Last week the greenback was traded mixed versus the half of the G10 currencies while it was virtually unchanged against the rest despite the soft data came out. Amid Fed’s cautiousness regarding tightening, the Retail Sales increased less than expected and the inflation rate fell to 0.9% after some optimistic figures the months before that were indicating a slow and stable rise towards central bank’s target.
The Euro plunged against all its major peers, even though limited fundamental news came out for the euro. The only exemptions were Swiss franc and the Swedish krona. Eurozone’s Industrial Production tumbled by 0.8% mom in February from an increase of 1.9% the previous month. The 19-nation union consumer prices remained flat in March, better than the market’s forecasts to decline by 0.1%.
[B]THE WEEK AHEAD: April 18 - 22[/B]
The ECB policy meeting on Thursday will hog the limelight this week following the easing monetary policy of the last two meetings. The RBA meeting minutes, as well as several speeches from Fed members, RBA Governor, and BoC Governor during the week, will be closely watched. The ZEW and IFO Surveys, as well as Markit PMIs, will release their results for April.
As usual, we start the week with a quiet day in terms of economic data. On [B]Monday[/B] morning, the German Buba Monthly Report will be published. Afterwards, Fed’s William Dudley will give a speech and will be closely watched by investors as it’s important for them to gauge when Fed will raise its interest rates after December. Later in U.S., the National Association of Home Builders will release the Housing Market Index for April. The market forecasted a slight increase to 59 from 58 before. Overnight, the Reserve of Australia will release the minutes of the last meeting.
Early on [B]Tuesday[/B], Eurozone’s Current Account will be released as well as the Construction Output both for February. The ZEW Survey for April will attract attention among the market participants as it will reveal data regarding Economic Sentiment and Current Situation in Germany as well as for the Economic Sentiment in Eurozone as a whole.
In U.S., the Building Permits and the Housing Starts for March are expected to show a slight increase compared to the month before. Afterwards, in New Zealand, the Global Trade Index will be announced give a press conference as to how the RBA observes the current Australian economy and the value of AUD. His comments may determine the short-term direction of the currency. A while later, the BoC Governor Stephen Poloz will also give a public speech.
On [B]Wednesday[/B], the attention will be on UK Labour Market report that is scheduled for release. The ILO Unemployment Rate for the three months to February is expected to remain stable at 5.1% while the Claimant Count Change is predicted to improve to -10K in March from -18K before. The Average Earnings Including Bonus for the three months to February are forecasted to rise up to 2.3% from 2.1% the three months to January.
In U.S., the Existing Home Sales for March will complete picture for the housing sector following February’s indicators. The markets expect the Existing Home Sales in March to increase to 5.26M from a plunge of 7.1% to 5.08M the month before.
On [B]Thursday[/B], the UK Retail Sales will be eyed and are expected to increase by 4.2% in March year-over-year compared to an increase of 3.8% the previous month. In comparison to the last month, the Retail Sales are forecasted to decrease by 0.1% versus a decline of 0.4% before. The major event of the day will be the European Central Bank Policy Meeting. The central bank currently has a record low interest rate, zero and a negative deposit rate of -0.4% in an attempt to boost the economy. The monetary policy statement and the press conference from the ECB President Mario Draghi will be closely eyed. Therefore, the preliminary Consumer Confidence for April will be out.
In U.S., the weekly jobless claims will be out, and following that, the Housing Price Index will be released as well as the Housing Price Index for February and the CB Leading Indicator for February and March respectively.
On [B]Friday[/B], we start the day with the preliminary Markit Services and Manufacturing PMIs for U.S., Eurozone and Germany. In Eurozone, the Services, as well as the Manufacturing sectors, are forecasted to expand in April according to the PMIs. In Germany, the Manufacturing sector is expected to advance while the Services to slow down slightly. The IFO Survey for April will be also released and will reveal the level of Expectations, Current Assessment and Business Climate in Germany.
Later in the day, traders’ attention turns in Canada where the Retail Sales for February and the Inflation Rate for March will be released. The year-over-year inflation rate is forecasted to come out 1.7% in March compared to 1.9% the month before. In U.S., the Markit Manufacturing PMI that is going to be released during the European afternoon, it forecasted to show an improvement to 52.0 from 51.5 before.