High Impact Economic Data for the upcoming week (All Times GMT+2)

market preview

Week Ahead - Week Three of December 2014

The week past was lighter than average on economic data but this did not stop markets producing strong price movements and volatility. The EURUSD, USDJPY and other majors experienced large moves as well as Crude Oil, Gold and Stock Indices. The week coming up is packed full of fundamental economic data across major fx pairs.

The main currencies in focus for the data releases this week are the EUR, USD, GBP, JPY, CAD and AUD, NZD and CNY. On Sunday the outcome of the Lower House Elections in Japan will become known and this will take place prior to the opening of markets. On Monday the main economic release expected is that of the Mid-Year Economic and Fiscal Outlook for Australia, this is likely to impact the AUD and its crosses. Tuesday is a busy day for markets, coming up first are the Chinese, French and German Manufacturing PMI figures as well as the GBP Bank Stress Test Results and GBP CPI (Inflation) data. On Tuesday afternoon German ZEW Economic Sentiment will shed further light on developments in the Eurozone's largest economy while Canadian Manufacturing Sales and USD Building Permits complete the news for this day. On Wednesday the news heats up further, in the morning important UK Employment data is set to be released in the shape of the Average Earnings Index and Claimant Count Change. At 13:30 GMT US CPI and Core CPI hit the news wires and this will provide an update on the inflation picture in the US. At 19:00GMT a series of key FOMC reports are released: the Federal Funds Rate, FOMC Statement and the FOMC Economic Projections. While thirty minutes later Janet Yellen Fed Chairwoman will commence the FOMC Press Conference. All the above news relating to the FOMC are the stand out economic events for the week in question. On each of these releases volatility is to be expected across asset classes and in fx markets. And on Wednesday the day closes with New Zealand’s quarterly GDP growth numbers. On Thursday German Ifo Business Climate is forecast to improve to a reading of 105.7, GBP Retail Sales are also expected to continue growing by a further 0.3% m/m. Over in the US Unemployment Claims and the Philly Fed Manufacturing Index will be released for the USD. The BOJ Press Conference and Monetary Policy Statement are scheduled for Friday as well as Core CPI and Core Retail Sales on the CAD. In total there will be no shortage of news and high octane action in the markets this week.

Events to Watch this Week

The main factors that will affect the fx markets and trends next week will be the:

  • Tuesday’s EUR Manufacturing figures could set the tempo for the week in the EURUSD and encouraging data could extend the resurgence of the EUR.
  • The Japanese Elections are worth keeping an eye on following exaggerated swings and volatility in the USDJPY last week. The USDJPY closed below 120 from a high of 122 last week.
  • Federal Reserve is in Focus on Wednesday and this is by far the most important event taking place this week and could shape the fx markets for weeks or months given a strong policy directive being announced that confirms or changes the present set of expectations.