe during the week ahead with political trends and central bank expectations having an important impact.
There are relatively few major data releases during the week ahead with jobless claims data due on Thursday and latest durable goods orders data due on Friday.
Comments from Federal Reserve officials will be potentially important if they look to push against the market reaction to the Fed rate hike although, at this stage, there are no major speeches scheduled from senior officials.
The latest UK inflation data will be the most important focus during the week with Tuesday’s release for consumer prices and producer prices potentially having important implications for Bank of England policy, especially if the annual CPI rate increases significantly above the 2.0% level.
The latest retail sales data will be released on Thursday after two weaker than expected monthly releases.
Political developments will be monitored closely with Article 50 expected to be invoked the following week. Developments surrounding Scotland will also be important with the Scottish Parliament likely to formally ask for a second independence referendum.
The latest Euro-zone PMI data releases are due on Friday and will have a significant impact on growth and inflation expectations with any further evidence of stronger conditions bolstering the case for a less aggressive monetary policy.
Any further comments from ECB officials will be an important focus during the week, although there are no scheduled remarks from Bank President Draghi.
Developments surrounding the French Presidential election will also be important with the first round due to be held on April 23rd. Any further increase in support for Le Pen would be likely to unsettle the Euro.
The Reserve Bank of New Zealand will announce its latest interest rate decision on Thursday local time.
Comments from G20 officials will continue to be watched very closely following the meetings in Germany to assess whether there is a serious risk of increased trade tensions.
Wider comments from President Trump and senior US officials will also be an important element.
The Canadian inflation and retail sales data will be released during the week along with the annual budget.
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