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Markets

Forex - Weekly outlook: August 18 - 22

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Investing.com -

Investing.com - The dollar was lower against the yen and the Swiss franc on Friday as heightened geopolitical tensions underpinned safe haven demand, while the euro moved higher, bolstered by expectations for fresh stimulus by the European Central Bank.

Tensions over the crisis in Ukraine escalated on Friday following reports that Ukraine's military attacked and destroyed a number of armored vehicles that entered the country from Russia.

USD/JPY touched session lows of 102.14 and was down 0.09% to 102.35 late Friday. USD/CHF ended Friday's session at a three week low of 0.9024, down 0.46%.

The US Dollar Index, which tracks the performance of the greenback versus a basket of six other major currencies, was down 0.20% to 81.48.

The euro pushed higher, with EUR/USD up 0.27% to 1.3400 late Friday. Data on Thursday showing that the euro zone economy stagnated in the second quarter fuelled speculation that the ECB will embark on quantitative easing to bolster the faltering recovery in the region.

Elsewhere, the pound posted its sixth straight weekly loss against the dollar, with GBP/USD at 1.6691 late Friday. For the week, the pair was down 0.51%.

The pound found some support after revised data on Friday showed that the U.K. economy grew at a rate of 3.2% in the year to June. Second quarter growth remained unchanged from the initial estimate of 0.8%.

The Canadian dollar rallied to more than two week highs against the U.S. dollar on Friday before later retracing most of those gains, after a revised jobs report showed that the Canadian economy added more jobs than expected in July.

Statistics Canada reported that the economy added 41,700 jobs in July, well above the original estimate of just 200 jobs and ahead of expectations for jobs growth of 20,000. The unemployment report ticked down to 7% from 7.1% in June.

The statistics agency released a revised version of the jobs report after detecting an error in the original jobs report released on August 8.

USD/CAD fell to lows of 1.0860 before pulling back to 1.0896 late Friday.

In the week ahead, investors will be looking ahead to Wednesday's minutes of the Federal Reserve's latest meeting, while the Bank of England and the Reserve Bank of Australia are also to publish meeting minutes. Thursday's data on euro zone private sector activity will also be in focus.

Ahead of the coming week, Investing.com has compiled a list of these and other significant events likely to affect the markets.

Monday, August 18

Germany's Bundesbank is to publish its monthly report.

Canada is to release data on foreign securities purchases.

The U.S. is to produce private sector data on the housing market.

Tuesday, August 19

The RBA is to publish the minutes of its latest policy meeting, which contain valuable insights into economic conditions from the bank's perspective.

New Zealand is to release reports on producer price inflation and inflation expectations.

The U.K. is to produce data on consumer inflation, which accounts for the majority of overall inflation.

The U.S. is to release reports on building permits, housing starts and consumer inflation.

Wednesday, August 20

RBA Governor Glenn Stevens is to speak, his comments will be closely watched.

Japan is to publish data on the trade balance, the difference in value between imports and exports.

The BoE is to publish the minutes of its latest policy meeting.

Canada is to release data on wholesale sales.

Later Wednesday, the Federal Reserve is to publish the minutes of its latest policy meeting.

Thursday, August 21

China is to release the preliminary reading of the HSBC manufacturing index.

Switzerland is to release data on the trade balance.

The euro zone is to publish preliminary data on private sector activity, while Germany and France are to also to publish data on private sector growth.

The U.K. is to release data on retail sales, the government measure of consumer spending, which accounts for the majority of overall economic activity.

The U.S. is to produce data on unemployment claims, manufacturing activity and existing home sales.

The first day of the annual economic symposium is due to take place in Jackson Hole, Wyoming.

Friday, August 22

Canada is to release data on retail sales and inflation.

Fed Chair Janet Yellen and ECB President Mario Draghi are both to speak at the second day of the annual economic symposium in Jackson Hole, Wyoming.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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