The US Dollar closed the week as the weakest currency led by the FOMC meeting which was more dovish than market expectations. With only two rate hikes projected for 2016, the markets saw the Greenback ease across the board. The Yen was the top performer, gaining 2.02% for the week as the BoJ’s meeting saw no changes to monetary policy but at the same time signaled potential easing bias at the next meeting. The Canadian dollar was the second best currency, rising 1.64% for the week as broadly better than expected data and rising Oil prices kept the CAD well supported.
The commodity risk currencies eased back towards the end of the week but not before notching decent gains. The week ahead is expected to remain quiet with Canada’s fiscal stimulus policies likely to take focus as the annual budget is presented.
Fundamentals for the Week 21/03 – 25/03
|21-Mar||00:01||GBP||Rightmove HPI m/m||2.90%|
|02:00||NZD||Credit Card Spending y/y||8.90%|
|11:00||EUR||German Buba Monthly Report|
|GBP||CBI Industrial Order Expectations||-13||-17|
|14:00||USD||Existing Home Sales||5.32M||5.47M|
|14:30||AUD||CB Leading Index m/m||-0.20%|
|00:45||AUD||RBA Assist Gov Edey Speaks|
|02:00||JPY||Flash Manufacturing PMI||50.6||50.1|
|04:30||JPY||All Industries Activity m/m||1.90%||-0.90%|
|05:30||AUD||RBA Gov Stevens Speaks|
|08:00||EUR||French Flash Manufacturing PMI||50.2||50.2|
|EUR||French Flash Services PMI||49.5||49.2|
|08:30||EUR||German Flash Manufacturing PMI||50.9||50.5|
|EUR||German Flash Services PMI||55.1||55.3|
|09:00||EUR||German Ifo Business Climate||106.1||105.7|
|EUR||Flash Manufacturing PMI||51.4||51.2|
|EUR||Flash Services PMI||53.5||53.3|
|GBP||PPI Input m/m||0.40%||-0.70%|
|GBP||Public Sector Net Borrowing||5.4B||-11.8B|
|GBP||Core CPI y/y||1.20%||1.20%|
|GBP||PPI Output m/m||0.00%||-0.10%|
|10:00||EUR||German ZEW Economic Sentiment||6.3||1|
|EUR||ZEW Economic Sentiment||8.2||13.6|
|13:45||USD||Flash Manufacturing PMI||51.6||51|
|USD||Richmond Manufacturing Index||-1||-4|
|20:00||CAD||Annual Budget Release|
|23-Mar||10:00||CHF||ZEW Economic Expectations||-5.9|
|14:00||CHF||SNB Quarterly Bulletin|
|USD||New Home Sales||512K||494K|
|23:50||JPY||BOJ Summary of Opinions|
|24-Mar||07:00||EUR||German Import Prices m/m||-1.50%|
|EUR||GfK German Consumer Climate||9.5|
|09:00||EUR||ECB Economic Bulletin|
|09:30||GBP||Retail Sales m/m||2.30%|
|GBP||BBA Mortgage Approvals||47.5K|
|12:15||USD||FOMC Member Bullard Speaks|
|12:30||USD||Core Durable Goods Orders m/m||-0.20%||1.80%|
|USD||Durable Goods Orders m/m||-2.50%||4.90%|
|13:45||USD||Flash Services PMI||49.8|
|23:30||JPY||Tokyo Core CPI y/y||-0.10%|
|JPY||National Core CPI y/y||0.00%|
|25-Mar||05:00||JPY||BOJ Core CPI y/y||1.10%|
|12:30||USD||Final GDP q/q||1.00%||1.00%|
|USD||Final GDP Price Index q/q||0.90%||0.90%|
Currencies/Events to Watch this Week
AUD: Data from Australia for the week ahead is quiet with RBA Governor Stevens due to speak. Housing price index data for the quarter is forecasted to rise 0.10%, slower than 2.0% increase previously. With the recent appreciation in the Australian Dollar, RBA Governor’s speech might gain attention for any references to verbally talking down the Australian dollar.
NZD: Data from New Zealand includes the credit card spending and trade balance data for the week. Both of these events is unlikely to garner much attention or influence the Kiwi’s exchange rates, leaving most of the currency moves to technical trading.
JPY: Data from Japan for the week ahead includes flash manufacturing PMI followed by industrial activity. Of importance however will be Thursday’s inflation data, where the BoJ’s Core CPI will be closely scrutinized as it slipped to 1.10% from 1.20% previously. A further drop in the BoJ’s core inflation could stoke up speculation for April easing from the BoJ.
EUR: It will be a quiet week for the Euro with the exception of German Ifo business climate and the German ZEW economic sentiment. Flash PMI numbers are also released during the week. The ECB’s TLTRO auction is due on Thursday with the recent action seeing 18.3 billion Euros being taken up by banks. With the rates now cut sharply, the TLTRO auction might see a bigger take up from the banks.
CAD: The only major release from Canada this week is the Annual Budget Release. In recent weeks, Canadian premier has given hints on a toned down budget where fiscal stimulus spending is expected to increase, but at a more moderate pace than initially expected. The BoC left interest rates unchanged earlier this month as the Central Bank opted to see the outcome of the budget proposals.
USD: The US Dollar will see data from existing home sales among Fed member speeches. Durable goods orders will be under scrutiny as expectations call for a decline of -2.40% and -0.20% on the core and headline orders respectively. On Friday, the final GDP data for the fourth quarter will be released with expectations that the fourth quarter GDP growth was unchanged at 1.0%