There are plenty of events scheduled to take place this week that could impact the GBP, EUR, USD, AUD, CAD, and ZAR exchange rates, such as Bank of England (BoE) and Federal Reserve interest rate decisions and high-tier data detailing employment levels and growth readings.
One of the biggest events for the Pound (GBP) exchange rate this week will be Bank of England’s interest rate decision and inflation report release on Thursday. Markets are largely pricing in an interest rate hike by the British central bank and Sterling’s current strength has accounted for the possibility of higher rates. However, if the BoE doesn’t increase interest rates, the Pound is likely to drop.
German inflation numbers are due for release on Monday, while the Eurozone as a whole is scheduled to detail growth and inflation numbers on Tuesday. However, as the week progresses, markets will be keeping a close eye on the situation between Catalonia and Madrid in the Catalan bid for independence. Any serious political instability could pressure the Euro exchange rate lower, giving other currencies the opportunity to climb against it.
The US Dollar could also feel the influence of central bank decisions this week, with the Federal Reserve due to undertake its next monetary policy meeting. However, there may be other ways the US Dollar exchange rate can be impacted by central bank developments. President Donald Trump is expected to announce who will be taking the top spot at the central bank this week. It’s thought that current Fed Chair Janet Yellen is in the running, along with John Taylor and Jerome Powell. A hawkish appointment could be a boon for USD strength.
There are a few economic releases that could create some Aussie dollar fluctuations in the week ahead. Tuesday will kick-off the data releases with Australian Home Sales and manufacturing sector data, and Thursday will continue with service sector figures, Trade Balance and Building Approvals ecostats.
It looks set to be an exciting week ahead for the Canadian Dollar this week, with some high-tier economic data due for release and some Bank of Canada (BoC) representatives due to speak. The Canadian Gross Domestic Product (GDP) stat will be out on Tuesday, Manufacturing Purchasing Managers’ Index (PMI) on Wednesday, and Friday will end the week of Canadian ecostats with the release of Unemployment Rate and Net Change in Employment numbers.
This week the Rand may feel the influence of Unemployment Rate and Balance of Trade figures on Tuesday, and manufacturing and vehicle sales numbers on Wednesday. Standard Bank will also release its October PMI on Friday. Last week the Rand suffered its worst week since March. In March the Rand dropped after a surprise loss of the well-respected Finance Minister, and last week the new Finance Minister slashed growth forecasts.