Investors in forex will focus this week on the appearances of the us president Donald Trump and the president of the federal Reserve board Jerome Powell, in the middle of new doubts about the progress of the trade negotiations between the United States and China.
Trump will deliver on Tuesday a speech to the Economic Club of New York, where the markets expect more clarity on a draft agreement “a first step” aimed at putting an end to a trade war damaging between the two largest economies in the world.
Powell must testify on the economy before legislators in Washington on Wednesday and Thursday and is expected to reiterate that the plans of easing are now in abeyance after the Fed has cut its rates last month for the third time in as many meetings.
Several countries, from Germany to Japan, will publish the growth data for the third quarter in the next few days.
The United States should publish data on inflation on Wednesday, while data on retail sales and industrial production on Friday will determine if consumers can continue to stimulate growth in the face of a manufacturing sector in difficulty and months of trade tensions.
The us dollar rallied Friday to reach its highest level in three weeks, while the appetite for risk has created a demand for yield currencies higher, which is dispelled with an uncertainty of renewed about the reduction of tariffs existing, an important component of a trade agreement, the preliminary between the United States and China.
Trump said that he had not agreed to a reduction of customs duties, in the aftermath of statements in this sense on the part of China.
The u.s. dollar index rose 0.2 % to 98,21 at the end of the week after having reached a peak of three weeks, under the effect of gains against the euro, which fell 0.3 % to 1,1017.
The dollar was little changed against the japanese yen to 109,27.
Jonas Goltermann, senior economist markets at Capital Economics in London, believes that, with the persistence of trade tensions, the dollar should remain strong.
“While we do not expect that the relative interest rate to stimulate the dollar further in the short term, we believe that the trade tensions persist and the slowdown of the global economy mean that the greenback will rise a little in 2020, despite the fact that, on a weighted base trade, he is already near its highest level since the early 2000s,” said Goltermann.
The british pound is weak, down 0.3 % to 1,2771, because of the continuing political uncertainty in the Uk and indications from the Bank of England according to which it is ready to reduce its rates in the event of a “Brexit” without operation.
Finally, as you begin a new week, Investing.com has compiled a list of significant events likely to affect the markets.
Calendar of important events for the Forex this week :
Monday, November 11,
UK : preliminary GDP, manufacturing production
USA : The bond markets are closed on the occasion of the Feast of veterans affairs ; the president of the Boston Fed, Eric Rosengren, took the floor
Tuesday, 12 November
Australia : business Confidence in the NAB
New Zealand : inflation Expectations
United Kingdom : Report on employment
Germany : ZEW economic sentiment
USA : the president of the Philadelphia Fed, Patrick Harker, and the head of the Fed of Minneapolis, Neel Kashkari, to take the floor.
Wednesday, November 13,
Australia : price Index of wages
New Zealand : Decision on the interest rate of the Reserve Bank of New Zealand
UK : CPI
USA : CPI ; the Fed chairman Jerome Powell, will testify before the economic Committee, the joint Congress.
Thursday, November 14,
Australia : Report on the employment
China : capital Investments ; industrial production ; retail sales
Germany : GDP preliminary
UK : retail Sales
Euro Zone : GDP revised
USA : PPI ; unemployment insurance claims ; speech of Richard Clarida, executive vice-president of the Edf ; speech by Charles Evans, president of the Chicago Fed ; Powell testifies before the budget committee of the Chamber ; speech by Mary Daly, president of the Fed of San Francisco ; speech of John Williams, president of the Fed of New York ; speech of James Bullard, president of the Fed of St Louis.
Canada : Speech by the governor of the Bank of Canada, Stephen Poloz
Friday 15 November
USA : retail Sales, index Empire Sate manufacturing