The greenback ended the week just past with slight losses against the other majors following February’s U.S. NFP report. However, the first reaction was mixed as the economy added 242k jobs in the non-farm sector versus forecasts of 190k.
The unemployment rate remained at the record low of 4.9% but the average hourly earnings shifted to the negative territory and pulled the dollar down. The hourly earnings decreased by 0.1% while they were expected to rise by 0.2%, the worst level since December 2014.
Heading into a new week, the time for the ECB meeting arrived! The 19-nation union central bank will revise its monetary policy and is very likely to add more stimulus measures. The Bank of Canada and Reserve Bank of New Zealand will also have interest rate decisions.
On [B]Monday[/B], the highlights are the Eurogroup meeting early afternoon and the Japanese GDP overnight. In Eurozone, the only indicator scheduled on the economic calendar is the Sentix Investor Sentiment for March, which is expected to rise up to 8.2 from 6 before. In U.S., the Labor Market Conditions index for February and the Consumer Credit Change for January will be released. The Japanese GDP for the fourth quarter is expected to show that the economy contracted in a faster pace than before, -1.5% yoy vs -1.4%.
[B]Tomorrow[/B], Eurozone’s final GDP will attract the attention, two days before the ECB decides whether will ease further the monetary policy. The market expects the flash figures of 0.3% qoq and 1.5% yoy to be met.
The NFIB Business Optimism Index for February is coming out during the morning and the IBD/TIPP Economic Optimism for March early in the afternoon. In Canada, the housing starts for February and the building permits for January are expected.
On [B]Wednesday [/B]morning, the UK Manufacturing and Industrial Production for January are scheduled for release. The manufacturing sector is expected to expand by 0.2% from a contract of 0.2% before, mom, while the industrial sector mom, to expand by 0.5% versus -1.1% in December. On the second half of the trading day, the NIESR GDP for the three months to February will be eyed. In U.S., the Wholesale Inventories for January are expected to slow down again by 0.1% as the month before. The Bank of Canada will review its interest rate decision but no changes are expected. Later in the day, the Reserve Bank of New Zealand will announce its interest rate decision accompanied with the monetary policy statement and followed from a press conference.
On [B]Thursday[/B], the European Central Bank will announce what they have decided following the review of the current monetary policy. The press of the ECB President Mario Draghi, as well as the interest rate decision, will be closely eyed. Currently, the cash rate stands at 0.05% while the deposit rate is still in the negative territory, -0.3%, since December, when the bank surprised the markets shifting to negative rates to decrease the deflation risks. Indeed, the 19-nation union economy may need some boosting measures but is doubtful which of the available tools they will use.
In U.S., the weekly jobless claims will come out as usual and the Monthly Budget Statement for February. In Canada, the new housing price index for January and the Capacity Utilization for the fourth quarter will be out.
Early on [B]Friday[/B], the German inflation rate will be out. In UK, the only notable macro-update is the trade balance number. In Canada, February’s employment report will be published. The unemployment rate is expected to remain stable at 7.2% while the net change in employment to add 5.5k from -5.7k the previous month.
In U.S., the flash University of Michigan Consumer Sentiment Index for March will be out, as well as February’s export and import prices indexes.