Weekly Forex Forecast: Sep 28 – 02 October

The US Dollar closed the week with the strongest gains across the board. The strength in the Greenback was largely on account of hawkish Fedspeak from various FOMC members who took the stage last week repeatedly reiterating the US Fed hike plans. The Kiwi dollar which was volatile last week came in as the second strongest currency with gains lifted by upward revised Fonterra payouts.

The Euro posted a second straight week of declines, losing a modest -0.29% for the week. However, it was the British Pound which was the weakest currency losing -2.26% to the Greenback followed by the Aussie dollar which lost -2.25%. The Aussie was largely dragged down by a sharp decline in various commodity prices.

Fundamentals for the Week 28/09 – 02/10

Date	Time	Currency	Detail	Forecast	Previous
28-09-15	15:30	USD	FOMC Member Dudley Speaks
		USD	Core PCE Price Index m/m	0.10%	0.10%
		USD	Personal Spending m/m	0.30%	0.30%
		USD	Personal Income m/m	0.40%	0.40%
	17:00	USD	Pending Home Sales m/m	0.40%	0.50%
	20:30	USD	FOMC Member Evans Speaks
29-09-15	00:00	USD	FOMC Member Williams Speaks
	09:00	EUR	German Import Prices m/m	-1.30%	-0.70%
	All Day	EUR	German Prelim CPI m/m		0.00%
	10:00	EUR	Spanish Flash CPI y/y	-0.60%	-0.40%
	11:30	GBP	Net Lending to Individuals m/m	4.1B	3.9B
		GBP	M4 Money Supply m/m	0.70%	1.00%
		GBP	Mortgage Approvals	70K	69K
	Tentative	EUR	Italian 10-y Bond Auction		1.95|1.4
	13:00	GBP	CBI Realized Sales	29	24
	15:30	CAD	RMPI m/m		-5.90%
		CAD	IPPI m/m		0.70%
		USD	Goods Trade Balance	-57.3B	-59.1B
	16:00	USD	S&P/CS Composite-20 HPI y/y	5.10%	5.00%
	17:00	USD	CB Consumer Confidence	96.2	101.5
30-09-15	00:45	NZD	Building Consents m/m		20.40%
	02:05	GBP	GfK Consumer Confidence	5	7
	02:50	JPY	Retail Sales y/y	1.30%	1.80%
		JPY	Prelim Industrial Production m/m	1.10%	-0.80%
	03:00	NZD	ANZ Business Confidence		-29.1
	04:30	AUD	Building Approvals m/m	-1.90%	4.20%
		AUD	Private Sector Credit m/m	0.50%	0.60%
	08:00	JPY	Housing Starts y/y	7.70%	7.40%
	09:00	CHF	UBS Consumption Indicator		1.64
		EUR	German Retail Sales m/m	0.30%	1.40%
		GBP	Nationwide HPI m/m	0.40%	0.30%
	09:45	EUR	French Consumer Spending m/m	0.40%
	Jul Data	EUR	French Consumer Spending m/m	0.20%	0.40%
	10:00	CHF	KOF Economic Barometer	101.2	100.7
	10:55	EUR	German Unemployment Change	-5K	-7K
	11:00	EUR	Italian Monthly Unemployment Rate	12.00%	12.00%
	11:30	GBP	Current Account	-22.3B	-26.5B
		GBP	Final GDP q/q	0.70%	0.70%
		GBP	Index of Services 3m/3m	0.80%	0.70%
		GBP	Revised Business Investment q/q	2.90%	2.90%
	12:00	EUR	CPI Flash Estimate y/y	0.00%	0.10%
		EUR	Core CPI Flash Estimate y/y	0.90%	0.90%
		EUR	Unemployment Rate	10.90%	10.90%
		EUR	Italian Prelim CPI m/m	-0.20%	0.20%
	15:00	USD	FOMC Member Dudley Speaks
	15:15	USD	ADP Non-Farm Employment Change	191K	190K
	15:30	CAD	GDP m/m	0.20%	0.50%
	16:45	USD	Chicago PMI	53.2	54.4
	17:30	USD	Crude Oil Inventories		-1.9M
	22:00	USD	Fed Chair Yellen Speaks
01-10-15	02:30	AUD	AIG Manufacturing Index		51.7
	02:50	JPY	Tankan Manufacturing Index	13	15
		JPY	Tankan Non-Manufacturing Index	21	23
	All Day	CNY	Bank Holiday
	03:00	USD	FOMC Member Brainard Speaks
	04:00	CNY	Manufacturing PMI	49.7	49.7
		CNY	Non-Manufacturing PMI		53.4
	04:35	JPY	Final Manufacturing PMI	50.9	50.9
	04:45	CNY	Caixin Final Manufacturing PMI	47.2	47
		CNY	Caixin Services PMI	51.2	51.5
	06:45	JPY	10-y Bond Auction		0.42|3.5
	09:30	AUD	Commodity Prices y/y		-20.90%
	10:15	CHF	Retail Sales y/y	0.30%	-0.10%
		EUR	Spanish Manufacturing PMI	53	53.2
	10:30	CHF	Manufacturing PMI	51.9	52.2
	10:45	EUR	Italian Manufacturing PMI	53.4	53.8
	10:50	EUR	French Final Manufacturing PMI	50.4	50.4
	10:55	EUR	German Final Manufacturing PMI	52.6	52.5
	11:00	EUR	Final Manufacturing PMI	52	52
	11:30	GBP	Manufacturing PMI	51.3	51.5
		GBP	FPC Meeting Minutes
	Tentative	EUR	Spanish 10-y Bond Auction		2.15|2.5
	Tentative	EUR	French 10-y Bond Auction		1.21|1.7
	14:30	USD	Challenger Job Cuts y/y		2.90%
	15:30	USD	Unemployment Claims	273K	267K
	16:30	CAD	RBC Manufacturing PMI		49.4
	16:45	USD	Final Manufacturing PMI	53	53
	17:00	USD	ISM Manufacturing PMI	50.8	51.1
		USD	Construction Spending m/m	0.60%	0.70%
		USD	ISM Manufacturing Prices	40	39
	17:30	USD	Natural Gas Storage		106B
	All Day	USD	Total Vehicle Sales	17.5M	17.8M
	21:30	USD	FOMC Member Williams Speaks
02-10-15	02:30	JPY	Household Spending y/y	0.40%	-0.20%
		JPY	Unemployment Rate	3.30%	3.30%
	02:50	JPY	Monetary Base y/y	34.20%	33.30%
	All Day	CNY	Bank Holiday
	03:00	NZD	ANZ Commodity Prices m/m		-5.20%
	04:30	AUD	Retail Sales m/m	0.40%	-0.10%
	10:00	EUR	Spanish Unemployment Change	17.9K	21.7K
	11:30	GBP	Construction PMI	57.5	57.3
	12:00	EUR	PPI m/m	-0.50%	-0.10%
	15:30	USD	Average Hourly Earnings m/m	0.20%	0.30%
		USD	Non-Farm Employment Change	202K	173K
		USD	Unemployment Rate	5.10%	5.10%
	17:00	USD	Factory Orders m/m	-0.90%	0.40%

