Forex Daily Outlook – December 18th 2009

This turbulent week comes to an end with a Japanese rate decision and important releases from Britain and Germany. Let’s see what’ up for today:

Britain starts the day with the release of the GfK Consumer Confidence which is expected to rise after a disappointing fall last month to -17 points. Note that this confidence indicator is still negative.

Later in Britain, Public Sector Net Borrowing is expected to double to 23.1 billion pounds. There’s a lot of talk about the growing deficit of the British government, and it probably won’t be reduced as Britain enters an election year.

British employment has improved after a long time, but this wasn’t enough for the Pound – it suffered major losses.

The Bank of Japan meets again for a rate decision. Japanese Overnight Call Rate isn’t expected to move from the rock bottom 0.1%. The focus will be on the Monetary Policy Statement that will accompany the decision, and the prospects for 2010.

In Germany, the all-important Ifo Business Climate is released today, and is expected to rise again – from 93.9 to 94.6. This could help the Euro, that has lost a lot of ground this week, starting with the previous major survey, and continuing with the dollar sweep.

Also in Europe, Current Account deficit  is expected to be halved to 2.3 billion euros. This might also help the Euro.

The Canadian dollar has weathered the greenback’s storm and managed to remain rather strong. Canadian Wholesale Sales close this week with an expected rise of 0.4%, double last month’s rise.

That’s it for today. Happy forex trading!