Forex Market Outlook for the Week August 20 – 24, 2018

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The U.S. dollar continued to rally amid the crisis in Turkey and also because of trade worries. It remains to be seen whether there will be a correction during the upcoming week. The Turkish crisis continued to engulf the markets. Turkey bridges Europe and Asia and the struggles that the country’s currency is going through have triggered fears not only about European banks but also about other emerging markets. The safe-haven Japanese yen and US dollar competed with each other for the top honors, while other currencies took a strong beating. The euro, Aussie, pound, and other currencies hit multi-month lows.

In general, the tightening of the financial situation has hurt vulnerable Turkey. It could hit others as well. The gradual interest rate hikes by the U.S. Federal Reserve has eventually taken its toll and the concerns about Turkey and other emerging markets have overshadowed the economic indicators. In the U.K., the fears about a no-deal Brexit continued to persist, while the second quarter GDP growth of the Euro Zone was upgraded to 0.4 percent.

Having said that here is an outlook on the major economic data releases scheduled for the upcoming week.

#1: Australia RBA Governor Philip Lowe Speaks (08/20/2018 Monday 22:00 GMT)

forex market outlookPhilip Lowe, Governor of the Reserve Bank of Australia, is scheduled to speak at an event of the Australian Securities and Investments Commission in Canberra. Markets often remain volatile during his speeches as traders look for interest rate clues.

#2: Australia Monetary Policy Meeting Minutes (08/21/2018 Tuesday 01:30 GMT)

The Reserve Bank of Australia releases the Minutes of the Monetary Policy Meeting about two weeks after the announcement of the Cash Rate. The statement provides a detailed account of the most recent meeting of the Reserve Bank Board. It also provides in-depth insight into the economic conditions that impacted the members’ decision on setting interest rates.

#3: New Zealand Retail Sales (08/21/2018 Tuesday 22:45 GMT)

In New Zealand, retail trade rose by 0.1 percent on a quarter-on-quarter basis in the March quarter after the figure for the prior quarter was revised downward to an increase of 1.4 percent. Out of the 15 retail sectors, sales were higher in seven sectors but the gains were lower in eight sectors. Sales rose sharply in the electrical-electronic goods sector but the increase was less in the supermarket and grocery stores and pharmaceutical sectors. Forecast for the June quarter of 2018: an increase of 0.4 percent

#4: Canada Core Retail Sales (08/22/2018 Wednesday 12:30 GMT)

In Canada, core retail sales increased 1.4 percent in the month of May, following the 0.2 percent rise in the prior month. Forecast for June 2018: a decline of 0.4 percent

#5: U.S. Crude Oil Stocks Change (08/22/2018 Wednesday 14:30 GMT)

In the U.S., crude oil stocks increased 6.805 million barrels during the week that ended on August 10, following the 1.351 million barrels decline in the prior week. Analysts had expected the crude oil stocks to be decline by 2.499 million barrels. Gasoline stocks, on the other hand, dropped 0.74 million barrels against analysts’ expectation for a decline of 0.583 million barrels.

#6: U.S. FOMC Meeting Minutes (08/22/2018 Wednesday 18:00 GMT)

The U.S. FOMC releases the Minutes of the Monetary Policy Meeting three weeks after the announcement of the Federal Funds Rate. It provides a detailed account of the most recent meeting of the U.S. FOMC and in-depth insight into the financial and economic conditions that impacted the members’ vote on setting interest rates.

#7: U.S. Core Durable Goods Orders (08/24/2018 Friday 12:30 GMT)

In the U.S., new orders for durable goods excluding transportation increased by 0.2 percent on a month-over-month basis in June, following the revised 0.3 percent increase in May. The reading for the month missed analysts’ expectations for an increase of 0.5 percent. Forecast for July 2018: an increase of 0.5 percent

#8: U.S. Fed Chair Jerome Powell Speaks (08/23/2018 Friday 14:00 GMT)

Jerome Powell, Fed Chair, is scheduled to deliver a speech on “Monetary Policy in a Changing Economy” at the Federal Reserve Bank of Kansas City Economic Policy Symposium in Jackson Hole. Markets often remain volatile during his speeches as traders try to understand the direction of interest rates.

#9: Canada BoC Governor Stephen Poloz Speaks (08/24/2018 Friday 16:25 GMT)

Stephen Poloz, Governor of the Bank of Canada, is scheduled to participate in a panel discussion at the Federal Reserve Bank of Kansas City Economic Policy Symposium in Jackson Hole. Markets often turn volatile during his speeches as traders make an attempt to understand the direction of interest rates.

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