Time: GMT+3

Currencies/Events to Watch this Week

Australia retail sales: Among other data during a relatively quiet week for the Aussie, the monthly retail sales data is forecasted to have grown at a pace of 0.4% for the month of September. The median estimates, point to a modest pickup in retail sales which declined -0.1% previously in August. Earlier in the week the monthly building approvals data is due, which is expected to show a decline of -1.9% after growing rapidly the month before at 4.2%. Although both these datasets do not account for much, the retail sales numbers could see some volatility in the Aussie currency pairs.

Canada GDP: The Canadian GDP is the only main event to look forward to for the week ahead. The median estimates forecast a slowdown to 0.2%, after the Canadian economy grew at a pace of 0.5% previously. Canada’s monthly GDP has been trending relatively flat with the exception of last month’s GDP. A better than or expected GDP print could be supportive to the Canadian dollar although the correlation to Crude oil prices has been stronger in recent weeks and has been the main driving factor.

China Manufacturing PMI: While data from China is quiet for the first part of the week, starting October 1st, focus will shift to the monthly PMI releases for both the manufacturing and non-manufacturing PMI numbers for the month of September. Expectations are for a near flat reading or unchanged from the previous month thus giving more scope for a possible beat on the estimates. In the unlikely event that the PMI’s continue to miss the median forecasts, it could potentially translate to another bout of uncertainty in the global equity markets as well as bring the Aussie and the Kiwi currencies under pressure.

German CPI and Eurozone flash CPI estimates: Data this week from Eurozone will see the monthly PMI data but the more important ones include the German CPI which is expected to stay unchanged. German retail sales are also due and is expected to post a soft print of 0.3%, down from 1.4% growth previously. Later in the week, the Eurozone flash CPI estimates are due for release with the median estimates pointing to a flat headline CPI of 0.0% while the core CPI is expected to be soft at 0.9% annualized.

UK Q2 Final GDP: The week ahead will see the final revised second quarter GDP results. Expectations are for an unchanged print of 0.7%. Last week, the US final revised GDP posted a strong upward revision of 3.9%, so a potential surprise with an upside revision to the UK’s GDP could help support the currency which has weakened considerably last week. Besides the GDP numbers, the monthly manufacturing and construction PMI data are also due for release.

US Nonfarm payrolls: The week ahead will be a busy one for the US with lot of economic releases on the agenda. However, the main event will be the monthly ADP private payroll numbers and the nonfarm payrolls due on Thursday and Friday. Expectations call for the unemployment rate to remain steady at 5.1% while the monthly job numbers is expected at 202k. Besides the unemployment data, many FOMC members continue the week with their speeches including Janet Yellen’s speech as well