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Weekly Forex Forecasts

Forex Weekly Outlook – August 10-14 2009

After a rollercoaster week, forex trading expects another interesting week: rate decisions in the US and Japan, CPI figures around the world and much more. Let’s see what’s on the menu this week.

Last week began with a collapse of the dollar. Later on, it began recovering, and then made a comeback on Friday’s surprising Non-Farm Payrolls. Will the greenback stabilize this week? Or are we expected for another volatile week? Here are the major events that will impact currency trading this week:

Monday, August 10th: Japanese  Core Machinery Orders start the week, which is expected to start positively. Australian Home Loans will are also expected to continue rising.

In Europe,  French Industrial Production is predicted to return to negative territory. Late at night, British  RICS House Price Balance is expected to print a drop, but better than last month.

Tuesday, August 11th: In Japan, there’s a fresh rate decision.  Overnight Call Rate isn’t expected to move from rock bottom, 0.1%. Traders will check out the  Monetary Policy Statement and later the  BOJ Press Conference for hints on recovery. Yen carry trades will shake.

British  Trade Balance is expected to show a stable deficit, remaining around 6.3 billion.

In Canada,  Housing Starts are predicted to stay stable. This is a very important figure for the loonie. In the US, quarterly  Prelim Non-farm Productivity and  Prelim Unit Labor Costs are the first American figures for this week.

Wednesday, August 12th: In Australia, the  Westpac Consumer Sentiment. In addition, quarterly  Wage Price Index is also important for the Aussie.

Britain’s first and most important employment indicator,  Claimant Count Change, is predicted to stand at 25.5K. Later in Britain, the BoE releases the monthly  BOE Inflation Report. It’ll be accompanied by a speech from BoE governor, Mervyn King. The Pound will definitely go wild…

In North America, American and Canadian Trade Balance figures are published at the same time. USD/CAD is sensitive to this double-feature event.

In the evening, a rate statement is due in the US. Ben Bernanke isn’t expected to raise the  Federal Funds Rate from the bottom, but might hint on future rate hikes. After Friday’s surprising employment figures, we might hear a different tone in the FOMC Statement.

Thursday, August 13th:  German Prelim GDP is highly important for the EUR/USD. After contracting by 3.8% last month, Europe’s biggest economy is expected to shrink by only 0.3% this time. This will be followed by the all-European Flash GDP, which is expected to drop by 0.5%. Also in Europe, note the  ECB Monthly Bulletin.

In the US, Retail Sales are expected to continue rising, this time by 0.5%. Also Core Retail Sales are predicted to be positive.

Following the good NFP figure, expectations for the weekly Unemployment Claims are also better than last week, standing on 540K.

Near the end of the day, Retail Sales are also published in New Zealand. This figure, as well as Core Retail Sales are expected to fall.  In Australia, RBA Governonr Glenn Stevens will speak.

Just before midnight GMT, Japan’s  Monetary Policy Meeting Minutes are released. Also note the  Tertiary Industry Activity, which is expected to fall.

Friday, August 14th:  Prelim Non-Farm Payrolls  are published in France, Europe’s second largest economy. They’re expected to fall. Later in Europe, CPI is expected to show that deflation is still here, with an expected fall. Core CPI is predicted to rise, but quite modestly.

In the US, CPI is expected to remain unchanged, despite early signs of recovery. A surprise here and in Core CPI sure is possible.

Also in the US,  Capacity Utilization Rate,  Industrial Production and  Prelim UoM Consumer Sentiment are released near the end of the forex trading week. The latter is expected to continue rising.

That’s it for the major events this week. I’ll later post coverages for the British Pound, Canadian dollar, Australian dollar, and perhaps another currency…

Yohay Elam

Yohay Elam

Yohay Elam: Founder, Writer and Editor I have been into forex trading for over 5 years, and I share the experience that I have and the knowledge that I've accumulated. After taking a short course about forex. Like many forex traders, I've earned a significant share of my knowledge the hard way. Macroeconomics, the impact of news on the ever-moving currency markets and trading psychology have always fascinated me. Before founding Forex Crunch, I've worked as a programmer in various hi-tech companies. I have a B. Sc. in Computer Science from Ben Gurion University. Given this background, forex software has a relatively bigger share in the posts.