After a week that saw renewed dollar weakness, this week is dominated by inflation and retail sales figures from all over the world. Also note a rate decision in Japan, and employment figures in Britain. There are more figures as well. Let’s see what’s awaiting us this week.
Australia was the first country to raise interest rates after the global crisis. The move helped other currencies gain against the dollar, and raised the question about which country will be next to raise rates.
Monday, October 12th: It’s a Thanksgiving in Canada, Columbus day in the US and Health Sports Day in Japan. The first figures are published late in the day. New Zealand’s Retail Sales are expected to rise, supporting the strong kiwi.
In Britain, BRC Retail Sales Monitor and RICS House Price Balance are published at night, with the latter expected to continue rising, showing that British house prices are on the rise. Will the Pound recover from the bearish hints by the BoE?
Tuesday, October 13th: Australia’s NAB Business Confidence is the first Australian figure following the whopping employment figures.
British CPI is expected to show a further slowdown of prices to 1.3%. Also note the RPI which expected to continue falling. This will be followed by the BOE Inflation Letter that will give an overview of prices in Britain.
German ZEW Economic Sentiment is predicted to show that Merkel’s country is even more confident after the elections, with this number rising to 58.8. Also the all-European figure is predicted to rise.
Canadian NHPI is expected to continue rising, pushing USD/CAD to parity. The USD Federal Budget Balance is the first American figure of the week, published late.
Wednesday, October 14th: Australia’s Westpac Consumer Sentiment starts the day, and is immediately followed by a rate decision in Japan. No change is expected in Japan’s Overnight Call Rate which is now at 0.1%. The interesting part will be the Monetary Policy Statement and the following BOJ Press Conference. The Yen is too strong for the economy, according to policymakers. Will they intervene?
British Claimant Count Change is the most important employment figure in the UK, and it’s expected to show more job losses, at 25.1K. British Unemployment Rate is expected to edge up from 7.9% to 8%.
In the US, Retail Sales are expected to turn around and fall by 2%, after rising nicely last time. Will there be a surprise here? Core Retail Sales are predicted to advance moderately, by 0.3%. Also in the US, Import Prices are predicted to rise while Business Inventories are expected to fall.
The FOMC Meeting Minutes are due in the evening, and might give us hints about the bond buying scheme. Will there be hints about a rate hike as well?
Near the end of the day, New Zealand’s quarterly CPI is expected to rise by 0.8% causing no pressure for the central bank to raise rates. RBA Governor Glenn Stevens closes the day with a speech in Perth.
Thursday, October 15th: The BOJ Monthly Report is due in Japan, and will complete the data from the rate decision. A similar release is due in Europe – ECB Monthly Bulletin. Later in Europe, CPI is expected to drop at a yearly pace of 0.3%, while Core CPI is expected to rise by 1.2%, less than last month. No inflationary pressures in Europe.
American CPI is expected to rise by 0.2%, half of last month’s rise, and Core CPI by 0.1%. Yet again, no inflationary pressures.
After last week’s surprise, the weekly Unemployment Claims are expected to edge up to 525K this week. The American job market is volatile. Also in the US, Empire State Manufacturing Index and Philly Fed Manufacturing Index are both expected to slip down.
Friday, October 16th: Swiss Retail Sales are expected to rise by 1.7%, helping the Swissy to reach parity with the dollar.
Canada closes this week in CPI releases, with an expected stagnation in prices. Core CPI is expected to rise by 0.1% – very very stable.
American TIC Long-Term Purchases are a very important figure to watch. They’re expected to squeeze down to 10.9 billion. Later in the US, Capacity Utilization Rate, Industrial Production and the Prelim UoM Consumer Sentiment are all expected to be stable, with the latter slightly edging up to 73.6.
Those are the major events in forex this week. I’ll later post special coverages for chosen currencies. Here they are: