On the Macro
It’s a busy week ahead on the economic calendar, with 59 stats focused within the week ending 15th May. within the week prior, 57 stats had been focused .
For the Dollar:
It’s a comparatively busy week ahead for the greenback.
In the 1st half the week, April inflation figures are due out on Tuesday and Wednesday.
Falling commodity prices and a slump in consumer spending is predicted to deliver deflationary pressures.
Barring particularly dire numbers, expect the stats to possess a muted impact on the Dollar and risk sentiment.
It gets more interesting within the 2nd half the week, however.
Weekly initial jobless claims figures on Thursday, April retail sales, and should consumer sentiment figures on Friday will provide direction.
While we expect the numbers to be negative another time , consumer sentiment figures will got to see a pickup. Jobless claims also will got to see a marked decline…
A continued surged in jobless claims will weigh down risk sentiment late within the week.
Outside of the numbers, it’s getting to be chatter from the Oval Office and COVID-19.
Trump’s looking to rally support from voters the simplest way he knows how. it’s going to not be as successful this point around. The U.S has paid a high price for the administration’s shortcomings early within the pandemic…
The Dollar Spot Index ended the week up by 0.66% to 99.734.
For the EUR:
It’s also a busy week ahead on the economic data front.
It’s a quiet start to the week, however, with stats limited to March industrial production figures on Wednesday. We expect the markets to ignore the numbers, leaving risk sentiment because the key driver.
In the 2nd half the week, 1st estimate German GDP numbers for the first quarter will influence on Friday.
Expect finalized April inflation figures within the 2nd half the week and Eurozone trade data to possess a muted impact.
On Thursday, the ECB’s Economic Bulletin also will garner many interest. Does the ECB see April because the bottom of the economic abyss?
While risk sentiment are going to be key within the week, lockdown measures will got to ease further to supply support.
The EUR/USD ended the week down by 1.29% to $1.0839.
For the Pound:
It’s a busy week ahead on the economic calendar.
The markets will got to wait until Wednesday, however, for a knowledge deluge.
Key stats include 1st estimate GDP numbers for the first quarter and March manufacturing production figures.
Retail sales, industrial production, and trade data will likely have a muted impact on the day.
On Friday, house price figures for April also will be ignored .
Outside of the numbers, updates from trade talks between the united kingdom and therefore the U.S, Brexit, and COVID-19 updates also will be key.
Risk sentiment will got to improve, however, for the Pound to urge any early bids…
The GBP/USD ended the week down by 0.77% to $1.2410.
For the Loonie:
It’s a comparatively quiet week ahead on the economic calendar.
March’s manufacturing sales figures on Thursday will likely have a muted impact on the Loonie.
The lack of stats will leave the Loonie within the hands of market risk sentiment.
From a Loonie perspective, the main target will remain on the near-term economic outlook and demand for crude.
The U.S administration’s renewed specialise in China also will be an element within the week…
Crude oil inventory numbers and OPEC’s monthly report will provide direction mid-week.
The Loonie ended the week up by 1.15% to C$1.3927 against the U.S Dollar.
Out of Asia
For the Aussie Dollar:
It’s another relatively busy week ahead.
In the 1st half the week, key stats include business and consumer confidence figures on Tuesday and Wednesday.
April’s business confidence and should consumer confidence figures will likely reflect sentiment towards COVID-19. within the past, both are on the slide in response to monetary policy easing. we should always see an identical outcome this point around.
Later within the week, April employment figures also are due out and can influence. Following better than expected March numbers, April figures are likely to be quite dire…
At the top of the week, industrial production figures out of China could deliver further support, however.
The Aussie Dollar ended the week up by 1.78% to $0.6532.
For the Kiwi Dollar:
It’s another quiet week ahead on the economic data front. On the economic data front, April electronic card retail sales and Business PMI figures are due out on Monday and Friday.
Expect the Kiwi to be relatively resilient to any weaker numbers. Lockdown measures were in situ through April…
The main event of the week is that the RBNZ monetary policy decision on Wednesday.
We had heard of negative rates in recent weeks. New Zealand is COVID-19 free now, however, and economic data has not been as bad as had been expected…
Could there be a more upbeat outlook, which might certainly give the Kiwi Dollar a lift within the week?
The Kiwi Dollar ended the week up by 1.20% to $0.6136.
For the Japanese Yen:
It’s a very quiet week ahead on the economic data front. March’s accounting figures, due out on Wednesday, will have a muted impact on the Yen.
A lack of stats leaves the Yen within the hands of market risk sentiment. While the Yen has not found an excessive amount of support from COVID-19, rising tensions between the U.S and China and Iran and therefore the U.S could deliver support.
The Japanese Yen ended the week up by 0.24% to ¥106.65 against the U.S Dollar.
Out of China
It’s a busy week ahead on the economic data front.
In the half of the week, April inflation figures are due out on Tuesday, which should have limited influence on market risk sentiment.
April’s industrial production, fixed-asset investment, and retail sales figures on Friday are going to be of interest, however.
Outside of the numbers, chatter from Beijing on Trump’s latest accusations will need monitoring… There also are updates on trade talks to think about .
The Chinese Yuan ended the week down by 0.16% to CNY7.0742 against the U.S Dollar.
Geo-Politics
OPEC
OPEC + will got to still toe the road on production to support petroleum prices.
Economic data suggests that production will got to be reined in further. Expect any chatter within the week to influence.
OPEC’s monthly report on Wednesday and inventory numbers for the week will have an impact…
For the Saudis, April production was at an all-time high, so cutting production are going to be optics and will test the oil price recovery…
Lockdown measures are easing but does that deliver the upswing in demand to deliver the needed rebalancing?
UK Politics:
Brexit, U.S – UK trade talks, and lockdown measures are the key areas of focus within the week ahead.
Last week, we saw the Pound struggling as a results of feedback on Brexit alone…
From the weekend, there was nothing positive on the Brexit front to support the Pound. In fact, if Johnson sticks to his guns and refuses to increase the transition period, a tough Brexit looks likelier than not.
When considering the united kingdom COVID-19 numbers, Brexit woes, and a possible drawn-out U.S – UK trade deal negotiation, upside for the Pound looks limited.
U.S Politics:
A sense of unpredictability has returned. There are China and Iran to think about within the week ahead…
Trump will definitely be looking to deflect the eye faraway from COVID-19 and therefore the blame for that matter. The impact on the U.S economy and market conditions has been catastrophic. His 2nd term as president depends on how well he manages to pass the buck…
Kicking off another trade war and rolling out sanctions on China might not be the solution .
The Coronavirus:
asing measures continued within the week and Trump spoke of the necessity to continue easing, regardless of the impact on the COVID-19 numbers. It might be a disastrous outcome and convey an end to any hopes of a 2nd term for Trump and therefore the Republicans.
From the market’s perspective, there are 3 key considerations that remain:
- Progress is made with COVID-19 treatment drug remdesivir.
- The downward trend in new coronavirus cases continues.
- Governments progress with easing lockdown measures.
All of this may got to translate into a marked decline in jobless claims and a pickup in consumer confidence…
At the time of writing, the entire number of coronavirus cases stood at 4,101,641, with the U.S reporting 1,347,309 cases to-date.
