Sunday, May 17, 2009

Forex Weekly Outlook - May 18-22 2009

It’s an interesting week ahead in forex: GDP figures in Britain and Japan, CPI in Britain and Canada and American Building Permits in the US are the highlights this week. Let’s see what other major indicators are due this week.

Sunday, May 17th: Yup, important indicators start early, with the PPI Input in New Zealand. In Britain, Rightmove HPI will be published at the hide of the night.

Monday, May 18th: Canada is on holiday today, and it seems that other countries are also slow. Note the European Trade Balance, expected to show a shrinking deficit.

Later, US Treasury Secretary Timothy Geithner and RBA Governor Glenn Stevens will speak and might move their currencies.

Tuesday, May 19th: The RBA will release the Monetary Policy Meeting Minutes in Australia. It’ll be interesting to see how the RBA sees the strong economy, with a high interest rate.

In Britain, CPI is expected to be normal, rising by 2.4% (annually adjusted).

German ZEW Economic Sentiment is expected to rise to 20 points and show that optimism came back to old continent. Based on lat week’s figures, recovery isn’t near in Europe.

American Building Permits and Housing Starts are expected to stay stable, as housing has stabilized in the US.

Just before the end of the day, Japanese Prelim GDP is predicted to show a fall of 4.2% in the first quarter. The Japanese economy has shown very fast contraction during this crisis.

Wednesday, May 20th: British MPC Meeting Minutes will be interesting to see. Why did the BoE expand the Quantitative Easing program? Also note the CBI Industrial Order Expectations in Britain.

Canadian CPI is predicted to stay almost unchanged, despite the rise in oil prices.

In the US, the FOMC Meeting Minutes will draw attention, as well as another speech by Geithner.

Thursday, May 21st: Some European countries are on holiday today, but there’s still lots of activity: Flash Manufacturing and Services PMI will be published in France, Germany and then for all the continent. The numbers are expected to rise.

British Retail Sales are predicted to rise by 0.5%, getting better all the time…

American Unemployment Claims are expected to stay at their current levels. Recovery in America isn’t so close. Last week’s jobless claims were very disappointing.

Also note the Philly Fed Manufacturing Index that’s expected to get somewhat better, though still stay negative.

Friday, May 22nd: Japanese Overnight Call Rate isn’t expected to change, staying at 0.1%. So, the Monetary Policy Statement and especially the BOJ Press Conference will shake the USD/JPY.

In Britain, Revised GDP isn’t expected to show any change, and still show that the British economy shrank by 1.9% in the first quarter.

Canadian Retail Sales are expected to grow, but Core Retail Sales are expected to shrink. The Canadian dollar has been on the march in the past few months. Will this continue?

Just before the markets close, Ben Bernanke will speak and might cause some “Friday effect“.

These are the major events for this week. Stay tuned for the daily updates.

Anyway, remember that forex trading isn’t easy money!

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