Weekly Forex Forecast: 22 – 26 June

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The Pound Sterling was the strongest currency last week, gaining over 2% for the week against the Greenback. Boosted by a weaker US Dollar and better than expected improving fundamentals, GBPUSD rallied to post new highs for the year, trading near 1.59 region. The Swiss Franc came in at a close second despite the SNB talking down the currency. The Franc was also boosted by the prevailing uncertainty in the Eurozone on account of Greece.

Weekly Spot FX Performance – 19/06/2015 (Source: Finviz.com)
Weekly Spot FX Performance – 19/06/2015 (Source: Finviz.com)

The Kiwi Dollar continued its decline as the currency weakened further last week on account of a weaker than expected GDP for the quarter. The NZD continued to attract sellers across the board as speculation continues for a second rate cut to be delivered by the RBNZ in the coming months.

Fundamentals for the Week 22 – 26 June

Date Time Currency Detail Expected Previous
22-Jun 01:00 NZD Westpac Consumer Sentiment 117.4
01:45 NZD Visitor Arrivals m/m 1.40%
All Day CNY Bank Holiday
06:00 NZD Credit Card Spending y/y 7.10%
08:00 JPY BOJ Monthly Report
10:45 GBP MPC Member Cunliffe Speaks
All Day EUR Euro Summit
All Day EUR Eurogroup Meetings
17:00 EUR Consumer Confidence -6 -6
USD Existing Home Sales 5.29M 5.04M
23-Jun 03:00 AUD CB Leading Index m/m -0.10%
04:30 AUD HPI q/q 2.10% 1.90%
04:35 JPY Flash Manufacturing PMI 50.6 50.9
04:45 CNY HSBC Flash Manufacturing PMI 49.4 49.2
10:00 EUR French Flash Manufacturing PMI 50.1 49.4
EUR French Flash Services PMI 52.5 52.8
10:30 EUR German Flash Manufacturing PMI 51.5 51.1
EUR German Flash Services PMI 52.9 53
11:00 EUR Flash Manufacturing PMI 52 52.2
EUR Flash Services PMI 53.7 53.8
12:00 EUR Italian Retail Sales m/m 0.10% -0.10%
13:00 GBP CBI Industrial Order Expectations 3 -5
15:00 USD FOMC Member Powell Speaks
15:30 USD Core Durable Goods Orders m/m 0.60% -0.20%
USD Durable Goods Orders m/m -0.50% -1.00%
16:00 USD HPI m/m 0.60% 0.30%
16:45 USD Flash Manufacturing PMI 54.2 54
17:00 USD New Home Sales 521K 517K
USD Richmond Manufacturing Index 1 1
24-Jun 02:50 JPY Monetary Policy Meeting Minutes
JPY SPPI y/y 0.40% 0.70%
05:00 CNY CB Leading Index m/m 1.10%
09:00 CHF UBS Consumption Indicator 1.25
11:00 EUR German Ifo Business Climate 108.2 108.5
11:30 GBP BBA Mortgage Approvals 43.1K 42.1K
15:30 USD Final GDP q/q -0.20% -0.70%
USD Final GDP Price Index q/q -0.10% -0.10%
16:00 CHF SNB Quarterly Bulletin
EUR Belgian NBB Business Climate -5.2 -4.9
17:30 USD Crude Oil Inventories -2.7M
25-Jun 09:00 EUR GfK German Consumer Climate 10.1 10.2
13:00 GBP CBI Realized Sales 32 51
15:30 USD Unemployment Claims 271K 267K
USD Core PCE Price Index m/m 0.10% 0.10%
USD Personal Spending m/m 0.70% 0.00%
USD Personal Income m/m 0.60% 0.40%
16:45 USD Flash Services PMI 56.5 56.2
17:30 USD Natural Gas Storage 89B
19:10 CAD Gov Council Member Schembri Speaks
26-Jun 01:45 NZD Trade Balance -50M 123M
02:30 JPY Household Spending y/y 3.70% -1.30%
JPY Tokyo Core CPI y/y 0.10% 0.20%
JPY National Core CPI y/y 0.00% 0.30%
JPY Unemployment Rate 3.30% 3.30%
09:00 EUR German Import Prices m/m 0.20% 0.60%
11:00 EUR M3 Money Supply y/y 5.40% 5.30%
EUR Private Loans y/y 0.20% 0.00%
17:00 USD Revised UoM Consumer Sentiment 94.6 94.6
USD Revised UoM Inflation Expectations 2.70%
17:15 GBP BOE Gov Carney Speaks

 

Currencies/Events to Watch this Week

Greece Crisis: With Greek Central bank receiving additional liquidity from the ECB last week, the Eurogroup members confirmed that they would convene a meeting on Monday in a last ditch efforts to reach a deal with Greece. The Euro is likely to be susceptible to the news flows the coming week. Besides the geo-political risks, economic flows from Eurozone show Flash services and manufacturing PMI’s on the tap with expectations showing a broad growth across the region.

BoE Member Speeches: The Pound Sterling heads into a slow week with BoE Governor Carney and MPC Member Cunliffe scheduled to give their speeches. Previously Carney had been vocal about the Pound Sterling’s appreciation in light of lower inflation readings and we could potentially expect to see some kind of market moving speeches this week..

Japan Economic Flows: With the BoJ leaving policy unchanged, the week ahead sees mostly some second tier data for the Yen, which is unlikely to bring any major changes to the currency. However ongoing geo-political risks out of Eurozone are likely to keep the Yen supported.

Busy week for the USD: The markets see another busy week for the US Dollar with most important, PCE data, the Fed’s preferred mode of gauging inflation on the tap. As of now, expectations are for the Core PCE to remain unchanged at 0.1%. A better than expected print is likely to keep the US Dollar well supported while a miss on the estimates could bring a bearish scenario. Other major economic data for the week includes the final first quarter GDP print as well, which is expected to remain unchanged.

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